Kindle Notes & Highlights
Bye and Hewett treated the “capital-output ratio” as a measure of the degree of roundaboutness. The higher the ratio, the more capitalistic is the economy. They estimated the U.S. capital-output ratio to be 3.4 in 1955, reflecting a “high degree of roundaboutness” compared to other nations.75
The dilemma is resolved by treating the first stage of production at the point where a new undertaking actually begins, not when the first joint capital good was produced.
