164 THE GENERAL THEORY OF EMPLOYMENTBL. IV

authority has to pay may still play a decisive part indetermining the scale of investment operations whichit can afford.

Thus after giving full weight to the importance ofthe influence of short-period changes in the state oflong-term expectation as distinct from changes in therate of interest, we are still entitled to return to thelatter as exercising, at any rate, in normal circum-stances, a great, though not a decisive, influence on therate of investment. Only experience, however, canshow how far management of the rate of interest iscapable of continuously stimulating the appropriatevolume of investment.

For my own part I am now somewhat scepticalof the success of a merely monetary policy directedtowards influencing the rate of interest. I expect tosee the State, which is in a position to calculate themarginal efficiency of capital-goods on long views andon the basis of the general social advantage, takingan ever greater responsibility for directly organisinginvestment; since it seems likely that the fluctuationsin the market estimation of the marginal efficiency ofdifferent types of capital, calculated on the principlesI have described above, will be too great to be offsetby any practicable changes in the rate of interest.