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Enterprise Cycle Definition. After land costs and rents drop, together with different costs, funding again turns into worthwhile. The economy recovers. George (1879, p. 268) famous that depressions had been preceded by booms and land speculation, “adopted by symptoms of checked manufacturing”. He rejected theories of normal insufficient demand, invoking language akin to Say’s legislation: “The diminution of the effective demand of shoppers is therefore however a results of the diminution of production” (p. 269). The high cost of land and rent is, in impact “a lockout of labor and capital by landowners” (p. 270). George’s concept tried to resolve the paradox of idle labor and capital in the depths of a depression. The reason the market was not clearing was that labor and capital had been lower off from the mandatory pure alternatives supplied by land.
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