A consistent macroeconomic approach would have to shun any reference to prices and to money. The market economy is a social system in which individuals are acting. The valuations of individuals as manifested in the market prices determine the course of all production activities. If one wants to oppose to the reality of the market economy the image of a holistic system, one must abstain from any use of prices. Let us exemplify one aspect of the fallacies of the macroeconomic method by an analysis of one of its most popular schemes, the so-called national income approach.
Income is a concept of the accounting methods of profit-seeking business.
The businessman serves the consumers in order to make profit. He keeps accounts to find out whether or not this goal has been attained. Out of such a calculation emerge the concepts of profit or loss as contrasted with that of capital. The illusiveness of this concept of national income is to be seen not only in its dependence on changes in the purchasing power of the monetary unit. The more inflation progresses, the higher rises the national income.