Book contents
- Frontmatter
- Contents
- PREFACE
- 1 INTRODUCTION
- PART I THE MICROECONOMIC THEORY OF PRODUCTION
- PART II MACROECONOMIC THEORIES OF DISTRIBUTION AND TECHNOLOGICAL PROGRESS
- 11 TECHNOLOGICAL PROGRESS AND THE NEOCLASSICAL THEORY OF PRODUCTION
- 12 TECHNOLOGICAL PROGRESS AND THE NEOCLASSICAL THEORY OF DISTRIBUTION
- 13 VINTAGE MODELS AND FIXED PROPORTIONS IN NEOCLASSICAL THEORY
- 14 LEARNING BY DOING
- 15 MONOPOLY AND AGGREGATE DEMAND AS DETERMINANTS OF RELATIVE FACTOR SHARES
- 16 INDUCED BIAS OF INVENTION AND THE THEORY OF DISTRIBUTIVE SHARES
- REFERENCES
- AUTHOR INDEX
- SUBJECT INDEX
15 - MONOPOLY AND AGGREGATE DEMAND AS DETERMINANTS OF RELATIVE FACTOR SHARES
Published online by Cambridge University Press: 07 October 2011
- Frontmatter
- Contents
- PREFACE
- 1 INTRODUCTION
- PART I THE MICROECONOMIC THEORY OF PRODUCTION
- PART II MACROECONOMIC THEORIES OF DISTRIBUTION AND TECHNOLOGICAL PROGRESS
- 11 TECHNOLOGICAL PROGRESS AND THE NEOCLASSICAL THEORY OF PRODUCTION
- 12 TECHNOLOGICAL PROGRESS AND THE NEOCLASSICAL THEORY OF DISTRIBUTION
- 13 VINTAGE MODELS AND FIXED PROPORTIONS IN NEOCLASSICAL THEORY
- 14 LEARNING BY DOING
- 15 MONOPOLY AND AGGREGATE DEMAND AS DETERMINANTS OF RELATIVE FACTOR SHARES
- 16 INDUCED BIAS OF INVENTION AND THE THEORY OF DISTRIBUTIVE SHARES
- REFERENCES
- AUTHOR INDEX
- SUBJECT INDEX
Summary
Introduction
As previously noted, some economists have come to believe that a separate macroeconomic theory of distribution is needed. To quote a proponent and gentle critic of macroeconomic theories:
…there is a definite demand for a macro-economic distribution theory. The almost complete neglect of macro-economic aggregates and inter-relationships in the neoclassical marginal productivity theory is felt as a serious shortcoming… [but] while the demand for a macro-economic approach to distribution problems is obvious, the lack of a sure foundation for the new theories is similarly evident.
It might be useful to dwell briefly upon the two reasons usually given to justify the ‘need’ for a macroeconomic theory. The chief reason, although vacuous as Bronfenbrenner has shown, is to explain the constancy of relative factor shares. To quote the most voluable, if not the most persuasive, proponent of this view:
…no hypothesis regarding the forces determining distributive shares could be intellectually satisfying unless it succeeded in accounting for the relative stability of these shares in the advanced capitalist economies over the last ioo years or so, despite the phenomenal changes in the techniques of production, in the accumulation of capital relative to labour and in real income per head.
A potentially more important reason has been stated by Rothschild:
The Keynesian employment theory shattered the belief that total employment could be deduced from an addition of all sectional marginal productivity schedules.
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- Information
- The Neoclassical Theory of Production and Distribution , pp. 308 - 335Publisher: Cambridge University PressPrint publication year: 1969