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Kalecki's Theory of Distribution
Kalecki's Theory of Distribution
THEORY OF
DISTRIBUTION
STATES THAT
PROFIT SHARE OUT OF NATIONAL
INCOME IS A DIRECT FUNCTION OF
DEGREE OF MONOPOLY POWER.
PROFIT SHARE OUT OF NATIONAL
INCOME IS A DIRECT FUNCTION OF
THE RATIO OF RAW MATERIAL COST
TO WAGE COST
BACKGROUND
THE TEMPO CREATED BY SRAFFA,
JOAN ROBINSON, CHAMPRELIN ETC.
ALMOST IN A MARXIAN STYLE
ASSUMPTIONS
INDUSTRIES WORK WITH EXESS
CAPACITY
LERNERS DEGREE OF MONOPOLY
POWER HOLDS GOOD
MC INCLUDES ONLY LABOUR COST AND
RAW MATERIAL COST
LABOUR COST INCLUDES ONLY WAGES
OF LABOUR
SALARIES ARE INCLUDED IN THE
INCOME OF CAPITALISTS. Cntd------
Cntd--------
KALECKI FIRST
FORMULATED HIS MODEL IN
1939 AND, IN RESPONSE TO
CRITICISM, HE REVISED THE
MODEL IN 1959.
FIRST VERSION
LENERS MEASURE OF DEGREE OF
MONOPOLY IS
AS THE ASSUMPTION
MC [m] =AC [a]
WE CAN RESTATE THE EQUATION AS:
CONCLUSION
SHARE OF WAGE [W/Y] IS A
DECREASING FUNCTION OF DEGREE
OF MONOPOLY POWER AND THE
RATIO OF RAW MATERIAL COSTS TO
WAGE COSTS
PREDICTION
AS CAPITALISM DEVELOPS ALONG
WITH INCREASING STRENGTH OF
MONOPOLIES, LABOUR SHARE
DECLINES.