Growth and Distribution: A Neoclassical Kaldor-Robinson Exercise
Kaldor’s capital/labor income distribution theory relied on diﬀerential saving propensities from proﬁts and wages. Robinson’s growth models typically speciﬁed constant-coeﬀicient technologies in which marginal productivities cannot determine distribution. Here these two insights are combined in a two-sector (capital goods, consumption goods) economy. Two technologies are available, but only as either-or alternatives. The choice of technology and the income distribution depend on the saving propensities. Steady-state consumption need not be greater when the economy is more capitalized and proﬁt rates are lower.
Tobin, James, "Growth and Distribution: A Neoclassical Kaldor-Robinson Exercise" (1990). Cowles Foundation Discussion Papers. 1177.