ISSN:
1467-6435
Source:
Blackwell Publishing Journal Backfiles 1879-2005
Topics:
Sociology
,
Economics
Notes:
Kaldor's famous ‘Keynesian’ distribution fomula is very useful when considered as a tautological formulation of the coherence between investment, saving and income as circulatory components. But Kaldor puts the formula in a theoretical model in which full employment and a constant propensity to save were assumed. Furthermore, since he considered real investment as an ‘active’ factor, then conse-quently income distribution is only a dependent variable.In the author's opinion, sociological and socio-psychological factors are neglected by Kaldor. Two main cases are treated in the present paper. First, in a short-term model the income-political aims of employees must additionally be taken into account, because through this factor investment plans of enterprises are realizable only to a certain degree. Therefore the connections between investment and income distribution are not unilaterial, but reciprocal.On the other hand, to assume a constant propensity to save in a long-term model is unrealistic. One can suggest, for example, that this propensity may be changed by wage policies. Consequently, not only investments but also labor market policies can change the long-term income distribution.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1111/j.1467-6435.1965.tb00994.x
