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The Public Sector In A Model Of Growth And Distribution À La Pasinetti: Existence Of One‐ Or Two‐Class Economies

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  • Massimiliano La Marca

Abstract

This paper explores the implications of different regimes of taxation and fiscal policies on the existence of a one‐ or two‐class economy in the Kaldor–Pasinetti approach of growth and income distribution. A simple model and its diagrammatical representation provide a complete taxonomy of the possible steady state equilibria and synthesize some early and recent contributions. It shows that the distribution among factors and the personal distribution among socio‐economic classes depend on the fiscal policy of the government, the behavioural parameters of actors and technology; but, provided that some conditions are fulfilled, the Cambridge Theorem and its distributional implications hold.

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  • Massimiliano La Marca, 2005. "The Public Sector In A Model Of Growth And Distribution À La Pasinetti: Existence Of One‐ Or Two‐Class Economies," Metroeconomica, Wiley Blackwell, vol. 56(2), pages 157-181, May.
    • Handle: RePEc:bla:metroe:v:56:y:2005:i:2:p:157-181
    DOI: 10.1111/j.1467-999X.2005.00211.x
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    References listed on IDEAS

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    1. Palley, Thomas I, 1997. "Money, Fiscal Policy and the Cambridge Theorem," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 21(5), pages 633-639, September.
    2. repec:bla:kyklos:v:34:y:1981:i:4:p:582-92 is not listed on IDEAS
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    Cited by:

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    3. Linus Mattauch & Ottmar Edenhofer & David Klenert & Sophie Bénard, 2016. "Distributional Effects of Public Investment when Wealth and Classes are Back," Metroeconomica, Wiley Blackwell, vol. 67(3), pages 603-629, July.

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