Abstract
One of the most exciting results of the macro-economic theories which have recently been elaborated in Cambridge is a very simple relation connecting the rate of profit and the distribution of income to the rate of economic growth, through the inter-action of the different propensities to save. The interesting aspect of this relation is that—by utilizing the Keynesian concepts of income determination by effective demand and of investment as a variable independent of consumption and savings—it gives a neat and modern content to the deep-rooted old Classical idea of a certain connection between distribution of income and capital accumulation. In this sense, it represents a break with the hundred-year-old tradition of marginal theory, and it is no wonder that it has immediately become the target of attacks and eulogies of such strongly emotional character. Approval and rejection have almost invariably coincided with the commentators’ marginalistic or nonmarginalistic view.
I have received helpful comments and criticism on a first draft of this paper from almost all my colleagues in Cambridge. I should like to thank them all.
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© 1971 Economic Study Society
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Pasinetti, L.L. (1971). Rate of Profit and Income Distribution in Relation to the Rate of Economic Growth. In: Hahn, F.H. (eds) Readings in the Theory of Growth. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-15430-2_14
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DOI: https://doi.org/10.1007/978-1-349-15430-2_14
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-0-333-10299-2
Online ISBN: 978-1-349-15430-2
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