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A Note on Credit Allocation, Income Distribution, and the Circuit of Capital

dos Santos, Paulo L. (2013) 'A Note on Credit Allocation, Income Distribution, and the Circuit of Capital.' Metroeconomica, 65 (2). pp. 212-236.

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Abstract

This note considers the relationship between credit allocation and the class distribution of income in the Circuit of Capital. Production and consumption credit inject means of purchase into different phases of capitalist reproduction. Comparative-dynamic analysis of steady-state evolutions shows that in the dynamic terms of Circuit of Capital production and consumption credit respectively increase wage and profit shares of aggregate income. These findings hold more broadly for any setting where sectoral revenue elasticities of outlays are below unity. They also have direct policy relevance for advanced and middle-income economies where household borrowing has been encouraged in attempts to support demand and growth.

Item Type: Articles
SOAS Departments & Centres: Faculty of Law and Social Sciences > Department of Economics
ISSN: 1467999X
DOI (Digital Object Identifier): 10.1111/meca.12035
Depositing User: Paulo dos Santos
Date Deposited: 20 Sep 2013 08:31
URI: http://eprints.soas.ac.uk/id/eprint/17096

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