Economic class and the distribution of income: A time-series analysis of the UK economy, 1955-2010
AbstractThis paper contributes to our understanding of the determinants and dynamics of a Marxian surplus-value rate using quarterly UK data, 1955-2010, and the Johansen (1988, 1991) cointegration and vector error correction model (VECM). A conceptual model is introduced to define surplus-value and its component parts, before elaborating on theoretical issues which are important in estimating the rate. In the empirical analysis we seek to explain distributive conflict, paying attention to three forces which are traditionally seen as drivers of power in distributional struggle: (i) political party; (ii) the size of the “reserve army” of the unemployed; (iii) working class militancy. Our results suggest a positive impact of unemployment on the rate of surplus-value, and that falling working class militancy tends to raise the rate. Political party also affects the rate of surplus-value with a negative impact on the rate emanating from movement to left-wing government. This analysis demonstrates the ongoing relevance of Marxian economics in providing an alternative, robust and significant explanation of distribution in the post-war UK economy.
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Bibliographic InfoPaper provided by The University of Sheffield, Department of Economics in its series Working Papers with number 2011012.
Length: 26 pages
Date of creation: Apr 2011
Date of revision: Apr 2011
Income Distribution; Political Party; Heterodox Economics;
Other versions of this item:
- Juan Carlos Cuestas & Bruce Philp, 2012. "Economic class and the distribution of income: a time-series analysis of the UK economy, 1955--2010," International Review of Applied Economics, Taylor and Francis Journals, vol. 26(5), pages 565-578, October.
- D33 - Microeconomics - - Distribution - - - Factor Income Distribution
- B51 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Socialist; Marxian; Sraffian
- C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-05-14 (All new papers)
- NEP-HME-2011-05-14 (Heterodox Microeconomics)
- NEP-PKE-2011-05-14 (Post Keynesian Economics)
- NEP-POL-2011-05-14 (Positive Political Economics)
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