The aim of this paper is to study the eff ect of emulation within a basic schema of the monetary theory of production (MTP). A theoretical model is presented, where workers set their target level of consumption based on the comparison with other workers taken as reference. It is shown that emulation can play a crucial role in increasing workers’ propensity to indebtedness. As a result, profits increase and so does the price level, thus generating a decline of the real wage.Moreover, the existence of indebtedness can provide a further solution to the so called »paradox of profits« within the MTP.
Emulation, indebtedness and income distribution: A monetary theory of production approach
PACELLA, Andrea
2010-01-01
Abstract
The aim of this paper is to study the eff ect of emulation within a basic schema of the monetary theory of production (MTP). A theoretical model is presented, where workers set their target level of consumption based on the comparison with other workers taken as reference. It is shown that emulation can play a crucial role in increasing workers’ propensity to indebtedness. As a result, profits increase and so does the price level, thus generating a decline of the real wage.Moreover, the existence of indebtedness can provide a further solution to the so called »paradox of profits« within the MTP.File in questo prodotto:
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