We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Nobody downloaded yet

The Marginal Productivity Theory of Distribution - Term Paper Example

Comments (0)
The marginal productivity theory of distribution Author Institution The marginal productivity theory of distribution Introduction The marginal productivity theory of distribution was advanced by a number of economists such as J. B. Clark (U.S.) and Wicksteed (UK) in the late 19th century…
Download full paper
The Marginal Productivity Theory of Distribution
Read TextPreview

Extract of sample
The Marginal Productivity Theory of Distribution

Download file to see previous pages... As such, each factor of production can be paid based on what it contributes to the production of the output. This paper argues that the marginal productivity theory of distribution is valid, and, on certain highly limited assumptions, bears relevance to micro-economic problems such decisions of individual firms with regard to employment of factors of production. Marginal productivity theory of distribution presented a unified inter linkage between the pricing of commodities and the “pricing of persons” by indicating that the returns to all factors of production, are grounded in a single, marginal productivity principle. However, from the start, it was apparent that the marginal productivity theory could not stand by itself and only represented a derivative section of the theory of value. Three core properties of marginal productivity theory make this apparent: (1) the theory is essentially a theory of the demand for factors rather than their supply; (2) it adopts prices of products as derived in the determination of demand for factors; (3) the theory cannot be applied to the determination of values within an exchange economy (Rima, 2001). ...
the previous political economy with a novel science of economics or a discipline that employed rigorous methods mimicking those of the physical sciences (Fetter & Rothbard, 2007). Since its inception in the early 19th century, the marginal productivity theory of distribution (MPTD) has been cited by some economists as the solution to the ethical problem of distributive justice (as a means of determining fairness in wages, interest, profits, and rent). Other economists have rebuffed this ethical claim but have perceived the MPTD as a valid demand-side criterion, which forms the basis of determining equilibrium and efficiency (Blaug, 1996). Some of the pioneers of the theory such as John Bates and Philip Henry Wicksteed argued that a business enterprise would be prepared to remunerate a productive agent only that which it adds to the firm’s utility. Clark sought to establish that each unit of labour and capital can be settled based on the value that it adds to the total product or its marginal productivity (Wicksteed & Robbins, 1935). Clark maintained that, although, all tasks within an enterprise vary in significance the remaining work can be reassigned to ensure that all essential tasks would be undertaken; hence, no single unit of labour can be considered to be more critical than the other (Stigler, 1994). Clark’s marginal productivity theory can be considered to be a rebuttal to Marx’s assertion that competitive capitalism methodically robs workers their labour since the workers contributes more to the total product relative to the wages that they receive. According to Clark, the payment to capital can be established based on its marginal productivity, and that there cannot be a “surplus value” expropriated from the labour as Marx had claimed (Blaug, 1996). ...Download file to see next pagesRead More
Comments (0)
Click to create a comment
Cultivation Theory
The theory asserts that the more an individual is exposed to reports by a media house, the more the individual will accept the information as being true. The theory will then imply that the way media houses address certain issues in their news reports will influence the overall impacts of such information on the public.
6 Pages(1500 words)Term Paper
The Labor Supply and China Economics
Due to the implementation of the one-child policy, the country is likely to face a severe shortage of labor in the future, which will adversely affect the economy of China. The shortage of labor supply has emboldened workers and led to the emergence of strikes, which have paralyzed the operations of major companies in China (Lu 2).
6 Pages(1500 words)Term Paper
Macroeconomics Theory
The BOP consists of two accounts; the capital account and the current account. The capital account records all the transactions between the resident of a country and the rest of the world whereas the current account records imports and exports of tangible goods and intangible services along with the unilateral transfers.
5 Pages(1250 words)Term Paper
Marketing Theory
d distribution of ideas, goods and services to create exchanges that satisfy individual and organizational objectives” (Calonius 419-428). This definition of marketing forms the core of all marketing theories that has been developed by various authors. It emphasizes on the purpose that marketing has in business or organizations around the world.
8 Pages(2000 words)Term Paper
Marginal cost is a concept in economics that describes the extra cost incurred in production of one extra unit of a good or service in a firm, the paper discusses both the utility theory and the marginal cost concept. Utility can be defined as the satisfaction derived from the
5 Pages(1250 words)Term Paper
The place of interest in the theory of production
ning what Lange has tried to promote in his paper, it would be nice to say a few words about Oscar Lange, the author of the paper I have chosen for the purpose of discussion. A Polish citizen by birth, Oscar Lange studied law and economics at Poznan and Cracow and also taught
4 Pages(1000 words)Term Paper
Economic Distribution in the U.S. ,Why The Rich get richer
worth millions of dollars, including credit loans, mortgages, car loans, educational loans, consumer loans etc and the other minority yet remarkable set of population, who have been, time and again featured in the Forbes richest people in the world list, such as Bill Gates,
5 Pages(1250 words)Term Paper
current methods of providing primary care aiming at improving the safety and health of clients in a cost-effective fashion for the clients as well as the healthcare system (Yoder-Wise, 2012). It is through EBP that primary care nursing delivers not only scientifically sound but
3 Pages(750 words)Term Paper
Incorporating Theory
To date, the theory has been extensively used in healthcare to analyze elements that affect the quality of patient care (Dougherty, 2012). The theory involves takes a focus on three healthcare delivery categories ‘structure,’ ‘process,’ and ‘outcomes’ to
2 Pages(500 words)Term Paper
A Business report of British electricity distributor industry
The industry product is electricity distribution. The revenue produced by the industry is £6 billion. Its annual growth is 6.7%, and it employs 13,023 employees (IBISWorld, 2014). There are
16 Pages(4000 words)Term Paper
Let us find you another Term Paper on topic The Marginal Productivity Theory of Distribution for FREE!
Contact us:
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us