Abstract
Whenever a theory becomes involved in controversy the question of what constitutes that theory itself becomes a contentious issue, and the neoclassical theory of distribution is no exception to that general rule. Some have seen marginal productivity as an essential feature of neoclassical theory. Others have regarded the aggregation of capital or an aggregate production function (even a function of the Cobb–Douglas form) as essential. Neoclassical distribution theory is viewed as general equilibrium theory by many but Friedman has defended the ‘Marshallian’ or partial equilibrium approach.
This chapter was originally published in The New Palgrave: A Dictionary of Economics, 1st edition, 1987. Edited by John Eatwell, Murray Milgate and Peter Newman
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Bliss, C. (1987). Distribution Theories: Neoclassical. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95121-5_105-1
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DOI: https://doi.org/10.1057/978-1-349-95121-5_105-1
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