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Pasinetti’s theory of economic growth and distribution is a significant contribution to post-Keynesian growth theory. Building upon the Harrod-Domar and Kaldor models, Pasinetti sought to address the dynamics of income distribution between wages and profits in the process of economic growth. His central concern was the functional distribution of income and how it influences the growth path of the economy. Unlike neoclassical models that emphasize marginal productivity and equilibrium, Pasinetti emphasized structural relations, saving behavior, and class-based income flows. The foundation of Pasinetti’s model is the division of national income into two broad categories: wages earned by workers and profits earned by capitalists. In ______ _____ ________ ___ __________ ____.
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