Sunday, March 13, 2011

What is the marginal productivity theory of income distribution proposed by Henry George?

The marginal productivity theory of income proposes that
the factors of production (like labour inputs) that are used to produce goods are in
equilibrium to the value of the output of the production (the finished product). The
theory primarily deals with how workers are compensated for their labour and presumes
that their labour is compensated on the basis of the marginal value of the products they
make. Parts of the theory also propose
that:


  1. There should be a tax on land because it
    is the collective property of the community and rent seeking is generally unproductive
    to the economy.

  2. There should be minimal restrictions on
    free trade.

No comments:

Post a Comment

How is Anne's goal of wanting "to go on living even after my death" fulfilled in Anne Frank: The Diary of a Young Girl?I didn't get how it was...

I think you are right! I don't believe that many of the Jews who were herded into the concentration camps actually understood the eno...