Skip to main content

Adding-Up Problem

  • 151 Accesses

Abstract

In any theory of income distribution in which one type of return is determined residually, it will be tautologically true that the various different incomes, as determined by the theory, will add up so as to exhaust the total product. By contrast, any theory which provides a ‘positive’ explanation for every category or return, treating none as a residual, must show that the various returns so explained do indeed exhaust the product. In practice, it has been with reference to the marginal productivity theory that this consistency requirement has received considerable attention. By the early 1890s a number of authors had sought to extend the ‘principle of rent’ into a completely general theory of distribution but it was P.H. Wicksteed, in his Co-ordination of the Laws of Distribution (1894) who first clearly stated, and attempted to resolve, the resulting adding-up problem.

This is a preview of subscription content, access via your institution.

Buying options

Chapter
USD   29.95
Price excludes VAT (USA)
  • DOI: 10.1057/978-1-349-95189-5_507
  • Chapter length: 4 pages
  • Instant PDF download
  • Readable on all devices
  • Own it forever
  • Exclusive offer for individuals only
  • Tax calculation will be finalised during checkout
eBook
USD   7,499.99
Price excludes VAT (USA)
  • ISBN: 978-1-349-95189-5
  • Instant PDF download
  • Readable on all devices
  • Own it forever
  • Exclusive offer for individuals only
  • Tax calculation will be finalised during checkout
Hardcover Book
USD   8,499.99
Price excludes VAT (USA)

References

  • Edgeworth, F.Y. 1904. The theory of distribution. Quarterly Journal of Economics. Reprinted in F.Y. Edgeworth, Papers relating to political economy, vol. I. London: Macmillan, 1925.

    Google Scholar 

  • Flux, A.W. 1894. Review of Wicksell’s Über Wert, Kapital und Rente and of Wicksteed’s co-ordination, etc. Economic Journal 4: 305–313.

    CrossRef  Google Scholar 

  • Hicks, J.R. 1968. The theory of wages, 2nd ed. London: Macmillan.

    Google Scholar 

  • Hutchison, T.W. 1953. A review of economic doctrines, 1870–1929. Oxford: Clarendon Press. ch. 5.

    Google Scholar 

  • Robbins, L. 1933. Editorial introduction to P.H. Wicksteed. The common sense of political economy. London: Routledge & Kegan Paul.

    Google Scholar 

  • Robinson, J.V. 1934. Euler’s theorem and the problem of distribution, Economic Journal. Reprinted in Collected economic papers of Joan Robinson, vol. I. Oxford: Blackwell, 1966.

    Google Scholar 

  • Samuelson, P.A. 1983. Foundations of economic analysis, enlargedth ed. Cambridge, MA: Harvard University Press. ch. 4.

    Google Scholar 

  • Stigler, G.J. 1968. Production and distribution theories: The formative period. New York: Agathon Press. ch. 12.

    Google Scholar 

  • Walras, L. 1874–7. Elements of pure economics. London: Allen & Unwin, 1954 (Appendix III).

    Google Scholar 

  • Wicksell, K. 1934. Lectures on political economy, vol. I. London: Routledge & Kegan Paul. esp. pp. 101, 125–33.

    Google Scholar 

  • Wicksteed, P.H. 1894. An essay on the co-ordination of the laws of distribution. London: Macmillan. Subsequent editions, ed. L. Robbins, LSE Reprints, 1932; ed. I. Steedman. London: Duckworth, 1987.

    Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Editor information

Editors and Affiliations

Copyright information

© 2018 Macmillan Publishers Ltd.

About this entry

Verify currency and authenticity via CrossMark

Cite this entry

Steedman, I. (2018). Adding-Up Problem. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_507

Download citation