Functional Distribution in the Large-Scale Manufacturing Sector in India

The object of this paper is to analyse how far the marginal productivity theory of distribution explains the relative shares of factors of production in the aggregate net product of the large-scale manufacturing sector in India. It is confined to the period 1946-57. As in the macro-economic formulation of the theory, only two functional categories are recognised - the wage-earners and salary-earners, on the one hand, and the capitalists, claiming the residual product, on the other.