Income Distribution in Stagnation Theories

Abstract

This chapter is concerned with the role of income distribution in secular stagnation theories. While questions of distribution are generally more important in demand-side than in supply-side theories, there are still considerable differences among individual stagnation hypotheses. In fact, the issue of distribution only plays a peripheral role in the approaches of Keynes, Hansen, Summers, and Gordon. Among the economists involved in the stagnation debates of the twentieth and twenty-first century, it was Steindl, one of the least recognized stagnationists in the history of economic thought, who put the (functional) income distribution at the heart of his stagnation theory. It is argued that Steindl’s hypothesis can enhance the contemporary stagnation debate by bringing the distribution of income to the fore.