ABSTRACT
Distribution has been central to classical economic theory as well as to the various strands of Post-Keynesian and structuralist macroeconomics. As a simplifying assumption, however, labor is typically taken as homogeneous, and the main focus has been on the functional distribution of income between wages and profits (with rents as an additional category in some versions). Kurz and Salvadori (1995, ch. 11) is a prominent exception but their treatment of labor heterogeneity stays at a high level of abstraction, and a large part of their analysis serves to clarify the conditions that would allow a reduction of heterogeneous to homogenous labor. This chapter, by contrast, has heterogeneity as its focal point: simplifying assumptions of homogeneity may be justified for many purposes, but labor disaggregation is essential if one wants to address some of the most striking changes in inequality over the last 100 years.
