ABSTRACT
The distinction between productive and unproductive labor is one of the more controversial ideas in economics. It can be traced to economic thought in antiquity, has been part of modern economic thought since at least the 17th century, and features prominently in Physiocratic and classical political economy. Marx develops a conception of productive and unproductive labor first briefly in Grundrisse, and then subsequently through an extensive criticism of others in Theories of Surplus Value. Employers advance capital to purchase labor power, and labor power exchanged for a wage from capital becomes capital. The employees of state agencies are another important case of workers who receive wage and salary income that is not paid from capital. The empirical Marxist literature estimating unproductive labor stretches back at least to the 1920s, usually done as part of estimating of value aggregates for national economies. Shaikh and Tonak estimate productive and unproductive shares of total employment for the 1948–89 period.
