This book provides an alternative foundation for the measurement of the production of nations, and applies it to the US economy for the postwar period. The patterns which result are significantly different from those derived within conventional systems of national accounts. Conventional national accounts seriously distort basic economic aggregates, because they classify military, bureaucratic and financial activities as creation of new wealth, when in fact they should be classified as forms of social consumption which, like personal consumption, actually use up social wealth in the performance of their functions. The difference between the two approaches has an impact not only on basic aggregate economic measures, but also on the very understanding of the observed patterns of growth and stagnation. In a world of burgeoning militaries, bureaucracies, and sales forces, such matters can assume great importance at the levels of both theory and policy.
This article starts out by trying to demonstrate why the distinction between productive and unproductive labour (PUPL) is crucial, both for the analysis of the trajectory of capitalism in general and for an understanding of the peculiar features of late twentieth century capitalism. Subsequent sections provide the necessary clarification about the distinction between PUPL by focusing on the concepts ‘productive labour in general’ and ‘productive labour for capital’ and attempt to classify all major types of labour in capitalism accordingly. The essay also deals with thorny questions about the status of labour in the services sector and state provision of social services. The last section addresses some common criticisms found in the literature concerning Marx's distinction between productive and unproductive labour.
The main focus of this study is the role of the state in the distribution process vis-a-vis the working class in the United States during the period 1952-1980. This focus led me to formulate and then answer a question: what is the net impact of the distributive activities of the state on the wages of the working class as a whole and various segments within it? In order to deal with this question I proposed a concept, net-tax, which is taxes paid to the state minus benefits and income received from it. The empirical findings of the article concerning the net-tax paid by labor led me to call into question the economically beneficial role of the welfare state in relation to the wages of the working class.
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