Keynesian theory challenges income distribution assumptions, reshaping economic policies.
The paper examines how income is distributed in the economy, focusing on Keynes's General Theory. Unlike previous approaches, this study does not assume full employment. The conclusions about income distribution in the General Theory depend on how prices and wages change with output. The paper criticizes Keynes's assumptions and looks at their impact on income distribution. Keynes's ideas about the relationship between output and wages were questioned by other economists in the late 1930s. Keynes accepted some of these criticisms and suggested a new approach to income distribution that differs from previous theories.