Abstract
This article uses the schumpeterian and kaleckian theories to present a sectoral model able to capture the dynamic effects of innovation on competitiveness and sectoral functional income distribution. Kalecki's distribution theory, according to which the functional income distribution is linked to markup pricing, is adopted. A simulation model for interaction between companies within specific sectors is developed from agent-based modelling. The main conclusion drawn from the results obtained with simulations shows that technological innovations directly affect income distribution by influencing both price and markup.
Keywords:
Sectoral model; Functional distribution of income; Competition process; Kalecki; Schumpeter
