Abstract

The paper discusses the concept of binary economics in holistic way. The purpose is to identify if binary economics is and efficient model to alleviate the income inequality. The research employs secondary qualitative research in the form of the data collection through books, journals, and articles. From the analysis of these publications, it is found that binary economics allow greater capital production and widen the scope of employment by employing two economic models at the same time. The studies have justified the benefits of the binary model as it offers significant reforms in the private property and the free markets.

Table of Contents

Chapter 1: Introduction2

Background2

Core Propositions3

Statement of Problem3

Study Purpose5

Chapter 2: Literature Review6

Theoretical View6

Binary Economics and the Role of Labor/Capital9

Technology Makes Capital More Productive11

Model of Binary Economy11

Capital's Distributive Relationship to Growth12

Methodological Principles and Theoretical Bases of Binary Economics13

Chapter 3: Methodology18

Research Methodology18

Data Collection Procedure19

Validity19

Ethical Concerns19

Chapter 4: Findings and Analysis21

Works Cited28

Binary Economics: A Solution to Income Inequality

Chapter 1: Introduction

Background

The binary economy differs from classical economics, neoclassical, Keynesian and socialist, that is most often employed by the government, private businesses, charities and individuals. Binary economy is what should be a clear explanation of the continuation of the unused production capacity, the persistence of poverty and optimal growth. The theory first advanced in 1958 by Louis Kelso by the name of capitalist manifesto. Its underlying principles show the economic objectives and strategies, which are separate from traditional solutions to capitalist or socialist. It provides a voluntary market-based production strategy which is much more abundant and widely distributed without any redistribution (Zou,1994,279-293).

Binary heterodox economics theory holds that private property and free markets, but also offers important reforms in the banking system. The aim is to provide a binary economy of all income earners of their own independent state capital, with interest-free loans by the central bank to promote employees (Zou,1994,279-293). These loans are divided into two parts of the costs to improve infrastructure, reduce the cost of business startup and expansion of share ownership.

Binary economics discipline minorities, which are difficult to place in the left-right spectrum. It has been variously characterized as the ideology of the extreme right and extreme left-wing critics. Binary means composed of two aspects, that is enough to see the validation of production factors, such as, but two (labor and capital, including land), and only two ways to win an authentic life and property productive capital. Theory considers man as a rule, a job, but not necessarily the other factor of production, which is the capital (Zou,1994,279-293).

Core Propositions

Keynes's informal model (informal, in the sense that he did not specify his model with a series of equations or represent it with a set of diagrams but, rather, mainly used verbal exposition) begins by seeing the classical economists as having held the validity of Say's law of markets. Say's law denoted an argument that all income generated by production would be spent on purchasing the national product either directly, as when workers' wages or capitalists' profits are spent on consumption, or indirectly, when capitalists' savings are ...