I would look at Harald Hagemann's work on the history of business cycle
theories. The debate in the 20s and 30s in German speaking countries between
the Austrians and the Kiel School focused on monetary theories of the cycle vs.
those approaches that viewed technological change (and the structure of
production) as the fundamental underlying cause, with monetary factors
exacerbating the cycle. An important paper in this debate was Burchardt's.
Hagemann's paper in the Lowe memorial volume (co-authored with Michael
Landesmann) looks at Tugan-Baranowsky, Bouniatian, Aftalion, Spiethoff, as well
as Lowe, Burchardt and Hayek. Hagemann has other papers that cover some of the
same ground, as well as Schumpeter, etc. The collections edited by Baranzini
and Scazzieri and books by each of them as well as Amendola and Gaffard, and
also Landesmann, all cover a lot of this ground as well. The journal Structural
Change and Economic Dynamics also has relevant papers, including its reprint of
classic articles series.
-----Original Message-----
From: J. Barkley Rosser, Jr. [mailto:[EMAIL PROTECTED]]
Sent: Friday, February 02, 2001 10:15 AM
To: [EMAIL PROTECTED]
Subject: [PEN-L:7698] Re: Re: Re: Re: recent economic trends
Michael,
Fair enough.
Anybody out there know who was the first to identify
bunching specifically with technologically related investment
waves? Schumpeter did it in his 1911 Theorie der
Wirtschaftlichen Entwicklung (English translation, 1934,
The Theory of Economic Development). This just barely
predates the original long wave paper in Dutch that did so
also, J. van Gelderen's, "Springvloed: Beschouwingen over
industrieele ontwikkeiling en prisjsbeweging," De Nieuwe
Tijd, 1913, vol. 18, pp. 4-6. Bart Verspagen published an
English translation of this classic article in 1998 in Structural
Change and Economic Dynamics.
Barkley Rosser
-----Original Message-----
From: Michael Perelman <[EMAIL PROTECTED]>
To: [EMAIL PROTECTED] <[EMAIL PROTECTED]>
Date: Thursday, February 01, 2001 5:10 PM
Subject: [PEN-L:7681] Re: Re: Re: recent economic trends
>
>Marx suggested something like an echo cycle occurring every ten years, but
>he never gave a reason for the original bunching.
>
>On Thu, Feb 01, 2001 at 03:44:41PM -0500, J. Barkley Rosser, Jr. wrote:
>> Michael,
>> We are all in full agreement on this business of
>> the replacement cycles and Marx, and Jim D. has
>> even helpfully noted where in Capital Vol. II it appears
>> (possibly elsewhere as well). The issue is that you
>> identified Marx as the father of the "bunching" theory
>> of technologically related waves of investment. Clearly
>> he gets a cycle from some kind of bunching, which could
>> be due to demand factors. But, did he ever identify the
>> (at least initial) bunching with waves of investment in
>> particular technologies in the way that Schumpeter,
>> Trotsky, and others did?
>> Barkley Rosser
>> -----Original Message-----
>> From: Michael Perelman <[EMAIL PROTECTED]>
>> To: [EMAIL PROTECTED] <[EMAIL PROTECTED]>
>> Date: Thursday, February 01, 2001 2:33 PM
>> Subject: [PEN-L:7672] Re: recent economic trends
>>
>>
>> >Here is a section from my Marx book regarding Marx's theory of
replacement
>> >cycles. Notice Engel's firm rejection at the end.
>> >
>> > The simplest of these versions of a reproduction crisis reflected the
>> life
>> >cycle of fixed capital. This idea was first broached when Marx was
reading
>> the
>> >works of Charles Babbage. He was skeptical about Babbage's notion that
>> most
>> >capital equipment turns over within five years (see Marx to Engels, 2
>> March
>> >1858; in Marx and Engels 1983: 40, pp. 278). He requested that Engels
send
>> him
>> >some information on the typical patterns of turnover of fixed capital.
>> Engels
>> >quickly supplied Marx with figures that contradicted Babbage's
conjecture
>> >(Engels to Marx, 4 March 1858; in Marx and Engels 1983: 40, pp. 279-81).
>> >According to Engels' estimates, the average piece of equipment lasted
about
>> 13
>> >years (Ibid.). More importantly, relatively little has been written
about
>> >devalorization and replacement investment, which has gone beyond Engels'
>> brief
>> >comments on the subject. He began: The most reliable criterion [of
>> the
>> >turnover of capital] is the percentage by which a manufacturer writes
down
>> his
>> >machinery each year for wear and tear and repairs, thus recovering the
>> entire
>> >cost of his machines within a given period. This percentage is normally
7
>> 1/2,
>> >in which case the machinery will be paid for over 13 1/3 years by an
annual
>> >deduction from profits. . . . Now 13 1/3 years is admittedly a long
time
>> in
>> >the course of which numerous bankruptcies may occur; you may enter other
>> >branches, sell your old machinery, introduce new improvements, but if
this
>> >calculation wasn't more or less right, practice would have changed it
long
>> ago
>> >[given the absence of taxes on profits at the time]. Nor does the old
>> >machinery that has been sold promptly become old iron; it finds takers
>> among
>> >the small spinners, etc., etc., who continue to use it. We ourselves
have
>> >machines in operation that are certainly 20 years old and, when one
>> >occasionally takes a glance inside some of the more ancient and
ramshackle
>> >concerns up here, one can see antiquated stuff that must be 30 years old
at
>> >least. Moreover, in the case of most of the machines, only a few of the
>> >components wear out to the extent that they have to be replaced after 5
or
>> 6
>> >years. And even after 15 years, provided the basic principle of a
machine
>> has
>> >not been supersceded by new inventions, there is relatively little
>> difficulty
>> >in replacing worn out parts, so that it is hard to set a definite term
on
>> the
>> >effective life of such machinery. Again, over the last 20 years
>> improvements
>> >in spinning machinery have not been such as to preclude the
incorporation
>> of
>> >almost all of them in the existing structure of the machines, since
nearly
>> all
>> >are minor innovations. [Ibid., pp. 280-81]
>> >Marx uncharacteristically disregarded many of Engels' subtleties.
Instead,
>> he
>> >confused the time required fully to depreciate equipment on the books
with
>> its
>> >economic lifetime. Thus, in his response to Engels, Marx noted that the
>> >typical business cycle lasted approximately as long as the average piece
of
>> >equipment (Marx to Engels, 5 March 1858; in Marx and Engels 1983: 40,
pp.
>> >282-84). Following this line of thought thought, Marx speculated
that
>> the
>> >business cycle might reflect the cycle of reproduction of fixed capital.
>> >Moreover, he noted that this approach would locate the engine of the
cycle
>> >within large scale industry (Ibid.). Four years later, just after
asking
>> >Engels to visit in order to help him with details on the Contribution to
>> the
>> >Critique of Political Economy, Marx again brought up the question of the
>> >durability of fixed capital (Marx to Engels, 20 August 1862; in Marx and
>> Engels
>> >1973: 30: 279-81; see also Marx to Engels, 7 May 1868; in Marx and
Engels
>> 1973:
>> >32, p. 82; and Engels to Marx, 10 May 1868; in Ibid., pp. 83-85).
>> Engels,
>> >caught up in the pressures of the Cotton Famine, was a bit impatient
with
>> >Marx's notion of the wear and tear of plant and equipment. He suggested
>> that
>> >Marx had "gone off the rails. Depreciation time is not, of course, the
>> same
>> >for all machines" (Engels to Marx, September 9 1862; in Marx and Engels
>> 1985,
>> >p. 414).
>> > Atypically, Marx never absorbed Engels' lessons on the turnover of
>> plant
>> >and equipment. Instead, he frequently referred to the decennial cycles
>> brought
>> >on by the pattern of renewing fixed capital (see, for example, Marx
1967:
>> 2,
>> >pp. 185-86; and 1963-1971; Pt. 1, p. 699).
>> >--
>> >
>> >Michael Perelman
>> >Economics Department
>> >California State University
>> >[EMAIL PROTECTED]
>> >Chico, CA 95929
>> >530-898-5321
>> >fax 530-898-5901
>> >
>> >
>>
>
>--
>Michael Perelman
>Economics Department
>California State University
>Chico, CA 95929
>
>Tel. 530-898-5321
>E-Mail [EMAIL PROTECTED]
>
>
