the rate of profit and recession by Devine, James 29 January 2002 15:49 UTC
Jim, On the below, I don't know if I interpreted your reference to "the counter-acting tendency ...winning" correctly as one of the countervailing influences that Marx lists that prevent the profit rate from falling despite its general tendency to fall. I took "stock capital" from Marx to be stock market profits as acountervailing influence to the tendency of the rate of profit to fall. Charles ^^^^^^^ I wrote:>>The fixed capital/output ratio continued to fall all the way until 2000 (following its trend from the early 1980s), indicating that labor productivity growth exceeded the rate of growth of fixed capital per worker. The "classical Marxist" theory doesn't seem to work, at least not for this specific example, because the counter-acting tendency was winning.<< CB: >Are you referring to the counteracting tendency termed "increasing intensity of exploitation" ? What about the counteracting tendency " increase of stock capital" in the time period you are discussing ? Was there a big rise in the stock market in this timeframe ?< the rise in labor productivity growth (which, BTW, was not as big a deal as the "new economy" folks alleged) relative to real wages helped raise the rate of exploitation (as measured by the share of profit+interest in the income of the non-financial corporate business sector) until the end of the 1990s, when it started to fall. However, this was not as important as a second trend: labor productivity growth also meant that the ratio of fixed capital to income (K/Y) fell, since the normal rise in the amount of fixed capital per worker (K/L) was out-weighed by the rise in labor productivity (Y/L). The fall in K/Y for this sector was a steady trend after 1980 or so. I don't understand the role of "the increase in stock capital." Jim
