Have any of you researching the falling rate of profits thought about the possibility that one of the counteracting tendencies which Marx did not see is the so-called fossil fuel bonanza, i.e., the fact that energy has been incredibly cheap all through the industrial revolution, and got even cheaper since then with the move from coal to oil and natural gas? This is not sustainable and we are reaching the end of the era of plentiful cheap energy (and with it all other natural resoures) just now. I like to think that for this reason, both absolute immiseration and falling rate of profits will be much more in evidence in the future than it has been in the past. I realize that at this point this is a wild hypothesis which needs much more research which I have not done and will not do. I'd like to throw it out here anyway because the general taboo around climate-change related issues may have prevented a critical mass of researchers from asking questions which seem obvious to me.
Here is a 1981 paper making this point for the post WWII period: Michael Bruno, "Raw Materials, Profits, and the Productivity Slowdown", NBER Working paper 660R, December 1981, http://www.nber.org/papers/w0660.pdf later published in the QJE, http://www.jstor.org/stable/1885718 Here are my notes about the Bruno paper, written over 20 years ago: Much of what had been measured as productivity increases was in fact substitution away from capital and labor into energy which became relatively increasingly cheaper. Therefore he also attributes the slowdown in productivity to energy prices, and can even explain the different national experiences (U.S., U..K., Germany, Japan) by different behavior of the energy prices due to exchange rates. The usual approach to growth could not detect that, since they used only two factors of production, and also since the use of price deflators buries the evidence again. Hans G Ehrbar _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
