In a message dated 5/2/2006 5:34:40 P.M. Eastern Daylight Time, [EMAIL PROTECTED] writes: Nowadays, prices may or may not rise with money wages, but capitalists have much more control over prices than under the gold standard. Currently, it's import and export competition (along with the dollar exchange rate) which determines how much power the businesses have over prices.
It is not clear the part about "export-import competition" and its connection with business power over prices. What it is clear is that the incorporation of China's labor force into the global industrial economy has push down wage costs of consumer as to have a significant impact in the domestic rates of inflation of rich countries, especially the US. Furthermore , as Marx's reserve army of labor goes global, just its presence is sufficient to stymie wage pushes in rich economies , to foster a low inflation climate and to increase capital's share of GDP.. Thus, nowadays prices do fall with money wages courtesy of global labor arbitrage.. As for the comment on Friedman's "natural rate of unemployment" ,it must be said that it was quickly replaced by that of the NAIRU or non-accelerating inflation rate of unemployment of which both Greenspan and Bernanke are enthusiastic supporters. Also, Friedman's dictum that inflation is always a monetary phenomenon, is pretty discredited as well.For instance, in the last five years the rate of growth of M3 has been around 55% while the CPI has grown just by 17%.. Very little actually remains from Friedman's monetarist projects. Cristobal Senior de Ruiz
