Jim Devine wrote:
what's your data source [regarding the rate of profit]? how do you
normalize it?
I do not have any data. I was just offering my broad interpretive
perception.
Two factors have covered up this phenomenon. First, the regulatory
scheme, including the undermining of protections for labor and the
environment, increased the profit opportunities.<
isn't there an actual rise in the rate of exploitation (and in the
property share of GDP) going on here? how does this "cover up" the
phenomenon? it seems like it would _change_ the phenomenon, like one
of Marx's counteracting forces.
What I mean by covering up is that this rise of exploitation appears as
a "natural" phenomenon rather than something engineered by changing the
rules of the game.
Second, capital compensates for the diminished rate of profit by
taking on more risk. In effect, the expected rate of profit [in a
statistical sense] may be declining, even though the measured rate of
profit is increasing. <
but how does taking on more risk raise the measured rate?
Very simply, suppose I have a company that invests money in the
lottery. The company buys a winning ticket and registers a high rate of
profit. The expected rate of profit of such an investment is not very
high. I'm thinking of finance in terms of lotteries.
--
Jim Devine / "Mathematics has given economics rigor, but alas, also
mortis" -- Robert Heilbroner.
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Michael Perelman
Economics Department
California State University
michael at ecst.csuchico.edu
Chico, CA 95929
530-898-5321
fax 530-898-5901
