> -----Original Message-----
> From: michael perelman [SMTP:michael at ecst.csuchico.edu]
> Sent: Tuesday, August 18, 1998 6:12 PM
> To: lbo-talk at lists.panix.com
> Subject: Re: Global melodrama
>
> Seth asked how wages could stagnate while the economy grew, yet have
> profits fall. The solution to the riddle is that heavy competition
> propelled by technical change and over capacity caused capital to be
> devalued. Firms, especially railroads, went bankrupt.
>
> Barkley Rosser says that you can explain this outcome with monetarism.
> I
> agree that it is consistent with monetarism. I think that we would
> nearer
> to the truth by explaining the problem in terms of what was going on
> in the
> market for goods. Neither explanation is exclusive of the other.
>
> Seth Ackerman wrote:
>
> > Michael Perelman wrote:
> >
> > <<The economy grew during the "fast deflation" of the late 19th C.
> > Profits fell,
> > wages did not increase much, but the economy grew, leading some to
> deny
> > that any depression occured.>>
> >
> > How can the economy grow faster than the sum of wage growth and
> profit
> > growth?
> >
> > Seth Ackerman
> > FAIR
>
>
>
> --
> Michael Perelman
> Economics Department
> California State University
> Chico, CA 95929
>
> Tel. 530-898-5321
> E-Mail michael at ecst.csuchico.edu
>