CB
>>> SAckerman at FAIR.org 04/03/01 04:50PM >>>
Doug Henwood wrote:
> U.S. corporate profitability peaked in late 96/early 97, and has been
> flat-to-down since. It makes you wonder where the alleged
> productivity boom is paying off.
.
Well it paid off in the NIPA statistics, didn't it? Output per worker
zoomed. So why didn't it show up in the profit rate? Accounting-wise,
wouldn't it have to be because the output/capital ratio (aka "capital
productivity) stagnated? Is that consistent with the data?
Charles wrote:
CB: In Marx's terms, the tendency of the rate of profit to fall is because the rate of profit is :
rate of profit = surplus value/ (constant capital + variable capital).
so
rate of profit = (s/v) /( 1 + c/v)
so if productivity goes up because of introduction of new technology raising the technical composition of capital, to the extent that rise in technical composition is reflected in a rising of the value composition ( i.e. the ratio of c to v ), the rate of profit will fall
Now , Doug asks:
So why did it rise from 1982 to 1996? And why hasn't it fallen in the EU? Am I just not tweaking the numbers properly to achieve the theoretically desired result?
(((((((((
CB: I wouldn't mind thinking about this more precisely in terms of actual numbers in the periods mentioned, but a snap answer, is of course "counteracting influences" or whatever the term is.
( Above I was commenting specifically on the fact that a " productivity boom", that is an increase in constant capital relative to variable capital, of new more productive or efficient machines, where "more productive" means more unit commodities produced per workperson hour, that a productivity boom would not be a reason to expect profit rates to go up, but to expect them to go down; this is the basic contradiction Marx explicates here: the bourgeoisie's drive to constantly revolutionize the instruments of production has a tendency to cause the rate of profit to fall because surplus value is derived from human labor, not from the means and instruments of production. So, reducing the number of human worker hours necessary to make a commodity ( increasing productivity) reduces the input of the source of surplus value)
This is the law of the tendency of the rate of profit to fall, and , according to Rudy Fichtenbaum, the law consists of the tendency of the rate of the profit to fall, and the counteracting influences, which counteracting influences , when they predominate , cause the rate of profit to rise. The counteracting influences are such things as capitalist success in the class struggle in driving down wages below the value of their labor power, economies of constant capital at the expense of the workers' health and lives, foreign trade. Here it is in the table of contents of Vol III of Cap. "1) Increasing Intensity of Exploitation ( Overtime and "Speedup"), 2) Depression of wages below the value of labour-power, 3) Cheapening the Elements of Constant Capital , 4) Relative over-population ( and the reserved army of the unemployed) 5) foreign trade ,6) The increase of stock capital ( that ought be of interest to ya; has the stock market "gone up or down " in the period you speak of ? ).
As far as I know , the capitalists are not confined to this list, and are free to think up and carry out new ways to counteract the tendency. The battles lines of the class struggle zig and zag.
I would note that the category of "foreign trade" has expanded enormously since 1883, and particularly with the qualitative shift of export of capital predominating over export of goods in Lenin defined imperialist countries.
So, the law of the tendency of the rate of profit to fall does not state that the rate of profit must or will always and continuously fall. Only that there is an inherent contradictory tendency to the inherent accumulation or profit raising operations of capital - M-C-M', wherein c , v, and s are combined in production to produce more s ,which is the basis for profit.