Fed Head Acknowledges Marx's Value Theory is Right

Drewk Andrew_Kliman at msn.com
Sat Apr 21 10:54:40 PDT 2001


Hi, Christian,

You argued that labor-displacing technology, leading to increasing productivity growth, in turn leading to a drop in prices (or the inflation rate) "is perfectly consistent with neo-classical theory, too, right?"

Well, yes and no. The problem is that their theory is itself inconsistent.

Think of it this way: What do we get when we take the analysis one step further? What is the effect of the drop in prices (or inflation rate) on the rate of profit?

The answer is clear. Once you concede that increasing productivity growth depresses prices (or the inflation rate), the direct consequence is Marx's law of the tendential fall in the profit rate -- labor-displacing technology tends to lower the general rate of profit. This is something the neoclassical economists (and physicalist-Marxist and Sraffian economists, etc.) refuse to accept, but it follows as the night the day. .

You go on to suggest that, by conceding that increasing productivity growth tends to depress prices, Marx's critics are not thereby committed to his theory that the origin of profit is surplus-labor. I'll have to think about that. It seems on the face of things that you're right, but I suspect that there's some other inconsistency lurking in the background. In any case, Marx's theory of value isn't exactly the same thing as his theory of surplus-value.

Andrew ("Drewk") Kliman Dept. of Social Sciences Pace University Pleasantville, NY 10570 USA phone: (914) 773-3968 fax: (914) 773-3951

Home: 60 W. 76th St. #4E New York, NY 10023 USA

"The practice of philosophy is itself theoretical. It is the critique that measures the individual existence by the essence, the particular reality by the Idea."



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