rate of return on capital

Doug Henwood dhenwood at panix.com
Wed Apr 17 06:45:35 PDT 2002


Carrol Cox wrote:


>Why is it counter-intuitive? I would assume that colonial profits have
>_never_ been higher in absolute terms than profits at "home" -- they are
>simply a requirement for the absorption of capital that otherwise would
>not be active at all.
>
>Return in Developed Nation: X %
>
>Return on additional investment in developed nation: 0 %
>
>Return on Investment in Colony: X/2 %. Better than nothing.
>
>This is why imperialism is _not_ a policy adopted by imperialist nations
>but the very mode of existence of capital.
>
>It is also why capital (if not destroyed) will destroy the human
>species.

The only thing wrong with this quasi-syllogism is that the marginal return in the developed nation is >0%, which is why about 2/3 of FDI goes to developed countries (and the remainder is concentrated in only about 10 "developing" countries). So while capitalism may destroy the human species, this isn't sufficient proof.

Doug



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