Let's say America had a low-wage prison colony and migrated all its capital stock there. How different would that look from what we see now?
With such a huge disparity in wages, it's cheaper to migrate capital stock to the developing world than to build it here.
And last time I heard, America's capital stock was actually newer than Japan's.
Boddi
On 12/13/06, Rakesh Bhandari <bhandari at berkeley.edu> wrote:
> Yet, Doug, if profits are easy then how do you explain the feeble
> capital accumulation in the North in recent years? Or do you deny
> that it has been feeble and that capital stock growth is likely to be
> near stagnant going forward?
>
> Prospect of profits from new investments has not encouraged a real
> spout of real capital accumulation, anemic compared to China's growth
> of capital stock rising 10% per year which as Andrew Glyn points out
> is four times the rate of Northern countries. That growth moreover
> is financed almost entirely from internal resources.
>
> Rate of profit here seems to have been bolstered by centralization
> and wage repression but that hardly encourages optimism. And then it
> gets dim as one expects a petering out of the stimuli from large
> federal deficits and mortgage refinancing. It may well be time for
> the Democrats to take power again.
>
> Despite high profit rate in US we may still see a flood of capital
> exports simply because as high as the profit rate on investments made
> in the US, it simply does not pay to accumulate.
>
> The rate of profit can remain positive as over-accumulation is
> neared and reached.
>
> I also don't get your profit theory. If you subscribe to LTV, then
> how could wage repression account for a lot of the profit rate
> incline since as mechanization proceeds the relative number of
> workers must decline and as Marx says no matter how exploited two
> workers are they can't produce as much surplus value as 24. Aren't
> you suggesting a theory of profits at odds with the theory of labor
> value? Are you a closet Sraffian?
>
>
> At any rate, I would pay careful attention to Grossman and Harvey. I
> think I saw a pamphlet written by Shaikh in 1988 or so that expressed
> implicit agreement with Grossman's theory of overaccumulation.
> Banaji's translation circulated at the New School before it was made
> available by James Heartfield and friends to the hoi polloi.
>
> Rakesh
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