Andrew, Let me see if I can be a bit clearer. Given our assumptions, as we look at the total output, 4V+L, L is the operating profit as well as the operating new value added to the product in the process of production. Given the wasted value, V, the realized profit becomes L-V and the realized value 4V+L-V. What seems strange here is that in certain circumstances not only can the realized profit become negative but so too can the realized value of the output. Indeed, the realized value of the output does not indicate the "true" social value of that output. The greater the loss due to "waste", the less the realized value. The question then becomes is the "waste" socially necessary if indeed it is seen as moral depreciation. Put another way, should we add moral depreciation to or subtract it from the operating value of the output in order to compute the realized value of that output? If we subtract it from the operating value, then clearly we could end up with negative realized values. On the other hand, if we add it to the value of the output, the realized unit values of the output could increase as productivity increases. I lean toward the latter approach as Marx's since he does note that moral deprectiation can, at times, become so great that a mechanized process may not be able to compete with the unmechanized process it could displace. This suggests to me that rapid increases in productivity can, at times, result in higher unit values of the output. John
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