> However, even if all of the above is true, it may _also_ be the case that
> there are other variables (e.g. related to market structure) inhibiting
> profit rate equalization.
As I have indicated in my asnwer to Juriaan, market structure is a concept
which foreign to marxian (and classical) framework of analysis. The
revelant concept for marxian analysis is the concrete conditions of
production and circulation of commodities. These conditions (largely)
determines the degree of mobility of capital. It is clear also that
governamental regulations, the degree of efficiency of the financial
markets and the mobility of labor power across industies and regions are
also important determinant of capital mobility. But these limitations to
capital mobility should not be seen, from the standpoint of marxian
analysis, as market structure variables.
>
> This p-M/p-K distinction between oligopolistic industries and competitive
> industries raises the question: do oligopolies represent the negation of
> competition (I think not) or a significant change in the *form* of
> competition (I think so)?
>
First of all, as I indicate above, the distiction between oligopolistic and
competitive industries is not meaningful within the classical/marxian
approach (see, for example, Semmler's book, 1984). For the p-M/p-K
approach, the emergence of oligopolistic sectors meant that the laws of
competiton had changes: in these sectors prices became determined by market
power and above average profit rates are protected by entry barriers. So,
for this approach oligopolies represent a decline of the degree competition
(not a negation of competition).
Secondly, in relation to the question you posed (after the above caveat) my
answer is as follows: the laws of accumulation (as derived by Marx) are not
in contradiction with the laws of competition. That is to say, the fact
that accumulation and centralization has led to the formation of
"oligopolies"
(i.e., industries where big firms predominate) does not imply a decline of
the competitive process, on the contrary. But that does not mean that
"oligopolies" represent a significant in the form of competition.
>It is not at all clear to me that if in contemporary capitalism there are
>these market power and entry barrier variables causing and enhancing
>profit rate differentials among different branches of production, this
>would represent a (empirical) "inconsistency" in Marx. Marx doesn't
>really talk about this subject, does he? At least, he doesn't talk about
>the form of competition taken in oligopolistic markets (including product
>differentiation and industrial pricing), does he?
As I said above, these concepts (market power and entry barriers) are
neoclassical ones, so Marx did not (and could not) develop them. Do you
think that industrial pricing is incompatible with the concept of price of
production? I do not think so.
In Marx's theory, equalization of industry profit rates (though at diferent
speed) happens independently of the fact that a given industry is composed
of a few large firms or many small firms. Thus, if it is found that the
so-called "oligopolies" obtain, presistently, above-average profit rates,
then this result is clearly incompatible with the predictions of Marx's
theory.
>
>I believe that our former mentors, Anu and Willi Semmler, wrote about
>this subject. How would you differentiate your theory and results from
>theirs?
>
The results obtained were part of my dissertation and Willi was my
supervisor. I think that Anu would expect the results obtained.
>
> What is the "long-run equilibrium profit rate"? How do you define
> "long-run" in this context?
>
The long-run equilibrium profit rate, in this context, is the average of a
autoregressive process of order p. That is, I have taken the whole sample
and calculate the average of this autoregressive process. This average, I
assumed, is the expression of the average rate of profit of the brazilian
manufacturing industry,
>
> As you know, at the time that Marx wrote the drafts for V3, he was
> planning on writing an "eventual" book on competition. Are you supposing
> that what Marx wrote in _Capital_ represents a fully-developed theory of
> competition?
Of course that I'm not assuming that "what Marx wrote in _Capital_
represents a fully-developed theory of competiton." But I think that Marx
has develped the basics elements of his theory of competition. BTW, one of
the important aspects of the competitive process that he intented to deal
with in the book on competition were related with the phenomena of
appreciation, depreciation, release and tying up of capital.
>
> Also, I don't think that it is all that useful or accurate
> to speak about and test Marx's "predictions". Of course, he had some
> "predictions", but certainly not as many as some believe.
>
Well, I not talking about Marx's predictions, rather I'm talking about
empirical predictions derived from Marx's theory.
Eduardo