>I've prepared a short mathematical statement on this. Since (although >the math is just simple algebra) it's difficult to present my argument >clearly in plain ascii I'm making it available as a PDF file >(16Kbytes). > >http://ricardo.ecn.wfu.edu/~cottrell/turnover.pdf > >The note is intended to show how to decompose the effect on the rate >of profit of an improvement of labour productivity into the two >components (a) increased exploitation effect, (b) reduced turnover >time effect. > >Allin. Allin, I am not clear as to why circulating capital would be cut in half by a halving of production time. If by circulating capital we mean (say) raw materials, then the circulating capital per production period should not change. Twice as much raw materials would be used per year, no? And what happens if assume that constant capital is used up in each period? It seems to me that we should assume such a pure circulating capital model to isolate the effect of an increase in the annual rate of surplus value. That is in effect what my simple example tried to do. Yours, Rakesh
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