From: Paul Cockshot (paul@cockshott.com)
Date: Wed Aug 28 2002 - 06:32:09 EDT
On Tuesday 27 August 2002 19:32, Rakesh Bhandari wrote: > Paul C writes in 7550: > >Paul: > >They are both an reflection and a cause of it. Accumulation is > >not regulated by an average rate of profit but by the portion of > >the profitability PDF that is higher than the prevailing rate of > >interest. If this is low enough it will generate higher capital > >composition ratios. > >-------------------- > > Yes but an increasing capital composition ratio does not necessarily > imply that the ratio of the physical surplus to the physical stock of > capital is falling. What I meant is that I would expect a low rate of interest to lead to a higher capital to output ratio. > >------------------------- > > >This is in no way contrary to the labour theory of value. If > > >there is no human labour input, the labour theory of value > > >simply does not apply to this case. > > > > As Pack presents the case, what this 'model' shows is that the > > elimination of living labor from the process of production need not > > lead to a collapse in the rate and mass of profit and thus the > > breakdown of the capitalist system. > >--------------------------------------- > > > >I dont see anything controversial about this other than the > >hypothesis that living labour can be completely eliminated. > > What is interesting to me is that if one does not assume that the > ratio of the physical surplus to the physical stock of capital is > falling and one uses simultaneous equations, it would be difficult to > demonsrate a FROP as the economy approaches full automation. But one > could demonstrate a FROP quite easily on TSS assumptions. My take on this is that the economy would only have a falling flow rate of profit if the physical surplus to physical stock is falling. If one takes stock deprectiation into account, falling rates of profit can occur under other circumstances. I am not impressed by the analytic treatment of this provided by TSS. > Well because the appropriation of unpaid labor time is the measure of > wealth in bourgeois society, the approach to full automation could > reduce the profit rate even if the ratio of the physical surplus to > the the physical stock of capital was rising. How would that occur? > > But this still leaves the question which I put to you in my last post: > > Wouldn't Gil say that this Dmitriev/Pack thought experiment shows > that private profit results fundamentally from the differential > ownership of scarce assets, not the exploitation of living labor in > the process of production? No, private profit arises from the existence of units of production which are juridical subjects of right and reproduce themselves by the purchase of commodities in the presence of a production system capable of producing a net surplus. It does not depend upon the pre-existence of inequalities, though it generates inequalities. A system of workers co-ops would have private profit. In time this would lead to income inequalities between the coops but the inequalities are not a pre-condition of the profits.
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