From: Simon Mohun (s.mohun@qmul.ac.uk)
Date: Wed Nov 06 2002 - 13:11:24 EST
Dear Rakesh, I think your definitions are wrong. Consult C1, ch.25 second para (Penguin ed. p.762) > It would seem that the OCC (as you, Alfredo and Simon are defining it) > is not mirroring changes in the VCC which result only from technical > change because your OCC makes no allowance for the reduction of unit > values and current prices effected by technical change. Response: the ratio which is determined by the TCC and mirrors the changes in the TCC is the OCC, not the VCC. >Yet why else would have Marx thought the OCC does not rise as sharply as >the TCC if in measuring the OCC itself he wasn't taking into account the >reduction in current prices effected by the continuous reduction of unit >values resulting from technical change? That is, it does seem to me that >Marx was indeed taking into account the changes in current prices effected >in the realm of circulation in measuring the OCC. Response: as long as the real wage rate is more than one dollar per hour, the OCC is always less than the TCC. >I would say that the VCC rises faster than the OCC because current prices >are only brought into the orbit of their new lower unit values which have >resulted from on-going technical change through the periodic effects of crisis. > >The VCC thus races ahead of the OCC and is only brought into conformity >with it through crisis. Response: I don't follow this. But empirically it is wrong. Over the period 1964-2001 for the US economy, we have 1964-1972: OCC greater than VCC 1973-1991: VCC greater than OCC 1992-2001: OCC and VCC virtually identical. To give some idea of orders of magnitude: In 1964 TCC = 41.06, OCC = 3.67, VCC = 3.48. In 2000 TCC = 66.13, OCC = 4.46 and VCC = 4.45 Simon Centre for Business Management, Queen Mary, University of London, Mile End Road, London E1 4NS, UK Tel: +44-(0)20-7882-5089 (direct); +44-(0)20-7882-3167 (Dept. Office) Fax: +44-(0)20-7882-3615
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