From: Gerald_A_Levy@MSN.COM
Date: Sat Nov 20 2004 - 04:27:12 EST
> I suspect (though I don't have strong evidence for this, and it's > hard to find evidence, since the market price of gold has long been > a creature of central bank policy and speculation) that over the > long run the rate of technical progress in gold production tends to > lag that in the economy at large. Allin, This proposition seems to be more supportive of the Varga thesis than that of Bauer, Spectator (M. Nakhimson) and Kautsky in the debate on gold production and inflation. All of the latter group emphasized an increasing composition of capital in the gold-mining branch of production. At the time, I think, the statistical evidence -- as presented by Bauer and Spectator -- supported this proposition. (Bauer also claimed that the decreasing costs of gold production were additionally caused by the employment of cheaper labour-power in South Africa). This appeal to the special conditions of production in the gold-mining branch of production as an explanation for the general rise in prices was objected to by Varga who claimed that if there is technological progress in gold- mining production this only increases differential rents within that branch. I don't have recent statistics that could shed light on whether the composition of capital in the gold-mining branch of production is higher or lower than the average across branches of production (perhaps Claus or Akira have recent statistics?). In any event, I see no reason for supposing that over the long-term the composition of capital in gold-mining production will lag behind the rest of the economy. What would happen in your thought experiment if: a) the composition of capital in gold-mining is equal to the social average? b) the composition of capital in gold-mining is higher than the social average? In solidarity, Jerry References: Bauer, Otto _DieTeuerung. Eine Einhuhrung in die Wirtschaftspolitik der Sozialdemokratie_ Wien, Verlag der Volksbuchhandlung Ignaz Brand & Co., 1910 ---------- "Goldproduktion und Teuerung" _Die Neue Zeit_ 30 Jg, 1911/1912, II Bd, pp. 4-14; 49-53; 246-247 J.v.G. "Goldproduktion und Preisbeweung" _Die Neue Zeit_, 30 Jg., 1911/1912, I Bd, pp. 660-664 Kautsky, Karl _The High Cost of Living_, Chicago, Charles H. Kerr & Co, 1915 [published online at http://www.marxists.org ] ----------- "Gold, Papier, und Ware" _Die Neue Zeit_, Vol. 30/31, pp. 836-47; 886-893 Levy, Gerald "Goldproduction and Inflation: A Post-Mortem on the Debate in Pre-World War I German-Austrian Social Democracy", unpublished seminar paper, 1982 Mjoset, Lars "The Debate on Goldproduction and Inflation Within Austrian and German Social Democracy before World War I", unpublished seminar paper, 1982 [both of the above submitted for a seminar at the New School, 208S, by Willi Semmler on "Selected topics in Advanced Political Economy: Theories of Competition and Price" -- *Lars*-- if you read this, send me an email. I'd like to know how you are.] Spectator, "Zur Frage der Goldproduktion und Teuerung" _Die Neue Zeit_, 30 Jg., 1911/1912, II Bd, pp. 550-553 Varga, Eugen "Goldproduktion und Teuerung" _Die Neue Zeit_, 30 Jg, 1911/1912, I Bd, pp. 212-220
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