From: Michael Perelman (michael@ECST.CSUCHICO.EDU)
Date: Tue Apr 03 2007 - 11:01:58 EDT
Rakesh Bhandari wrote: > Michael, > Can technological progress then raise unit values as machinery which had > it been amortized over its natural life would have allowed for a reduction > in unit values is amortized rapidly to avoid moral depreciation? Marx, of course, says that value depends upon the cost of reproduction, which would not allow for the perverse effect that you suggest. In > response to this perverse result, do and must capitalists which have not > already centralized then come to an implicit understanding to undertake > greenfield investments collectively only in the context of recessionary > downturns (see William Darity and James Galbraith's political theory of > the business cycle)? Both Keynes and Marx suggests that most greenfield investments are a response to irrational exuberance. For Marx, the followers that come in later after costs have declined will reap the benefits. If so, then this would give credence to the Uno idea > that unit values are fairly stable in the prosperity phase of the business > cycle? This would create some problems for the TSS school to which you are > sympathetic, no?Sekine's criticism of TSS is one of the few which has > given me reason for pause. I have not yet read Railroad Economics. I think > I saw review of it on eh.net, no? there was a friendly, but dismissive review, by Richard Vedder, a very conservative economist from Ohio State. > Rakesh > -- Michael Perelman Economics Department California State University michael at ecst.csuchico.edu Chico, CA 95929 530-898-5321 fax 530-898-5901 www.michaelperelman.wordpress.com
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