From: Paul Cockshott (clyder@GN.APC.ORG)
Date: Sun Apr 08 2007 - 11:28:27 EDT
Rakesh wrote: Quoting Karl : >The theoretical conception concerning the first transformation of surplus-value into profit, that >every part of a capital yields a uniform profit, expresses a practical fact. Whatever the >composition of an industrial capital, whether it sets in motion one quarter of congealed labour and >three-quarters of living labour, or three-quarters of congealed labour and one-quarter of living >labour, whether in one case it absorbs three times as much surplus-labour, or produces three >times as much surplus-value than in another - in either case it yields the same profit, Paul Karl is wrong here, there is a systematic inverse correlation between the rate of profit and the organic composition of capital. see fig 1 of the attached. >> Quoting Rakesh Bhandari <bhandari@BERKELEY.EDU>: >>> 2. Given Marx's emphasis on regular changes in prices of production, he >>> would not have thought that the prices of production which governed the >>> prices of the inputs could have been the same as the prices of >>> production >>> which he derives for the outputs. So even if one thinks Marx left the >>> inputs in the form of values or simple prices, there is no evidence that >>> he was calling for a vector of equilibrium prices in the specific >>> sense of >>> same prices for the inputs and outputs. Indeed the chapter as a whole >>> indicates that Marx would have rejected the equilibrium idea that prices >>> of production do not change interperiodically. To judge Marx on the >>> neoclassical equilibrium terrain is to impose foreign standards on him, >>> not to judge him on his own terms. Marx cannot be said to have >>> called for >>> the neoclassical equilibrium test which he then fails. But that is >>> how it >>> is presented in almost every account of Marxian economics. Take Heinz >>> Kurz's entry on value in The Radical Political Economy entry, ed. by >>> Malcolm Saywer as just one of countless examples. Some radical political >>> economy! Though that point of view is vociferously defended on this >>> list; >>> unfortunately I have been disallowed with the AC's approval from >>> replying >>> directly. >> >> Hi Rakesh, >> >> Which passages in particular in Chapter 9 do you think indicate that >> Marx was assuming continuous changes in values in each industry, period >> after period? >> >> It seems to me that in these few pages at the end of Chapter 9 Marx is >> making the theoretical point that, even though prices of production are >> not proportional to values, prices of production are nonetheless >> ultimately determined by values, and that changes in prices of >> production are ultimately caused by changes in values, either in the >> given industry or in industries that produce means of production for >> this industry. I don't see any suggestion that he is assuming that >> such changes of values happen continuously, period after period, in >> each industry. > > Right but Marx emphasizes here that prices of production do not always > change in the long term. > > > But let me take the undisputed point first. The fact that the average > rate of profit only changes in the long term actively misleads > capitalists as to what the consequences of productivity growth are in > those branches undergoing at any time the most explosive growth. In > other words, the type of thought typical of active capitalists does > not allow them to penetrate beyond the appearances to the essences of > modern society, for a grasp of the whole is the condition of > knowledge, and this is simply incompatible with rationality in the > form of rationalization concerned only with the maximization of > profits (I draw here from Rockmore's summary of Lukacs). > > So here is a crucial paragraph from this ninth chapter in terms of > Marx's holistic epistemology, i.e. the idea that a grasp of the whole > is the condition of knowledge and that capitalists are constitutively > incapable of such grasp though the kind of rationality we have is > shaped by their narrow interests: > > The theoretical conception concerning the first transformation of > surplus-value into profit, that every part of a capital yields a > uniform profit, expresses a practical fact. Whatever the composition > of an industrial capital, whether it sets in motion one quarter of > congealed labour and three-quarters of living labour, or > three-quarters of congealed labour and one-quarter of living labour, > whether in one case it absorbs three times as much surplus-labour, or > produces three times as much surplus-value than in another - in either > case it yields the same profit, given the same degree of labour > exploitation and leaving aside individual differences, which, > incidentally, disappear because we are dealing in both cases with the > average composition of the entire sphere of production. The individual > capitalist (or all the capitalists in each individual sphere of > production), whose outlook is limited, rightly believes that his > profit is not derived solely from the labour employed by him, or in > his line of production. This is quite true, as far as his average > profit is concerned. To what extent this profit is due to the > aggregate exploitation of labour on the part of the total social > capital, i. e., by all his capitalist colleagues - this interrelation > is a complete mystery to the individual capitalist; all the more so, > since no bourgeois theorists, the political economists, have so far > revealed it. A saving of labour - not only labour necessary to produce > a certain product, but also the number of employed labourers - and the > employment of more congealed labour (constant capital), appear to be > very sound operations from the economic standpoint and do not seem to > exert the least influence on the general rate of profit and the > average profit. How could living labour be the sole source of profit, > in view of the fact that a reduction in the quantity of labour > required for production appears not to exert any influence on profit? > Moreover, it even seems in certain circumstances to be the nearest > source of an increase of profits, at least for the individual capitalist. > > The philosophical significance of this chapter is rather > breath-taking once one understands Marx's views of holistic > epistemology (and the implicit critique of the capitalist perversion > of rationality) and real contradiction (the contradiction between the > law of value and the equalization of the profit rate as a real > contradiction of generalized commodity capitalist production, a real > contradiction between social production and private profit resulting > in the mediation of the price of production which raises the class > struggle to a social level). > > Most of the readings we have of the transformation problem are quite > flat footed as if the problem were well understood as as a problem of > algebra. > > Now to where we disagree. > > > In terms less than required for depressions in the average rate of > profit to register, we should assume that the change in pop was > occasioned not by a change in the general rate of profit but by a > change in the value of the commodity itself, and since the value of > the commodity can change in consequence of technical changes within > its own sphere as well as in consequence of a change in the value of > those commodities which form the elements of its constant capital, > unit values will likely tend to change before, say, the means of > production have been amortized or scrapped. That is, for the prices of > production to change, there need not be ceaseless productivity growth > in its own branch but only in one of the branches producing its means > of production. This makes it likely that reductions in unit value are > quite frequent. > > Moreover, when, how often and as a result of what do you think prices > of production change? > > Importantly, RIcardo himself thought that unit values were changing > very regularly as I have shown and Ricardo of course had not yet > assimilated the consequences of large scale industry. > > Rakesh > > ps sorry not to have replied to Dogan's question about my own query > about Althusser's critique of Hegel. I of course had the essays in For > Marx in mind, but there are other important essays as well. And it > will take me time. > > > > >> >> Thanks. >> >> Comradely, >> Fred >> >> >> ---------------------------------------------------------------- >> This message was sent using IMP, the Internet Messaging Program. >
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