Re: [OPE-L] how industry-specific are most capital goods?

From: Jerry Levy (Gerald_A_Levy@MSN.COM)
Date: Wed Apr 18 2007 - 10:20:58 EDT


>  It seems to me that most capital goods
> are quite industry specific, and are used in only one industry, or a
> small group of industries.


Hi Fred:

What about computers  (to the extent that they serve as
means of production)?

One has to remember that a distinguishing characteristic of
new information technologies is *flexibility*:  thus, industrial robots
can be employed in many different branches of production and
assigned many different tasks and all that is needed is re-programming
(which is often very simply done) and other minor changes (e.g.
the changing of end effectors).  This form of flexible (or "soft")
automation is in contrast to the "hard automation" that used to be
more common and has now increasingly become obsolete in many
branches of production (but are retained in some other sectors for
industry-specific reasons).  Similarly,  office computers are
"flexible" and the same hardware is used in many sectors.  The
software is often changed, but -- even there -- there are commonly
used software programs in many branches of production.

Consider for a moment how many capital goods use the chip.
An enormous amount!

There are also common elements of constant circulating capital
required across branches of production, e.g. electricity, heating oil,
etc. Also,  plastics (an oil derivative) and steel are  by no means
industry-specific but often are elements of constant capital.

In solidarity, Jerry


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