From: Paul Cockshott (wpc@DCS.GLA.AC.UK)
Date: Sun Oct 28 2007 - 16:01:23 EDT
In that case can you cite any econometric data indicating a reduction in the coefficient variation of the
rate of profit over time?
Paul Cockshott
www.dcs.gla.ac.uk/~wpc
-----Original Message-----
From: OPE-L on behalf of Gary Mongiovi
Sent: Sat 10/27/2007 9:35 PM
To: OPE-L@SUS.CSUCHICO.EDU
Subject: Re: [OPE-L] Marx on the general rate of profit/rate of interest: a translation error
To Paul: I think Marx was more or less in synch with Ricardo & Smith on these issues. If there are no impediments to the movement of capital, profit rates should converge. If there are barriers to the movement of capital we might observe "constraints on the dispersion." These constraints would be the mechanism that draws the profit rates together when there are no barriers to the movement of capital.
I should add that I am talking about Marx's understanding of capitalist processes. The mechanism described by Smith, Ricardo Marx etc may not be stable, in which case it may be more useful to talk of boundedness & constraints rather than gravitational mechanisms.
Gary
-----Original Message-----
From: OPE-L on behalf of Paul Cockshott
Sent: Sat 10/27/2007 1:33 PM
To: OPE-L@SUS.CSUCHICO.EDU
Cc:
Subject: Re: [OPE-L] Marx on the general rate of profit/rate of interest: a translation error
What is left unstated in your summary Gary is whether Marx expects the dispersion of profit rates to narrow with
time?
If that does not occur what does a tendancy to equalise mean?
Instead of a tendancy to equalise, one might hypothesise some constraints on the dispersion.
Paul Cockshott
www.dcs.gla.ac.uk/~wpc
-----Original Message-----
From: OPE-L on behalf of Gary Mongiovi
Sent: Sat 10/27/2007 2:06 PM
To: OPE-L@SUS.CSUCHICO.EDU
Subject: Re: [OPE-L] Marx on the general rate of profit/rate of interest: a translation error
A distinction without a difference, in my opinion. In either translation Marx is talking about a mechanism that causes profit rates to tend to equalize, as in Ricardo, as in Smith. Marx thought this tendency to be an integral aspect of how capitalism works, though no doubt there are nuanced differences between his account & Smith's. But on fundamentals, as regards the existence, operation and centrality of the mechaninsm, they are in agreement.
Gary
-----Original Message-----
From: OPE-L on behalf of Jurriaan Bendien
Sent: Sat 10/27/2007 7:41 AM
To: OPE-L@SUS.CSUCHICO.EDU
Cc:
Subject: [OPE-L] Marx on the general rate of profit/rate of interest: a translation error
When, in an often ignored passage, Marx discusses the relationship between the general rate of profit and the rate of interest (in Capital Vol.3, Chapter 22), we read in the official translation:
On the other hand, the general rate of profit is never anything more than a tendency, a movement to equalise specific rates of profit. The competition between capitalists - which is itself this movement toward equilibrium - consists here of their gradually withdrawing capital from spheres in which profit is for an appreciable length of time below average, and gradually investing capital into spheres in which profit is above average. (...) The general rate of profit... derives actually from causes far different and far more complicated than the market rate of interest, which is directly and immediately determined by the proportion between supply and demand, and hence is not as tangible and obvious a fact as the rate of interest. The individual rates of profit in various spheres of production are themselves more or less uncertain; but in so far as they appear, it is not their uniformity but their differences which are perceptible. The general rate of profit, however, appears only as the lowest limit of profit, not as an empirical, directly visible form of the actual rate of profit. http://www.marxists.org/archive/marx/works/1894-c3/ch22.htm
We see here, that the official translation used by marxists.org mentions "this movement towards equilibrium", suggesting Marx is an equilibrium theorist, rather than a dynamicist, contrary to the general tenor of his discussion.
Intrigued by this, I consulted the original German text. Whaddaya know, the German original DOES NOT MENTION EQUILIBRIUM AT ALL!
Here is the passage again, now in the original German:
Dagegen existiert die allgemeine Profitrate beständig nur als Tendenz, als Bewegung der Ausgleichung der besondren Profitraten. Die Konkurrenz der Kapitalisten - die selbst diese Bewegung der Ausgleichung ist - besteht hier darin, daß sie den Sphären, wo der Profit auf längre Zeit unter dem Durchschnitt, allmählich Kapital entziehn und den Sphären, wo er darüber, ebenso allmählich Kapital zuführen (...) Die allgemeine Profitrate schöpft also in der Tat ihre Bestimmung aus ganz andren und viel komplizierteren Gründen, als die durch das Verhältnis von Nachfrage und Angebot direkt und unmittelbar bestimmte Marktrate des Zinses, und ist daher kein handgreifliches und gegebnes Faktum in der Art, wie es der Zinsfuß ist. Die besondren Profitraten in den verschiednen Produktionssphären sind selbst mehr oder minder unsicher; aber soweit sie erscheinen, ist es nicht ihre Uniformität, sondern ihre Verschiedenheit, die erscheint. Die allgemeine Profitrate selbst aber erscheint nur als Minimalgrenze des Profits, nicht als empirische, direkt sichtbare Gestalt der wirklichen Profitrate.
http://www.mlwerke.de/me/me25/me25_370.htm
What Marx actually says is: "The competition of capitalists - which itself is this movement of equalling out [of profit rates]...". The word "Ausgleichung" (i.e. equalisation) is rendered as "equilibrium" by the official translation, but this is in no way what it actually means. In the vastly superior Pelican translation by David Fernbach, this mistranslation is corrected however (p. 488-490, loc.cit.).
Jurriaan
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