From: Dave Zachariah (davez@KTH.SE)
Date: Fri Jan 11 2008 - 13:41:12 EST
Jerry, do you think there is any advantage to measure profitability as s/(c+v) over s/K? The latter tells us the maximum growth of the stock of real capital. //Dave Z on 2008-01-11 14:03 Jerry Levy wrote: >> I would express it as as r = (s-u)/K >> where u is unproductive wages >> > > Hi Paul C: > > That would be consistent with the idea that u represents a > deduction from s. > > Another alternative would be to write: > > r = s/(c+u)+v > > This would retain v in the formula, which - as you have > explained - you object to. OTOH, it would put u in the > denominator and thereby make it clear that u is a cost of > production, but one unlike v (because it doesn't produce > value) and also unlike c (because it represents expenditures > for labor rather than means of production). > > There is a temporal dimension to the perspective that u > represents a deduction from s that doesn't quite fit. > I.e. wages for v and u are actually (and logically?) paid > out at the same time rather than v being paid out first > followed by a temporal lag when s is realized and then > u is paid out. This lag becomes obvious if we put the > issue in terms of period analysis (which, as we both agree, > has inherent limitations). > > In solidarity, Jerry >
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