[OPE] webpage computing and the sperm rate of profit

The demography paper is available e.g. here
http://reality.gn.apc.org/econ/merged.html The basic empiricist reasoning of
it has some plausibility but the argument depends partly on how exactly the
variables are derived, and on data quality.

If the longrun growth rates of economic variables used are themselves
dependent on numerous assumptions, it is possible that the cumulative effect
is, that the longterm growth rates of economic variables are overestimated
or underestimated, skewing the series by a wide margin from the real
magnitudes.

I cannot find any formula for the rate of profit as inferred from population
and labour force data, nor can I find any information about what is included
and excluded in the empirical variables used.
Is the profit rate shown in the graphs the derived equilibrium profit rate
r_eq = ( gL + gP + d) / i ?

The gL and gP variables can be obtained with reasonable accuracy, but as
regards the d and i variables, there can be a large margin of empirical
error and I am not even sure how they are calculated. There's a lot to be
said about that, but anyway there is no necessary relationship between the
depreciation rate and the reinvestment rate, and it is the actual money
depreciation rate which is decisive and not the imputed economic
depreciation rate.

In the i variable, the non-productive component, which is large and
increases faster, should be excluded. I think the formulas ought to be
modified, to build in various other influences, such as the ratio of
distributed and undistributed profit, the interest rate and the currency
exchange rate. How do we know that gL, gP and d have equal weightings?

The methodological documentation in the Shaikh/Tonak book is pretty bad,
because it is not possible to reconstruct and derive exactly where they get
their actual figures from, you have to take their word for it. In science,
the onus is on the researcher to provide sufficient documentation on data,
sources, methods, concepts and assumptions, and just saying something like
"well I used the Penn tables" will not do the trick. Without appropriate
documentation, the exercise cannot be distinguished from a scam.

As I have said, the input-output Marxists are renowned for their sloppy,
cavalier approach to documenting how exactly they arrive at their numbers
and making their assumptions explicit. They are often terrible as
communicators, and thus do not rise in the credibility stakes.

Jurriaan

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Received on Sat May 16 06:20:02 2009