On 2010-12-03 02:17, Paul Zarembka wrote:
> To me, physical depreciation
> means something like 5% of the machines need to be replaced annually,
> otherwise, production falls by 5%. Moral depreciation is harder to
> grasp; I only feel that it cannot be a magic wand, permitting capital
> stock to decline from $100 billion, to 90, to 50 (in real terms, of
> course) without effect on $10 billion profits.
Note that we are computing the profits net of depreciation. But at this
level of abstraction the labour theory of value would predict the mass
of profits to stay at $10 billion, since the amount of labour is constant.
A more detailed analysis, with a model of relation between capital
stocks and technical coefficients, would be required to say something
about how a decline of the total capital stock from $100 to $50 billion
affects labour productivity. Partly this is indeterminable since it is
also compatible with certain innovations that could offset the effect of
a declining capital stock in monetary terms.
Hence rather than looking at monetary figures, I suggest looking at the
growth rate of the ratio of living to dead labour.
//Dave Z
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Received on Fri Dec 3 03:29:38 2010
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