[OPE-L:4157] No Sheep

john erns (ernst@pipeline.com)
Wed, 5 Feb 1997 23:26:01 -0800 (PST)

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Let me follow up your responses in OPE 4156 to my OPE 4148. Here's
a bit of what I said as well as your comments.

John: "if the capitalists' calculations have, as you say, little in common
with yours ..."

Andrew: "I didn't say that. I said they don't necessarily *have to have*
anything in common."

John: "... does your rate of profit differ from theirs? If so, how?"

Andrew: "Yes. Partly for the reasons I've discussed, having to do with
how they figure profit. The whole surplus-value doesn't get counted as
profit when a charge is taken for anticipated or actual capital losses."

Ok. A couple of points.

1. If we say that there may be differences between your calculation of
the rate of profit and that of the capitalists', then which one is
to be used as we consider the tendency of the rate of profit to fall?
Can one fall while the other rises or stays the same?

2. Let's back up a minute and consider where we agree about the
transfer of the value of constant capital. If the constant capital
is used up in a single period and has a value of 100 and in a period
of production 200 of living labor is added, we both agree that
the total output is 300. Indeed, we would say the output has a value
of 300 even if the unit input values are greater than the unit output
values. But now let's add something to this. If in the middle of
this period, the same means of production become available at one
half the value or price. Further, let us assume that half of the
means of production are used up at the half way point of the period
and half of the labor is added at that point. We could then represent
our initial one period process as one taking place in two periods given
the periods are now half as long as before. You would then represent
the two periods as follows:

Period Capital Depreciation Value Value of
Advanced Added Output

1 100 50 100 150
2 25 25 100 125

Total Value Produced 275

Initially we saw an output of 300; now we see 275. Where did
the difference of 25 go?