Re: Jerry's OPE-L 5024
Jerry wrote:
John, responding to Fred, wrote in [OPE-L:5020]:
> I think you are still wrong on this one. For Marx, "moral depreciation"
> is part of the depreciation charges. It is the loss in value of
> fixed capital as better or, simply, cheaper machines are introduced. It
> is a cost anticipated by the capitalists according to Marx. It is not
> at all a surprise to them.
I think you are still wrong on this one, John. As the issues associated
with expectations also concern issues raised on the "ideal vs. real
value" thread, I am changing the subject line in order to broaden the
discussion.
A) Before investing money capital in c and v, capitalists have certain
expectations concerning the rate and mass of profit. In that sense, the
expectations that capitalists have re market prices, demand, and cost all
enter into their decision-making and can, thus, affect the quantity of
money capital actually invested in c and v.
John: I'd agree they do indeed have expectations.
Jerry wrote:
B) Whether those expectations concern future prices, future demand,
future technical change and depreciation (or whatever), they are merely
ex ante estimates ("guesstimates") which may be very different from the
ex post prices, demand, technical change (or whatever). When John says re
depreciation and technical change that "it is not at all a surprise to
them", he vastly overestimates the knowledge of individual capitalists
and the uncertainty inherent in commodity production and circulation.
John:
I don't get it. Are you saying that a capitalist knows nothing of
obsolescence? Does he think his new machinery will last until
it is physically worn out?
You seem to want to impute to me a position I do not have --
capitalists have perfect knowledge of the future. To say
that because John claims capitalists allow for moral depreciation
is equivalent to saying that John "vastly overestimates the
knowledge of individual capitalists" makes use of a logic of which
I know little. Or, perhaps, you claim they know nothing of
the future prices and it always comes as a complete shock to them
when the reproduction prices of their fixed capital fall.
Jerry:
C) Typically, capitalist estimates -- no matter how mathematically
sophisticated; no matter what amount of market research -- simply boil
down into projections that past trends will continue into the future.
Thus, they conduct market research into past trends re demand and/or
have questionaires re the quantity that would be demanded of a product if
it were produced now. Yet, none of this can guarantee that the products
that they produce _will_ have a use-value and an exchange-value. This is
because the decision re demand is _not theirs to make_ and they have _no
way of knowing for sure ex ante_ what will happen "in the event."
Similarly, capitalists may _estimate_ technical change and the rate of
obsolescence of fixed capital, but they have no way of knowing what
_will_ happen. This is because it is not something that they _can_ know
in advance with any certainty. For instance, they can not know what the
pace of technical change and the price of future means of production will
be whether they produce those means of production internally (since there
is a large degree of uncertainty associated with R&D expenditures) or
whether they purchase those means of production from other capitalists.
In this sense, capitalist production proceeds on a wish and a prayer.
John:
This sounds good but says little. I am simply saying that capitalist
expect and allow for some "moral depreciation." Do present-day
capitalists know that the prices of the computers they buy today will
be lower in the future? Do they allow for this?
I am not claiming that their predictions of the future are always
correct. However, they do not invest with the expectation that
the current prices will always prevail. With Marx, I assume that
they include "moral depreciation" within their depreciation charges
and take it into account in estimating how long the fixed capital
they purchase will last.
Note that as we attempt to construct models in which technology is
changing we assume values and prices fall. Do the capitalists
see none of this? Again, I'm simply saying that given these
price decreases occur they will allow for, at least, some of it.
Your post goes on about expectations concerning rates of accumulation,
the wages of work, rent, etc. I have not dealt with any of that as
it is not part of the concept of "moral depreciation." Why drag
these other topics into this discussion?
The basic question here is: "If capitalists including the
costs of moral depreciation within their overall depreciation charges,
are they not expecting some fall in the prices of the already purchased
fixed capital?" Note neither Marx nor I claim that the expectations
are perfect. The expectations are there -- right or wrong.
John