The problem for me with your results is that they seem radically
counter-intuitive. Why should the industries with the greatest organic
composition of capitals have the lowest profits? These are industries with
the largest firms, operating in the most concentrated industries, operating
on a global scale, and producing a diversity of products. Industries with
the lowest organic composition of capitals have none of these advantages.
Firms in low organic composition industries have only one advantage, rapid
exit due to low barriers to exit. So, what's the intuition behind your
results?
My comment:
I may sound like a broken record but I don't see how we can ignore the
age-stratification of fixed capital when looking at profitability. If
capitalists are investing on the basis of an anticipated rate of
return rather than a simple expected profit rate, then the profit
rates earned using newer plant and equipment may well be less than
those earned using older, less productive techniques. Further, the
drive for immediate increases in profits would seem to be less in
industries that are dominated by relatively few firms. These firms
can give less attention to immediate profitablitly and make investment
decisions that give a higher priority to the rate of return over several
years.
John