ALB wrote: Maybe your are

December 31, 2011 at 9:50 pm #86747

Anonymous

Inactive

ALB wrote:

Maybe your are jumping to the conclusion that because we regard ourselve as Marxists we’re committed to the view that crises are caused by the rate of profit falling as a result of labour-saving capital accumulation. In the debates on this question we have not taken this position. Admittedly, others in these debates have argued this but not us. We’ve argued that because there are counteracting tendency it is not possible to predict how the rate of profit will move, up or down, in the short or even medium run. See for instance this and this.

thanks for the links and you were right on me assuming that.It seems i was too fast to judge looking back at the wiki article as their seems to be quite some criticism:The problem with these examples is that they are based on comparative statics. The comparison is between different economies each on an equilibrium growth path. Models of dis-equilibrium lead to other results. If capitalists raise the technical composition of capital because thereby the rate of profit is raised, this might lead to an ongoing process in which the economy has not enough time to reach a new equlilibrium growth path. There is a continuing process of increasing the technical composition of capital to the detriment of job creation resulting at least on the labour market in stagnation. The law of the tendency of the rate of profit to fall nowadays usually is interpreted in terms of disequilibrium analysis, not the least in reaction to the Okishio critique. It does seem a lot more sane to assume that there are many factors at play on whether the rate of profit will rise or fall, especially in a global interconnected economy with stock markets and financial products.