File spoon-archives/marxism.archive/marxism_1994/94-07-31.000, message 104


Date: Sun, 24 Jul 94 22:24:09 MDT
From: Hans Ehrbar <ehrbar-AT-econ.utah.edu>
Subject: Re: Labor, Surplus value, catastrophism



Yes, Alex, a small minority of Marxist economists, myself included,
think the basic mechanism is that simple.  But if you get into the
details things become much more complex.  If I had to recommend one
single reference about the question whether the rate of profit has
actually fallen it would be:

Gerard Dumenil and Dominique Levy, "The Economics of the Profit Rate",
Edward Elgar 1993,  ISBN  1 85278 760 0.

Even if the rate of profit falls, the next question would be, why
should that lead to crisis?  Could not capitalism go on for ever with
a smaller and smaller rate of profit, especially if the rate of
exploitation and the mass of profits increase?  Dumenil and Levy have
an interesting answer which I want to give here only to illustrate the
depth of the question: as a response to the falling rate of profit
firms streamline their operations: computerized inventory control and
just in time deliveries etc.  But what is rational for the firm turns
out to be destabilizing for the economy as a whole.  Therefore Dumenil
and Levy hypothesize, along with the tendency of the falling rate of
profit, a tendency of rising instability of capitalism.  They have a
neat little bifurcation model, their famous "pitchfork", which models
this mathematically.

Regarding catastrophe, however, my own concern lies in a slightly
different direction.  Marx was too concerned with the autosubversion
of capitalism, and did not foresee that capitalism would ever become
so entrenched that it could run up against the ecological limits of
our earth.  The labor theory of value postulates that the forces which
govern the capitalist economy are not reducible to individual
intentions but Marx called value an "automatic subject".  There seems
to be widespread optimism that it will be possible to wean the world
economy of its addiction to growth and profit before it is too late.
I do not share this optimism.



Hans G. Ehrbar                                    ehrbar-AT-econ.utah.edu
Economics Department, 308 BuC                     (801) 581 7797
University of Utah                                (801) 581 7481
Salt Lake City    UT 84112-1107                   (801) 585 5649 (FAX)


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