From: "John R. Ernst" <ernst-AT-pipeline.com> Date: Mon, 27 Nov 1995 00:18:09 -0500 Subject: 3 J's (A Few Points) Jim, Maybe we "three J's" have too many balls in the air at once. At any rate, this note is meant to nail down a few points. 1. On that extra value. I did not think I was doing anything clever in my post. I was simply trying to look at a capitalist investment following the guidelines given by Marx. At any rate, the 1920 is the social value created if there is no price reduction. I then go on to drop the price a bit, using the same assumption Marx's makes in Book I, Chapter 12 where he discusses the concept of relative surplus value. Note that, in the next line of numbers, I drop the surplus value to 920, indicating the usual Marxian assumption. Still, there is "extra" value produced just as there is in Marx when he distinguishes between social value and individual value. 2. On the Technical Composition of Capital. In my discussions (mainly with Juan) I saw this as a battle over the role or potential role of index numbers. Economists use them all the time to indicate changes in the real wage and productivity for the economy as a whole. Are they in Marx's CAPITAL? No. Strictly speaking, Marx does says that the technical composition of capital is the mass of the means of production per worker. But, when I read your posts concerning measuring actual masses of inputs, I began to move to Juan's position. As you know, I have suggested dropping the topic for now as it did not seem to helpful in getting clarity on issues in CAPITAL. The point I was trying to make is better made by Marx himself in the two passages from the Book III (pp 108-9 and pp 260, Int. Ed.) We should be aware that the vast majority of opponents and defenders of Marx's FRP would not accept the types of investments that Marx speaks would lead to a FRP. Here, I refer to the works of John Roemer, an Analytical Marxist, Ian Steedman, a neo-Ricardian as well as professed Marxists like David Laibman and Maurice Dobb. 3. On Moral Depreciation I certainly do agree with your point that there may be a connection between "moral depreciation" and the "turnover of fixed capital." In a recent post, I gave an example of my interpretation of "moral depreciation." In attempting to determine the depreciation charges on a piece of machinery that costs 1500 -- the capitalist is told by the engineer that the equipment will last 15 years and by his experience that, on average, machinery lasts 10 years. If he believes his engineer the depreciation charge would be 100 per year. If he believes his experience, the depreciation charge would be 150 per year. The difference between the two, 50, is what I call "moral depreciation." It surely is related to the turnover time of fixed capital. 4. On Engels I'd like to postpone a discussion of what Engels says following Marx's statement in Bk III, CH 15, Sec. 4. I do note in a post following mine, you found something I didn't. I hope this post does "nail a few points." Regards, John --- from list marxism-AT-lists.village.virginia.edu --- ------------------
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