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In reply to Michael Perelman's OPE-L 3825:
"In an economy with rapid tech. change, no one can predict what an
appropriate value-depreciation should be.
"I first discussed this problem in my Marx book and then I tried to
show how this rapid depreciation of fixed capital led to to crisis
in the U.S. economy in the late 19th C. in my End of Economics. In
other words, you can get a falling rate of profit from an
acceleration in the rate at which capital has to be scrapped.
Andrew Kliman and I came upon this idea separately -- his article
appeared shortly after my book, but he could not have been aware of
what I was doing -- although we seem to have taken our intepretation
along different paths."
Michael is right; we came upon this idea independently, as did a few
other TSS authors (I believe John Ernst was the first).
I think of Michael's and my work on this matter as complementary -- the
paths we've taken may not be precisely the same, but I don't see that
they diverge. I have found Michael's historical (including history of
thought) studies on this topic to be very illuminating. I also greatly
appreciate his work on the category of fictitious capital, and his stress
on the fact that capital-value advanced, in Marx's discussion of the rate
of profit, refers to fictitious as well as "real" capital.
And I certainly agree that moral depreciation makes the determination of
the rate of profit (and of the value produced) unpredictable. But as
work on nonlinear dynamical systems has reminded us, unpredictable isn't
the same thing as indeterminate.
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