[OPE-L:6102] Re: Re: falling profits - 2

From: Fred B. Moseley (fmoseley@mtholyoke.edu)
Date: Mon Oct 29 2001 - 00:58:46 EST

On Fri, 26 Oct 2001, Rakesh Bhandari wrote:

> > 
> > 2.  From the mid-70s to 1997, the rate of profit recovered, but only
> > partially (only about half of its prior decline), so that the rate of
> > profit in 1997 remained about 25% below its earlier postwar peak.  The
> > main reason for such a weak recovery of the rate of profit was the
> > continued increase of the ratio of unproductive labor to productive labor,
> > which partially offset a sharp increase in the rate of surplus-value and
> > its positive effect on the rate of profit (the composition of capital
> > increased only slightly during this period, due mainly to slower capital
> > accumulation and lower costs of raw materials).  
> OK, so was the decline in the costs of raw materials less or more
> important as 
> the rise in s/v in the (partial) recovery of the profit rate? 

I haven't done a detailed study of this, but I think the increase in the
rate of surplus-value was much more important.  

> what made for 
> lower costs of raw materials? technological improvements in extraction, 
> breaking of cartels by entry of new states?

I think the lower raw material prices were mainly due to the slower growth
of the world economy, which reduced the demand for raw materials,
especially oil.  

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