Re: On the 'Unanswered Questions About Rent'

From: Cyrus Bina (binac@MRS.UMN.EDU)
Date: Wed Jan 28 2004 - 11:30:08 EST

Hi Paul,

In the paragraph that (Chapter 45, Absolute Ground Rent) you have cited, the
phrase: "excluding those lines in which capital consisting of machinery and
other fixed capital is very considerable," is an indication that Marx knew
that such conditions are very likely in capitalism.  This means that
successive investment of capital, which leads to DRII, may also eliminate
the investment on "marginal" land and AR.  The "regulating capital" in the
"extractive industry proper" may shift from "marginal" land to
"intra-marginal" as DRII had already set the limit to AR (in this case,
zero).  Now, from the standpoint of (capital) accumulation process,
successive investments of capital on lands that are already under lease can
continue without the obstruction of the landed property.  It is due to such
investments, given competition, that the "organic composition of capital"
will increase to or beyond the average in industry.  Therefore, asserting
that AR is not relevant to the oil industry should be accompanied by a
demonstration of high capital intensity in the oil industry,which also
depends on the specific analysis of the oil industry itself.   Again, Bina
(1985 and 1989) could be used as references.  I have no access to your
article in RPE.  If you want me to read it, please send it to me at  It would be a pleasure to send my comments to you
directly and if you wish to post them, it is up to you.



----- Original Message -----
From: "Paul Zarembka" <zarembka@BUFFALO.EDU>
Sent: Monday, January 26, 2004 8:51 PM
Subject: Re: On the 'Unanswered Questions About Rent'

> Cyrus,
> Thanks for your posting.  I've just quickly looked over again Marx's
> chapter on Absolute Ground Rent.  The last paragraph begins with
>   "This absolute rent plays an even more important role in the extractive
> industry proper, where one element of constant capital, raw material, is
> wholly lacking and where, excluding those lines in which capital
consistingindustry proper
> of machinery and other fixed capital is very considerable, by far the
> lowest composition of capital prevails."
> I argued in a 1979 piece that a low organic composition of capital is
> required for Absolute Rent, but unfortunately the argument would require
> some elaboration.  Could I merely point to the above sentence to suggest
> that Absolute Rent would not apply to oil extraction where a high c/v
> obtains?  If this is insufficient and you have access, I could point to my
> "Accumulation of Capital in the Periphery", R.P.E., Vol. 2 (1979), pp.
> 102-105.
> Paul
> --On Monday, January 26, 2004 8:17 PM -0600 Cyrus Bina <binac@MRS.UMN.EDU>
> wrote:
> >   * Absolute Rent (AR) in Marx reveals the immediate effects of property
> > relations.   Such effects include the types and patterns of ownership of
> > agricultural lands.  According to Marx, AR in agriculture is the result
> > of ?monopoly? of private land ownership. AR must be paid to the owner of
> > lowest quality land under cultivation, the land that is called
> > land.  Marx maintains this terminology in order to keep the conversation
> > and, by going beyond it, advances his own theory. Marx?s capital (or
> > land) does not have anything to do with ?marginal? analysis.  Indeed,
> > ?regulating capital? remains lumpy and connected with ?average
> > productivity.? Marginal land for Marx is the lowest quality land that
> > or may not be coincided with the ?regulating value? of the total product
> > in agriculture.  Once the ?regulating value? of the product from the
> > ?marginal? (lowest quality land) land represents the ?regulating value?
> > of the total product of land, AR will become a part and parcel all
> > individual values associated with all categories of lands under
> > cultivation.  And, once (for reasons given in #5) eliminated, neither
> > ?individual? value(s) nor the ?regulating value? of total product does
> > include AR.
> ***********************************************************************
> RESEARCH IN POLITICAL ECONOMY,  Paul Zarembka, editor, Elsevier Science
> ********************

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