Re: [OPE-L] Marx on the 'maximum rate of profit'

From: Francisco Paulo Cipolla (cipolla@UFPR.BR)
Date: Mon Oct 09 2006 - 12:56:04 EDT

Jerry, V=0 is not a hypothesis. As a hypothesis it wouldbe unsustainable. The
maximum rate of profit is the rate of profit attaining under maximum rate of
exploitation, in fact, infinite.Unfortunately the citation you brought is not
related to the issue. In your citation what counts is the rate of profit when
wages are squeezed down to a minimum, the physiological minimum. In the
maximum rate of profit argument all new value created stands in the numerator
and capital advanced in the denominator, the well known L/c, where L is the
new value crested and c the constant capital. Then, the argument goes, if the
value composition of production c/L (as Shaikh(?) calls it) presents a
tendency to increase, the maximum rate of profit L/c must present a tendency
to fall. This is the kind of argument Ajit said has never seen in print. It is
already there regardless of being right or wrong.

glevy@PRATT.EDU wrote:

> Note how Marx -- unlike Sraffa and some Marxists -- does NOT claim
> that wages equal zero when there is a maximum rate of profit.  On
> the contrary, the following make it clear that he believed that a
> Maximum R occurs where there are _positive_ wages.
> In solidarity, Jerry
> <>
>  Value, Price and Profit
> XIV. The Struggle Between Capital and Labour and its Results
> But as to profits, there exists no law which determines their minimum. We
> cannot say what is the ultimate limit of their decrease. And why cannot we
> fix that limit? Because, although we can fix the minimum of wages, we
> cannot fix their maximum.
> We can only say that, the limits of the working day being given, the
> maximum of profit corresponds to the physical minimum of wages; and that
> wages being given, the maximum of profit corresponds to such a
> prolongation of the working day as is compatible with the physical forces
> of the labourer. The maximum of profit is therefore limited by the
> physical minimum of wages and the physical maximum of the working day. It
> is evident that between the two limits of the maximum rate of profit and
> immense scale of variations is possible. The fixation of its actual degree
> is only settled by the continuous struggle between capital and labour, the
> capitalist constantly tending to reduce wages to their physical minimum,
> and to extend the working day to its physical maximum, while the working
> man constantly presses in the opposite direction.
> The matter resolves itself into a question of the respective powers of the
> combatants.

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