Re: [OPE-L] questions on the interpretation of labour values

From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Tue Feb 27 2007 - 11:36:22 EST

>3) And think of the following as a general reflection: "if there are taxes,
>payments to unproductive labor, rents, or interest payments, the tendency
>may be to equalize net profits after deducting these items" (Foley, 1982, p.
>46). It is clear that it is a "tendency", not a short-term fluctuation, and
>also that the resulting prices, that include gross profits, not just net
>profits, would be different from production prices in all those cases.

Hi Diego,

Writing near Silicon Valley...if there are scarcity rents included in
the wages of highly skilled labor in what James Galbraith calls the
knowledge intensive capital goods industries--and there may not
be--does the tendency to equalize profit rates obtain only after
deducting such scarcity rent? How would knowledge intensive capital
good industries maintain prices above values to pay scarcity rent
wages while still receiving the equalized net profit rate? What role
do patents and intellectual property rights play in this  or barriers
to entry in knowledge intensive capital goods?

Yours, Rakesh

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