Re: [OPE-L] simple reproduction

From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Fri Mar 30 2007 - 23:53:56 EDT

> On Fri, 30 Mar 2007, Rakesh Bhandari wrote:
>> I was wondering whether anyone could recommend any other work or
>> offer some analytical comments on just why capitalism could not
>> settle into simple reproduction (stationary state?) or why even
>> if were constrained to do so it would have difficulty
>> maintaining equilibrium.
> It's possible "in principle",

Yes, I see your point that follows also. And it does seem to me that
simple reproduction is possible in principle, but I find this following
objection in Mattick's reading of the chapters on simple reproduction. I
don't see that he or Marx is right.

"Marx then showed how the double character of the commodity, as value and
use value, transforms even the apparent equilibrium of simple reproduction
into disequilibrium. Thus, for example, the wear and tear and replacement
of fixed capital can produce dislocations in the value-defined conditions
of exchange, destroying any possibility of equilibrated reproduction.
Without going into Marx’s examples of the appearance of disproportionality
within simple reproduction, it here needs to be stressed only that they
apply exclusively to capitalist reproduction.

Once the capitalist form of reproduction is abolished, it is only a matter
of the volume of the expiring portion-expiring and therefore to be
reproduced in kind of fixed capital.. . varying in various successive
years. If it is very large in a certain year ... then it is certainly so
much smaller in the next year. The quantity of raw materials,
semi-finished products, and auxiliary materials. does not decrease in
consequence. Hence the aggregate production of means of production

would have to increase in the one case and decrease in the other. This can
be remedied only by a continuous relative overproduction. There must be on
the one hand a certain quantity of fixed capital produced in excess of
that which is directly required; on the other hand, and particularly,
there must be a supply of raw materials, etc., in excess of the direct
annual requirements... – This sort of overproduction is tantamount to
control by society over the material means of its own reproduction. But
within capitalist society it is an element of anarchy."

So as I understand the argument: given the conditions of simple
reproduction there could not be varying annual levels in the production of
'fixed' capital. For the 'fixed capital' to be available, then, when it
needed to be replaced--and given its physical or use value characteristics
it would turn over more slowly than wage goods--fixed capital would have
to be overproduced every period. This would not be a problem in non
capitalist production; on the contrary. But for capitalism it is a source
of anarchy.

If this argument is valid, then what are consequences of this anarchic

I'm confused about this, and appreciate much the response.

Yours, Rakesh

if the capitalists consume the
> surplus and just carry out replacement investment.  But I'd say
> the instability stems from this consideration: as soon as each
> capitalist sees that his competitors are just plodding along doing
> the same thing over and over, he realizes he could carry out a
> little investment, improve his technology, and make a killing.
> Excessive stability creates a strong incentive to destabilize.
> Allin Cottrell

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