[OPE-L] Non equilibrium (was Kliman and Wikipedia)

From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Mon Apr 16 2007 - 11:40:18 EDT

Written yesterday.

The TSSI entry seems to have been rewritten again. It seems that
there is a need for an entry on non equilibrium currents within

For before we ever get to TSSI as a school of non equilibrium Marxism
we have to first ask this question: Can one develop through the
analysis of the logical construct of simple reproduction an
explanation of why capitalist dynamics will likely be characterized
by constant non equilibrium, with equilibrium which is the rule
presupposed by political economy only at best a momentary transitory

Allin clarified Marx's own often ignored insight that the means of
production would likely not be physically used up such that that
their respective replacement dates are staggered so that monetary
demand each year would be exactly equal to the fixed quantity of
means of production available each year in simple reproduction.

Rather there is  likely to be an overproduction of capital goods, as
Marx emphasized, even in simple reproduction which can only create
anarchy in a capitalist economy. The question then becomes what the
consequences of that anarchic overproduction are likely to be.

Paying attention to the temporal and use value aspects of the
reproduction process, Grossman inferred from that anarchic
overproduction that there would likely be strong competition among
capital goods producers, resulting in the perpetual innovation of
superior means of production which firms would be forced to
assimilate on pains of survival.  The economy would as a consequence
undergo structural and spatial change as it grew and moved from
disequilibrium to disequilibrium. Capitalist development is not
likely to be simply a case of market-clearing expanded reproduction
on the basis of a fixed organic composition of capital and fixed unit
values. Marx's schema of expanded reproduction should not give this
impression that capitalism could ever resemble a dynamically stable,
equilibrium system. They were only a stage in the approximation in
reality, focused  on the narrow question of the conditions of
circulation of capital in cases of simple and expanded reproduction.
In using Bauer's schema in his magnum opus Grossman was perhaps
somewhat to blame for this misinterpretation of the schema of
expanded reproduction as a representation of the actual course of

As Rick Kuhn  writes in his important biography of HG, this
theoretical development from the critical analysis of simple
reproduction to dynamics and nonequilibrium (including the tendency
once fixed capital costs are high to compete for market share by
increasing output and using new technology even in the face of
declining demand)  is an important aspect of Marx's critique of
political economy as an ideology of equilibrium.

TSSI is not the only school defending a non equilibrium version of
Marxism. Which is not to say that it has not made unique and
important contributions.

Yet David Harvey's Limits to Capital also seems to me non equilibrium
in spirit as does Paul Mattick's last book. And Michael Perelman
seems to have been a non equilibrium thinker for quite some time.
Grossman seems to have been the first Marxist to have rejected the
equilibrium idea. One finds criticism of comparative static
methodology in the writings of John Weeks and Geert Reuten. Paolo
Giusanni was a critic of equilibrium thinking even before TSSI was
constituted as a school.

Moreover, outside of Marxism there are schools of non equilibrium
economics. One thinks of course of Joan Robisnon, Paul Omerod has
popularized some of the new thinking. Mark Blaug has moved in this
direction; the radical Schumpeterian Nathan Rosenberg was there long

In other words, in its basic thrust TSSI is not unique though some of
its detractors and some of its supporters seem to think that it is.


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