[OPE-L] SV: [OPE-L] how industry-specific are most capital goods?

From: Martin Kragh (Martin.Kragh@HHS.SE)
Date: Fri Apr 20 2007 - 05:52:54 EDT

I wrote

>  As regards computers they are now completely integrated to all of
> industry (except for a few places in the world) this is true, but when

> we talk about capital goods, they constitute an indefinitely small
> part of the total value of the capital stock. Perhaps the equivalent
> of a few days paycheck for one employee.

Jerry wrote:

"On what basis did you come to that conclusion?"

Do you mean my last statement on the cost of labour? That statement was
too exaggerated I admit. I tried to make a point about the tremendously
fast cheapening of computers in our days, but obviously a "few days
paycheck" is stretching it too far.

Kind regards

PS. I will reply to Juriaan Bendien's "Russia-post" later. I need to
seriously think that one through.

> I think that somebody who would be interested in researching this
> seriously would actually look at fixed capital assets sold (in one
> branch, or year), and follow the stream, that is, try to find out
> where it ends up. You get some methodological problems (how do you
> define alternative use?)  but most likely something will come out of

I agree: it's a topic which is worthy of further empirical studies.
There are many studies which have been conducted in industrial
organization and accounting and management literature, although those
studies tend to define terms differently and are tend to look at
somewhat different but related issues.

There are important theoretical issues from a Marxian perspective
concerning how industry-specific most constant capital goods are,

o  the extent to which constant fixed capital is mobile or immobile and
hencethe extent to which it constitutes barriers to exit and can disrupt
the formation of a general rate of profit and lead instead to persistent
variations in rates of profit by branches of production and sectors.

o how changes in the re-sale value of means of production affects the
depreciation methods and schedules employed by capitalist firms.

o  with computerization,  there is the likelihood of a further
between the technical composition of capital (TCC) and the value
composition of capital (VCC).  That is,  computers make possible
miniaturization where an increasing value of constant capital can be
represented by a decreasing physical mass of means of production.

In solidarity, Jerry

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