[OPE-L] The Annual Fetish

From: glevy@PRATT.EDU
Date: Mon Oct 01 2007 - 09:19:00 EDT

> It seems to me that Steedman’s “far more plausible” assumption is not
> very plausible at all.
> By contrast, the rate of profit that is determined in Marx’s theory is
> the annual rate of profit, which is determined by the ratio of the
> total surplus-value produced in the economy as a whole in a year to the
> total capital invested in that year.  Marx’s theory assumes that the
> rate of profit that is equalized by capitalist competition is this
> annual rate of profit.
> It seems to me that this is a “far more plausible” assumption.

Hi Fred:

What is the basis for your claim that the convention/assumption of an
annual rate of profit is any more lor less plausible than that of a weekly
rate of profit?

It is true that modern capitalist corporations tend, in their accounting
practices, to use the convention of a year.  This is done because of tax
reporting requirements and to prepare annual reports for shareholders in
preparation for annual meetings (also to comply with legal requirements).
I think this is a very weak basis for insisting on keeping the convention
of a year since:

a) it is contingent upon *state* requirements. Yet, the analysis of the
turnover of constant capital should begin before the state is introduced
into the analysis, don't you think?

b) corporate accounting practices concerning about how often they issue
reports are similarly contingent and often specific to individual
capitalist social formations (and often mandated by law).

It is true that Marx's theory uses the convention of an annual period of
production.  Yet, this is not a *reason* by itself for accepting that

In agriculture, it might make more sense to think in terms of a year than
a week (hence the Physiocratic basis for the convention).  I don't see why
we should accept this remnant of Physiocratic thought. (btw, I wish to
thank Paul C for making me see this point.)

To insist on the assumption of an annual rate of profit, given the above,
seems to me to be fetishizing a 'year' as a time period.

In solidarity, Jerry

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