Re: [OPE-L] Obstacles to movement of capital

From: GERALD LEVY (gerald_a_levy@MSN.COM)
Date: Fri Nov 02 2007 - 09:30:43 EDT

Hi Paul C:

The assumption of perfect constant capital mobility also assumes away both
to entry and *barriers to exit*.  The latter is particularly relevant for
the examples you
gave.  Also, even if it was possible to disassemble some elements of fixed
and move them to a new location:

a) variable capital would have to be expended to disassemble and relocate
the elements
of fixed capital;

b) there would be transport costs which would either have to paid out to
another capitalist
firm or covered internally through additional allocation of monies for
variable capital
(trasport labor), constant circulating capital (energy, etc.), and constant
fixed capital
(trucks, ships, planes, freight cars, etc.)

c) there are certain types of fixed capital (e.g. "hard automation") that
were only built for
a specific purpose and may only retain value elsewhere as scrap metal).

Then, there's the assumption in profit rate equalization theory of the
perfect mobility
of variable capital.  On a regional and national level, there are already
obstacles to that
mobility. e.g. skill differences in the labor force.  Even if workers end up
moving to where
there is a demand for labour power, there tends to be a significant temporal
lag.  When
one asks about the possibility of profit rate equilization in the world
capitalist economy
then still other issues arise in relation to the mobility of labour-power.
Some of those issues
require that one grasp the role of *nation states* in limiting that
mobility.   There are
also additional issues on the international level in terms of the mobility
of constant capital:
e.g. state export and import limits, special taxes to be paid to export and
import (tariffs),

In solidarity, Jerry

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