Re: [OPE-L] accumulation of capital and the working class - actual non existence of variable capital

From: Paul Cockshott (wpc@DCS.GLA.AC.UK)
Date: Fri Jan 11 2008 - 12:40:07 EST

Jerry Levy wrote:
>> No V does not figure, or 'reckon'.
> Hi Paul C:
> How would you logically demonstrate the existence of exploitation
> under capitalism and surplus value _without_ reference to the category of variable capital?
One does not have to demonstrate it logically but empirically.
One measures the person hours per year consumed by the working class,
and takes this away from the person hours per year in the total social
product. If one fixes the 'person year' at not
365 x 24 but at
wd x wh
where wd is the number of working days per year, and wh number of
working hours per year,
( which I implicitly assumed in a previous post ) one can then
dimensionally reduce the consumption of the working class to a number of
people - the number of people whose
normal working year is required to support the consumption of the
working class. I
explained in a previous post that one can express surplus value in a
similar way - as
so many million people. One then expresses exploitation as

number of people producing accumulation and luxuries
----------------------------------------------------  = rate of exploitation
number of people producing wage goods

Using I/O tables and statistics on the average working week, number of days
holiday per year, all of this is reasonably easy to do.

> Without V, what is your formula for the rate of profit?
The formula I use now for profit would be s/K  where K is the capital stock.

The dimension of profit should be 1/t    since it is a rate growth per
If you just say the rate of profit is s/(c+v) there is a potential
confusion between stocks and flows.
If s, c and v are all taken to be flows of value (= number of people)
then the rate of profit is a dimensionless number, which contrasts with
the normal usage of the term rate of profit as for example 5% per year.
What, in the case of simple reproduction s/(c+v) actually measures is the
number of workers working in department iii divided by the numbers of
workers working in the other two departments. This is an interesting
measure but it is not equivalent to the rate of profit.

I have, in various publications since the 1970s, called s/K the stock
rate of profit, and s/(c+v) the flow rate of profit. Strictly speaking
the ratio s/(c+v) is not a rate of profit. In the   simple model
used in much of Capital where no clear distinction is made between
stocks and flows it has a didactic value, but   as one comes to
do empirical work one needs to do a proper dimensional analysis and
distinguish stocks from flows.

>> If one employs flow accounting rather than stock accounting, there is a flow of wages, there is a flow of means of production etc, and in this accounting framework it is useful to label the flow of wages as v and the flow of means of production as c, but these distinctions are not applicable to analyzing what has been accumulated, since what has been accumulated is a stock. <
> Capital exists as both a stock and a flow.
No, capital is a stock. The owners of capital recieve a flow of income
from it.
> I think it's one-sided to just conceive of capital (or capital accumulation) in terms of just one or the other.  The problem, I guess, is that these different concepts (and realities) give rise to measurement difficulties that are difficult to deal with in an accounting framework.  I can see this both in terms of practical problems re
> the calculation of the technical composition of capital (TCC) and the value and organic compositions of capital. I don't know of anyone who has ever suggested a meaningful way to calculate the TCC, for instance [which is because there are so many problematic conceptual issues associated with the economic meaning and (ir) relevance of the 'units' being measured].
The problem is that the TCC is not a scalar.
> In solidarity, Jerry

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