Re: [OPE] webpage computing dynamic rate of profit

From: Gerald Levy <>
Date: Sat May 16 2009 - 06:47:57 EDT

> means of production. The data is however restricted to fixed capital
> stock.

Hi Dave:

So, obviously, economies in the use of constant circulating capital
wouldn't be reflected in the data.

>> Also, why isn't V in the denominator?
> R = P/K is *one* way to measure the rate of return on capital invested. If
> one takes it as the annual rate of profits then the turnover time for
> money advanced in wage payments is taken to be relatively small. In any
> case the magnitude of V is much smaller than K.

The total labor costs (wages plus benefit costs) for capitalists is
small compared to K? While it tends to be the case that non-labor costs
for firms tend to exceed labor costs, this doesn't imply that the former
are "relatively small". Since there are significant variations in V
internationally, it would have been interesting to see how incorporating
V into the formula would have changed the comparative results. (NB:
then, of course, there's the question of productive vs. unproductive
labor since only wages paid out to the former group constitute V).

> But the main motivation for me was to be consistent with the bulk of the
> literature on the profit rate.


In solidarity, Jerry

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Received on Sat May 16 06:49:43 2009

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