Re: [OPE] topics for summer discussion: theories of the crisis

From: paul bullock <>
Date: Thu Jul 22 2010 - 19:45:31 EDT


Any chance you can forward an attachment/ copy of your 2008 article for me
to read?


Paul Bullock

-----Original Message-----
From: []
On Behalf Of Dave Zachariah
Sent: 22 July 2010 21:26
To: Outline on Political Economy mailing list
Subject: Re: [OPE] topics for summer discussion: theories of the crisis

On 2010-07-22 21:31, Alejandro Valle Baeza wrote:
> If you agree, I would like to discuss your formulation.

Of course, I would be very interested in pursuing that discussion.

> I agree on this at all. I published in Spanish "US crisis and profits"
> ("la crisis estadounidense y la ganancia" Razón y Revolución, num. 18,
> segundo semestre de 2008, pp. 79-93) devoted to answer (very
> tentatively) why US is in crises after a period of profitability
> recovering? I pointed out the basic role of the debt rise in the crisis.

It would have been interesting to have a look at your paper, but
unfortunately I can't read Spanish.
> I think you are right on this. For the last paragraph I recall Farjoun
> and Machover book: Laws of Chaos and some Cockshott and Cotrell articles.

Yes, I'm heavily influenced by their probabilistic approach.

>> As an alternative to this formulation, I believe
>> the approach taken by Paul C, Allin and myself is more fruitful: It can
>> be shown that average profitability is determined by the balance of
>> three factors:
>> 1. Growth rate of labour
>> 2. Growth rate of productivity
>> 3. Level of investment ratio
>> The two first act to raise profitability, while the last factor lowers
>> it. Clearly the significance of the first factor has vanished in the
>> industrialized economies. It turns out that in general the most
>> significant factor is the investment ratio. Note that this is
>> *independent* of the level of the wage share, thus eliminating one
>> factor from the analysis of profitability.
> Please let me know the reference for this or better send to me your paper
if it is possible.

The article about profitability is available here,

    Determinants of the average profit rate and the trajectory of
    capitalist economies
    Published in Bulletin of Political Economy (Vol.3, No.1, 2009)

and extending it is a joint article with Paul C, recently published in
Science & Society (Vol. 74, No. 3, 2010). The pre-print of that article
can be found here:

    Credit Crunch: Origins and Orientation

> There were Marxist analysis on balance of class forces when rate of
> profit diminished. Recall profit squeeze theorist during the seventies
> but not after that.

You are right about this. It is clearly a central element in Glyn's
framework, and partly adopted by Harvey. But again they are people who
are familiar with European labour movements.

But for Shaikh, arguably one of the best Marxist economists today, the
organization of labour appears to have no clear role in the trajectory
of capitalist economies. It is not even a passive element in the
system's laws, it is absent. I think it is hard to understand the
important shifts within capitalism without taking into account the
balance of class forces. I suppose the peculiarity of the US
working-class movement is the cause of this theoretical absence.
> I enjoyed most of the paper, specially empirical discussion. I think
> this sort of analysis should be current discussion in Marxist circles
> and Husson paper is quite valuable for this.

Agreed. I think Husson's paper shows how to conduct the type of
discussions we ought to be having on OPE-L.

//Dave Z
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