From: Allin Cottrell <cottrell@wfu.edu>

Date: Wed Dec 15 2010 - 22:06:20 EST

Date: Wed Dec 15 2010 - 22:06:20 EST

On Tue, 14 Dec 2010, Paul Cockshott wrote:

*> I agree that one possible hypothesis is that the disorder we see
*

*> in real profit rates arises from technical change. Another
*

*> possibility is that it arises from variations in the turnover
*

*> and depreciation rates of capital stocks in different industries
*

*> and firms which would mean you have a large number of coupled
*

*> oscillators with different periods which could have a similar
*

*> dispersive effect.
*

*> Your [Ian Wright's] earlier models evolved to a maximal entropy
*

*> distribution which is what you expect of a conservative system
*

*> with high degree of freedom. If your current one does not then
*

*> it is likely to be non conservative in some way. Maxwells daemon
*

*> must be at work somewhere. Dave Z suggested in conversation with
*

*> me that the non conservative element might be the effect of
*

*> price changes on stocks?
*

Ian's model contains several classical negative-feedback rules,

for instance:

* An increase/reduction in unsold stocks of a firm's output leads

to a fall/rise in price of that output.

* An increase/fall in the price of a firm's output (relative to

cost, i.e. an increase/fall in the firm's rate of profit) leads to

an increase/fall in the firm's output.

* An increase/fall in aggregate employment relative to the (fixed)

labour force leads to an increase/fall in the wage rate.

In that context (and given constant technology and a uniform

"period of production") it's not surprising that the system tracks

towards an equalized finite rate of profit "in principle".

What is noteworthy is the de facto numerical stability of the

system. The mathematical expression of Ian's system is in

continuous time. As Ian and I have discussed offlist, the system

can be simulated effectively in discrete time, but only if the

time-step is chosen to be suitably small. With dt = 1 everything

flies apart pretty fast (negative prices, employment of more than

the entire labour force, and so on, in just a few iterations), but

with dt = 0.001 I can replicate Ian's results fine; his various

elasticities are well chosen.

Allin Cottrell

_______________________________________________

ope mailing list

ope@lists.csuchico.edu

https://lists.csuchico.edu/mailman/listinfo/ope

Received on Wed Dec 15 22:08:07 2010

*
This archive was generated by hypermail 2.1.8
: Fri Dec 31 2010 - 00:00:02 EST
*