[OPE-L:1633] Re: Temporality vs Simultaneity

John R. Ernst (ernst@pipeline.com)
Fri, 29 Mar 1996 07:52:26 -0800

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At the end of your post (1605), you ask for an example with numbers
to clarify matters. Fair enough.

In response to my 1570, you stated:

Some things are clearer. So that I'm not being unclear, I applaud the
introduction of "real time in the analysis of capitalism." I really do. I

just don't think that taking up that task requires throwing out the
extremely useful insights that SSS numbers provide about the structure of
equivalent exchange in capitalism, which to me is conceptually crucial in
thinking about what Marx's categories mean in Vol.3. (It's that, rather
than an attachment to "equilibrium," that makes SSS numbers continue to be
relevant, even if in real time other numbers are needed too.) So while I
may not much care for the specific TSS equations that I've been
criticizing, I really do want to see dynamic "real time" analysis move

I also do comprehend the obvious fact that, having actually laid out $1000,

a capitalist doesn't entirely forget that just because prices and values
subsequently change. (I think that the concepts of "release and tie-up of
capital" and a changing "monetary expression of labor" are needed in order
to see how that historically given $1000 fits in to the other numbers that
are relevant in subsequent periods. But I can't really elaborate that

Unfortunately, I don't understand precisely what you mean in referring to a

"visible r" and a "value r" and the "social value" and "individual value"
of commodities. (I'm used to using the term "individual value" to refer to

the output of a single capital in a larger industry, but that doesn't seem
to be the temporal sense of the term in your usage.) Is it possible to
clarify for me what your terms mean? I don't want to fetishize the
numbers, but can you tell me in the context of either of my examples what
numbers would express these terms?"

John says:

Let's look at a two period example with no fixed capital and
only one commodity. Let c=$800, v=$100 and s=$300 in Period I.
Further let the price of the one commodity, corn be $1 both as an
input and an output. The living labor expended in this period is
40 hours. Then we can write:

I c + v + s = w
$800 + $100 + $300 = $1400

Note that r, the rate of profit is 33.33%.

Now in Period II, let's assume that a new technique becomes
available such that the same labor force can produce more
corn in less time. Assume that 1000 corn used as constant
capital can now yield 2200 corn as output. To the capitalist,
this would appear as

c + v + s = w

II $1000 + $100 + $1100 = $2200

If the price of corn remains unchanged, then the rate of profit
would be 100%. But note that in Period I, the living labor (v+s) adds
a value of $400 to the constant capital (c) and that in Period II,
the value added (v+s) is $1200. By assuming the value of the corn
is constant, in Marxian terms, we assume that the social value of
the commodity is unchanged. However, assuming that the value added
remains the same from period to period and that wages are advanced
we see that


c + v + s = w

II $1000 + $100 + $300 = $1400

The rate of profit, r, with these assumptions is 3/11 or 27%,
rounded. Here corn now sells for $1400/2200 or about $.64 per
unit. The social value of corn has fallen to its individual
value. The rate of profit fell. Should the wage advance be
less such that the labor force and the corn consumed by workers
remain constant, we could write (with some rounding)


c + v + s = w

II $1000 + $64 + $336 = $1400

The rate of profit, r, would then be about 32%, still less
than the rate in Period I despite the constant real wage and
the increase in the rate of surplus value.

Depending upon competitive conditions, as we move from
Period I to Period II, the price of corn may fall and thus
CASE 1 may never come into being. Should the price not fall
or fall only slightly, then the social value of corn would be
selling above its individual value which is given in CASES 2 and
3. In cases in which corn is selling above its individual value
I would refer to the rate of profit as the visible rate of profit
and still refer to the rate of profit in CASES 2 or 3 as the
actual rate of profit and distinguish the two by the assumptions
of how wages are paid and of how wages may or may not change.


Bruce, I hope this clears up my use of the terms. I do think that
there is one other point worth making here. Note that as we moved
from Period I to Period II, the increase in constant capital, c, is
200/800 or an increase of 25%. The output increased from $1400
to $2200 or 800/1400 or, about, 57%. Note that with TSS, the capital
output ratio CAN decrease in this fashion as the rate of profit to
falls. A falling rate of profit and a decreasing capital output
ratio with constant real wages is impossible to construct within
SSS. Since Marx himself said that the capital-output ratio within
the period of large scale industry can decrease, TSS once again
provides a way of showing the validity of Marx's notion of

Query to you: You mention the "useful insights" of SSS. I am
interested in what you are putting into this category. Here, I
am not looking to fire away once you list but think that many
may be found in TSS as well.