[OPE-L:2540] FRP Models

John Ernst (ernst@nyc.pipeline.com)
Wed, 19 Jun 1996 07:20:34 -0700 (PDT)

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In the exchange between Duncan and Andrew we, again, encounter
the idea of capital-saving and capital-using technical change.
Here is part of Andrew's post and Duncan's comment.

One reason Duncan doesn't think this was what Marx was studying is
according to Duncan, Marx was studying "capital-using" tech. change. I
take this to mean a rising capital/output ratio. I know of no evidence
for this in Marx, none. I think this is a myth, albeit one with an
obvious explanation.

What's interesting to me is that the general pattern of capital-using,
labor-saving technical change is widely observed in the course of
capitalist development. I don't have the time or inclination now to go
through Marx with a fine-toothed comb on this issue, but much of what he
says on the FRP and on relative surplus value in Volume I of Capital
suggest this.

Here, let's consider the following:

1. I think Duncan is right that much of Vol. I does indeed suggest
the idea that technical change is capital-using, labor-saving.
However, without using that "fine-toothed comb", I do think it
is interesting to consider Section IV, Chapter 15 of Vol III on
this. Note what Marx writes and what Engels adds to it. Clearly,
Marx's own example suggests that capital-saving and labor-saving
technical change is part of the dynamic of accumulation.

2. No doubt in Vol. I there are numerous examples of capital-using,
labor-saving technical change. But let's recall that many of
these are used in describing the transition from manufacture to
large-scale industry. Once we have arrived in the period of
large-scale industry, then what? Again the only remarks by Marx
concerning this are found by Marx are in Vol. 3 or its drafts.

3. Many posts ago, I asked Duncan to cite specific examples of
capital-using technical change for cases involving the replacement
of machines and labor by machines. That he had none proves
nothing. However, does anyone? Indeed, let's assume that we
have studies showing a falling rate of profit. Given Okishio,
do we not also have to have examples of individual capitalists
choosing techniques that bring about the fall? As we sift through
the examples, should we not find some that fall into the category
of capital-using replacement of machines and labor by machines?
Clearly, if we find none, it proves nothing but, I think, suggests
that something is wrong.

4. Within a given industry, as techniques become more mechanized, the
reduction of the cost price with capital-using techniques becomes
more difficult as labor costs become smaller and smaller per unit
of production. Why would capitalists not try to reduce the
capital costs as well? Here, I am not suggesting that anyone argues
they do not do so, but merely pointing out that as they do the
normal manner in which the rate of profit is computed would lead
to the observation of an increasing rate.