[OPE-L:3196] Re: Equal Profit Rates

Paul Cockshott (wpc@cs.strath.ac.uk)
Tue, 1 Oct 1996 01:26:10 -0700 (PDT)

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>In my view Marx's conception of the profit rate is better
>understood as the basis of his critique of bourgeois economic
>thought. The notion of an actually equal profit rate (which
>Ricardo introduced) enters bourgeois political economy as a
>vulgar category where it is turned into an apologetic
>category. This is because it appears as the 'price' of the
>commodity 'capital'. But capital is not a commodity. Marx
>wished to show where the categories of bourgeois thought came
>from and had to demonstrate that the illusion of a commodity
>called 'capital' with its own price, the interest or profit
>rate, arose from an actual material process which it failed to
>represent accurately.

This is plausible to me, though, as with any attempt to
discover the 'intentions' of a person it is open to
dispute. I think the point you make about criticising
the idea of interest as the price of capital is apposite.

>The problem is as follows: everyone says (including ourselves
>- this isn't a complaint) that Okishio has to be refuted on his
>own terms. But *He* (not us) assumes, along with all static
>theory, an equal profit rate.

Why must he be refuted?

That is surely to take a rather ideological stand.

What should be at issue is how useful his theory is as a predictor
of what actually happens in capitalist economies. To assess this one
has to judge the extent to which the preconditions of the theory
actuall exist in the real world, what testable predictions it makes
about actual economies, the extent to which the available historical
evidence is compatible with its predictions.

Paul Cockshott