[OPE-L:4459] RE: analysing the rate of profit (formerly, Mandel vs. Baran/Sweezy)

Alejandro Valle Baez (valle@servidor.dgsca.unam.mx)
Thu, 20 Mar 1997 11:12:17 -0800 (PST)

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On Wed, 19 Mar 1997, Tsoulfidis Lefteris wrote:

> > In message Wed, 12 Mar 1997 05:45:39 -0800 (PST),
> > Alejandro Valle Baeza &lt;valle@servidor.dgsca.unam.mx> writes:
> >
> > > 1. If v -->0 then s/v --> infinite. It means that the surplus is infinite
> > > IN RELATION TO VARIABLE CAPITAL. It does not mean anything more. It does
> > > not mean that surplus is infinite.
> > > 2. If v -->0 then s/(s+v) --> 1. It means (as Marx said) that the
> > > surplus value cannot be greather than the working day.
> > >
> > > 3. Both propositions are true. You need to choose one for the specific
> > > problem you are dealing with. If you are analizing the rate of profit and
> > > you write:
> > > r= (s/v)/(c/v+1) the limit of r when s/v and c/v --> infinite is an
> > > INDETERMINATE form (infinite divided by infinite). Hence you are not
> > > finding ANY limit of r.
>
>
> The third proposition is not exactly right, while it is true that
>
> lim r with v->0 gives infinite/infinite,
>
> but in these cases it is important to know how fast the numerator and
> the denominator grow. For this reason we apply L'Hospital's rule and we
> get:
>
> lim r with v->0 =[-s/v^2]/[-c/v^2]=s/c
>
> The same result is obtained if we divide the numerator and the
> denominator of the usual formula of the rate of profit by labor time
> L=s+v. Thus we get:
>
> r=s/(c+v)=[s/(s+v)]/[c/(s+v)+(v/(s+v)]
>
> if v->0 => s=L and we get r=1/(c/s)=s/c=L/c=maximum rate of profit.
>
> Of course it is imperative to use labor time as this is indicated in
> points (1) and (2) and also in the formula for the rate of profit above
> in order to have a more concrete idea of the limits of the rate of
> surplus value, the rate of profir and their interreconnections.
>
Thank you very much for this. You are right.
Saludos
Alejandro