[OPE-L:4460] Re: Depreciation and the Rate of Profit

Duncan K. Fole (dkf2@columbia.edu)
Thu, 20 Mar 1997 12:03:56 -0800 (PST)

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>Duncan K. Foley wrote:
>> I've been meaning to try to address some of John Ernst's posts for a
>>while now.
>> The way I think about the problem of the rate of profit is basically the
>> same as Allin's. Ex post.
>Duncan, you are correct, that ex post, calculations are
>unproblematical. But Marx insists that what drives the system is the
>quest for profit [surplus value]. That quest is ex ante.

I agree with this. But a lot of Marx's discussion also concerns phenomena
that can be measured ex post. It seems to me that we'd like to know what's
actually been happening to the Marxian categories, even with the proviso
that ex post measurement is not the same as ex ante prediction or

>For empirical purposes,of course, we do not even have the ex post data.
>In the U.S. the Commerce Dept. more or less keeps tracks of the new
>capital, but does not do a good job of tracking the scrapping and
>discarding of capital.

This data is in fact pretty good, and many of the features Marx talked
about (especially in the discussion of relative surplus value and the
falling rate of profit) are quite gross features of reality that will come
through even if there are problems with the details of the data. All
economic research faces this same problem.

>Duncan, I note that in your dissertation suggestions, everything was
>empirical. I would like to know how much you trust the official data.

I view empirical investigations as the logical first step toward model
building and theory. I don't necessarily "trust" the official data
completely, but the only way to quantify "distrust" would be to run some
validating empirical tests, such as comparative tests between capitalist
countries, or tests against other data bases (financial data bases, for
example.) Looking at data through the Marxist categories is very often
surprising and enlightening, as the work of Shaikh and Tonak, Tom Michl,