[OPE-L:7274] [OPE-L:802] Re: Technical Change and Productivity Change

John R. Ernst (ernst@PIPELINE.COM)
Tue, 30 Mar 1999 11:59:56

Re: Jerry's 799

I had written:

> True enough and you could perhaps find some real examples of
> this esp. when it comes to saving on energy costs. But is this the
> general case?


No, the "general case" would be labor-saving technical change. My point,
in raising this issue here and now, is to suggest that technical change
does not necessarily lead to the tendencial fall in the rate of profit,
i.e. where there is technical change that does not cause the productivity
of labor to increase, this type of change would not consequently cause the
rate of profit to decline. Nonetheless, I do think that this is an
interesting case of technical change -- even if it isn't the "general
case" -- and we should be able to explain this possibility theoretically
(by, for instance, considering its affect on the rate of profit and the
accumulation process).

My comment: I'm a bit unclear on what you are saying. Let me
see if I can reword things a bit as I add a comment here and there.

1. Technical change may or may not cause the productivity of labor to
2. Should the productivity of labor not increase, there is no tendency
for the rate of profit to fall.
3. We're unclear about the general case but even with this unclarity
we're able to determine that technical change without an increase in
productivity is "interesting."
4. To say that, in general, technical change is labor-saving is a bit
like saying -- At night, all cows are black. The issue is capital-
saving versus capital-using given labor-saving in both cases.

I had written:

> If we look at Marx on Co-operation, we see that for him
> technical change generally means increasing the scale of the operation
> as techniques change. Thus, in the period of manufacture, increasing
> the work force by ten-fold with, say, a "better" division of labor would
> increase output by more than ten-fold. Productivity increases. Replacing
> a set of machinery with a ten-fold increase in machines that are "better"
> machines will, generally, increase the output of the process by more
> than ten-fold. That is, Marx's chapter on Co-operation in Vol 1 lays
> out some fundamental principles of technical change that hold in the
> period of large-scale industry.

Jerry wrote:

It remains to be seen, though, whether this is the same dynamic at work in
"late capitalism". In the recent history of capitalist markets it is
frequently the case that you see an expansion of technical change even in
the face of stagnant markets. I.e. there is technical change without a
corresponding increase in output. The main name of the technology game it
seems is now very frequently "lower costs, constant output". This, then,
has consequences in terms of the size of v and the working population
where there is labor-saving technical change.

My comment: I think you're jumping a bit too quickly to "late capitalism."
Given the development of the world market since Marx's time, the notion of
stagnation and the non-accumulation of capital should be viewed more on
a global basis. We also need to look at the world-wide production of
raw and auxiliary materials. If stagnation is global, the production of
such materials should be stagnating as well.

Note that with "lower costs, constant output", you may well have capital
saving and labor saving as well. Hence, no falling rate of profit. Indeed,
no accumulation of capital. Do you really think that the accumulation
of capital has stopped in "late capitalism"?

I had written:

> I must admit that I've abstracted from unproductive labor
> and the machinery used by that unproductive labor in all of this.

Jerry wrote:

As we more concretely look at technical change, this also would be a topic
well worth investigation. Given the large size of the unproductive labor
force and the automation of various tasks associated with unproductive
labor, the effects of this dynamic should be considered.

My comment: We seem to have more than enough problems dealing with technical
change and productive labor. I am reluctant to jump to unproductive
labor. To those who think the unproductive is of a "large size", I'd
like to know how they determine this. If it is by simply looking at
"capitalism in one country", then I think we need to consider the global
economy as well. We, in US, seem especially prone to generalize from the
US case.

I had written:

> Note
> that with Marx I would maintain that a ten-fold increase in investment
> will bring about a *greater* than ten-fold increase in output. If
> you disagree, fine. But go after Marx on this one. Again, see esp.
> Chap. 15, Sec 4.

Jerry wrote:

Historically, I believe that this was the case. Yet, as I explained
previously, there are instances in which it does not have to be the case.
And I think Marx well understood that since he discussed both attempts to
reduce the consumption of constant circulating capital through technical
change and was certainly aware of the issue of unproductive labor.

My comments:

1. If you think that Marx was right albeit for his time, then you join
a small but growing minority of Marx's followers who hold this view.
The vast majority of Marxists would disagree that what Marx said in that
passage was ever true.

2. There is a limit to how much you can reduce "the consumption
of constant circulating capital." That is, with growing output you have
to use more raw materials as you economize on auxiliary materials. If
your idea is that capitalism produces no or very small changes in output,
I do not see this.

3. Of course, Marx did recognize the existence of unproductive labor; however,
he never used the category to develop his notion of the falling rate of
profit. Should we?

If we are unclear about how technical change can be both capital-saving
and labor-saving in the period of large scale industry with a falling rate
of profit, then I fail to see how dragging in the concept of unproductive
labor can help us resolve the unclarity. Indeed, it would seem to a way of
avoiding the issue.