[OPE-L:1657] Re: Re: technical change and real wages

Subject: [OPE-L:1657] Re: Re: technical change and real wages
From: Duncan K. Foley (foleyd@cepa.newschool.edu)
Date: Tue Nov 09 1999 - 22:24:30 EST

Actually, it seems to me that Okishio was trying to answer this passage (on
the assumption that the technical change was once-and-for-all), by showing
that if the new method appeared to raise the rate of profit for the
individual capitalist it could not lower the rate of profit in the system
as a whole once it was universally adopted.

>Ajit wrote in [OPE-L:1633]:
>> Chris, there is no basis for this "assumption" in Marx. What is the
>> logic behind the assumption that rate of surplus value will remain
>> constant in the face of technical changes? All Marx is doing is to
>> suggest that *if* the rate of surplus value remains constant then the
>> implication of a rise in the organic composition of capital is a fall
>> in the rate of profits. <snip>
>I'm with Ajit on this point. In his discussion of "more intense
>exploitation of labour" in the chapter on "counteracting factors",
>Marx makes it clear that the rate of surplus value can not be taken to
>be constant over the process of accumulation and discusses briefly the
>case which he takes to be typical -- that of an increase in the rate
>of surplus value.
>btw, does the following passage (from the chapter on "Development of the
>Law's Internal Contradictions") anticipate and answer the Okishio
> "No capitalist voluntarily applies a new method of production,
> no matter how much more productive itmay be or how much it
> might raise the rate of surplus-value, if it reduces the rate
> of profit. But every new method of production of this kind
> makes commodities cheaper. At first, therefore, he can sell
> them above their price of production, perhaps above their
> value. He pockets the difference between their costs of
> production and the market price of the other commodities,
> which are produced at higher production costs. This is
> possible because the average socially necessary labour-time
> required to produce these latter commodities is greater than
> the labour-time required with the new method of production.
> His production procedure is ahead of the social average. But
> competition also makes the new procedure universal and subjects
> it to the general fall. A fall in the profit rate then ensues -
> firstly perhaps in this sphere of production, and subsequently
> with the others - a fall that is completely independent of the
> capitalists' will" (Penguin ed., pp. 373-374)
>In solidarity, Jerry

Duncan K. Foley
Department of Economics
Graduate Faculty
New School University
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