# [OPE-L:4081] RE: Revaluation

From: P.J.Wells@open.ac.uk
Date: Fri Oct 13 2000 - 06:57:44 EDT

```This is in response to John's #4079

> Alejandro # 4071
>
> Despite I'm Eduard Bernstein, I read "Extirpating Simultaneous Valuation"!
> In that fascinating article, I've got the idea that the magnitude of value
> and its component parts should be temporally well defined. However, in the
> preceding passage I don't see any temporal determination in your
> magnitudes. I'd say that the first c+v+s corresponds to a certain "t" and
> the other to, say, t+1. "x" is the difference between the value in t+1 and
> in t, but this doesn't mean that value in t+1 is = c+v+s+x; it's, as
> always, (c+v+s).
>
>
> My comment:   Fine,  I still think there is an "x" term in your
> thinking as move from time t to t+1.
>
> C(t+1)+c(t+1)+v(t+1)+s(t+1) +x  = C(t)++c(t)+v(t)+s(t)
>
>
> where C(t)+c(t) is the total capital stock invested at t, c(t) is that
> portion that is actually consumed and C(t) that which is not consumed.
> At the end of the period, C(t+1) is the value of stock that can be used
> in the next period. If there is moral depreciation,  then C(t+1) < C(t)
> or C(t+1)+x=C(t) where x is the amount of moral depreciation that
> took place as we move from t to t+1.
>
I'll be interested to see Alejandro's response to this; in the
meantime, here's mine:

As a matter of algebra, this is indeed equivalent to my accounting
(in which "moral depreciation" means "unanticipated loss of value")

C(t+1)+c(t+1)+v(t+1)+s(t+1)  = C(t)++c(t)+v(t)+s(t) - x

where x is moral depreciation, and a loss of capital. John goes on:

> But the real question is --  how does moral depreciation effect the
> rate of profit?

On the above, of course, it raises it, since the denominator is
smaller by x, cet. par. -- but this is not much help to the capitalist,
whose loss of capital has set them on the road to being a non-capitalist.

> Or does it?  It seems to me that at times labor could
> become so productive that the moral depreciation term might be greater
> than the living labor added.  This would be have no significance if
> moral depreciation plays no part in rate of profit calculations.
>
>
>
> However, Marx then goes on to refer to "moralischen Verschleisz."
> In Vol. I,  this is the first time the term is used.
>
> If Marx is using other words that are translated as "moral depreciation"
> in other parts of his work, we may gain some insight into the
> development of the concept itself by looking at this.  On the other hand,
> why does he even bring up "moralischen Verschleisz"  as he introduces
> to the manner in which a machine transfers its value to the product?
> At any rate,  the different terms he uses for moral depreciation may
> well be significant and I'm  certainly open to more on this topic even
> from revisionists such as yourself.
>
I too would like to hear more on this from the German-readers on the
list; pending these, my first thought is that Marx thinks of depreciation as
physical in the first instance ("wear and tear") but recognises that even
though regular maintenance can keep the machine's use-value intact for a
substantial period (by restoring the effects of wear and tear) it will still
have to be written off eventually.

The only logical way to provide for this is to write it down in
equal instalments (assuming equal production rates in each period); these
may not correspond to physical depreciation, hence "moral depreciation".

Julian
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