Re: [OPE-L] SV: [OPE-L] what is irrational in the functioning of capitalism?

From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Thu Nov 30 2006 - 11:41:18 EST

Allin wrote:

>On Wed, 29 Nov 2006, Rakesh Bhandari wrote:
>>What Samuelson and Steedman emphasize is that the quantitative
>>allocation of social labor time is determined by the techniques
>>of production... But once we have the techniques of production
>>in terms of which the allocation of social labor time is
>>ultimately determined, it could be argued, prices and profits
>>can be determined without any reference to values.
>(I know you're not agreeing with this point of view.)  My point of
>criticism of this argument is that "technical conditions" suffice
>to determine prices _only on the counterfactual assumption of an
>equal rate of profit_.  A robust labour theory of value does not
>depend on that assumption.

I certainly agree with this assumption. I am wondering also whether
certain branches of production
enjoy monopoly profits--that is, the rate of profit does not equalize
across branches. Thinking here of James Galbraith's ideas about
technologically advanced capital goods production (microprocessors,
medical equipment, machines for wafer fabs, key parts of aircraft
production,  etc).

  His idea seemed to be that some of the extra profit does not appear
as such but trickles down to the employees in much higher than
average compensation.

If this is a feature of an advanced capitalism, then we shouldn't be
saddled with the counterfactual assumption of an equal rate of profit?


>Allin Cottrell

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