Re: [OPE] webpage computing dynamic rate of profit

From: Cipolla <>
Date: Tue May 19 2009 - 16:17:41 EDT

Sorry to be junping into this thread a little late. The highest two graphs
in Figure 5.16 (page 128 of Shaikh and Tonak: Measuring the Wealth of
Nations) for aggregate rates of profit use K as the stock of fixed capital.
Therefore it is not "all of the capital invested in means of production". It
is a rate of return on the stock fixed capital. It is a different measure
from Marx´s rate of profit.
Also, their measure of the value composition of capital is not really Marx's
value composition. Their C*/V* has in the numerator only the flow of
constant capital used up in production, that is, material inputs plus
depreciation. You can check for this on page 95 and then see the
corresponding graph 5.15.
The road of conversion of National Accounts into Marxian Accounts is not
that smooth.
----- Original Message -----
From: "Dave Zachariah" <>
To: "Outline on Political Economy mailing list" <>
Sent: Sunday, May 17, 2009 11:57 AM
Subject: Re: [OPE] webpage computing dynamic rate of profit

> GERALD LEVY wrote:
>> Let's contract the list instead. Let's just look at the formula employed
>> by two of those you mention above - Shaikh and Tonak. Is it P/K where
>> K is all of the capital invested (K) is means of production?
> Yes, see chapter 5.5.
>> As you know, for
>> S&T the division between productive and unproductive labor is a an
>> important variable in Marxian macro empirical studies. How can this
>> variable show up if the denominator in the rate of profit is simply K?
> This division does not show up in the stock variable of the denominator
> but is directly related to the flow variable in the numerator since
> surplus value is decomposed as: S = P + U, where P is profit-type income
> and U is unproductive expenditure. Thus R* = S/K an upper-bound to R =
> P/K.
> See chapter 7.1.
> //Dave Z
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