[OPE-L:2985] Re: Value of labour power and real wage

Paul Zarembka (ecopaulz@ubvms.cc.buffalo.edu)
Sun, 8 Sep 1996 05:34:08 -0700 (PDT)

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On Wed, 4 Sep 1996, Patrick Mason wrote:

> Paul Z:
>
> I think you and I are agreement that assumptions regarding changes in the
> wage rate are a secondary consideration in Marx's analysis of the falling
> rate of profit. I'll try to clear up the confusion from my earlier posts.
> (Also, Alan Cottrell recently posted a response that makes the point I'm
> arguing below).
>
> Defining the value rate of profit as r = S/(C+V) = (L-V)/(C+V), where L =
> the labor time of productive workers, we get r(max) = L/C. That is the
> maximum rate of profit occurs when V=0. If C/L shows a tendency to rise over
> time due to technological change then the maximum rate of profit will also
> decline. If the minimum rate of profit is r = 0, then the process of
> technological change leads to an actual rate of profit that is increasingly
> squeezed between a declining ceiling and a constant floor. Alternative
> changes in the wage rate may cause the actual rate of profit to increase,
> decrease, or remain the same but the fluctuation band between the maximum
> and minimum profit decreases over time in response to the accumulation of
> capital. Are we on the same page?
>
> peace, pat mason

Pat, Sorry I didn't get back to you earlier. Anyway, while your algebra
is ok, I don't exactly know what you are wanting to accomplish by
discussing the case of max. r and r=0. In fact, I do think s/v has been
increasing so that r can be increasing. Also, devaluing constant capital
is a very important counter-tendency. In sum, I don't think the "falling
tendency" provides much empirically verifiable leverage for asserting r
declines in the long term.

Paul Z.