The Rate of Profit and Crises in a Socialist Economy

1995 ◽  
Vol 17 (2) ◽  
pp. 307-313 ◽  
Author(s):  
Theodore P. Lianos

In a recent paper (1994) in this journal, Elias L. Khalil makes two claims. First, he contends, the law of the tendency of the rate of profit to fall is not unique to the capitalist mode of production but it is equally valid in a socialist economy. Second, a decline in the rate of profit in a socialist economy would engender crises as would be the case in a capitalist economy. Even more, he argues that crises would be necessary in any social form if there is a secular tendency of the organic composition of capital to rise.

2019 ◽  
Vol 49 (1) ◽  
pp. 163-203
Author(s):  
Nuno Miguel Cardoso Machado

Abstract Marx's theory of crisis is usually associated with the law of the tendential fall in the rate of profit presented in volume three of Capital. According to Marx, the rising organic composition of capital - the fact that variable capital grows in absolute terms, but falls relatively because of the faster growth of constant capital - results in the fall of the general rate of profit, which undermines the reproduction of capital. In this article I will argue that: i) there is a "first version" of Marx's theory of crisis, outlined especially in the Grundrisse, which ascribes the secular crisis of the capitalist economy to the absolute decline of living labour and, therefore, to the falling mass of socially produced surplus-value; ii) only this "first version" of the theory of crisis allows the absolute internal limit of capital to be deduced consistently.


2019 ◽  
pp. 15-35
Author(s):  
David Harvey

David Harvey apresenta uma crítica à importância dada à lei da queda tendencial da taxa de lucro, sugerindo que Marx derivou a “lei” de pressupostos “draconianos” e que Engels foi bem mais entusiasta dela do que Marx, que nunca voltou adiante à teoria apesar de sua evidente incompletude. Portanto, ele argumenta, não deveríamos levar suas conclusões teóricas muito longe. Em sua visão, Marx concebeu as crises como erupções momentâneas e violentas que resolviam as contradições existentes, que podem ser consideradas oportunidades para a reconstrução capitalista ao invés de um sinal do fim eminente do capitalismo. Harvey defende que a taxa de lucro pode ser estabilizada por uma variedade de fatores como uma desvalorização do capital constante devido à mudança tecnológica, a monopolização ou a aceleração do tempo de rotação tanto na produção como na circulação. Ele argumenta, ainda, que um aumento da produtividade que não seja associado a perdas de emprego não reduziria a produção de mais-valia. Ademais, uma queda nas taxas de lucro pode resultar de muitos outros motivos além do aumento da composição orgânica do capital. ABSTRACTDavid Harvey’s article argues against the importance given to the law of the tendency of the rate of profit to fall (TRPF), suggesting that Marx derived the “law” under “draconian” assumptions and that Engels was far more enthusiastic about it than Marx, who never went back to the theory later in his life despite its evident incompleteness. Therefore, he argues, we should not take his theoretical conclusions too far. In his view, Marx perceived crises as momentary and violent eruptions that resolve the existing contradictions which can be considered as opportunities of capitalist reconstruction rather than a sign of the imminent end of capitalism. Harvey argues that the rate of profit can be stabilized by a variety of factors such as a devaluation of the existing constant capital due to technical change, monopolization, or accelerating turnover times in both production and circulation. He argues, moreover, that a productivity increase that is not associated with job losses would not reduce surplus value production. Moreover, a fall in profit rates could result from a number of reasons rather than an increase in the organic composition of capital. Tradução: Cássio Arruda Boechat ([email protected])


1994 ◽  
Vol 16 (2) ◽  
pp. 292-309 ◽  
Author(s):  
Elias L. Khalil

It is clear from the enormous literature on the subject that Karl Marx believed that his law of the tendency of the rate of profit to fall is applicable only to the capitalist mode of production. Is there, however, really anything in the law which confines it specifically to capitalist production? This is an important question which is not asked in an explicit manner in the literature on Marx's economics. His most important law or tendency about the internal contradictions of capitalist production might turn out to be a characteristic of production per se—including socialist production in its ideal form.


Capital ◽  
2008 ◽  
Author(s):  
Karl Marx

The organic composition of capital depends at any given time on two circumstances: first, on the technical relation of labour-power employed to the mass of the means of production employed; secondly, on the price of these means of production. This composition, as we have...


2012 ◽  
Vol 20 (2) ◽  
pp. 3-38 ◽  
Author(s):  
David Harvey

Abstract The gap between Marx’s theoretical writings on political economy (for example, the three volumes of Capital) and his historical writings (such as The Eighteenth Brumaire of Louis Bonaparte and The Civil War in France) arises out of certain limitations that Marx placed upon his political-economic enquiries. These limitations are outlined in the Grundrisse where Marx distinguishes between the universality of the metabolic relation to nature, the generality of the laws of motion of capital, the particularities of distribution and exchange, and the singularities of consumption. What an analysis of the content of Capital shows is that Marx largely confined his efforts to identifying the law-like character of production to the exclusion of all else. While this allowed him to identify certain laws of motion of capital within any form of the capitalist mode of production, it did not and could not constitute a total theory of a capitalist mode of production. A better understanding of what it is that Marx can do for us through his identification of the general laws of motion leads to a far better appreciation of what it is that we have to do for ourselves in order to make Marx’s theoretical findings applicable to particular conjunctural conditions, such as those that have arisen throughout the economic crisis that began in 2007.


2017 ◽  
Vol 50 (1) ◽  
pp. 99-115 ◽  
Author(s):  
Guido Starosta ◽  
Alejandro Fitzsimons

This article critically examines the received wisdom on the value of labor power that posits the workers’ material reproduction and the class struggle as two independent factors that determine the bundle of wage-goods consumed by the working class. It shows that this reading has no solid textual basis on Marx’s writings. Furthermore, it argues that it rests on a problematic separation of the actual immanent unity between materiality and social form in the capitalist mode of production.


2000 ◽  
Vol 6 (1) ◽  
pp. 139-144
Author(s):  
Tony Smith

AbstractI should like to thank Ben Fine, Costas Lapavitsas and Dimitris Milonakis for their stimulating and detailed comments. In the limited space available, I cannot respond to every criticism. A number of criticisms appear to be a matter of mere semantics. In the Marxian literature, the term ‘crisis’ is often used to refer to extended downturns as well as to short and sharp declines. And Marx himself defines the organic composition of capital as the value composition considered ‘in so far as this is determined by its technical composition and reflects it’, which is how the value composition is considered in my paper. Nor will I respond to the charge that my ‘use of Grossmann is mechanical and unpersuasive’, since I am not sure what exactly the objection is. Firstly, I will take up the criticisms regarding the logical structure of Capital. Then I move on to consider one substantive issue raised regarding the tendency for the falling rate of profit. I will next respond to criticism of my treatment of the relation between systematic and historical dialectics. Finally, I respond to criticism of my main thesis overall.


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