La tasa de ganancia y sus leyes (6)

Economa poltica IV 2013-II Alejandro Valle

 1) Marxs law is inconsistent because its categories are indeterminate; 2) it is empirically unproven and even unjustifiable on any measure of verification; 3) Engels badly edited Marxs works to distort his view on the law in Capital Vol 3;

 4) Marx himself in his later works of the 1870s began to have doubts about the law as the cause of crises and started to abandon it in favour of some theory that took into account credit, interest rates and the problem of realisation (similar to Keynesian theory); 5) Marx died before he could present these revisions of his crisis theory, so there is no coherent Marxist theory of crisis

 A rising organic composition of capital will eventually produce a downward move in the rate of profit even when the rate of surplus value is rising faster to begin with. The rate of surplus value rises over time if wages do not rise as fast as the productivity of labour. But as the rate of surplus value rises, it rises at an ever slower rate as it approaches its limit which is the full appropriation of the product of living labour (wages plus surplus value).

 As for Heinrichs argument that Marxs law cannot be empirically proved or refuted, this is bizarre. We can measure the rate of profit in capitalist economy using Marxist categories and test the law against its components.

 Does the rate of profit fall over a long period as the organic composition rises? Does the rate of profit rise when the organic composition falls or the rate of surplus value rises more than the organic composition increases? Does the rate of profit recover if there is sharp fall in the organic composition of capital through the destruction of value of capital? The answers to each of these empirical questions is yes.

 Between 1963 and 1975, the UK rate of profit fell 28%, while the organic composition of capital rose 20% and the rate of surplus value fell 19%. Between 1975 (when the UK rate of profit troughed) and 1996, the UK rate of profit rose 50%, while the organic composition of capital rose 17%. The rate of profit rose because the rate of surplus value rose 66%, faster than the rise in the organic composition of capital

 . Finally, from 1996 to 2008, the rate of profit fell 11%, as the organic composition of capital rose 16% but the rate of surplus value was flat. All these three phases are compatible with Marxs LTRPF. Indeed, over the whole period, 1963 to 2008, the organic composition of capital rose 63%, while the rate of surplus value rose 33%, so the rate of profit fell on a secular trend.

 In the case of the US economy, the rate of profit fell 24% from 1963 to a trough in 1982, because the organic composition of capital rose 16% and the rate of surplus value fell 16%. Then the rate of profit rose 15% to a peak in 1997, because although the organic composition of capital rose 9%, it was outstripped by a rise in the rate of surplus value of 22%.

 %. From 1997 to 2008, the rate of profit fell 12%, because the organic composition of capital rose 22%, outstripping the rate of surplus value, up only 2%. Again, all three phases fit Marxs law, when the organic composition of capital rose faster than the rate of surplus value, the rate of profit fell and vice versa. Over the 45 years to 2008, the US rate of profit fell secularly by 21% because the organic composition of capital rose 51% while the rate of surplus value rose just 5%.

 The rate of profit was negatively correlated with the organic composition at -62%, while there was no significant correlation with the rise in the rate of surplus value. When the rate of profit starts to fall, a crisis or economic slump will occur some time thereafter and, even more specifically, the recession begins when the mass of profit falls as a result of the falling rate of profit.

 This is predictive value is more than we can say about any studies that aim to justify empirically alternative explanations of crises based on the problem of realisation (consumption or investment) or on high interest-rates or lack of credit, Keynesianstyle.

 Again, I looked at the UK economy. Since 1963 there have been four major economic recessions of slumps: 1974-5, 1980-2, 1990-2 and 2008-9. In each recession, the rate of profit peaked and started to decline at least one year before the slump began. And each recession was accompanied by (or coincided with) a fall in the mass of profit in successive years.

 ..at the US economy, there were five recessions or slumps after 1963: 1974-5, 1980-2, 1990-2, 2001 and 2008-9. In each case, the rate of profit peaked at least one year before, but on most occasions up to three years before. And on each occasion (with the exception of the very mild 2001 recession), a fall in the mass of profit coincided with the slump, with the biggest fall (over 7%) in the Great Recession

 So there is a body of evidence to support the view that Marxs law does operate in a capitalist economy and that it is the key (underlying) factor in booms and busts. We can derive a coherent theory of crisis from Marxs works based on his LTRPF, his views on credit and banking (fictitious capital) and on world markets and imperialism. Of course, there is plenty of work to be done in developing Marxs theory of crisis in relation to modern developments and, as Marx did, we are learning more each day.

 Marxs LTRPF remains the most robust explanation of capitalist crises and something way superior to alternative Keynesian and other mainstream economic explanations, which signally failed to explain the Great Recession.

EUA, tasa de ganancia 1929-11

20.0

15.0

10.0

5.0

0.0

-5.0