THE TRANSFORMATION PROBLEM, THE NEGLECTED THIRD VARIABLE.

the third variable – transformation problem pdf

3 Responses to THE TRANSFORMATION PROBLEM, THE NEGLECTED THIRD VARIABLE.

  1. Habib says:

    What is the emperor and theoretical proof of equalization of Tate of profit? Paul Cockshott provides empiric evidence agains this equalization
    Thanks

    • No one has been able to prove or disprove this. The reason is that the rate of profit is based on fixed and circulating capital and not simply on fixed capital. The ratio between circulating and fixed capital can vary with the composition of capital, so omitting circulating capital invalidates any comparison. Even when Anwar Shaikh in his recent book “Capitalism, Competition, Conflict, & Crises” shows a strong convergence in profit rates between newly invested capital in a number of industries, this cannot be considered conclusive because of the absence of circulating capital. Fortunately it is now possible to estimate circulating capital as I have shown with perhaps a greater degree of accuracy than fixed capital itself. Thank you for reminding me this task is yet to be completed. I will examine around 20 diverse industries with differing compositions of capital and publish the results for 2017 in the next few months.

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