>I am on a poor telnet connection, so I will be brief. Marx said that >mechanization began in consumer goods and then moved to producer goods. >In the first stage K/L should autmatically increase; in the second, it is >indeteriminate.
I think Marx did think it was indeterminate, strictly speaking, but I think he thought the tendency of rising OCC would over time and in a zig zag manner prevail over the counter-tendencies. Marx was interested in why the rate of profit did not fall in rapid straightline fashion as one may have predicted from Ricardo's dismal model. Grossmann worked in this Marxian tradition by preparing to date the most elaborate study of counter-tendencies. Marx thought that it was only in *certain cases* that the mass of constant capital would increase while their total value remains the same or falls. As I have noted before, the cheapening of ever more powerful computers is most often adduced in the analysis of capital saving innovation, but if one looks at the computer industry itself as a whole--including the chip business--it seems that the very thing that has made computers cheaper is the reduction in capital costs per unit made possible by enormous (if not mindboggling) upfront outlays of capital in chip and computer production. Cheaper capital goods in themselves do not prove that technical change is neutral because what distinguishes and drives capitalism is the development of means of production with which to produce those cheaper means of production. That is, the development of a Department Ia is where the action is. We hear of the ever cheaper end product of the computer but not about what's happening in chip production or the industries that equip those building chips and computers. And it does not seem to me that the mass of constant capital employed in these Dept Ia industries has remained stable,much less lessened, in terms of value? When will have 5 or 10 billion dollar fabs?! Rakesh
