Barkley asks Yoshie: > If Japan is a "labor scarce" economy, then why has the unemployment rate been rising >in the past decade?< the test for a labor scarce economy in my book (and it's my "book" that counts, since I'm the one who uses the labor scarce/labor abundant dichotomy) is whether or not wages start rising faster than labor productivity when accumulation speeds up in the boom, so that Marx's volume I story of the "wage squeeze" applies, however temporarily. (It's temporary because capitalists either use labor-saving technical change or recession to end the squeeze.) What happens when accumulation is in a funk -- as in Japan during the last 10 years or so -- is a different issue. The labor-abundant economy would be more like W. Arthur Lewis' "classical" model, in which accumulation leads to rising profit rates in the boom. I see this scenario as fitting the US in the late 1920s and perhaps the late 1990s. BTW, as usual, I'd like to hear alternative terms for "scarcity" and "abundance," since these do not simply reflect "natural" conditions but the institutions of worker organization and the like (including how mobile capital is). >I stand corrected on the profit rate, although the decline reported by Doug does not >seem sufficient to explain the very sharp decline in growth rate in Japan, not to mention the collapse of the bubbles.< the decline in the profit rate could be sufficient simply because there's no simple mechanistic connection between the profit rate and accumulation. That is, even though the profit rate declines (as it may have done after 1998 in the US), accumulation continues to soar, driven by expectations and competitive pressure. It's the over-shooting -- often based on accumulation of debt, along with bubbly financial behavior -- that's the basis for the sharpness of the decline. (Makato Itoh made a similar point years ago.) --------------------------------------------- This message was sent using Panda Mail. Check your regular email account away from home free! http://bstar.net/panda/
