Jim Devine <[EMAIL PROTECTED]>:
>Marx praised Ricardo for seeing how capitalism is expansionist (M - C -
>M'). But the latter, unlike Marx, saw the problem -- including the falling
>rate of profit -- as arising due to external processes (scarcity of land &
>raw materials).
You are right about Ricardo's theory of rent. I wanted to refer to Marx's
praising of Ricardo for his better understanding of the pervasiveness of
M-C-M' as compared to those who looked at the external hurdles or the
recessionary (or stagnationist) spells in capitalist history.
And you're also right about underconsumption playing a role in Marx's theory
of crisis. But, IMO, its role is secondary. In principle, the "effective
demand" necessary to close the M-C-M' circuit can be generated by the
process itself. I don't think that's controversial, but I may be wrong.
Now, what I stated about the contrast between Marx and Ricardo/Malthus/etc.
is not meant to be a denial of the theoretical problems of Marx's analysis
of capitalism. So, yes, Marx's thesis of the rising composition of capital
is problematic. But whether it has been due to a persistent increase in the
real income of workers and not strictly to a rising value composition of
capital, profitability has exhibited a tendency to decline in the documented
history of capitalism. To me that's a partial validation of Marx. In any
case, the increase in the real income of workers is internal to M-C-M'.
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