Michael, how do you know that there's been more technical change since
the crash?
Also, while depressions and recessions may promote competition in a
market economy, they also restrict the ability of businesses to afford
to implement technical innovations. Given the evidence that I've seen,
it's quite possible that the last Depression pushed US business away
from technical innovation and toward wage cuts, speed-ups, and
stretch-outs as a way to deal with low profits and cash-flow. The
weakness of workers' resistance when unemployment is high allows this
strategy to work. ("Relative surplus-value extraction" is replaced by
"absolute surplus-value extraction" when businesses are desperate.)
This promotes underconsumption tendencies, which can make a depression
persist.
On Sat, Mar 26, 2011 at 9:38 AM, Perelman, Michael
<[email protected]> wrote:
> I agree with everything Jim D. said, but I would add one twist. Both
> Keynesian policy and monetary stimulus also have the effect of reducing
> competition. In effect, depressions and recessions are what promote
> competition in a market economy. That is the reason that so much technical
> change occurred since the market crash began.
>
> Lacking adequate competition, the market gets weaker. In a globalized
> economy, part of result will be deindustrialization.
>
> Michael Perelman
> Economics Department
> California State University
> Chico, CA
> 95929
>
> 530 898 5321
> fax 530 898 5901
>
> http://michaelperelman.wordpress.com
>
>
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--
Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own
way and let people talk.) -- Karl, paraphrasing Dante.
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