Charlie wrote: > Regarding secular trends rather than the cycle, technological change has > not been shown to raise the composition of capital economy-wide, except > in a few early decades of industrialization.
right. When Department 1 (the sector producing means of production) is underdeveloped, i.e., "a few early decades of industrialization," then the value of means of production is not reduced by technical change. This means that the tendency to mechanize production, which raises the technical composition of capital (TCC = MP/LP, where MP and LP are physical quantities of means of production and labor-power, respectively), also raises the value composition of capital. To see that, suppose that the VCC = (per-unit value of MP)*MP/[(per-unit value of LP)*LP] = v1*TCC/vlp. Representing the technical backwardness of Department 1 by a constant v1, if TCC rises at a faster percentage rate than vlp falls, then the VCC rises. With different definitions of the VCC and TCC, the story is different. But the point is that the VCC stops rising once technical change is introduced into Department 1 and v1 starts falling. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
