Marx then turns to the point raised earlier, which is that not only is the agricultural profit increased, as a result of the rise in the general annual rate of profit, but it is also directly raised as a result of the initial rise in agricultural efficiency, which sparked the sequence of events.
“As we have seen above, the farmer’s rate of profit would rise, in any case, if, as a result of the lower price of corn, the general rate of profit of the non-agricultural capital increased. The question is whether his rate of profit would rise directly, and this appears to depend on the nature of the improvements.” (p 391)
I have set out two variants of that earlier. A third variant would be where there is no change in agricultural/mineral productivity, but the value of constant capital employed in agriculture falls.
Marx argues,
“If the improvements were of such a kind that the capital laid out in wages decreased considerably compared with that laid out in machinery, etc., then his rate of profit need not necessarily rise directly. If, for example, it was such that he required one-quarter less workers, then instead of his original outlay of £40 in wages, he would now pay only £30. Thus his capital would be £60 c + £30 v, or on £100 it would be £66⅔ c + £33⅓ v. And since the labour costing £40 [provides a surplus-value of] £20, the labour costing £30 provides £15. And £16⅔ [surplus-value is derived] from the labour costing £33⅓. Thus the organic composition would approach that of the non-agricultural capital.” (p 391)
That is correct, although Marx doesn't take into consideration here the consequence that the fall in grain prices also leads to a 25% fall in the value of labour-power, which thereby raises the rate of surplus value, and rate of profit. So, previously, £40 was paid in wages, creating £20 of surplus value, i.e. £60 of new value. But, if wages fell to £30, surplus value rises to £30. Similarly, if the improvement in agricultural efficiency results in less labour being employed, so that where 4 workers were employed, at a total wage of £30, and surplus value of £30, now 3 workers are employed, at a total wage of £22.50, with a surplus value of £22.50. Therefore, although, as Marx says, this further fall in the value of the variable capital, relative to the constant capital, causes the organic composition of capital to come closer to that in industry, and thereby to bring the rate of profit in the former closer to that in the latter, the rise in the rate of surplus value, in agriculture and industry, from 50% to 100%, causes the rate of profit in agriculture also to rise, counteracting the rise in the organic composition.
The agricultural capital, of 60 c + 22.50 v, is equal to a capital of 100 divided 72.73 c + 27.27.
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