Contrary to what Mill intended to show, with his example, what it actually shows is that, where wages rise, due to a fall in productivity, which raises the value of labour-power, whilst this causes the rate of surplus value to fall, it can result in a rise in the rate of profit, because the fall in productivity also causes more labour to be employed – relative to constant capital – increasing the mass of surplus value, and its ratio to total capital. In Mill's example, the rate of profit rises, also, because the value of constant capital is set to zero. But, even where the value of constant capital remains constant, a fall in productivity that causes more labour to be employed, and exploited, it can still result in a higher rate of profit, because it represents a lower organic composition of capital.
For example, suppose 10 workers work 10 hours each to transform 100 kilos of cotton into 100 kilos of yarn. The cotton has an exchange-value of £100, the workers are paid £100 in wages, and produce £100 of surplus value. The rate of surplus value is 100%, and the rate of profit is 50%. If productivity falls, so that 20 workers are required to process the cotton, the constant capital remains £100, wages are now £200, but, if the rate of surplus value remains 100%, they produce £200 of surplus value. So, the rate of profit rises from 50% to 66.6%.
Even assuming that the fall in productivity causes the value of labour-power to rise, and the rate of surplus value to fall, the consequence can still be a rise in the rate of profit. For example c 100 + v 220 + + s 180, r` = 56.25%.
“In all these cases, not only are variations in the rates of profit not determined by variations in the production costs of wages, but they take place in the same proportions. Here it must be noted that it does not follow from this that the movement of one is the cause of movement of the other (for example, that the rate of profit does not fall because the production costs of wages fall, or that it does not rise because the production costs of wages rise), but only that different circumstances paralyse the opposite movements. Nevertheless, the Ricardian law that variations in the rate of profit take place in the opposite direction to variations in wages, that one rises because the other falls, and vice versa, is false. This law applies only to the rate of surplus-value. At the same time, there exists however a necessary connection (although not always) in the fact that the rate of profit and the value of wages rise and fall not in the opposite but in the same direction. More manual labour is employed where the labour is less productive. More constant capital is applied where the labour is more productive. Thus in this context the same circumstances which bring about an increase or a decline in the rate of surplus-value, must as a consequence bring about a decline or an increase in the rate of profit [i.e., a movement] in the opposite direction.” (p 212)
This is not the same thing, however, as Marx describes, as where wages rise, for example, due to an increased demand for labour-power, which does not result in a change in the technical composition of capital. For example, if it continues to be the case that 10 workers process 100 kilos of cotton into 100 kilos of yarn, but either wages rise because the value of labour-power rises, or because the demand for labour-power pushes wages higher, we would have:
c 100 + v 120 + s 80, r` = 80/220 = 36.36%.
This is the difference between a squeeze on profits, and a fall in the rate of profit due to a rise in the organic composition of capital. In the former, the technical composition remains the same, but the value composition falls. In the latter, the value composition remains the same, or may even fall, as rising productivity reduces the value of constant capital, but the same rise in productivity causes the technical composition to rise, as a given mass of labour processes an increased mass of material, which leads to an increased organic composition.
No comments:
Post a Comment