Technical Changes and the Rate of Profit in the Canadian Food Industry

Abstract

The rate of profit and the causes of changes in the rate of profit in the Canadian food and beverage industry, for the years 1952–1981, are examined in this paper. Until the mid-1960s, the rate of profit was stable or rising, but since then it has fallen. In the first half of the period under consideration, the market strength of the food and beverage industry offset the negative effects of changes within the industry; in the second half of the period, however, the food and beverage industry has suffered as its price per unit of value of output has fallen (but changes within the industry have been negligible). Within the industry the following changes have occurred: turnover times have fallen; the value of labour power (and so the rate of exploitation) has been virtually constant; the technical composition of capital has risen, but only slowly since 1965; until 1965, the main contribution to the rising technical composition of capital has been an increase in fixed capital per worker (and so of the quantity of materials processed per hour); since 1965, the technical composition of capital has changed only in response to changes in turnover times and in capacity utilisation rates. The general picture, then, is of an industry in which technical change has slowed dramatically and changed its form since the mid-1960s; the interaction of this effect and of the changing market strength of the industry accounts for the history of the rate of profit in the Canadian food and beverage industry.