The Decline of the Conventional Rate of Profit

Abstract

The preceding chapters have been concerned with a rigorous empirical test of Marx’s theory of the tendency of the rate of profit to decline as a result of technological change. This test involved the derivation of conceptually rigorous estimates of the Marxian rate of profit and its determinants for the postwar US economy. The main conclusion is that the Marxian rate of profit declined due to an increase in the composition of capital, consistent with the hypothesis of Marx’s theory. This conclusion is very different from that reached by Weisskopf and Wolff in their earlier estimates of the Marxian variables. The main reason for these different conclusions is the different treatments of Marx’s concepts of productive labor and unproductive labor.