RE: RE: Re: the profit rate & recession

["Devine, James" <jdevine@xxxxxxx>]

Title: Re: [PEN-L:20980] the profit rate & recession

Rakesh writes: >Doug H and Fred M have both argued that spike of profit rate (as conventionally measured) especially in the 90s was a result influx of foreign capital, which reduced borrowing costs. <

 

I missed this. I don't know what Doug and Fred argue here, but I think Marx's theory that the profit rate is determined independently of -- and largely constrains -- the interest rate is a good one. Since I see the profit rate as determined by accumulation, technological change, class struggles, etc., I don't see how a temporary spike in interest rates could determine the profit rate. BTW, the profit rate I use has both interest and non-interest profits in the numerator.

JD