Re: Marx and Keynes on Unemployment

[ECAS@xxxxxxxxxxxxxxxxxxx id <01HPVC8QMNC68XG1O6@xxxxxxxxxxxxxxxxxxx>; Fri, 28 Apr 1995 11:42:09 +1000]

Jim Devine says:
As a macroeconomist inspired by Marx rather than one _limited_ by Marx,
I care about the "real world" (present, past, & future) much much more
than I care about "what Marx (really) said" and I tend to be bored by
exegeses and seances.
____________________

(Sorry Jim! Can't cut the margins. Technology is beyound my control)
Anyway, let's be clear about one thing, I'm not a religious Marxist and when I
say that something is there in Marx or something is not there in Marx, it does
not mean that it is by definition true or false. However, I think Marx is a
good theoretician and his theory and its internal cohesion should be taken
seriously. Anything I or you believe is true should not be attributed to Marx.
That would not be a good scholarship to say the least. History of thought is a
serious subject and it is sad to know that you get bored by history of thought.
_____________________
>....the idea that labor-saving technical change is introduced because
>of an upward pressure of wages carries with it the neo-classical germ of
>switching to relatively capital intensive technology in response to higher
>wages-- and this kind of reasoning was quite foreign to Marx. This aside, For
>Marx a labor-saving technical change is a long-run or secular tendency in
>capitalism. Moreover, in his framework, the real wages as well as the value of
>labor-power also have a secular falling trend. That is why the rationale for
>labor-saving technical change had to be found somewhere else than in wage
>pressure.
_____________________

To my above statement, Jim responds:
But one of the reasons why Marx saw the real wage as having a
downward trend (NB: relative to productivity growth, so that the
value of labor-power falls) is that technical change and accumu-
lation keep the demand for labor-power down.

Also, on p. 638 of vol. I of CAPITAL, Marx wrote that
in response to higher agricultural wages, the capitalist farmers
"introduced more machinery, and in a moment the laborers were
redundant again in a proportion satisfactory even to the farmers....
the demand for labor fell, not only relatively but absolutely."
_____________________

But Jim! what you say is right but it does not support your point at all. You
are confusing the causality of the argument. It is true that technical change,
in Marx's framework, causes a tendency for the real wages to fall. However, it
does not mean that technical change is caused by a tendency for the real wages
to rise, which is what you are implying. As far as Marx's quotation is
concerned (I thought quotation bored you!), that is a very well known quotation
and I have myself quoted it in a paper. The fact of the matter is that here
Marx is talking about an unusual case of a sudden fall in the supply of labor
in the agricultural sector of an area. And it seems that Marx is arguing that
machinery is introduced to overcome shortage of labor rather than a response to
rise in wages. In anycase, this is an unusual case and it is introduced here to
basically argue that the capitalist system which accumulates by fits and starts
cannot relie on the population mechanism. See! you have to make sense of
quotations in a broader context of its discourse and not just reading three
lines. Then quotations no longer remain boring.

Cheers, ajit sinha