EconoFiction

The law of the tendentious fall of the general rate of profit in capital Bd.3

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20 Jan , 2020  

In the opinion of Georgios Stamatis, Marx, in presenting the law of the tendentious case of the general rate of profit, equates value and price, among other things, in order to disregard the effect of the so-called Wicksell effects (including the observation of the relationship between the rate of profit and the rate of interest) on the course of the general rate of profit.1 Marx further presupposes that parameters such as productivity, the technical composition of capital, the consumption of raw materials and the stock of means of production have shown a constant tendency towards growth in the course of the internal history of capitalism, possibly also the real wage rate. And Marx further assumes that the percentage increase in productivity at the level of the total complex of capital is less than the percentage increase in the technical and organic composition of capital. At the same time, capitalist competition constantly forces companies to accelerate the processes of research, technological innovation, and thus leads to the introduction of new (industrial) production methods. And finally, individual capital is less interested in the absolute mass of profit realised after a given production period, but more in the amount of money it receives in relation to its initial investment, ergo the profit rate (and the profit rate in relation to the interest rate). And the result is an ever-increasing technologically-based capitalization of production, which Marx sees expressed in the increase in the organic composition of capital (value ratio of constant (c) to variable capital (v) including the price indexation of the change in value of constant and variable capital of the same quality).

The relation between added value (m) and constant capital (c) + variable capital (v) implies the profit rate p = m / c + v. If we extend Marx’s formula for the profit rate by 1/v, we arrive at the following formula:

p= m/v

                   ——

                    c/v +1

Consequently, the profit rate as a relation between absolute quantities is transformed into a relation of relations, whereby this relation of relations remains related to the general average profit rate. (Cf. Heinrich 2006: 330) Marx identifies the two main determinants of the profit rate in the value added rate (m/v) and the value composition of capital (c/v). (MEW 25: 221ff.) The profit rate implies the relation of a flow quantity – the profit in an accounting period – to a stock quantity, the advanced constant and variable capital. While in the case of credit the return is determined ex ante in a contract, namely as interest, the empirical determination of the profit rate and its general tendency of movement can only be the result of a complicated statistical ex post calculation, whereby the transformation of data sets taken from the national accounts (national economic accounts) to Marxian quantities requires an exact determination of what can be assumed as quantities for calculating the profit rate based on the empirical data series. Firstly, the so-called surplus must be limited and recorded, which is included in the profit rate above the fraction line, i.e. the profit before or after deduction of depreciation and taxes and taking into account derived income and income from employment of self-employed persons. And secondly, it would be necessary to clarify what capital is to be determined as advanced capital, whether net fixed assets or gross fixed assets are to be recorded. Last but not least, the calculation of the profit rate requires that price changes be taken into account when determining the capital stock, which is usually the result of investments made at very different times. Furthermore, a distinction must be made between the profit rate as a relative figure and the profit mass, an absolute figure.

Marx’s law of the tendential case of the general rate of profit wants to say that under very specific conditions, which for him were those of classical industrial capitalist production, the capitalist methods of production correspond to a long-term tendency to increase the organic composition of capital, which in percentage terms is higher than the increase in the rate of added value, so that the general rate of profit, if we take it as the ratio of the rate of added value and the organic composition of capital, must fall in the long term. (Cf. Stamatis 1977: 115ff.) The necessary and sufficient fall of the general profit rate is primarily the consequence of an excessively increasing capital intensity or productivity, which is accompanied by an increasing savings rate of capitalists (increasing ratio of means of production to added value), through which the increasing intensity of means of production realizes.

However, in certain historical phases we are simultaneously dealing with so-called counter-tendencies which can lead to a higher percentage growth of the rate of value added than that of the organic composition of capital: 1) extreme increase of the rate of value added; 2) reduction of the wage and the fact of overpopulation; 3) expansion of capital abroad; 4) share capital etc. (MEW 25: 242ff.) Finally, there can also be a strong reduction in the price of machinery and technology, which leads to a fall in the organic composition of capital, which in turn can increase the profit rate.

Marx attempts to capture modifications of the material properties of production processes with the relation technical composition of capital, the relation between means of production/raw materials and wage-dependent labour, whereby this relation is to be understood as a technological set-up of production processes in physical units. Because we are dealing with processes of exploitation at the same time, there has always been a specific relationship between constant capital (means of production) and variable capital (wages), which Marx writes in terms of the law of the case of the general rate of profit, especially in values. (Cf. Stamatis 1977: 189f.) The technical composition of capital expressed in values is what Marx calls the value composition or organic composition of capital (c/v). While the value composition of capital also takes into account the indirect effects and variations of the parameters that determine it, the organic composition of capital refers purely to the direct changes in (c) and (v). For Marx’s description of the long-term developmental trends of the capitalist mode of production, the assumption of an increasing technical and, to a lesser extent, organic or value composition of capital (this is due to the increase in productivity, which results in falling prices for constant capital) is of great importance, whereby Marx justifies this with the compulsion, mediated by competition, to increase the internal productivity for individual capitals. (Ibid.: 221f.) Here Marx distinguishes two types of competition, namely a) the intra-sectoral competition, which captures the individual capitals within a sector, and b) the intersectoral competition between individual capitals of the different sectors. The saving of labour through the increased use of machinery (in the form of the immediate release of labour or in the form of a greater output with the same labour input) thus tends to lead in capitalism to an increase in constant capital in relation to variable capital, i.e. to an increasing organic composition of capital. And Marx further assumes that the increased use of machinery, technology and apparatuses – as a result of the scientificization of production – is the significant structure of the increase in productivity under capitalism and thus at the same time the decisive method for reducing the costs of production. (Ibid.: 236f.)

However, under the conditions defined by Marx, which constitute the logical framework for the law of the case of the general rate of profit, more efficient machinery and technology is only used for the purpose of reducing the costs of individual capital if, for a coming production period, the additional expenditure of constant capital (the monetary capital invested in machines and raw materials) is thus less than the savings of variable capital, i.e. the monetary capital invested in the remuneration of labour. Technological innovation is applied when, at least for the individual capital, ∆ c1 < ∆v1, thus reducing the previous cost price of the goods. (Cf. Heinrich 2003: 338) This initially leads to the realisation of extra profits for the technologically dominant company until the production level in an industry has generalised again. The dominant company can also realise further extra profits by increasing its material output. Two trends should be taken into account here: On the one hand, the new production methods, which entail an increase in productivity, lead to a reduction in the price of food, which is necessary for the reproduction of labour, over and above the saving of labour (however, in the course of capitalist development all goods, whether raw materials, machines and food, become cheaper, because more or higher quality products are produced for a given working time), which results in an increasing value composition of capital. At the same time, the new technologies and production methods can also lead to a reduction in the price of the elements of the

in a declining value composition of capital, although the reduction in the price of the elements of constant capital at the level of total capital only leads to a declining value composition if the increase in productivity in the production of means of production (Division I) is permanently higher than that in the production of consumer goods (Division II). In order to justify the tendency of a long-term increase in the value composition of capital and thus the fall in the profit rate, it would have to be shown that the reduction in the price of the elements of constant capital associated with the increase in productivity cannot compensate for the other aspects which, in the so-called counter-trend, lead to an increasing value composition of capital – technical or immediate increase in constant capital relative to variable capital, reduction in the value of labour. (Stamatis 1977: 221f.) It is therefore necessary to consider how the relationship between constant capital and variable capital behaves, for example, whether variable capital decreases more strongly than constant capital increases, so that inversely the value added increases more strongly than constant capital, namely to the extent that variable capital decreases, which would mean that we would indeed be dealing with an increasing profit rate. However, constant capital can also increase more strongly than variable capital decreases, and yet a generally increasing profit rate (and profit mass) can still be observed, namely in a period in which at least the technologically dominant companies are making extra profits, namely when their total costs of (c) plus (v) per product unit are lower than the average costs in the industry and their products are sold at the old, still valid social price or at least at the limit of the old price. Price reductions (above the individual, but below the social “value”) may be necessary to realize the larger material product quantities. The individual capital must take into account both the relative added value or total costs per product unit and the increase and realization of their quantity in their calculations, plans and calculations. In addition, the technologically dominant capital can also gain advantages by laying off workers without increasing the value added rate. It can even reduce the profit mass, which in turn is compensated by the extra profit. We are dealing here with individual strategies for reducing production costs per unit of product, but with regard to the development of the general profit rate and its tendency to fall, we must focus on the generalisation of new production methods in so far as they have lowered the general value level, whereby with the elimination of the extraprofit u. The abolition of the extra profit may actually lead to a fall in the general rate of profit, because the increase in constant capital or capital intensity has its full effect at the level of capital as a whole, depending on whether or not the new technologies improve the conditions for the exploitation of an entire industry.

Marx imagines the process, which tends to lead to the fall of the general profit rate, as follows: If one assumes that for a given production the quantity of goods necessary for the reproduction of labour remains the same, as does the length of the working day and the intensity of labour, and that the value product created per working day by the labour force remains constant, then it follows that with increasing productivity the rate of added value m/v rises because of the reduction in the price of goods, but this increase still means that the individual labour force uses a larger quantity of means of production (raw materials and machinery) in the same given period of time than in earlier production periods. The saving of labour through the use of machinery thus leads directly to an increase in constant capital in relation to variable capital, i.e. to an increase in the technical composition of capital and, to a lesser extent (due to the cheapening of machinery) to an increase in the value composition of capital. Marx assumes that the greater quantity of means of production per worker also corresponds to a greater value of these means of production, which, as we have seen, is problematic, since the increase in productivity makes all goods cheaper – ultimately also the means of production. (Ibid.: 249f.) Although it may be the case that in a particular industry a slight increase in productivity requires a high expenditure of additional constant capital, as was previously the case in traditional capitalist industries such as the steel industry or the chemical industry, on the other hand, in some industries, such as

today in the computer industry, where the new computers are hardly more expensive than the old models, a high increase in productivity can be achieved with relatively little additional constant capital, and it may even be the case that an industrial robot represents less value than the old mechanical equipment and therefore a higher profit/profit is achieved even with constant added value per constant and variable capital employed. Trenkle/Lohoff argue at this point that while it could be profitable for individual capital to replace labor with industrial robots (instead of two workers at old mechanical apparatus, there would then only be one worker at an industrial robot), on the other hand this leads to a “melting of the value mass” at the level of total capital. (See Lohoff/Trenkle 2012: 105f.) We have already commented on this above.

Let us recapitulate with Stamatis the fundamental provisions of the capitalist form of productivity increase, which imply the tendential fall of the general profit rate: Each increase in productivity leads to a percentage increase in the technical composition and therefore in the value composition of capital, while at the same time, in the wage sector, one can observe a decrease in the value of the means of reproduction, plus, if the rate of growth of productivity is higher than that of the real wage, a decrease in the value of labor. However, the resulting increase in the relative rate of value added is far from sufficient to compensate for the increase in the value composition of capital, so that ultimately the general rate of profit must fall. Now, however, there are certainly “new” capitalist production methods (which Stamatis discusses in detail, see Stamatis 1977: 305ff.), to which Marx himself briefly refers in the Grundrisse in connection with the presentation of the problem of the basic pension; methods which increase the relative rate of added value due to specific increases in productivity, while at the same time the value composition of capital remains the same or even falls (among other things, due to the reduction in the price of machinery, which may indeed be the case in the digitalised industries today): By definition, this increases the overall rate of profit. Even with an increasing technical composition of capital and, to a lesser extent, of its value composition, the profit rate can therefore increase if productivity grows more strongly than the value composition of capital in percentage terms – and this seems to be crucial for the introduction of these new capitalist production methods to occur at all. Insofar as cybernetic systems make machines run faster and at the same time reduce their technical wear and tear, the value of such innovations is to be assessed from the outset as lower than that which they replace (cheapening of constant capital). And it must be taken into account that machinery, as hardware, is today subject to efficient control by software, which translates and iterates the beat of the clock. And in these processes even specific reserves of production are taken up and taken up, which are to be considered as parts of collaborative work and cooperation (affects, cognition, language etc.) or as a free service for capital. For Marx, on the other hand, it was the classical production methods of industrial capital and the associated specific form of productivity increase (especially in the thermodynamic and chemical industries) that led to an increase in the technical composition and, to a lesser extent, in the value composition of capital, and at the same time to an increase in the rate of added value, albeit less than that of the value composition of capital. And thus, in the final analysis, the ratio between the relative increase in the rate of value added and the relative increase in the value composition of capital determines whether the rate of profit rises or falls within the framework of the general conditions, parameters and variables that Marx gave with the construction of the law of the tendential case of the general rate of profit. (Cf. Heinrich 2013) In the case of a falling profit rate, however, it must then apply sui generis that the rate of added value increases in percentage terms more slowly than the value composition of capital. It would therefore have to be shown that the value composition of capital rises faster than the value added rate, or, in other words, that total capital grows faster than the absolute value added mass. (Cf. Stamatis 1977: 249f.) The elasticity of the value-added rate in relation to the value composition of capital, which indicates by how much the value-added rate increases when the value composition increases by one percent, must assume a certain magnitude for the profit rate to eventually fall, and this is precisely the case when the percentages of

increase in the value added rate compared to the percentage increase in the value composition is lower than the ratio of constant to total capital. (Ibid.: 143ff.) Marx now believes to know that the value-added rate tends to grow more slowly than the value composition of capital, i.e. over a longer historical period, the elasticity of the value-added rate is therefore lower than its critical value. (Ibid.: 282f.) One can see here, if one then takes into account the formal and mathematically well-founded attempts at justification of Stamatis, that with regard to the affirmation of the law of the tendentious case of the general rate of profit it is by no means sufficient to state that constant capital increases in relation to variable capital, but constant capital must always increase in a certain dimension (and the greater the increase in productivity, the more so). And finally, we can see that while it is possible to specify the direction of movement of the individual variables that ultimately determine the profit rate, the relative speed of movement of the variables is always at issue. And one could even calculate, within the mathematically formulated conditions of the law, by how much % the constant capital would have to increase in order for the profit rate to fall; but whether the constant capital really increases by so many percentage points in the singular historical courses of the differential accumulation of total capital is not so easy to determine on the basis of empirical studies, which are also based on statistical data, constructions and methods based on the concepts of economics. (Cf. Heinrich 2013a) And it can now be summarized that Marx’s law of the tendential fall of the general rate of profit can be determined from a formal-logical point of view, as Stamatis demonstrated with mathematical precision work, but this does not say anything about a possible historical validity of the law. According to Marx, under very specific conditions, which must be given, the increase in productive power leads to a tendency for the profit rate to fall, which in turn should be confirmed by empirical studies and analyses, whereby the hypotheses and reasons for the empirically determined development should also be named. The purely functionalist approach of the law, which substantiates the description and hypotheses of the conditions under which a specific functional relationship exists between the rate of added value and the value composition of capital, should therefore always be extended to include the substantiation of the conditions of the empirical development of profit rates through the internal history of capital. The law itself deals less with the variation of the levels of effects and counter-effects on the rate of profit than with the production of effects and counter-effects under very specific conditions, which Marx points out from the limits in which variations are possible, and these limits are determined by the capitalist structure as an overall complex.

The matter becomes even more complicated and complex if, as Ernest Mandel did in his analyses of late capitalism in the 1970s, the profit rate is understood as a synthetic indicator in which, in addition to the important parameters of the value composition of capital and the rate of added value, the relationship between fixed and circulating capital, the turnover time of capital, the rate of accumulation and the exchange relations of the means of production and consumer goods departments are also included in the analysis as variable factors for determining the profit rate. (Cf. Mandel 1972: 104ff.) Both the development of the value-added rate and that of capital efficiency remain dependent on the relative development of wages. Not only as a measure of the profitability of capital, but also as a synthetic indicator, the movement of the profit rate should, according to Mandel, also be examined empirically, in its historical cyclicality, in order to be able to demonstrate, for example, over-accumulation tendencies in the internal history of capital, for example, due to a falling return on capital. According to Mandel, in his description of the law, Marx could still assume a pure movement of the equalisation of average profit rates between industries (intersectoral) and on a national scale, as well as a uniform national configuration of wages in the individual industries, which was ultimately crucial for determining the indicator value-added rate. With the internationalisation and globalisation of capital accumulation, however, according to Mandel, the possibilities for regulation within the nation states have been reduced, which means that the parameters of profit production today increasingly vary along the

the globalised competition of capital and the dynamics of capitalisation/financialisation. (ibid.: 42ff.) Thus, both the differences in the capital turnover times of internationally operating corporations and the network structures of capital among themselves, and not least the internal value flows and the material conditions of these corporations themselves, would have to be examined anew.

In this context, let us consider a final problem, which has gained in sharpness through the attempt of the Japanese economist Okishio to refute Marx’s Law. (Cf. Stamatis 1977: 160ff.) With regard to the problem of the temporalization of accumulation, we can assume that, when new investments are realized, production is carried out with means of production and wages that were still bought at “old” prices, which initially implies that a change in the technical composition is only reflected with a time lag in a higher or lower organic composition of capital, which in turn influences the emergence of new prices for production outputs (due to higher productivity). The production of goods imposes their updating as goods in circulation, without the quantities sold being able to be predicted in advance, whereas, conversely, circulation (qua economic mathem) has to update these goods depending on the volume of the products. At the same time, it must be taken into account that technological changes also affect other production facilities and branches of production. If individual capital now wants to change immediately to new prices, this would anticipate the process of updating value, in so far as production based on a set of “old” prices and the generation of a new set of prices must be taken into account, which companies in circulation are confronted with. Let us consider a single sector of the economy with different levels of productivity: at a given time, innovative firms have invested in more efficient machinery than other firms in order to make an extra profit, at least temporarily. These companies immediately face the following problems: As these new technologies become established, the gradual devaluation of goods makes it less profitable to recover their previous investments. Although the newly achieved extra profit can partly eliminate this problem, investments in fixed capital, i.e. capital that remains in the production sphere for several production periods and only passes on its value to the product at intervals, exacerbate this problem. This stock of fixed capital has usually been purchased at fixed commodity prices, while its “value” has to be updated over several production periods or may have to be realized in transit with possibly new commodity prices, so that the operative parameters of capital utilization on the different time scales would have to be reduced to a common time interval in order to obtain a meaningful relation with respect to the price variables used to empirically determine the profit rate (electricity and stock variables). Thus, according to Marx, when a company uses a new technology for a coming production period, the value of the labour used is reduced. If one follows Okishio’s interpretation, however, this process does not lead to pressure on the profit rate, but rather to an increase in the profit rate, due to the reduction in the price of machinery associated with increased productivity and possibly the reduction in the value of labour, at least for the technologically dominant individual capital. (ibid.) This, in turn, is completely different for the American economist Kliman, because in his view it is impossible to reduce the costs of a future production period in which new technologies are used, since the machinery is still paid at the “old” prices. And in this respect, new prices can only be the result of a future production period, because capitalist production processes must be imagined not primarily in terms of their simultaneity, but above all as successive successive phases. For Kliman, Marx’s description of prices and profit rates clearly focuses on the temporal aspect, whereby the prices of the inputs of production already differ from the output prices. One could now do anything with mathematics, Kliman concludes with a side blow to the so-called simultaneousists, but if the assumed conditions are already unrealistic, one could also reach completely unrealistic conclusions. (Cf. Kliman 2006) However, and this may be objected to Kliman without hesitation, technological change (which Kliman also accepts) does not necessarily lead to

to a case of the profit rate, because with regard to new production periods, even if one assumes fixed input prices, the quantities of inputs necessary to produce a constant output are always shrinking – and this continuously because of the immanent increase in productivity. In addition, at this point the question would also have to be raised at what rate of interest a company can borrow outside capital, and this in turn would have to be set in relation to the standards of profit rates, which can of course drastically change the conditions for the utilization of individual capital. And finally, its conditions of exploitation, insofar as its outputs are included in those of other capitals, would significantly affect the overall process of the exploitation of plural capital within the framework of differential accumulation. And last but not least, the quantitative result of the calculations depends on the choice of a certain time interval (because of the permanent turnover of capital, empirical methods are extremely difficult to obtain useful results if, for example, investments that have not been completely written off are taken into account: one should therefore work with a prospective approach). The existence of such temporal intervals does not only remain relevant for theoretical analysis, but also tends to be established in practical terms through the compulsion of companies to prepare monthly and annual accounts via the cycle of networked production and their synchronisation effects. In the end, however, the operative parameters on the various time scales can hardly be summarized or reduced to a single time interval in order to be able to make a meaningful approximation of the relationship between the variables used for the empirical calculation of the profit rate (electricity and inventory variables).

Against the thesis that a reduction in the price of constant capital could lead to a reduction in the general profit rate, a number of Marxist authors put forward the following argumentation: First, the increase in the material volume of constant capital is purely logically related to the reduction in the price of constant capital. One reason is the saving of labour in Division I, the division of production that produces constant capital, i.e. the corresponding proportion of this labour is continuously decreasing with the development of productivity. Similar to relative value-added production, the saving of variable capital does not grow in proportion to productivity, but only by the proportion of living labor that can be saved in Division I, which is decreasing step by step. A decline in the number of labour required in Division I naturally also leads to a decline in production in Division II, which produces consumer goods. While at the same time the counter-tendencies to the fall in the profit rate are weakened more and more, the increase in the value composition (c/v), which leads to the fall in the profit rate, remains unaffected by the absolute reduction in the labour force in Division I, in so far as the value composition is not an absolute quantity but a ratio which increases precisely because of the tendency of the variable capital to shrink in favour of the constant capital share. The decrease in the price of (c) cannot therefore ultimately overcompensate for the decrease in (v), or at least this is to be seen in relation to the mass of profit, which means that the tendency to reduce the price of constant capital cannot stop the general fall in the general profit rate. The prerequisite for this argumentation remains, of course, that the profit rate is written down as a relation of absolute values (profit mass in relation to the sum of capital advanced) and not as a relation of relations, which certainly amounts to hypostatization, with which the differential nature of accumulation and the corresponding differential profit and interest rates are not considered at all. In addition, this argumentation does not take into account the new production methods brought into play by Stamatis, in which each increase in productivity does not lead to an even greater increase in the technical composition of capital, which goes hand in hand with an increase in the capitalists’ savings rate (increase in the means of production in terms of added value); on the contrary, the growth rate of productivity will now actually increase more strongly than the percentage increase in the technical composition of capital, whereby the composition of the employed

work remains constant or falls. It is now possible that even if the value composition of capital remains constant or falls, productivity increases, and this is not primarily due to the productivity of labour, but rather to the degree of efficiency in the use of constant capital, which is called capital productivity. We come back to this issue in more detail at the beginning of the last section of this book.

In the context of permanent technological upheavals, the question now is how and in which time horizons an average and general rate of profit can take place at all after a “disruption” caused by technological progress qua individual capital. And this in turn means that the dynamics of capitalist production at the level of the total complex must be grasped as a non-linear non-equilibrium problem, which makes the validity of ceteris paribus approaches, as Marx actually does with the law of the tendential case of the general rate of profit, rather doubtful. On the contrary, it can be assumed that one has to take into account much more differentiated approaches and methods of mathematically oriented economic theories, which determine their problems roughly analogous to Ehrenfest’s theorem in physics, which states that only under very specific conditions the classical equations of motion of mechanics, which always include equilibrium, apply to mean values in quantum mechanics. One could now follow up on this and finally assert that, in the case of economics, imbalanced systems do not necessarily lead to growing disorder and lack of stability, even if they produce entropy over the long term, but that it may be possible to relocate them into highly structured and stratified local environments and milieus in order to control and regulate them in this way. If one understands entropy as a thermodynamic quantity, then schemata and content are not to be treated decoupled, so that a system is only a system because it works and not because it conquers something. Entropy as a measure of disorder has its maximum disorder in the state of thermodynamic equilibrium, as a state of pure potentiality without regularity, and this ultimately means the death of the system. It would then be considered a static system that no longer translates any energy from one form to another. If we now turn to a non-thermodynamic thinking of entropy, we are always dealing with monstrous quantities (negentropy) that are both discrete and infinite. The economic mathem and, beyond that, the algebra of concepts refers to this kind of quantification, and this should be understood with Deleuze as an important way of thinking. Since the emergence of symbolic algebra in the 19th century, we have been dealing with numerical bodies that contain a case-by-case rationality; we assume local or disparate universes in which differences insist as different differences. Moreover, it would be questionable whether, in the final analysis, all economic processes are not inherently unstable and, as soon as they tend towards an (ideal or hypothetical) equilibrium, they start to shift discreetly again, so that the historical-singular, the extraordinary and tenacious power of survival of the capitalist economy is dependent on the next stone being thrown into the pond (extraprofit qua innovation), so to speak, even before the waves of the various profit rate curves, including averaging, have processed through all sectors of production. Thus, the structural dynamics of capitalist production with its close interlocking of technological, symbolic and discursive change could indeed be described as that of non-linear, dynamic, heterogeneous systems, which above all process the future by borrowing from it or anticipating it. Allergings are not completely indeterministic systems, because these systems are highly organized, at least on the microscopic level of organizations, and on the macroeconomic level they undergo average formations of profit rates, which, however, cannot be separated from crisis-like accumulation breaks at all. Here we assume from the outset the possibility of determined chaos. (Cf. Deleuze 1992a: 96f.) Regardless of whether this kind of chaos of capitalism can be defined more precisely as a permanently “re-updating network” or as “pure contingency” (Ayache), it is at any rate certain that we are dealing with non-linear structuring and restructuring of capital (as an overall complex), which in reality takes place in an infinite number of frequencies of superimposition of productions and circulations, whereby

coherent pathways are created and dissolved again in order to add new pathways, entirely in the sense of Deleuze’s mechanical processes, the connective and disjunctive syntheses, which ultimately have a very specific death immanence.

And at this point, it can again be connected to the prefix “not” of non-economy, insofar as this does not express a negation, but rather an alienation – the “not” would be to be understood with Laruelle in the course of his turning to a non-euclidean geometry. (Cf. Laruelle 2003) Consequently, Laruelle generalizes philosophy in the same way that non-euclidean geometry generalized the Euclidean model. By assuming a possible pluralistic mode of existence of philosophy as such, Laruelle depotentializes philosophy and treats it as another pure material. By analogy, the traditional axioms of economics and, to some extent, of Marxist economic criticism would have to be questioned, so that, at least with regard to Marxism, one would not only arrive at a “critical” description of the reality of capitalism, but finally also at new theoretical drafts of the organization of a post-capitalist economy. If the change of axioms from Euclidean to non-euclidean geometry occurs immanently on the one hand, on the other hand something is shifted decisively here, insofar as the non-euclidean geometry rejects the classical axiom of geometry (parallels cannot meet ad infinitum). Analogously, new problems, concepts and axioms to be constructed in the context of a non-economy are to override the axioms of economic equilibrium thinking. And, of course, newly invented hypotheses are presupposed to be true, even though they initially have the status of “as if” or minimum-transcendental material, because their correctness depends not only on their empirical content, which they also have to prove, but also on the immanent strength and impact of the new concepts, constellations and theorems themselves, which must be developed on the basis of problems and hypotheses and not deduced. Thus Laruelle writes: “As a result, it is philosophy and its logical organon that lose their prerogatives by being turned into a simply real-transcendental organon. Thus, it is necessary to take the expression ‘non-philosophy’ quite literally, so to speak. “It is not just a metaphorical reference to ‘non-Euclidean’.” (Laruelle 2013b) Only in such a context could the question of the validity of the law of the tendency of falling profit rates be asked anew and adequately.

In his theory, Wicksell distinguishes between the market interest rate and the natural interest rate. The latter defines the rate of return on real capital, whereas Wicksell understands market interest to be the current interest rate on the capital market. Now the Wicksell effect describes the following: If the volume of credit is increased by an appropriate monetary policy of the central bank (e.g. by increasing the money supply M3) and as a result the market interest rate is reduced, the demand for credit increases, which in turn increases the investment activity of companies and the natural interest rate remains the same for the time being, but slowly moves upwards, because investors will always choose from the given investment alternatives those that yield the highest return. As investment activity grows, however, there will also be an increasing number of investments with a comparatively low rate of return, which will tend to cause the natural interest rate to fall again. After all, investors only invest until the natural interest rate has reached the level of the market interest rate again (= Wicksell effect). And as soon as the market interest rate exceeds the natural interest rate, the investments lose their attraction for the investors.

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