The Orthodox Theory of Profit

Joan Robinson

Chapter Chapter VII in An Essay on Marxian Economics, 1966, pp 52-62 from Palgrave Macmillan

Abstract: Abstract The most striking difference between Marx and the orthodox economists appears in the conception of surplus. To Marx, depreciation and wages are the only necessary costs of production, and rent, interest and profit are all subdivisions of surplus. In the orthodox system, rent of land is a surplus, because land is a “free gift of nature”, and would exist just as much if no payment were made for it, but interest and profits are the necessary supply price for capital, without which it would not be forthcoming. Wages, interest and profit are grouped together as “the reward of human efforts and sacrifices”. Thus attention is distracted from the distinction between income from work and income from property, and a moral justification is provided for interest and profit.

Keywords: Moral Justification; Supply Price; Academic Economic; Reserve Army; Orthodox Theory (search for similar items in EconPapers)
Date: 1966
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-349-15228-5_7

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DOI: 10.1007/978-1-349-15228-5_7

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