Profit rate dynamics, income distribution, structural and technical change in Denmark, Finland and Italy

Andrea Vaona

No 11/2010, Working Papers from University of Verona, Department of Economics

Abstract: Under less restrictive assumptions than in previous contributions, this paper highlights various general patterns of profit rate dynamics. Without a substantial re-distribution of income in favour of profits, the profit rate declines. When labour productivity is weak the profits/wages ratio declines leading to a decline in the profit rate, also due to capital deepening. Developments in the capital-labour ratio tend to increase the organic composition of capital while those in the ratio between the capital price deflator and the average wage tend to decrease it. Falls in the profit rate took place in countries with a weak technological change with episodes of Marxian bias. Employment shifted from low to high capital intensity sectors, from low to high organic composition industries and from low to high productivity sectors. Rising strength of labour and realization failures tend to have a greater role than rising organic composition in cyclical profit rate dynamics. Over the cycle, the first mechanism is also the first one to show up, while the others tend to follow it.

Keywords: Profits; Wages; Labour productivity; Organic composition of capital; Capital intensity (search for similar items in EconPapers)
JEL-codes: E11 J30 P17 (search for similar items in EconPapers)
Pages: 69
Date: 2010-07
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://dse.univr.it//workingpapers/PIST26_7_2010.pdf First version (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found

Related works:
Journal Article: Profit rate dynamics, income distribution, structural and technical change in Denmark, Finland and Italy (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ver:wpaper:11/2010

Access Statistics for this paper

More papers in Working Papers from University of Verona, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Michael Reiter ().