Capital Flows and Rates of Profit

Abstract

Using a simple two department model this paper concludes that even if capital does flow from less to more profitable firms or industries, profit rates may not be equalized. Thus theories that assume that profit rates are equal in equilibrium are called into question as well as those which argue that profit rates are unequal solely because of immobilities. © 1989, UNION FOR RADICAL POLITICAL ECONOMICS. All rights reserved.