Accumulation and the rate of profit: Regulating the macroeconomy

Abstract

In this paper we argue that as models of profitability and growth within the Marxist tradition have become more formal, they have relied increasingly upon assumptions of equilibrium. An alternative single-region, single-commodity model is proposed in which output, demand, and capital accumulation are independently determined and therefore potentially in disequilibrium. In the short run this means that profitability can be rising or falling, depending upon the rates of growth of demand, supply, and net exports, the rate of capital accumulation, the rate of change of unit costs of production, and the initial starting position of the economy. In the longer run, though, output is limited by the ..