Land,technical progress and the falling rate of profit

The paper sets out a one sector growth model with a neoclassical production function in land and a capital–labour aggregate. If the elasticity of substitution between land and the capital–labour aggregate is less than one and if the rate of capital augmenting technical progress is strictly positive, then the rate of profit will fall to zero. This result holds regardless of the rate of land augmenting technical progress: no amount of technical advance in agriculture can stop the fall in the rate of profit. The paper also discusses the relation of this result to the classical and Marxist literature.     

Tax Overpayments, Tax Evasion, and Book-Tax Differences

A strictly risk-averse manager makes joint decisions on a firm's tax payments and book profit declarations according to accounting standards. It is analyzed how the incentives to overpay or evade taxes and to inflate book profits are influenced by (1) the composition of the manager's remuneration, (2) the ability to control the manager's actions, (3) the costs of making untruthful profit declarations, and (4) the tax rate. If the firm's owner or the government take into account these effects when pursuing their own objectives, the changes in tax payments and book profit declarations become theoretically more ambiguous.     

Unproductive labour,capital accumulation and profitability crisis in the Greek economy

The focus of this paper is on the evolution of the major macroeconomic variables of classical political economy and the contrast with their orthodox counterparts in the quest to identify the causes of the current crisis in the Greek economy. Our analysis shows that declining profitability past a certain point leads to a stagnant mass of real net profits that discourage investment and increase unemployment. More specifically, for the period 1970–2007 for which we have detailed data, we identify the so-called silent depression of the 1970s and early 1980s, the new golden age of accumulation during which the capitalization of the production process led to a rapidly growing productivity and with stagnant or slowly rising real wages increased the rate of surplus value to new heights. As a consequence, the rate of profit from the mid-1980s onwards displayed a mildly rising trend and remained at a much lower level than that of the early 1970s. The rate of profit starts to fall after 2007, the year of the onset of the (world) economic crisis, and this continues up to 2014. Our econometric analysis based on an ARDL model further shows that the incremental rate of return, a variable derived from, and therefore strictly related to the average rate of profit, constitutes a by far more concrete measure of profitability and, in combination with the real interest rate, shapes the process of capital accumulation.     

Contributions to Cournot oligopoly theory

This work contributes to a number of questions concerning oligopoly models. In particular, uniqueness of the Cournot equilibrium point is demonstrated under the assumption that either the unit price function is differentiable and the derivative is strictly negative or the cost functions are strictly convex. Also, under the assumption of either strictly decreasing unit price function or strictly convex cost functions, it is shown that (a) the total production level at equilibrium increases with entry of additional players, (b) that cooperation between some of the players necessarily entails profit for the others, and (c) cooperative grouping causes decrease in production levels.     

The optimality of a control band policy

Consider a firm with an arbitrary profit function whose relative price follows a Brownian motion with negative drift. When the firm faces a fixed cost of price adjustment, we prove the optimal pricing policy is a control band if the following sufficient conditions are met: the profit function is continuous, strictly concave and single-peaked; moreover, together with its first and second derivatives, it is bounded in absolute value by a polynomial. We also demonstrate various ways of constructing the value function associated with the control band policy and show it has certain properties carried over from the profit function. Numerical examples are found to be consistent with empirical estimates regarding the frequency of price adjustments.     

Feasibility of predatory pricing in a capacity-constrained duopoly

Predatory pricing is feasible only if the minimax profit of the prey is strictly smaller than the expected profit in the corresponding Bertrand-Nash equilibrium. We completely characterize the conditions for feasibility of predatory pricing in Kreps and Scheinkman's model of capacity-constrained duopoly. The predator must have a capacity larger than that of the prey, and also larger than the Cournot capacity. Surprisingly, predatory pricing may be infeasible not only if the prey is too large but also if it is too small.     

Differentiable Technology,the Curvature of the Profit Function,and the Response of Supply to Own-Price Changes

The author establishes a property of supply for a competitive firm: Assuming differentiability of the production frontier, linearly independent price vectors have disjoint image sets under the supply mapping. This property supports the main results. First, the author drew a simple proof of McFadden's proposition that differentiability of the production frontier is necessary and sufficient for strict quasiconvexity of the profit function. This proposition rules out linearity of the profit function on any subset of price domain, in turn ruling out supply and input- demand functions that are constant and have zero values for all price effects. Second, for discrete price changes, own-price effects in supply are strictly positive, assuming a differentiable technology. In this context, strict convexity of the production set is irrelevant. The author indicates implications for cost and demand theory.     

商业银行高额利润现象的平抑对策

合理的利润分配是社会经济持续稳定和协调发展的基础。目前,商业银行在社会利润分配结构中享有固定利润分配特征。其原因主要在于我国商业银行的准入门槛高、市场对社会资金供不应求以及利率市场化程度不高。保持我国商业银行合理利润区间,必须进一步推进商业银行利率市场化进程,推进商业银行与企业间利益共享、风险共担机制,推进金融自由化进程。     

Profit-sharing versus interest-taking in the Kaldor–Pasinetti theory of income and profit distribution

Abstract

This paper reformulates the Kaldor–Pasinetti model of income and profit distribution by introducing the interest rate from the very outset of the model but maintaining other Kaldor–Pasinetti assumptions intact. It is shown that the profit rate and the share of profits in national income are not independent from either the capitalists' or workers' propensity to save. Many contributors to the theory of income and profit distribution have erred in attributing a potentially positive impact of the interest rate upon profits. The interest rate is always and everywhere a tax on functional and personal incomes together. This result explains Schumpeter's observation that ‘Interest acts as a tax upon profit.’ In an alternative model, workers receive a share of profits instead of fixed contractual interest. It is shown that the profit rate and share are not independent from either propensity to save. Furthermore, the workers' share of profits has a positive impact on the rate and share of profits. This implies that a profit sharing regime could be more conducive to capital accumulation and job creation. It is found that Pasinetti's Cambridge Equation is more akin to a profit sharing regime.     

Technical change and the “tendency of the rate of profit to fall”

For the most part, the discussion of Marx' falling rate of profit has been of a qualitative and fairly imprecise nature. In particular, the transformation problem concerning the relationship between the price and value rates of profit is usually not adequately dealt with. The present article defines the various concepts rigorously and demonstrates the relationship between the price and value concepts. It is then shown that technical change which competitive capitalists will introduce always raises the rate of profit, if real wages are constant; that these viable technical changes are always socially desirable; but that there are socially desirable technical changes which will not be introduced under competitive capitalism. Some of these desirable technical changes would cause the profit rate to fall. Any efforts to demonstrate a falling rate of profit as a consequence of technical change must therefore concentrate on the relationship between technical innovation and changes in the real wage.     

政企分配关系视角下企业税收负担的国际比较与启示

政府参与企业收入分配的主要形式是税收,企业利润税收负担率是反映这种分配关系的重要指标。近几年来,世界各国的企业利润税收负担率总体呈现下降态势,不同类型国家呈现经济越发达,企业利润税收负担率越低的总体特征,但不同收入水平国家之间差异较大,企业适用的最高边际税率对企业利润负担率的影响显著。从国际比较来看,中国企业利润税收负担率一直偏高,需要理顺政府与企业分配关系,实行实质性减税政策。     

A model of profits and market adjustment

A market adjustment process is analyzed, where the prevailing rate of profit affects the rates of change of quantity produced and unit cost of production. Only under special conditions does the process lead to a steady-state where the rate of profit is zero.     

Monopolistic screening and uninformed buyers

In the standard monopolistic screening problem, buyers obtain information rent as a result of possessing private information; if a contract can be offered before the buyer knows his valuation, the seller can extract the full (expected) surplus. I consider a situation where the buyer may or may not have private information about his valuation at the time the contract is offered. Is the seller (strictly) better off as compared to the standard situation? The answer depends crucially on the specific model. In the 2-types model, unless the probability (that the buyer is uninformed) reaches a critical threshold, the seller is unable to benefit from the buyer's ignorance. In the continuum-types model, on the other hand, optimal expected profit is strictly higher than in the standard model whenever this probability is positive.     

Rate of profit and interest in a growth theory with endogenous money

This paper attempts to incorporate an endogenous money approachinto post-Keynesian growth theory in order to derive the fullemployment equilibrium rate of interest as well as that of profit.This rate of interest, named the ideal rate of interest, differsfrom the rate of profit in that it is in proportion to a monetaryvariable, not a real variable. Further, the rate of profit alsodiffers from the rate of interest as a premium because it isproductive. The rate of interest could be important in explainingcircumstances in which financial capital has been accumulatedin excess.     

The persistence of profits in the Greek manufacturing industry, 1963–88

The objective of this article is to evaluate empirically the profit rate persistence in the case of the Greek manufacturing industry (1963–88). More specifically, we address ourselves to two questions: first, do industrial profit rates eventually converge on a common rate? and secondly, what are the factors that affect the speed of adjustment of industrial profit rates? Our results suggest: a high persistence of profit rates for most industrial sectors; a generally high permanent component of the profit rates with substantial variations among sectors; and a similarity with other studies of industrialized countries with regards to the factors (concentration ratio, advertising intensity, export intensity, capital intensity etc.) affecting the speed of adjustment.     

Privatization,Underpricing, and Welfare in the Presence of Foreign Competition

We analyze privatization in a differentiated oligopoly setting with a domestic public firm and foreign profit‐maximizing firms. In particular, we examine pricing below marginal cost by the public firm, the optimal degree of privatization, and the relationship between privatization and foreign ownership restrictions. When market structure is exogenous, partial privatization of the public firm improves welfare by reducing public sector losses. Surprisingly, even at the optimal level of privatization, the public firm's price lies strictly below marginal cost, resulting in losses. Our analysis also reveals a potential conflict between privatization and investment liberalization (i.e., relaxing restrictions on foreign ownership) in the short run. With endogenous market structure (i.e., free entry of foreign firms), partial privatization improves welfare through an additional channel: more foreign varieties. Furthermore, at the optimal level of privatization, the public firm's price lies strictly above marginal cost and earns positive profits.     

Profit rate equalization in the U.S. and Europe: An econometric investigation

Although the equality of profit rates has been a key concept in classical as well as neoclassical economics, there are few empirical studies ascertaining to what extent profit rates are equalized or a tendency toward equalization can be observed. Using recently published data, we estimate an econometric model of profit rate convergence for the United States and four European countries. We compare size and significance of interindustry profit rate differentials in Europe and the United States and examine the sensitivity of the results to the definition of the rate of profit and the time period considered.     

Size structure,stability and performance of the largest British and EEC firms

This paper indicates that industrial as wel' as aggregate concentration of the largest European firms is increasing. Inside the group itself, the British firms show a marked decline of their size superiority over the EEC firms and a lower survival rate. At performance level, the actual increase in economic concentration does bring inferior results in terms of profit and growth rates along with it. The main consequence of a larger size is to reduce the firm's exposure to risk as expressed by the coefficient of profit variation. Comparing the two groups, the effect of a lower British survival rate is strengthened by the fact that the surviving British firms grow systematically more slowly than the continental firms. On the other hand, the British firms have a higher rate of profit and a lower coefficient of profit variation.     

我国A股上市公司增值额分配比率差异——基于产权、行业和地区差异的视角

运用2003—2009年我国A股上市公司的增值额及其相关比率数据,从产权、行业和地区差异的视角,研究了我国A股上市公司在增值额分配比率方面的差异特征。研究发现:非国有上市公司的政府报酬率、债权人报酬率和企业留存率高于国有上市公司,而前者的员工报酬率和股东报酬率却低于后者;不同行业上市公司的增值额分配比率存在显著的行业差异;上市公司所在地区的市场化程度越高,上市公司的政府报酬率和企业留存率越高、员工报酬率与债权人报酬率越低,但没有发现股东报酬率存在类似规律。     

统一利润率与差别利润率——兼论两种均衡体系的比较

瓦尔拉斯把资本形成方程引入一般均衡体系后出现了内在的不一致性,从而在异质资本品的假设下,一般均衡体系只存在“差别利润率”。在斯拉法体系中,不同的资本品部门却拥有“统一利润率”。两种类型的利润率体现了两种均衡体系的对立。与“差别利润率”相联系的一般均衡体系只研究一般生产过程中的资源配置,体现技术关系;而与“统一利润率”相对应的斯拉法体系则涉及特定市场经济关系下的总量分配,体现社会关系。而后者才可以更好地解释市场经济中的现实问题。