Further Mathematics 2nd Edition by R.I. Porter

By R.I. Porter

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Inch. 31 'on Machinery', which was added in the third edition of Principles, Ricardo also recognised the possibility of rendering labourers redundant and distressed as a result of introducing machinery. Until the second edition Ricardo believed that the number of workers thrown out of jobs by the introduction of more productive machinery would certainly be able to get new jobs in The Birth of the Theoretical System of Capiialism 21 other industries, such as producing such machinery. But he found by the third edition that this balance between the reduction and the increase in employment cannot be guaranteed and may create an unfavourable effect on workers.

Socio-economic difficulties within the third world countries in particular might provoke such an approach. However, so long as the main stream of the historical school has opposed Marxism as well as the classical and the neo-classical schools, it has often been reformistic and technocratic, easily combined with varieties of ideologies including extreme nationalism or Nazism. At the same time with its inclination to stick to the national concrete features of economic development, the historical school could not or intentionally did not present theoretically systematic studies of the capitalist economy and thereby overcome the theoretical defects of the classical school.

It is because there are different proportions between circulating capital invested in wages and fixed capital in machinery and buildings, and also different speeds in turnover of capital across industries. A rise of wages must affect more the costs of such industries having a higher proportion of circulating capital for wages or a lower speed of turnover. Therefore such industries must suffer from a greater decline of profit rates than others so far as the exchange values of their products remain constant in spite of a rise of wages.

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