Introduction

In the preceding two chapters, we have shown that the rate of profit will not fall as a consequence of rational, competitive technical change if the real wage is held constant. It is clear that if the real wage rises, however, the equilibrium rate of profit may fall. To develop a full theory of a dynamic rate of profit, one would require a theory of how the real wage changes as a consequence of technical change. From the Marxian point of view, such a theory cannot be entirely “economic,” in the usual sense, as what wage the workers succeed in receiving depends on subjective elements that become realized in class struggle. In this chapter we investigate one simple model which posits a relationship between technical change and the real wage. Briefly, we shall assume that real wages adjust after the innovation so that the relative shares of labor and capital remain unchanged.

In recent discussions of the labor process by the Marxian economists, there has been some controversy as to whether technical change is introduced by capitalists because it is efficient, or because it allows capitalists better to control workers and hence extract surplus value. [See, for instance, the writings of Marglin (1974), Stone (1974), Braverman (1974), Gordon (1976), Edwards (1979), and Gintis (1976).] In the final section of this chapter, we shall indicate how the model presented can be used to discuss this dichotomous aspect of technical change.