2019 (16), №1

Debating Points in Production Theory and Accumulation of Capital

DOI:

https://doi.org/10.31063/2073-6517/2019.16-1.14

For citation: 

Zhdanova, L. L. (2019). Debating Points in Production Theory and Accumulation of Capital. Zhurnal Economicheskoj Teorii [Russian Journal of Economic Theory], 16(1), 154-168

Abstract:

This research draws a retrospective comparison of largest economists’ views on capital reproduction in the face of technical progress. The purpose of this study is to explain the disproportions which arise due to this process and suggest possible options to tackle them. The article discusses two types of global imbalance: (a) discrepancy between cost and natural-material structure of produced consumer goods and money income of the population intended for consumer purposes; (b) discrepancy between manufacturing capacities in production sector of investment goods and national business demand for fixed assets. Opportunities and ways to overcome these contradictions are heavily discussed. Slight mitigation of contradiction (a) is thought to be possible to achieve with substantial institutional transitions in developed countries. Regarding contradiction (b), only one approach is considered feasible: export operations and, consequently, positive value of net exports as an integral part of aggregate demand. The article discusses the inconsistency of such a solution, which implicitly transfers the process of macroeconomic equilibrium formation to the world market. In this case, the conservation of underdevelopment will ensue in the economies of countries that fall behind in economic development. The research relies on a genetic method based on the unity of the historical and the logical in the ascending process from the abstract to the concrete. A fundamentally new question is raised. It concerns the transfer of macroeconomic balancing process from the national market to the world market along with the characteristics of the economies involved in this process in terms of the size and natural-material structure of their net exports. The conducted research is aimed primarily to develop the theory of reproduction and capital circulation of all social capital that currently holds the issues of fixed capital reproduction in the unity of natural-material and cost forms at the periphery of academic focus. The findings of the given study may also be used in the development of economic policies aimed to stimulate or deter certain commodity flows in a country’s export and import.

Lyudmila Leonidovna Zhdanova — Doctor of Economics, Associate Professor, Odessa National University of Economics, Professor of the Department of General and Economic Theory and Economic Policy (Odessa, Ukraine; e-mail: l_zhdanova@ukr.net).