Munich Personal RePEc Archive

Some Questions on the Rates of Profit and Rents

Melendez-Plumed, Vicenc (2014): Some Questions on the Rates of Profit and Rents.

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Abstract

We deal with three subjects, namely, the presence of more than one rate of profit in an economy due to the existence of rents (absolute and monopoly rents); the subordination of the prices and the rate of profit (in price terms) to the real profit or net product, measured in value terms; and the impact of leveraging on the rate of profit and on a simple calculation of the sum of credit (money) generated in an economy over a given period of time. Production prices are affected by absolute and monopoly rents. An arbitrary rise of an industry rate of profit increases the global rate and system prices while the real product expressed in values is not altered. Labour magnitudes determine the sustainable price system. An increase in the quantity of credit is a natural consequence of economic growth and the rate depends on the proportions of the effective use and the production of commodities. Interests of credits have similarities with differential rent, provided that the production costs increase depressing the rate of profit and generating a “rent” to capitalists who do not need to borrow money.

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