Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/184765
Authors: 
Galanis, Giorgos
Veneziani, Roberto
Yoshihara, Naoki
Year of Publication: 
2017
Series/Report no.: 
Working Paper 814
Abstract: 
This paper provides a formal dynamic analysis of exploitation, class inequalities and profits. A stylised model of a capitalist economy with two classes - workers and capitalists - is considered which extends Roemer [21, 22]. First, a dynamic generalisation of a key Marxian insight is provided by proving that the profitability of capitalist production is synonimous with the existence of exploitation. Second, it is shown that, in a competitive environment, asset inequalities are fundamental for the emergence of exploitation, but they are not sufficient for its persistence, both in equilibria with accumulation and growth, and, perhaps more surprisingly, in stationary intertemporal equilibrium paths. Finally, it is shown that labour-saving technical progress may yield persistent exploitation by ensuring the persistent abundance of labour.
Subjects: 
Dynamics
Accumulation
Exploitation
Classes
JEL: 
E11
D51
D63
C61
B24
Document Type: 
Working Paper
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