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Capital intensity, unproductive activities and the Great Recession in the US economy

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  • Lefteris Tsoulfidis
  • Dimitris Paitaridis

Abstract

The purpose of this article is to show that the Great Recession of 2007 in the USA is of the classical type featuring the rising value composition of capital which more than fully offsets the rising rate of surplus value giving rise to a falling rate of profit. The tendential fall of the latter, from a point onwards, led to a stagnant mass of real net profits, thereby decreased net investment and eventually impacted on employment. The evolution of capital intensity and the consequences of unproductive activities remain key issues in the discussions of capital accumulation and its periodic ruptures.

Suggested Citation

  • Lefteris Tsoulfidis & Dimitris Paitaridis, 2019. "Capital intensity, unproductive activities and the Great Recession in the US economy," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 43(3), pages 623-647.
  • Handle: RePEc:oup:cambje:v:43:y:2019:i:3:p:623-647.
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    File URL: http://hdl.handle.net/10.1093/cje/bey051
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    References listed on IDEAS

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    1. Shaikh, Anwar, 2016. "Capitalism: Competition, Conflict, Crises," OUP Catalogue, Oxford University Press, number 9780199390632, Decembrie.
    2. Malikane, Christopher, 2017. "Profitability and Crisis in the South African Economy," MPRA Paper 76165, University Library of Munich, Germany.
    3. Dimitris Paitaridis & Lefteris Tsoulfidis, 2012. "The Growth of Unproductive Activities, the Rate of Profit, and the Phase-Change of the U.S. Economy," Review of Radical Political Economics, Union for Radical Political Economics, vol. 44(2), pages 213-233, June.
    4. Lefteris Tsoulfidis, 2017. "Growth Accounting of the Value Composition of Capital and the Rate of Profit in the U.S. Economy: A Note Stimulated by Zarembka’s Findings," Review of Radical Political Economics, Union for Radical Political Economics, vol. 49(2), pages 303-312, June.
    5. Tsoulfidis, Lefteris, 2001. "Rethinking long cycles: are the 1990s the onset of a new phase of capital accumulation?," MPRA Paper 39739, University Library of Munich, Germany, revised 2012.
    6. Simon Mohun, 2014. "Unproductive Labor in the U.S. Economy 1964-20101," Review of Radical Political Economics, Union for Radical Political Economics, vol. 46(3), pages 355-379, September.
    7. Lefteris Tsoulfidis, 2009. "Competing Schools of Economic Thought," Springer Books, Springer, number 978-3-540-92693-1, June.
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    Cited by:

    1. Tsoulfidis, Lefteris & Tsimis, Achilleas & Paitaridis, Dimitris, 2018. "The Rise and Fall of Unproductive Activities in the US Economy 1964-2015: Facts, Theory and Empirical Evidence," MPRA Paper 84035, University Library of Munich, Germany.

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    More about this item

    Keywords

    Composition of capital; Unproductive labour; Capital accumulation; Rate of profit; Growth accounting;
    All these keywords.

    JEL classification:

    • B5 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches
    • D33 - Microeconomics - - Distribution - - - Factor Income Distribution
    • E1 - Macroeconomics and Monetary Economics - - General Aggregative Models
    • N12 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - U.S.; Canada: 1913-
    • O51 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada

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