The Cyclical Profit Squeeze: A Marxian Microfoundation
This paper develops a microfoundation for the cyclical profit squeeze theory of crisis. An optimal cyclical mark-up pricing policy is derived. The mark-up rises from initial trough until midexpansion and then declines until the terminal trough. The necessary and sufficient conditions for the resulting decline in the profit rate are the capital-labor struggle which determines the behavior of costs and the competition among capitals which restricts rising costs from being fully passed on. It is also shown that this optimal mark-up behavior serves as a microfoundation for a profit squeeze theory of the business cycle.
Year of publication: |
1985
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Authors: | Goldstein, Jonathan P. |
Published in: |
Review of Radical Political Economics. - Union for Radical Political Economics. - Vol. 17.1985, 1-2, p. 103-128
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Publisher: |
Union for Radical Political Economics |
Saved in:
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