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Capital doesn't maximize capital; it maximizes productivity. In absence of controls, capital naturally flows to productivity in order to be maximized by the hol
by bmmayer1 11y ago
Capital doesn't maximize capital; it maximizes productivity. In absence of controls, capital naturally flows to productivity in order to be maximized by the holders of capital; but only because productivity creates wealth, not the capital itself.
- deleted 11y ago[deleted]
- biomene 11y agoCapital only maximises productivity if it gains an advantage by doing so. In other words, productivity is a means for Capital to maximise itself, not an end. There are infinite examples of this: shrimp peeling machines have existed for ages, but shrimp is still mostly manually peeled in Thailand because it has a cheap workforce.
- ZenoArrow 11y ago> "only because productivity creates wealth" Does it? For whom does productivity create wealth for? Productivity is about getting set results based on the smallest set of resources (time, money, materials, etc...). It does not include anything about wealth, nor where that wealth is distributed to, or whether resources could have generated more wealth used in a different way. It's actually possible for increased productivity to decrease wealth.
- bmmayer1 11y agoProductivity is the creation of goods and services. Goods and services are the building blocks of wealth: one who has more goods and services is more wealthy. It is impossible to create more wealth without increased productivity. Now, to your point, the fruits of productivity could be unfairly captured by non-producers, in which case wealth is being misappropriated from those who created it to those who have the power through whatever form to capture it (i.e., taxes, feudal land ownership, etc).
- theworstshill 11y agoWell said.
- gglitch 11y agoIf I'm understanding this observation correctly, you're saying that capital flows to the productive, which creates wealth, which in principle generates more productivity, and therefore draws more capital?
- barrkel 11y agoProductivity is the ratio of outputs to inputs. In an efficient competitive market, profit tends to zero. That would make capitalism a minimizer of productivity, as long as productivity is greater than 1 (otherwise the enterprise is not profitable). Labour productivity, by economic definition, is the ratio of output to people. If most of the wealth generation in an organization is automated, labour productivity will be high, whereas if most of it is manual, labour productivity will be low, even when both organizations are producing the same amount of wealth.