From Okishio to Marx through dialectics

Abstract

The law of the tendential fall in the profit rate provides the basis for a Marxist critique not only of neoliberalism but also of Keynesian anti-crises policies. This article argues that Okishio’s critique of the law, far from providing the definitive proof of its inconsistency, is undermined by a logical inconsistency and is based on the replacement of Marx’s notion of labour as value creating with conventional economics’ notion of labour as a cost. Further, the article introduces and uses dialectical logic to show that the law is both internally consistent and determinate.