Search

Following Marx's general law of capitalist accumulation, the present article seeks to evaluate the impact of fixed capital stock, labor productivity, and the mass of profits on the dynamics of employment in Colombia from 1965 to 2019 using a Vector Error Correction Model. The results show that the level of employment exhibits a significant long-term relationship with both the fixed capital stock and labor productivity. In line with Marx's theory, employment expands with fixed capital stock and contracts with labor productivity. In turn, the mass of profits has positive effects on both the capital stock and labor productivity. The empirical findings also support the existence of Marx's biased technical change as well as a negative feedback effect from employment to profits. JEL Classification: J21, C21, C22, B51 [ABSTRACT FROM AUTHOR]

In Marx's economic theory, the level of employment is fundamentally determined by capital accumulation. Nevertheless, that determination is contradictory since, on the one hand, the employment level expands with the capital stock while, on the other hand, it tends to contract with technical change and the growing productivity of labour. This article seeks to estimate this contradictory effect employing two complementary econometric methods: first, cross-sectional regression analysis for more than 100 countries in the years 2014, 2004, 1994 and 1984; second, time-series analysis for the United States, France, Japan, Turkey and Mexico from 1964 to 2014. Our empirical results are in line with Marx's theoretical framework: the level of employment grows with the expansion of fixed capital stock and reduces with increases in the productivity of labour. [ABSTRACT FROM AUTHOR]