Recently, Professor Xian Zhang of the School of Economics, Sichuan University, cooperated with Professor Yufeng Xue of the School of Marxism, Yunnan University of Finance and Economics, published a paper entitled "Critical Deconstruction of the Okishio's Theorem" inSocial Sciences in China (6th Issue, 2020).
The tendency of the profit rate to fall is the most essential law of capitalism revealed by Marx, which is also the most difficult to understand. The law has become controversial since it was first proposed, giving rise to two different views and theoretical arguments about affirming and denying this law. Nobuo Okishio is a well-knownJapanese mathematical Marxian economist. While studying Marx's theory of value, he proposed his famous Okishio's theorem: intuitively, it can be understood as saying that if one capitalist raises his profits by introducing a new technique that cuts his costs, the collective or generalrate of profitin society - for all capitalists – goes up.The research and debate on the ground of Okishio's theorem has become an important issue that cannot be avoided in the study of Marxist economics.
This paper (of Professor Zhang) chooses this important subject, makes a systematic and in-depth study of Okishio's theorem, and points out a series of problems and contradictions in the process of proving Okishio's theorem. It further points out the fundamental reason why Okishio's theorem cannot be established. In this paper, the author makes a critical and comprehensive deconstruction of Okishio's theorem from the theoretical basis and the mathematical model that the theorem adopts. It has made up for the defects and deficiencies in the research of Okishio's theorem in a certain sense. At the same time, the paper makes a mathematical summary of the mechanism that the profit rate tends to fall in line with Marx's original intention according to the game theory thought embodied in Marx's demonstration of the tendency of the profit rate to fall.
Professor Zhang has been dedicated to the teaching and research of Capital for a long time. He has published research papers in Social Sciences in China, Studies on Marxism and Economic Research Journal. Moreover, he has published books such as Introduction to Economic Dynamics, Research on China's Financial System Reform, and Marx’s Economics (translation work).
