About new book “Economy from the standpoint of a physicist” by A. Nenashev
This work on political economy written by physicist. In the first part of the book the usual economic laws that are postulated, are proved as theorems.
It’s unusual that the author shares the economic laws and the laws of the capitalist economy, which is dedicated to the second part.
The third part is devoted to the modern neo-capitalism, that is differs from «classical» capitalism.
The fourth part deals NON-capitalist solution for the future. It is not anti-capitalist, namely non-capitalist ideas. The possible to be for NON - capitalism is follows from the fact that there are fundamental economic relations (Part I), and capitalism is only one way to ensure their functioning.
The economic science as many researchers notice, is based on supervision and interpretation that leads to dispersion of the points of view on this or that economic problem. In this work I made attempt to apply natural-science methods to search of the most fundamental interactions and terms which use would allow to approach the unambiguous solution of such known political economic problems as definition of essence of the price, values, profits, capital, operation, crises... . In our unstable century importance of answers to these questions grows.
In this book for the purpose of the study of economical interactions the methodology of hard science has been used and the physical concepts such as “invariant”, “observed quantity” etc are being introduced. If the fundamental relations are found correctly, partial conclusions from them will be true and it is easy to be checked. Following this approach, the concept of pure value is entered, equality of production — an exchange and the conclusions following from it is formulated. For example, it is shown that money, the existence of currency circulation, is a consequence of the economic invariant (Part 1).
Other natural-science approach — transition from special values to integrated ones allowed to find a common ground between the different, often competing economic schools. Use of this approach for the understanding of concepts of the capital, profit, exploitation, helped to define the conditions of the development of capitalism.(Part II)
The political and economic changes in the world happening at the beginning of our century again raise a question of capitalism: about laws of its development, that the new, post-industrial phase bears it. Consideration of these problems together with the use of basic provisions and equations allowed to formulate and to provide description of principles of neo-capitalism – the predominant system in current world economy. (Part III).
Considering the changes in socioeconomic interactions which took place in the last century, comparing current situation with predictions of former social and economic theories, there is an opportunity to determine those moments when classical theories began to disperse from real results. The accounting of these differences allows to determine emergence and development of non-stability in current economy and to make assumptions of possible changes of the existing economic relations (Part IV).
In this work the concept of pure value – expression (1a) — the differences of value of goods and its price which is key in pricing is offered. Pure value is based on the most general ideas of conscious human activity and terms of the exchange, on situation that in the course of purposeful activity of people creates more, than spends means, and that in an exchange both parties have to gain income. When using pure value the law of supply and demand is proved (and not just it is fixed): if the price decreases, the difference of value and price increases, so for bigger number of people the goods get the great pure value thereof the number of buyers (Figures 2a, 2b, 2c) grows.
Equality of production — exchange (4), (5) and (16) - comparison of pure value and net income in unit of time, determines the size of a proportion of the price and the income of the producer, social pure value and the price when the balance of volume of supply and demand is established. If equality the exchange that leads to the crisis phenomena in economy is broken, becomes impossible. Studying of equality helped to formulate important consequences: interdependence of the income of the producer and buyer, existence of white inflation — process of increase in the price and pure value of a product, advantage of inflationary processes over deflationary.
Use of equality of production — an exchange to all productions in production technological chains gives the chance to make the chains of equalities connecting all producers and buyers in this economy — (10). The competition condition (the maximum competitive productivity) allows to connect cross chains of equalities among themselves, turning productivity on pure value (the volume of pure value in unit of time) in an economy invariant, creating prerequisites for introduction of uniform coefficients of an exchange — money (11), (12). It is important that thanks to white inflation the uneven growth of labor productivity in different segments of economy does not disturb performance of equalities of production — an exchange.
Three possibilities of change of chains of equalities of production — an exchange for development of new productions understand. It can occur by withdrawal of part of the income (development in option 1), at increase of a standard of living when buyers are interested in new goods (option 2), and by
issue of funds for innovations which as it is supposed, will create the great pure value (option 3).
In the second part of the book the concept of capital as sizes of pure value in unit of time is entered. Thus, it is possible to leave from concept of capital as certain constant (the sum of means or goods for production) and to come to concept of capital as process which only at development in time has an obvious embodiment — pure value; as the sizes similar to energy in natural sciences, the size passing from one look into another.
It is shown that societies with a different productivity on pure value (with different economies) are divided by a valuable barrier (Figures 5a and 5b), it is characterized by coefficient of a barrier - equality (15). The concept of a barrier allows to explain Loukas's paradox about a capital overflowing from the poor countries in the rich. Also there is clear a reason of delay of growth of developing countries at increase in foreign investments in them. Those and other facts are absolutely inexplicable from a position of the classical economic theory.
The problem of operation and compensation is also defined at the appeal to equality of production — an exchange. The owner — is the one who forms equality and who possesses net income, the hired worker — the one who receives a salary which enters equality of production - an exchange (5) as the account part reducing the pure value of the made goods. Also, when there are hired workers and, so the expense in the form of payment of a salary to them, arises concept of profit, it is part of the income of all enterprise of which only the owner disposes. That is in the course of a turn of capital there is a bottleneck, peculiar "a bottle neck" — private opportunity to influence (in particular, by means of a financial type of the capital) public balance of conditions of production and an exchange. Thereof the private requirement of continuous profit markup of profit, its growth on a geometrical progression (18) that leads to a separation of growth of capital from growth of volumes of the made goods, from growth of their pure value is met. It breaks off chains of exchange equalities, destroys work of uniform economy. Such separation cannot but arise and cannot be stopped differently, as crises (Figures 9a and 9b).
In the third part of the book differences of the modern capitalist relations called neocapitalism from what were formulated by economists in XVIII — the beginning of the XX centuries are analyzed that allows to investigate evolution of capitalism - the main economic system of our time. Influence on performance of equalities of production — an exchange of "the third pole" of the capitalist relations, namely buyers which both owners, and workers are is noted. The system uniting both the production, and trade, consumer relations becomes more difficult. The system of crediting penetrating all modern economy, especially crediting of the final buyer gives a certain stability and opportunity to stop the crisis phenomena to it. Because of it there are important consequences: more people can use capital which thus continues to concentrate at limited number of persons; the financial capital growing under the law of difficult percent receives a support in the form of capital – works of real objects of economy; valuable the barrier is used for control of the shaft of debts hanging over developed economies.
At neocapitalism there is a peculiar class of neoworkers — these are the businessmen using the loan capital and, thus, operated by means of payment of percent on it.
The business owners surviving in competitive fight face ultraboundary operation: to gain income after payment of percent, they have to make constantly ultraboundary profit, big, than average profit on economy. Such loading forces them to use all opportunities of technical progress to increase the value of the made goods.
In large corporations not only tactical, but already and strategic, "master's" issues of capitalization are resolved by top managers. Owing to all this the importance of a private property falls a little, economic freedom is more appreciated, to begin the business, opportunity to do business.
The neocapitalistic economy issues secondary securities under future profit which papers "about possession of the capital" can bring that allows it to have both the production, and financial capital at the same time, without waiting for their turn. Thus, the commodity capital assumes an air of the financial. The turn of capital is characterized already by expression "the credit — a treatment — (the credit + percent)" (19). Becomes necessary not to hold stocks of the enterprise, derivative securities, gaining from them "master's income", and to trade in them, constantly to turn. In medium-term prospect there is important not a profit of the issuer of papers, and simply rather long existence of firm - the issuer.
It is separately shown that financial structures at neocapitalism have possibility of statistical management of private business, so, change of an interest rate or deprives of possibility of one thousand people to have "the business", or softens conditions of its maintaining.
The freezing of crises — opportunity to increase capital became the most interesting phenomenon in neocapitalism, without allowing them to turn into a commodity form in general which cannot grow under laws of difficult percent. So, supergoods of neocapitalism was the real estate in which it is possible to invest, without being afraid of commodity crisis. It grows in the price, makes profit, without participating in the address As well the state emitting the securities demanded in the world market is one of the most important mechanisms of freezing of debt crisis. Allows to provide growth of capital also the new segment of economy connected with demand management, advertizing first of all; it helps to increase the pure value of goods, changing not their properties, but property of buyers.
Influence of the frozen capital can be considered in equality of production — an exchange in the form of the phantom value increasing both the pure value, and productivity on pure value. It leads to rise in price of currencies of the developed countries, increase of a valuable barrier and still bigger inflow of the real production and commodity capitals to the rich countries from the developing. Moreover, because globalization of economy compels farms of developing countries to participate in the financial address of neocapitalism, they are interested in acquisition of credit obligations of the developed countries that increases their value even more.
Meanwhile the unlimited growth of capital nevertheless conducts to crisis. As recession of 2008-2009 showed, households cannot repay the loans at uncontrollable expansion of a mortgage, that is the supergoods of neocapitalism cease to carry out function of a freezing. Possible global crisis (so to speak, a defrosting) contacts consumption level in the countries where crediting of the end user, internal consumption became a basis of economic development. Crucial importance renders on it valuable a barrier when the weak countries finance and in many respects contain the developed. Then refusal of the developing states of participation in the neocapitalistic relations of the rich countries, refusal of use of their currencies, purchases of their securities and, moreover, the offer of their obligations for payment (for financing of own projects), can destroy all present system of neocapitalism founded on loan percent.
In the last, the fourth, parts of the book, are investigated positive and negative sides of neocapitalism, possibility of refusal of the neocapitalistic relations. Though they satisfy to equalities of production — an exchange (this most important), allow to realize in many respects a personal initiative of people, raise a standard of living and demand performance of laws in society — nevertheless also negative tendencies collect: growth of debts is accelerated, growth of productivity is slowed down; mass use of fruits of technical progress comes into conflict with the private competitive organization of production; and also the new type of the person — homo neocapitalus, meeting requirements of senseless consumption and growth of the credit address is brought up.
The solution of the majority of problems of neocapitalism seems in replacing the competition with a condition of direct dependence of the price of goods on results of its subsequent operation. In this case equality of production — an exchange is also carried out, but there is a replacement of the principle of maximizing profit by maximizing pure value. Then the Noncapitalistic economy solves a problem of maximizing not profit which is got by owners, and pure value for the buyer and the related net income of the producer. It is necessary for transition to Non-capitalism that not the private, master's firm became the main object of economy, and the responsible personality, that is it is necessary to transfer object of economy to more fundamental level, to the producer directly connected with results of the work. In this case short action of purchase and sale in capitalist system (system of the markets, the competition, arrived also other) is replaced with interdependent process of payment and use of goods. This process is necessary and sufficient for Noncapitalistic system of managing. It is important that it is possible to make use of the experience of the solution of problems of a guarantee, insurance, transparency of firms, a free access to information which is saved up by market economy for its performance and revolutionary change of the property rights is not required.
The way to direct interest in the pure value of goods (that is in a demand, quality, their further usability) all occupied on production, and not just owners opens. Interest in foreign success receives an economic, and not just humanistic basis, which creates conditions for high-performance works in association.
The concept of freedom on production for everyone affecting the fundamental principles of production and an exchange appears wider. It gives stability to Non-capitalism's system. In general, we can say that if capitalism directs man to be above all the rich, the Non-capitalism conditions directly aim at something to make the wealth of his neighbor, and therefore himself.
It is not less important that sprouts of the similar Noncapitalistic address already exist. Experience of firms where the buyer himself quotes the price which he is ready to pay for goods is most interesting. Such condition forces the producer to provide a product of the highest quality irrespective of the competition.