Describe marxs theory of the falling rate of profit

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The tendency of the rate of profit to fall (TRPF), also known as the "law of the tendency of the rate of profit to fall" (LTRPF), is a hypothesis in economics and political economy, most famously expounded by Karl Marx in Part Three of Das Kapital, Volume 3. Although the existence of such a tendency is rejected by mainstream economics nowadays, it was generally accepted in the 19th century.[1]Geert Reuten states that "In Marx's day it was taken for granted among economists that there is such a law, both on empirical and theoretical grounds".[2] Economists as diverse asAdam Smith,[3]John Stuart Mill,[4]David Ricardo,[5]Stanley Jevons[6] andJohn Maynard Keynes[7] recognized a tendency of the rate of profit to fall. They differed in their opinion about why this might be the case.

Describe Marx's theory of the falling rate of profit and explain its relation to his value theory.

Additional RequirementsMin Pages: 2Other Requirements: 1000 words, mla citation.

Reference no: EM131056896

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