Table of Contents

The Great Financial Meltdown

The Great Financial Meltdown

Systemic, Conjunctural or Policy Created?

New Directions in Modern Economics series

Edited by Turan Subasat

The Great Financial Meltdown reviews, advocates and critiques the systemic, conjunctural and policy-based explanations for the 2008 crisis. The book expertly examines these explanations to assess their analytical and empirical validity. Comprehensive yet accessible chapters, written by a collection of prominent authors, cover a wide range of political economy approaches to the crisis, from Marxian through to Post Keynesian and other heterodox schools.

Chapter 4: Monocausality and crisis theory: a reply to David Harvey

Michael Roberts

Subjects: economics and finance, financial economics and regulation, radical and feminist economics


This chapter aims to refute the arguments of David Harvey that Marx’s law of the tendency of the rate of profit to fall is not relevant to any Marxist theory of crises under capitalism. The chapter argues that, contrary to recent revisionist scholarship, Marx did not abandon his law of profitability or ignore it as a theory of crises in his later years. It attempts to defend the view that Marx’s law is logically consistent with his law of value; that the law is relevant to a coherent theory of crises; and, moreover, that the law provides the underlying explanation and ultimate cause of crises in the capitalist mode of production. The law provides a clear causality for crises that is backed up by a growing amount of empirical evidence compiled by many scholars. The nature of the law as a tendency along with counter-tendencies can explain the cyclical development of capitalist production better than any alternative theories of crises presented by Marxists in the past and David Harvey now.

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