ABSTRACT
This chapter argues for the persistent theoretical and empirical validity of the Law as the unsurpassed theory of crises in modern capitalism. It focusses on the most important economy worldwide, the US. The US economy has been subdivided into productive and unproductive sectors and the sectors producing material goods have been chosen as a proxy for the former. As for the unproductive sectors, the focus is only on finance and speculation. Even though the secular trend is downward, the average rate of profit (ARP) starts rising from the mid-1980s. The replacement of labor by means of production, or greater efficiency, causes average profitability to fall. Thus, a falling ARP indicates that, given a lower mass of surplus value produced, the profitability of the innovators rises while that of the technological laggards and the ARP fall. As more and more capitalists introduce the new technologies, increasingly less labor is employed and less surplus value is generated.
