Superprofits

(redirected from Superprofit)
Also found in: Dictionary, Wikipedia.

Superprofits

 

in the capitalist enonomy, a category reflecting the excess (surplus) of the profit of capitalist enterprises and monopolies over the average profit.

During the premonopoly period of capitalist development, superprofits were a converted form of excess surplus value. In industry, superprofits are obtained by technologically advanced enterprises for which, as a consequence of the high organic structure of capital, the level of production outlays is below the sectoral average. In the “Theories of Surplus Value” (vol. 4 of Das Kapital), K. Marx wrote that superprofits (or surplus profit) in industry are obtained “by the most productive capital” (K. Marx and F. Engels, Soch., 2nd ed., vol. 26, part 2, p. 97). He emphasized that “in industry, surplus profit is obtained, as a rule, from a reduction in the cost of the product” (ibid., p. 9). During the period of premonopoly capitalism, superprofits have a temporary, sporadic character, because as the productive forces develop, technological innovations and inventions are introduced at many enterprises. Superprofits decline at one enterprise and emerge at another, where new, more advanced machines are put into operation. In agriculture the additional profit resulting from more favorable natural and transportation conditions and the consistent investment of capital in land can serve as the source of superprofits.

Under imperialism, particularly during the period of state-monopoly capitalism, superprofits become high monopoly profits and act as the motive force and regulator of capitalist production. The monopolies’ superprofits increase steadily. For example, in Great Britain during 1973 alone, the profits of the companies producing the means of production increased by 50 percent, and those of companies producing consumer goods, by 43 percent. In Japan the profits of monopolistic associations increased by 36 percent between 1969 and 1972, and the profits of nonmonopolistic enterprises, by 24 percent.

V. I. Lenin pointed out that high monopoly profits give the capitalists the economic opportunity to buy off individual strata of the workers, winning them over to the side of the bourgeoisie of a given sector or given nation (Poln. sobr. soch., 5th ed., vol. 27, p. 423).

In the present stage of the development of state-monopoly capitalism, the sources of superprofits include the exploitation of the working people at the enterprises of monopolistic associations. The use of new technology, inventions, and scientific discoveries, which leads to increased labor productivity and reduced production outlays, plays an important role in this type of exploitation. Another source of superprofits is savings in production outlays when the monopolies obtain cheap electric power and gas from state enterprises or transport their cargo on state railroads at reduced rates. This essentially constitutes a hidden form of state subsidies for the monopolies. Superprofits may also result from the exploitation of the working people at nonmonopolistic enterprises and in economically backward countries which are characterized by low wages and a longer workday. In addition, such profits are promoted by the establishment of monopolistic prices, at which monopoly capital sells its commodities (machinery and equipment) to agricultural enterprises, purchasing agricultural products at low prices. As a result, the industrial monopolies receive not only a portion of the profits of the capitalists in agriculture but also the surplus product of small-scale commodity producers who do not exploit alien labor. A system of low prices for raw materials and agricultural products is widely used to fleece the economically underdeveloped countries. Another source of superprofits is the redistribution of national income through the financial system of the capitalist countries. Enormous profits are also received from the state budget by the military-industrial complexes, in the form of payments for military orders at exceedingly high prices, the payment of interest on state loans, numerous subsidies, financial aid, and credits. Generous tax benefits for the monopolies are also a source of superprofits.

REFERENCCE

Finansy kapilalisticheskikh gosudarstv. Moscow, 1975.

R. D. VINOKUR and L. A. DROBOZINA

References in periodicals archive ?
This is when firms should concentrate their efforts on maintaining their superprofit and blocking entry to competitors.
The category manager next examines SuperProfit Foods' standing within the market, finding, for example:
On the taxation front, the state turned decisively to use its power of taxation to circumscribe private trade, signaled most explicitly by the introduction of a new tax on "superprofits" in the summer of 1926 that targeted the two highest license categories of businesses.
Par Han Khachaba Si cette affaire est une fraude geante organisee par des mafias a l'echelle europeenne en vue de realiser rapidement des superprofits, elle occulte cependant un probleme essentiel, autant chez eux que chez nous, qui est celui de l'elevage des animaux, de l'importation incontrolee, du stockage des produits alimentaires et de la qualite finale des produits vendus.
The superprofits of one year evaporated as deficit dominated the financial ledgers twelve months later.
As a result, there was only insubstantial regulation, as witnessed by the rapid return to superprofits and bonuses at Goldman Sachs and the other too-big-to-fail financial institutions from 2009.
Thus the only way this French company can increase its superprofits is by slapping huge price increases on us.
Moreover, Japanese corporations and banks are as attracted by the prospect of superprofits from the exploitation of the resources of the region as major U.S.
To put the superprofits of the two years in perspective, a baseline was established in which profits were averaged for the six years from 1998-2003.
Ruhs proposes mechanisms that would channel the "economic rents" or superprofits generated from using foreign workers to alleviate any negative consequences for domestic workers--that is, to overcome the resistance of domestic workers through side-payments for displaced workers and perhaps through funds invested in productivity to reduce dependence on low-wage labor.
Sassen argues that what is evident today is a process of valorization, indeed over-valorization, of certain types of economic activity, such as finance and other specialized services, and a concomitant devalorization of manufacturing and low-value added services because these do not generate the types of superprofits characteristic of much financial activity (Sassen 1998a, 86-89).
It gave these new superpowers the ability to generate superprofits by providing standardized fare, de-emphasizing more costly local and original shows, and turning radio programming into a vast infomercial.