Falling rate of Intelligence?

Conventional marxist theory used to argue that capitalism was doomed to regular and deepening crisis due to the impact of a phenomen known as ‘the falling rate of profit’. Basically the idea runs as follows: since on the marxist view labour is the only source of genuine wealth creation, and capital accumulation means that the proportion of active labour to ‘dead labour’ (capital investment) tends to decline, then the ‘rate of profit’ will diminish accordingly. Now I certainly have no intention of going into all this rigmorole, but I do remember some wit back in the seventies suggesting that if this was the case, then, for example, we could argue that intelligence must be falling, since the quantity of active human brainpower as a proportion of accumulated knowledge (living to dead ‘mental labour’) was constantly diminishing.

Well, low and behold, a paper out this week at the NBER argues just this case.
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