[jwmhjwmh]

If you automate everything, how is profit made? Say every firm charges a 5% markup above costs of materials and machine upkeep. A given firm must pay other firms' 5% markups on the materials it needs, making it cheaper for the firm to produce those materials itself. This tends toward complete centralization. There are two ways to fix this. The first is to have an economy based on many monopolies trading resources. This obviously suboptimal for economic calculation. The second way is to adopt a planned economy.

As labor productivity increases, profitability decreases, as historical data shows[1]. In the long term, this problem of capitalism cannot be avoided.

[1]: https://thenextrecession.wordpress.com/2022/01/22/a-world-ra...

[imtringued]

Or you could just allow the interest rate on capital to fall to 0% by introducing a negative interest rate on cash and close up all the economic rent seeking via land value taxes and similar approaches. That would eliminate the profitability and growth requirement and result in the end of capitalism as we will have too much capital to care about it specifically.

[bumby]

If you automate everything, how is profit made?

I think profit is a different issue. Profit is not necessarily dependent of automation. Automation is just a means to reduce human labor. Generally, this increases efficiency which leads to increased productivity, but it's definitely not the only way to improve efficiency. There are other ways of increasing productivity and I would argue you will never have completely efficient processes. And innovation is always a potential disrupter to generate new profit.

Even Marx said it's just a tendency for profit to fall and not an absolute maxim.