6 
/ysw* 
Thus the possibilities of increasing the capital-coefficient 
without reducing the profit rate depend on the size of the 
ruling profit margin, in other words, on the distribution 
of income. (It should immediately be noted that this ruling 
profit margin will be different for different size classes 
of firms.) 
\ We -Jttrtteer turn to the relation of capital intensity and 
productivity. It can be shown that the growth rate of the 
capital-output ratio equals the growth rate of capital per 
man minus the growth rate of output per man. On p. 33 I used 
, I 
different concepts: Instead of capital per man^the capital- 
cost ratio, and instead of output per man the sales-cost 
ratio. If we «asr take the wage as constant, the analysis 
of p. 53 will come to the same as the present analysis, but 
it should be noted that in fact real wages can differ 
, N (&vui 
between firms (e.g. of different sizes), Jwat especially over 
time. 
/& fit /d&tk- 
it seems^arttfriba that 1 the growth in productivity will ^ ^ 
outM/£»i^ the growth of capital intensity over a wide range,: 
In consequence the capital-output ratic will decline over 
this range. This is indeed apparently the course of much of 
the technical progress. It might be that beyond a point the 
relation will be reversed, the capital growth will oui.wtt'tyi 
the productivity growth, so that.capital-output ratio^in- 
crease^; ttirt will be diminishing^returns to capital which 
on p. 35 I atill took for plausible. Today I doubt whether