Land, technical progress and the falling rate of profit

The paper sets out a one sector growth model with a neoclassical production function in land and a capital–labour aggregate. If the elasticity of substitution between land and the capital–labour aggregate is less than one and if the rate of capital augmenting technical progress is strictly positive, then the rate of profit will fall to zero. This result holds regardless of the rate of land augmenting technical progress: no amount of technical advance in agriculture can stop the fall in the rate of profit. The paper also discusses the relation of this result to the classical and Marxist literature.