Final answer:
Karl Marx criticized David Ricardo's theory of profit decline, emphasizing that Ricardo's model ignored the impact of constant capital on the rate of profit, which contradicts the situation where capital investment in machinery leads to a fall in profit rates.
Step-by-step explanation:
Marx's criticism about the Ricardian theory of rate of profit decline primarily rested on the reason that Ricardo's corn model did not consider constant capital. Marx believed that over time, industrial capitalists would invest more in constant capital (machinery, tools, etc.) and less in variable capital (human labor). This increased investment in constant capital would lead to a higher organic composition of capital and, according to Marx, a decline in the general rate of profit since surplus value is produced only by variable capital - human labor.
David Ricardo was an important figure in economics who argued for specialization and free trade in his treatise On the Principles of Political Economy and Taxation. His theories included the advantages of free trade based on the principle of comparative advantage. However, Karl Marx, viewing industrialization and capitalism through a lens of social conflict, critiqued Ricardo's theories by incorporating the dynamism of capitalist production and the role of labor in creating value.