This is a response to Diego's 7347. Diego, thanks again. On Thu, 6 Jun 2002, Diego wrote: > This is a responde to Fred's 7328 > > > Rakesh (or Diego or others), would you please explain further what is > > meant by "real determination", as opposed to "conceptual > > determination"? Thanks. > > > > > > Comradely, > > Fred Diego, unfortunately your long and interesting post (see below) does not answer this question that I posed in my previous post (or I don't see how it does). In a previous post, I argued that the "matrix algebra" interpretation of Marx's theory does not really provide a theory of exploitation, because the theory of value and surplus-value in Volume 1 plays no essential role in the determination of the rate of profit and prices of production in Volume 3. In other words, Samuelson and Steedman's critique of the "matrix algebra" interpretation of Marx' s theory is correct - value and surplus-value are "redundant". (Their mistake is to equate this interpretation with Marx's theory itself). You (and Rakesh) replied by endorsing Shaikh's defense against Samuelson and Steedman's critique, which is based on Shaikh's distinction between "real determination" and "conceptual determination". I replied that this distinction as employed by Shaikh makes no sense to me, and I asked for further explanation about the differences between "real determination" and "conceptual determination" (i.e. the above question). So I would still like to have further clarification of this important point. (I have also asked Rakesh the same question). Otherwise, I would conclude that Shaikh's defense fails, and that Samuelson and Steedman's critique of the "matrix algebra" interpretation of Marx's theory is valid - value and surplus-value are redundant in this interpretation. I will discuss later some of the other points you discuss in your post, but I would first like to follow through on this key question from our previous discussion. Comradely, Fred > > > The theory of value is a theory about the behavior of prices. The Labor > theory of value (LTV), as I understand it and defend it is a theory of > prices which asserts: > > A) In social, capitalist reality there are real prices of two > kinds: prices of the commodities in social human time consumed in their > reproduction (1-prices) and their evident manifestation in > business: 2-prices (specially, monetary prices). There are 2-prices > because there are 1-prices, ie, because the process of labor in a > certain kind of society adopts a certain, fragmentary, etc. form. But > 2-prices are as real as 1-prices are. > > B) social reality determines social conscience. The existence of > real, effective, actual prices, requires that we theoreticians > understand their behavior. In order to this we need to construct > theoretical model-prices which allow us to capture and explain the real > movement of real prices. > > > Assertion A is unique for the LTV. Assertion B is not. Theoreticians > who do not support the LTV should say what are absolute prices made > of. If they think that just relative prices exist, they must be aware > that their theoretical behavior differs very much from the behavior of > scientists in all other disciplines (there is no relative weight or > volume without previously being an absolute weight or volume, etc.). > > > In my opinion, the supporters of the LTV are those who assert that > absolute prices are made of quantities of labor. > > > Another question refers to the quantitative relationship between > theoretical and effective prices (either absolute or relative). I take > effective prices in a double sense: the price of every single > transaction, and also average prices in a pure, statistical sense (e.g., > in a month, a year, etc.). One important point is that defenders of the > LTV may disagree in grasping this quantitative relationship. Of course, > Marx gave a crucial importance to this quantitative relationship, and > made his best at this regard. But I think he can and should be > improved. However this is a point to discuss later. Let's focus on > another point now. > > > Fred thinks that we should do as Marx did: to begin with effective > prices of the inputs and add to them the actual quantity of direct labor > in order to figure out "volume I-values", and then to redistribute > surplus-values in order to calculate "volume III-values". Well, both > values are theoretical prices in the sense of my table above, and it > does not matter if they are taken as absolute or relative prices. > > > In my opinion, this procedure -which I think was the one Marx had in > mind-is a theoretically correct approach. It is the best approach when > one does not have access to more accurate methods. It is my contention > that were Marx known matrix algebra -which can be used for dynamic > purposes, of course--, he would not have had any problems with using the > same theoretical prices of the inputs that the theoretical prices of the > outputs he was looking for. He did not know how to do this. Now we know > how to do it. We can use eigenequations in order to obtain the two most > popular theoretical prices used in our literature: direct prices and > production prices (both of which can be understood as either quantities > of labor or money). The only difference consists of using either the > rate of surplus-value or the rate of profit as the crucial element in > the relevant eigenvalues. > > > Both kinds of theoretical prices are not interchangeable. If we are > just considering the "vertical" relationship capital-workers, ie, > exploitation, we should start from direct prices. If we are considering > vertical and horizontal relationships altogether, we can start from > production prices (which are, in my opinion, the same kind of values as > direct values are) and we may as well be interested in comparing the > latter with the so-called (by Marx) "individual" values, etc. > > > The health of the LTV does not hinge on whether we begin with direct > prices or production prices, but on being aware that: 1) relative prices > exist because absolute prices exist (ie a certain type of real labor > processes exist); 2) theoretical prices are a tool for understanding the > behavior of effective prices. > > > In this approach, Bródy, Shaikh or Martínez Marzoa are not "Matrix > algebra Marxists" but modern supporters of the LTV who make use of the > mathematical tools available to all. Would someone say that if a Marxist > takes a derivative he belongs to the "Marginalist Marxism" school? > > > What is primarily important in Marx is not his methods, but his > results. His methods matter too, but insofar as they help explaining and > understanding his results. > > > Comradely, > > Diego > >
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