From: Jerry Levy (Gerald_A_Levy@MSN.COM)
Date: Sun Apr 22 2007 - 08:26:43 EDT
>>> By vindication I mean to argue in favour of the truth, justice or validity of something that has been subject to discussion. Lange vindicates the subjective theory of value as a devise to explain the every day exchange in the market and to efficiently allocate resources under capitalism or socialism. It doesn’t mean that Lange hasn’t believed in the usefulness of Marxian theory. He thought the later is useful for another purposes. <<< Hi Alejandro: There's no doubt that Lange came to be attracted to some of the analytical tools of marginalism. This does not mean that the subjective theory of value was vindicated thereby anymore than a Marxian theory of value is vindicated when someone abandons marginalism in favor of a Marxian perspective. *At best*, it was an assertion by Lange. Before one comes to the conclusion that the market is an efficient process which has guided the allocation of resources under capitalism and can do so under capitalism, let us consider from a global standpoint the consequences of this alleged capitalist efficiency. In due course, I believe that it will be commonly recognized that the most far-reaching and historically important consequence of capitalism has not been merely the development of the productive forces, instability, poverty, class oppression and economic crises, but has rather been the *systematic undermining of the conditions for the reproduction of life for our species and all others on this planet!* It was not surprising -- given the time and social context in which Lange wrote -- that he did not appreciate the extent to which the market, and "externalities", have etched this legacy into the land and seascape of Earth. If there is socialism, a burning and urgent question for workers will be whether we can collectively "salvage" the environment before it's too late for our species and others. Faith in the market, just like faith in the ability of new technologies to solve these problems, must be abandoned. >>> Clearly the relative merits of Marxian economics and of modern “bourgeois” economic theory belong to different “ranges”. Marxian economics can work the economic evolution of capitalist society into a consistent theory from which its necessity is deduced, while “bourgeois” economists get no further than mere historical description. On the other hand, “bourgeois” economics is able to grasp the phenomena of the every-day life of a capitalist economy in a manner that is far superior to anything the Marxists can produce […] In people want to anticipate the development of Capitalism over a long period a knowledge of Marx is a much more effective starting point than a knowledge of Wieser, Boehm-Bawerk, Pareto or even Marshall (though the last-named is in this respect much superior). But Marxian economics would be a poor basis for running a central bank or anticipating the effects of a change in the rate of discount. (pp. 191-192) Oskar Lange, “Marxian Economics and Modern Economic Theory”, The Review of Economic Studies, Vol. 2, Nº 3, (Jun., 1935). <<< I agree with you that Marx was very concerned with the problems of everyday life under capitalism -- hence his repeated admiration for Engels' book _The Condition of the Working Class in England_ and his many journalistic articles which reported on a wide range of events. Lange's claim, however, that bourgeois economics is better able to grasp those realities is (once again) at best an assertion. To the extent to which Marx was concerned with everyday phenomena, he was far more concerned with the everyday lives of the working class than with central bank policy. He did not see to establish a role for himself as a policy advisor for states and capitalist institutions: he was a revolutionary and tended to focus on those everyday events which had significance for grasping the condition of workers and had implications for the revolutionary struggle against capitalism. In solidarity, Jerry
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