[OPE-L:2266] Re: Re: Re: Re: value-form theories

From: Michael J Williams (michael@williamsmj.screaming.net)
Date: Fri Jan 21 2000 - 11:04:49 EST

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Some comments on Fred's post
----- Original Message -----
From: Fred B. Moseley <fmoseley@mtholyoke.edu>
To: <ope-l@galaxy.csuchico.edu>
Sent: Friday, January 21, 2000 1:19 PM
Subject: [OPE-L:2262] Re: : : value-form theories

> 2. I would like to emphasize that the "Steedman critique" has to do
> specifically with Marx's theory of prices of production and the rate of
> profit in Part 2 of Vol. 3. Steedman (following many others) argues that
> Marx's theory of prices of production is "inconsistent" (i.e. failed to
> transform inputs) and "unnecessary" (i.e. "redundant" in the determination
> of prices of production and the rate of profit). Steedman argues further
> that Sraffian theory is therefore the preferred theory of prices of
> production and the rate of profit.


> As best I can tell, VF theory does NOT respond to the "Steedman critique"
> by presenting a better quantitative theory of prices of production and the
> rate of profit.

As Chris has pointed out, VFT is not a 'response' to Steedman in this sense.
It is a (perhaps a number of differing) interpretations and developments of
Marx's theory united by a rejection of the coherence of any embodied labour
theory of value, including the one that Steedman criticises.

It's relationship to the 'linear production' interpretation of Sraffa is
complex. For me, VFT's most important contribution here is to provide an
interpretation of what such a theory of prices means. At its simplest, the
linear production approach models the exchange ratios between outputs
dictated by the imperatives of simple reproduction. Such exchange ratios are
at most but one component of the determination of prices.

>Saying that the
> determination of prices of production is "systemic" does not provide an
> alternative quantitative theory.

Of course not - it merely indicates a key characteristic of VFT's
understanding of how prices (not 'prices of production', which are of course
in fact values adjusted for heterogeneous compositions of capital assuming
equal profit rates) are determined in a market capitalist economy.

> No equation is presented for the precise
> determination of prices of production

imo, it is not the absence or presence of an equation that is at issue, but
of the interpretation of such an equation. VFT argues that not only prices
but also values are monetary phenomena. There is a quantitative relationship
between abstract labour and prices; *but* 1) this is being continually
reconstituted as the system reproduces itself and 2) the constitution of
abstract labour from concrete labours (of differing use-value
productivities, intensities, skills, etc) is itself an actual process. This
problematizes the interpretation of an equation claiming to capture a
determining ('causal'?) relationship between price and value magnitudes. It
no longer seems adequate to stipulate a one-way causal link from abstract
labour to value to price: that misses out the role of the market price
system in allocating labour to different technical-material labour processes
that involves both constituting abstract labour and at the same time
dividing it up between different labour processes.
In short, the discussion here is not about who's got an equation, but about
how such equations are to be interpreted.

But that does not justify Fred's assertion :
> Once again, VF theory appears
> not to be very interested in quantitative questions

> >
> Presumably then VF theory is also compatible with the Sraffian theory of
> prices of production, right?

VFT, or rather systematic dialectics is a synthetic method. As such it seeks
to critically appropriate the partial truths of any serious political
economy. An indication of my take on how it might do just that with linear
production models is given above.

Consequently, Fred's conclusion:
> If so, then the VF theory accepts not only
> the "Steedman critique", but also Steedman's quantitative theory of prices
> of production and the rate of profit.

does not follow. To 'critically appropriate' is not to 'capitulate to'. What
do you think Herr Marx was up to when he was writing the notes on classical
political economy gathered together into TSV ...?

> 4. I have presented in several papers a different response to the
> "Steedman critique". I argue that the "Steedman critique" misunderstands
> Marx's logical method in the determination of the rate of profit and
> prices of production. The "Steedman critique" attributes to Marx's
> theory the logical method of Sraffa's theory (i.e. linear production
> theory), following an interpretation that started with Meek and Dobb in
> the 1960s.

I have no general disagreement with your arguments concerning the one-sided
interpretation of Sraffian models.
> But I argue that this is a misunderstanding of Marx's logical method,
> on two key points: (1) the determination of aggregate magnitudes and the
> general rate of profit prior to the determination of individual magnitudes
> and prices of production, and (2) the initial givens in Marx's theory of
> surplus-value (Vol. 1) and prices of production (Vol. 3) are quantities of
> money-capital, not physical quantities of inputs and outputs, as in
> Sraffian theory and in the Sraffian interpretation of Marx's theory.

I have no problem with (1) as a partial economistic moment of a systemic
perspective on capitalism.
I do have a problem with your repeated use of 'givens' as here. I agree that
the one-eyed neglect of Money in Sraffian models is a problem. But how
exactly are we to interpret some such statement from you as 'the quantity of
money capital is taken as given'.

Is it
A. a ceteris paribus assumption made by the theory or the theorist? If so
what kind is it; how do we deal with it in interpreting your model in order
to give us some insight into the real world?
B. an empirical claim about the imperatives of capitalism? i.e. 'it is a
characteristic of the system that money capital exists as a given quantity'?
C. an empirical claim about the rules of thumb by which capitalists make
decisions? e.g. that they typically start with a sum of money and then
decide what to do with it?
 or what?

These are not trivial questions if one wishes to interpret one's equations
in order to draw some insights about the real world on the basis of them.
> Once Marx's own logical method is better understood, then the "Steedman
> critique" simply does not apply to Marx's theory.

Agreed. If we can take 'logic' more broadly than simply 'formal logic' this
is indeed a central thrust of the VF approach.

> Marx did not "forget to
> transform the inputs"; and Marx's value analysis is not "redundant",

agreed, although probably for reasons other than yours.

> (value
> analysis determines the rate of profit, which is then taken as given in
> the determination of prices of production).

This is perhaps a bit too elliptical? 'value analysis' (better: 'theory')
provides an account of what determines the rate of profit under capitalism;
'analysis' (or 'theory') cannot itself 'determine' a real world variable (at
least not without the intervention of some reflexive mechanism).

> Instead, the "Steedman
> critique" applies only to the misguided attempt to interpret Marx's theory
> in terms of Sraffa's theory.

> I look forward to further discussion.

Me too - although the professional demands of the up-coming seminar will
soon reduce my contributions to a trickle at best.

Dr Michael Williams
Economics and Social Sciences
De Montfort University
Milton Keynes
fax: 0870 133 1147
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