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Fred B. Moseley wrote:
> This is the second installment of my response to Ajit's (3741). It
> focuses on what I understand Marx's rationale to be for taking constant
> capital and variable capital as given quantities of money-capital at the
> beginning of his theory. One more installment to come on the key
> variable m in Marx's theory, the "money new-value produced per hour". I
> will also try to find the time to respond to more recent posts (my classes
> start tomorrow).
>
> Ajit wrote:
>
> "[Fred] takes C in money terms as *given* for the total economy as a
> whole. But who gives this C to Fred is what I don't understand. All Fred
> has to tell is that this is his logical method. What kind of logical
> method takes something as given without being able to explain how it is
> given."
>
> 1. Marx just assumes that this quantity of money-capital is a known
> quantity (it is "postulated", "presupposed", etc.). We know that in a
> certain period of time a certain amount of money-capital is invested to
> purchase means of production and labor-power. This amount of
> money-capital is in principle observable; it is an empirical given. This
> is a perfectly acceptable logical procedure. All theories have to begin
> with some initial givens. Ajit seems to think that the only legitimate
> givens for an economic theory are the physical quantities of inputs and
> outputs, i.e. the Sraffian initial givens. But surely this is not the
> only possible way to begin an economic theory. I argue that Marx started
> his theory with given quantities of money-capital, the initial quantities
> of money-capital used to purchase means of production and labor-power in
> the first phase of the circulation of capital.
________________________
Fred, Ajit is not that dumb "to think that the only legitimate givens for an
economic theory are the physical quantities of inputs and outputs, i.e. the
Sraffian initial givens." He has read some other theories to know that one can
begin from somewhere else as well. The problem I'm trying to bring home to you
is that your so-called givens presuppose the Sraffian givens. That is, the
Sraffian givens are prior to your givens, and so your givens have no
legitimate theoretical status. When a theory takes something as given, it
claims that those givens are determined in a space outside of its particular
theoretical space. For example, utility function in the neoclassical economics
is taken as given. By this the theory is claiming that the utility function is
determined by the psychology and the socio-psychological determinants that are
outside the scope of the economic theory. In your theory you do not claim that
those money variables are determined by the variables that are outside of the
scope of your theory. When you say that "We know that in a certain period of
time a certain amount of money-capital is invested to purchase means of
production and labor-power. This amount of
money-capital is in principle observable; it is an empirical given", you must
accept that this *observation* cannot take place independently of what was
"purchased" and how much at what price. Your empirical givens are *derived* by
taking the amounts of inputs and labor and their prices. By claiming that my
theory closes its eyes to it does not change the objective situation that the
theoretical givens in your theory are Sraffian givens plus the prices of all
inputs. Furthermore, when you go about determining your prices of production
by taking the disaggregated Ci's and Vi's, you never explain how do you get
these disaggregated figures without the knowledge of the Sraffian inputs. Just
saying that I take everything as given given given don't make a theory.
Cheers, ajit sinha
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