I've been reluctant to engage on the question of which of the interpretations of the theory of value better represent Marx's thought, on the grounds that experts in Marxist exegesis are better situated than I am to form a judgment on this vexed issue. But I had occasion this weekend to re-read Part Two of Volume III of Capital (in the Penguin edition), and inevitably read it in part in the light of the controversies on the list and elsewhere. Since I don't read German, I can't determine whether the translation has some systematic biases in it, but for what it's worth here are some observations. 1) Marx's distinction between the technical and value compositions of capital seems to point toward the modern Sraffian notion of a technique of production determined prior to or at least separate from prices and the profit rate. (Here I think I agree with Ajit.) 2) I didn't see much positive evidence that Marx was a temporalist. I could discern no explicit discussion of the timing of prices and profit rates. It seems to me that the temporalist claim has to rest on an indirect argument that it is consistent with some of the conclusions Marx drew (the conservation of total value, constant capital, and the profit rate in the movement from the embodied labor accounting to price accounting) rather than on direct evidence. The problem with trying to establish an interpretation through an indirect argument of this kind is that there might be some different interpretation that also preserves those conclusions. (Sherlock Holmes recommends the rather dubious logic that once you eliminate all the impossibilities, whatever remains must be the true explanation. But I never understood how Holmes could be sure that he started with an exhaustive list of all the possibilities.) 3) Reading the whole of Part Two of Volume III together, I found strong reasons to think of Marx as a "long-periodist", that is, as adopting the methodology of long-period positions in his reasoning. He explicitly links his discussion to Smith's theory of competition, and the adopts characteristic long-period language, such as the distinction between natural and market price. 4) I'm not sure that long-periodists are simultaneists in the modern terminology, since the long period position of the Classicals involves the image of constantly fluctuating prices, gravitating around natural prices (or prices of production in Marx's terminology), while simultaneists are supposed to believe that input prices and output prices are always somehow equalized. Thus I don't think Marx was a simultaneist, either. 5) Marx's treatment of the profit rate seems to be much more nuanced and subtle than most contemporary algebraic treatments. For example, the first paragraph of section 3 of chapter 12 (Supplementary Remarks) (p. 310 in the Penguin edition) says: "It has been said that competition equalizes profit rates between the different spheres of production to produce an average rate of profit, and that this is precisely the way in which the values of products from these various spheres are transformed into prices of production. This happens, moreover, by the continual transfer of capital from one sphere to another, where profit stands above the average for the time being. Something that must also be considered here, however, is the cycle of fat and lean years that follow one another in a given branch of industry over a particular period of time, and the fluctuations in profit that these involve. This uninterrupted emigration and immigration of capitals that takes place between various spheres of production produces rising and falling movements in the profit rate which more or less balance one another out and thus tend to reduce the profit rate everywhere to the same common and general level." Neither contemporary "simultaneist" nor contemporary "temporalist" models seem to be a very good representation of this process. They both tend to neglect the dynamics of the motion of capital in and out of different branches that Marx emphasizes (closely following Smith). Both tend to come up with one equalized profit rate that is supposed to rule in a period, rather than demonstrating the gradual averaging process that Marx describes. Neither model represents the movement of capital from one branch to another which Marx seems to put in the center of the process. 6) I didn't have much better luck with understanding the tableaux this time than I have had before. It sure seems to me that Marx feels bad about not revaluing constant capital in some places. For example, on p. 265 (middle of chapter 9) he says: "As the price of production of a commodity can diverge from its value, so the cost price of a commodity, in which the price of production of other commodities is involved can also stand above or below the portion of its total value that is formed by the value of the means of production going into it. It is necessary to bear in mind this modified significance of the cost price, and therefore to bear in mind too that if the cost price of a commodity is equated with the value of the means of production used up in producing it, it is always possible to go wrong." I find it very difficult to reconcile this kind of language with the idea that Marx made no distinction between the labor embodied in the constant capital and the money value of the constant capital at prices of production. The best I could do on this reading was the impression that Marx uses the same tableaux, or at least parts of the same tableaux, to represent the situation both before and after the redistribution of surplus value through competition. Maybe if he had gone back and revised this he would have clarified this point. 7) If there's a problem with these chapters, perhaps it should be stated in terms of possible inconsistencies with the long-period position methodology, not with contemporary "simultaneism". Duncan -- Duncan K. Foley Leo Model Professor Department of Economics Graduate Faculty New School University 65 Fifth Avenue New York, NY 10003 (212)-229-5906 messages: (212)-229-5717 fax: (212)-229-5724 e-mail: foleyd@cepa.newschool.edu alternate: foleyd@newschool.edu webpage: http://cepa.newschool.edu/~foleyd
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