Andrew, here's a reply to your 4503:
>In OPE-L 4497, Rakesh Bhandari wrote
>
>: Surplus value does not have to remain invariant in the complete
>: transformation in order for the the theory of exploitation to hold.
>
>
>Why then, pray tell, did the author insist that total profit equals total
>surplus-value? Rakesh's position implies internal contradiction, or
>error, or "incompleteness" on Marx's part.
Andrew, I do argue (and have argued repeatedly) that the sum of
profits has to be determined by total surplus value. I argue however
that since surplus value is total value or total price (its monetary
expression), less cost price, the modification of cost price will
change the mass of surplus value. That modified mass of surplus value
then determines the modified sum of branch profits.
Had you once looked at the set of transformation equations which I
propose before this outburst of desperation?
Here is my argument again.
Following Ricardo's critique of Smith, Marx argues that the value of
a product is not determined by adding up wages, profit and rent.
Rather he maintains that the size of a product's value--as determined
by the quantity of (indirect and direct) labor expended in its
production--is the *primary*, basic magnitude that then is resolved
into or breaks down into cost price and surplus value. It is
therefore obvious that once the entire magnitude (the value of the
product) is given in advance as a fixed entity (being dependent on
the quantity of labor needed to produce it), any increase in one of
its parts (cost price) will invariably lead to a fall in the other
(surplus value). [see II Rubin, A History of Economic Thought, p. 259)
So if C is the value of a product (which of course has a monetary
expression based on the constant monetary expression of labor value
which Marx assumes just as Ricardo did in his Principles):
(1) C => k + s
If not only C but also the monetary expression of labor value remains
constant--as they do in the transformation exercise--then it is
impossible for
(2) (k+a) + s => C + a {a can be positive or negative)
Under both Ricardian and Marxian assumption, this expresses the
consequence of a modification of cost price (k + a), the whole point
of the completed transformation
(3) C => (k + a) + (s-a)
The conditions which a successful complete transformation in which
cost price is modified by the transformation of the inputs must meet
rather are the following:
A. the modified sum of surplus value (s - a) still determines the sum
of profits
B. the sum of profits still derives entirely from unpaid newly added value by
labor
This gives the transformation equations which I have proposed.
(5) c1 + v1 +s1 = c1 + c2 + c3 (C)
(6) c2 + v2 +s2 = v1 + v2 + v3 (V)
(7) c3 + v3 +s3 = s1 + s2 + s3 (SVA)
(8) (C + V + SVA) - (C + V) = s1 + s2 + s3
the set of transformation equations should then be:
(9) (1+r) c1x + v1y = Cx
(10) (1+r) c2x + v2y = Vy
(11) (1+r) c3x + v3y = r(Cx + Vy) (SVB)
(12) (Cx + Vy + SVB) - (Cx + Vy) = r(c1x + v1y) + r(c2x + v2y) + r(c3x + v3y)
The invariance condition of course is
(13) (C + V + SVA) = (Cx + Vy + SVB),
In my equations, x, y and r can be solved; the equations do not
overdetermine the system
As the total value remains as constant the monetary expression of
labor value throughout out the transformation exerise, the sum of
prices in both schemes have to be set to equal each other, which is
given in (13).
There is no other invariance condition allowable on Marxian premises.
The mass of surplus value is also set to equal to the sum of branch
profits. The modified mass of surplus value is given in the left hand
of equation (12) as the sum of prices of production minus the sum of
modified cost prices, that is the sum of paid indirect and direct
labor. This means of course that surplus value originates in unpaid
labor. That sum of surplus value then determines the right hand of
the equation: the sum of branch profits. So your outburst above was
completely inappropriate: I maintain the so called second equality.
SVA does not and should not equal SVB as cost prices have been
modified. See (1)-(3). But though surplus value is not invariant,
appropriated profit in the transformed scheme still originates
entirely from unpaid labor; the theory of exploitation is thus upheld.
There are two equalities indeed but only the one invariance condition
which derives from Marxian theory.
>
>Rakesh claims that deviations of cost-price from the value of the used-up
>means of production and consumption are offset by deviations of aggregate
>profit from aggregate surplus-value.
I am not quite sure what you are getting at; this may be my fault.
But I argue that upon allowing for the transformation of the inputs,
Marx recognizes that prices of the input means of production may no
longer be 'proportional' to the value of those means of production as
consumed in and transferred to the commodity output. I maintain that
this is exactly what the textual evidence says Capital 3, p. 309.
>I know of ABSOLUTELY NO textual
>evidence that supports this claim. It is simply a consequence of his
>adherence to the physicalist dogma that the value of constant capital
>cannot differ from the value of the means of production.
The value of the constant capital can be the value of the money
needed to purchase the means of production. I do in fact emphasize
that this value is different from the value of the means of
production as consumed in and transferred to the commodity output. I
argue that total value is determined by the value of the means of
production consumed in the final output plus new value added--that
commodity value is determined by the direct and indirect labor which
a commodity embodies.
From this the capitalists then deduct the actual money which they
have laid out as constant and variable capital, leaving then surplus
value.
All the best, Rakesh
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