[OPE-L:7019] Re: Sraffa's Critique of Economic Theory

From: Steve Keen (s.keen@uws.edu.au)
Date: Fri Apr 19 2002 - 08:05:52 EDT


At last a topic I can contribute to.

Firstly, briefly answering the third question you pose, I very much doubt 
that Sraffa saw his POCBMOC as the foundation of an alternative theory. 
Especially in the light of claims he made in his 1926-30 papers, I think 
his "positive" agenda would have been much more like Kalecki's.

On how you can use his analysis to critique marginalism, essentially I see 
Sraffa as providing in POCBMOC a means to accurately measure the amount of 
capital: by firstly devising the standard commodity, and then by expressing 
the amount of capital as *approximately* (because there is always a 
non-zero commodity residue) equal to the value of the dated labor time used 
in its production.

The combination of these two components--the wage unit measured in terms of 
the standard commodity, and capital measured in terms of dated labor 
input--is a term that accurately measures the amount of capital as

(1 -r/R)(1+r)^n

where R is the maximum rate of profit of the input-output system, r is the 
actual rate of profit (in equilibrium), and n is the number of periods ago 
that the labor input occurred.

Thus, rather than the rate of profit depending upon the amount of 
capital--which is an essential concept in the marginal productivity theory 
of income distribution--the measured amount of capital depends on the rate 
of profit (in a highly nonlinear way).

Since the marginal productivity theory of income distribution is an 
essential element in neoclassical theory, it is unsustainable with produced 
means of production.

Cheers,
Steve
At 09:00 PM 19/04/2002 Friday, you wrote:
>What "critique"?
>
>Let's recall that Sraffa claimed _only_ that the _PCMC_
>represented a "prelude to a critique of economic theory"
>(the sub-title of _PCMC_).  He was very specific about
>this:
>
>"It is, however, a peculiar feature of the set of propositions
>now published that, although they do not enter into any
>discussion of the marginal theory of value and distribution,
>they have nevertheless been designed to serve as a basis for
>a critique of that theory.  If the foundation holds, the critique
>may be attempted later, either by the writer or by someone
>younger and better equipped for the task" (_PCMC_, p vi).
>
>As far as I know, Sraffa never claimed that he was later able
>to attempt that critique nor did he claim that others had
>successfully developed a critique of marginalism that was
>built on his "foundation".
>
>This leads to my *first question*:  in the 42 years since his
>book was published, has anyone  built a critique of marginalism
>on the foundations of his book?  It seems to me that the
>re-switching and capital-reversing literature is *not* the critique
>that Sraffa had in mind.  What then would be?
>
>The *second question* would be: how did Sraffa understand
>the meaning of "critique"?   Did he understand it in the same
>way as Marx?  ...  Wittgenstein?  ...  Hegel?   Are these
>understandings of critique the same? (I think not.)
>
>The *third question* might be: in what specific sense was
>_PCMC_ a "prelude" to a critique of marginalism?   Did Sraffa
>believe that a comprehension of capitalism could be built on a
>"foundation" that itself only claimed to be a prelude to critique?
>Note here that Marx attempted to critique (primarily) classical
>political economy whereas Sraffa attempted to lay the basis for
>a critique of marginalism.  This, then, leads, me to my *last
>question*: does the comprehension of capitalism through critique
>depend on the engagement of a *particular* economic theory?
>For instance, does the critique of marginalism serve the same
>purpose as the critique of cpe?  (although of course, Marx
>subjected other economists to critique as well.)   Would we
>be equally able to comprehend capitalism through the critique
>of  (old style) institutionalism, neo-institutionalism,  post-Keynesian
>theory, monetarism, et al?   For that matter, could we develop
>an understanding of capitalism and develop the "economic law
>of motion of modern society" through a critique of other social
>theorists who aren't economists, e.g. Durkheim, Weber,
>Rousseau,  Sartre?
>
>In solidarity, Jerry

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