re 7303 > >Matrix algebra gives us an easy way to calculate both direct and production >price vectors (as eigenvectors) which differ a bit from Marx's "vectors", >but serve as well as the same type of attractors or centres of gravity for >actual prices. Even if these vector are not Marx's ad pedem litterae, they >are in agreement with Marx's spirit and serve the same purpose: the >theoretical understanding of both exploitation-and-competition actual >processes, a sector or reality which we all want to capture. > >What do you think? > >Comradely, > >Diego Dear Diego, I think that Marx's theory of value was never meant to determine absolute or relative values of individual commodities (I find Mattick's chapters on the labor theory of value in Marx and Keynes to be in the spirit of Marx). Similarly, I think Baumol is correct that this is also why there has been so much trouble in understanding Ricardo's first chapter; it is read as a 93% pure labor value theoretic explanation of relative prices rather than the foundation stone for a macro dynamics which is based on an inverse relationship between profits and wages. For Ricardo, the importance of the theory of value is not in a theory of prices but in the critique of the Adding Up Theory of Price which it allows. And I think the latter holds at the macro level, not at the level of individual prices which exhibit many curious effects once distributional parameters are changed. It also does not seem to me that Marx would have been much interested in the vectors which can be formed by matrix algebraic calculations. Marx never attempted a theory of price formation (at least as economists understand it) and exchange ratios. In his so called transformation, Marx was primarily interested to show that prices and exchange ratios do not invalidate the value concept as they indeed appear to do; Marx wanted to free himself to use the value concept for other (more macro) purposes. For example, in examining changes in the rate of profit over time, a Marxist is led by Marx's value reasoning to make estimates of changes in s/v, OCC and VCC (as well as turnover) while a neo Ricardian would look for changes in the real wage and the technical conditions of production. While the technical conditions of production could remain the same, the rate of profit could increase by a crisis-induced devaluation of the VCC. How would a neo Ricardian working on the basis of an input-output matrix explain the most important purgative role of crises in the course of capital accumulation? (By the way, I think Alejandro has provided the clearest explanation we have of what the differences between the TCC, OCC and VCC are in his very valuable book Value of Marx.) Comradely, Rakesh
This archive was generated by hypermail 2b30 : Tue Jul 02 2002 - 00:00:04 EDT