re 7343 > >Rakesh, I have two questions of clarification for now: > >1. What do you think is the difference between "conceptual >determination" and "calculation"? Why do you prefer "calculation" over >"conceptual determination"? And what exactly is "real >determination"? How is "real determination" related to "conceptual >determination"? > >2. What would you say Marx was doing in the determination of prices of >production in Part 2 of Volume 3: "real determination" or "conceptual >determination" or "calculation"? > >I look forward to your replies and to further discussion. > Fred, thanks for the reply. the questions which you posed are difficult ones--I am still hoping that Anwar will reply to your important challenge. Before I provide my answers, let me clear something else up. Meek says that Marx attempted a journey from values to prices of production. Now you are argue that Marx attempted a journey from givens in money, not values, yet if the sum of invested money that you take as a given was in turn determined more or less by the prices of production of the means of production and wage goods which served as inputs, then aren't you saying that Marx simply made a journey from prices of production to prices of production? The seemingly tautologous nature of your theory of price derivation has provoked criticism before. Moreover, since you argue that prices of production do have the property of long term equilibrium prices, how does your monetary macro interpretation allow us to know that the prices of production which Marx derives could have been the prices of production for the inputs the monetary purchase of which you take as the given? It does not seem to me that your theory moves us any closer to proving that Marx does have a valid theory of equilibrium prices. And as Andrew argued, once you agree that prices of production have to be equilibrium ones, you cannot but arrive at the same prices of production which are yielded by the formalism of simultaneous equations. You then countered that your prices of production will be different than Bortkiewicz's or Sraffa's because you take the money wage rather than the real wage as the given. But that leads us back to the same problem. If you take the money wage as given, presumably that was determined more or less by the prices of production of wage goods. Which then again yields the question of whether we can be sure that your monetary-macro prices of production for the output which is wage goods could have been the same prices of production for the input wage goods. You argue that they have to be the same prices of production, but I don't see how you show that they indeed are. How do you prove that your macro monetary prices of production would allow the economy settle down into price equilibrium? Now since Carchedi does not assume that the prices of production which Marx derives for the outputs are, have to be, or could have been the same as the prices of production for the inputs, he does not have a similar burden. Some will say that a true price of production theory should be able to pass a Walrasian test of equilibrium, so Carchedi is wrong not to worry about whether the prices of production which he derives for each sequence are equilibrium ones. But this objection makes no sense to me. The equilibrium test would only be valid if it were true that a theory which does not hold in equilibrium cannot hold in a dynamic framework. But that does not follow; moreover, since Marx's theory of prices of production only holds for capitalist reality, why should the theory be valid for a state in which the capitalist economy never finds itself, viz. equilibrium? Why should any theory of price in a bourgeois economy pass the equilibrium test? But you argue against the TSS school that Marx's prices of production have to be equilibrium prices without proving that Marx in fact derived prices which can serve as long term centers of gravity. And this finally brings us to Shaikh who does in fact attempt to show how one can proceed from prices proportional to values (simple or direct prices) to equilibrium prices of production which can regulate the prices of both the inputs and the outputs. Your macro monetary theory does not demonstrate that Marx in fact derived equilibrium prices of production. So in terms of demonstrating what both you and Shaikh think has to be demonstrated--Marx's prices of production can be equilibrium prices, and determined by labor value magnitudes--Shaikh's approach is simply better, though you are in fact correct that Marx does not begin with values or simple prices but with the sum of money which actual capitalists had to have laid out to commence the circuit of capital and that there is no need to transform the inputs (of course an inverse transformation is needed). Yet if we have equilibrium prices of production, the technical conditions and the distributional parameters have to be constant. It is argued that if we have data of the technical conditions and distributional parameters we do not need values to calculate the prices of production. Moreover, it is argued values can only be inferred from the technical conditions. So then the objection is why do we need to make reference to value at all in the calculation of prices of production. Moreover, once we take the technical conditions and real wage as given, it does not matter whether we start from prices which are proportional to values or prices which have some random relation to values (I take this to be Hodgson's argument on p.91-92 of the Value Controversy): the fixed point iteration through its own process will arrive at the same equilibrium prices of production whether or not we begin with prices proportional to values or say 20 periods into the iteration in which prices will no longer be proprotional to values. Why is value not simply redundant? This is the question which Shaikh attempted to answer. All the best, Rakesh
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