Another brief response to Rakesh. I also agree that on questions of money, Marx is superior to Ricardo. Sraffa was an extremely astute monetary economist--as perceptive, I think, as Keynes. Check out his baccalaureate thesis, on the Italian inflation that accompanied and followed the First World War: a tranmslation appeared in the Cambridge Journal a few years ago. It's a masterpiece of institutional political economy. Then there is Sraffa's disabling critique of Hayek's monetary theory of the trade cycle. This work, I think, bears out my claim that questions relating to money can usefully be separated from foundational questions about how prices, distrubution and the technical conditions of produciton are related to one another. Gary >===== Original Message From Rakesh Bhandari <rakeshb@stanford.edu> ===== >In regards to Gary's stimulating 7508, I have two very brief points. > > >>Hi. Two points on this: >> >>(1) Sraffa's model can accommodate rents. His chapter 11 is concerned with >>non-reproducible scarce resources. Of course, Sraffa's treatment of rent is >>different from both Marx's and Ricardo's, but as with his determination of the >>profit rate, I would argue that the differences stem mainly from the fact that >>Sraffa had more sophisticated tools at his disposal. The root question is >>whether Sraffa, Marx and Ricardo are concerned with essentially the same >>theoretical problems, at any rate in their discussions of value. In earlier >>posts Fred has argued that M&R had much the same project and that Sraffa's >>project was different from theirs. M&R were trying to articulate some very >>complicated issues at a time when economic discourse did not have a unified >>conceptual language. These difficulties have parallels in our own problems of >>intertreting that earlier discourse. I would argue that when Marx, in striving >>for a clarity he never achieved, expresses himself in a particular way that is >>different from the way SRaffa or Ricardo poses a question, he may not in fact >>be articulating a theoretical framework that is fundamentally different from >>Sraffa's, but is instead trying to develop a language of discourse that was >>not available at the time. That is to say, I think Fred is supposing that, >>because Marx EXPRESSED himself in terms that are very different from those of >>modern economics, he must have been TALKING ABOUT something different from the >>issues we find in Sraffa. > >Marx is certainly talking about something different in regards to >money than either Ricardo or Sraffa. > > >> >>(2) Differential profit rates are also compatible with Sraffa's framework: >>instead of multiplying the input matrix by a scalar uniform rate of return, >>one multiplies by a diagonal matrix in which the elements on the diagonal >>represent the sectoral profit rates. These can of course be equal except for >>the few sectors for which monopoly elements block intersectoral capital flows. >>I don't think Marx understood differential profit rates as analagous to rents >>(Gil might disagree about this), but, be that as it may, Fred's objection >>doesn't seem cogent to me. Whether the numeraire is produced by a sector that >>earns the general normal profit rate is irrelevant to its ability to function >>as a standard for expressing relative prices: y apples can be swapped for x >>units of numeraire gold; why should gold-sector capitalists have to earn a >>rate of return different from the normal competitive profit rate in order for >>us to be able to put gold to this use in a Marxian context? > >As I have already tried to suggest, the problem with the Sraffian >framework in regards to the money commodity is that the exchange >value of the latter depends fundamentally on the strength of demand >for which there is no room in the Sraffian framework. > >The exchange value of money is not regulated in the long term by >either the value or the price of production of the money commodity. I >agree with Naples' weak negative thesis that the exchange value of >money is not determined by its price of production as a result of the >structural scarcity of gold and the interference of absolute rent; I >don't agree with her strong positive thesis that the exchange value >of money is determined by the value of the money commodity, though of >course Marx makes this assumption throughout the three volumes of >Capital. > >All the best, Rakesh
This archive was generated by hypermail 2b30 : Sat Aug 24 2002 - 00:00:03 EDT