From: Andrew Brown (Andrew@lubs.leeds.ac.uk)
Date: Tue Dec 03 2002 - 05:44:15 EST
Hi, Re your 8093. > > (1) I would be very interested to know your theoretical explanation > > for the correlations that you obtain. > > > > This is a very difficult question. > > At one level I would explain it by saying that labour is > overwhelmingly the main non-produced input to capitalist commodities, > and as such it will tend to drive the price system. It is the signal > that shows through the noise of random market fluctuations. Do you mean that wages are more stable than other major costs due to the fact that labour-power is non-produced? > Another factor one has to explain is why the attractive force of > labour values is at least as strong as, if not stronger than the > attractive force of prices of production ( the price vector is at an > angle in between the value vector and the price of production vector > ). I would explain this in probabalistic/darwinian terms. The > probability of reproduction of a firm whose selling price falls below > labour costs is very low. This constrains almost all of the population > of firms to be selling at a price above prime costs. F and M show that > if one makes the very conservative assumption that the distribution of > the prices relative to labour costs is gamma, then this forces just > the observed correlation between prices and labour values. > > There will also be a tendancy for firms whose rate of profit > is below the mean to be less likely to survive than those whose > profit is above the mean, but this pressure is less strong than > the previously mentioned one. This I think explains why > the price vector is between the value and price of production > vector. You did say it is a difficult question. Clearly your answer is very brief and raises alot of theoretical questions. Excuse my ignorance but by how much do prices of production tend to differ from labour values? The closer is the correlation between these two then the less the theoretical work has to be done. Thanks, Andy
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