From: Rakesh Bhandari (rakeshb@stanford.edu)
Date: Wed Dec 04 2002 - 08:28:31 EST
Paul C writes in 8110 > >The question is how accurate a determination prices one can get from >an i/o model drawn up on the basis of national accounts. Yes, this is a fair and succinct re-formulation of my question. > The answer is >that it is not bad. This does not rule out the possibility that one >could derive an even better model if one had access to disaggregated >foreign trade statistics. As it stands, the i.o tables deal with this >just as another industry that consumes exports and produces imports. Well what about Cyrus Bina's approach? He assumes that the global price of oil is regulated by the least productive oil fields. That is, there is no longer a national level of prices but a level determined on the world market. The price of oil is not regulated by its labor value in each respective capitalist national market as that labor value would be calculated on the basis of i/o tables in the respective nations' accounts. It is only by assuming that value and price formation happen on a global scale that Bina is able to explain the magnitude of differential oil rent and in particular the movements of Arab oil rent the struggle over the disbursement of which he puts at the center of international political conflict. Moreover, unless we assume that social values are formed at a global level, then we can't even entertain the possibility that technologically advanced countries are making a surplus profit at the cost of the technologically less developed ones. The hostility to international unequal exchange theory then would stem from the methodological impossibility of accomodating it once one has assumed that the value which regulates price in each respective national market can be calculated on the basis of each respective nation's i-o account. > >As to whether the correlations obtained between labour contents and >sectoral prices indicate that labour contents determine sectoral prices, >well in one sense you are right, it could just be a matter of chance >that prices are closely correlated with labour inputs but not for instance >with electricity inputs, but this is unlikely given the strength of >the correlations and their replicability accross countries. I am not saying that labor value contents or transformed labor value contents do not determine prices. I am asking whether either can be known simply on the basis of national data. rb
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