From: Rakesh Bhandari (rakeshb@stanford.edu)
Date: Mon Mar 17 2003 - 18:23:46 EST
>> >>Rakesh, please read again the quote from Carchedi below, and my >>paraphrase, which you say you agree with. Carchedi is saying precisly >>that, when there is technological change in a given period, then constant >>capital is revalued in that period, so that the value transferred to the >>output is the current (i.e. revalued) value of the constant capital; >i.e. input prices are equal to current output prices. Again I think there is a conflation of two questions--the question of how the value transferred from means of production is determined and whether one should assume that output prices equal input prices. But let me restate my criticism. Let us say that we have three production periods t0 => t1 t1=>t2 t2=>t3 Firm one buys means of production at t0 which it will be amortize over three periods. Firm two buys means of production at t1 which it will amortize over the next three years Firm three buys means of production at t2 which it too will amortize over three periods. I assume that each firm buys its means of production at a cheaper price and those sets of means of production though roughly physically equivalent each represent less value. For the sake of simplicity I also assume that the price of production at t1, t2 and t3 is determined by the most efficient firm in that period. That is, at t1 price of production will be the kr for firm one; at t2 PoP will be the kr for firm two; at t3 Pop will the kr for firm three. So that means at t3, firm one must sell at the price of production determined by firm three. The value transferred from the means of production owned by firm one to its output in the period t2-t3 is also determined not by the value such non depreciated stock would have had at the point firm one did purchase means of production but by the current value of the non depreciated stock, i.e., the value of the equivalent means of production purchased by firm three at t2. But this does not mean that value of the means of production purchased by firm three at t2 will have the same value as the equivalent means of production purchased by say firm 4 at t3. The value of the means of production is changing from period to period. That is, I make no assumption that input prices equal output prices or input values equal output values, and I still fail to see why this assumption should ever be made in the analysis of technical change in an economy characterized in world historic terms exactly by the ceaselessness of its productivity growth. It seems to me that this list should take the steps needed to encourage the return of the TSS people so that we can have a proper discussion. To the extent that the RRPE is featuring polemical criticism of TSS, it would seem to be in this list's interests to have the other side represented. I say this to you as list moderator, one of the people handpicked by Jerry on the basis of whom he can get along with. I don't know about Alfredo but it seems that this list is administered by people who are much more comforable with the idea or methodology of comparative statics than the TSS people are...and in my opinion Marx was! Yours, Rakesh
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