From: ajit sinha (sinha_a99@YAHOO.COM)
Date: Thu Jun 10 2004 - 08:24:41 EDT
Fred, you are not answering my simple questions. My
point is that what you are saying in the name of Marx
is simply nonsense. I can prove that if only you would
agree to discuss the matter step by step. This problem
has nothing to do with positivism etc. I may not know
much philosophy, but I know this much that nonsense
does not become profundity in non-positivist
philosophy. Any way, I don't even know what you mean
by positivism. Is it Vienna school you are referring
to? Cheers, ajit sinha
--- Fred Moseley <fmoseley@MTHOLYOKE.EDU> wrote:
> Ajit seems to suggest in his comments below that the
> only variables that
> are permissible in economic theories are EMPIRICALLY
> OBSERVABLE
> MAGNITUDES. In other words, a positivist or
> operationalist philosophy of
> science. Ajit keeps asking, "how do we EMPIRICALLY
> KNOW the L's and the m
> in your equation?" He asserts that, unless these
> variables are
> empirically known, then there is no theory.
>
> But this is not true. Positivism is too narrow. It
> is also permissible
> for economic theories to be based on the assumption
> of unobservable
> variables. These assumptions cannot be directly
> empirically tested, but
> they can be indirectly empirically tested, in terms
> of the conclusions
> derived from these assumptions, which do refer to
> observable phenomena.
>
> Marx assumed that commodities possess definite
> quantities of abstract
> labor-time, even though it is not empirically known
> what these quantities
> are. From this assumption Marx derived certain
> conclusions that do refer
> to observable phenomena - inherent technological
> change, conflict over the
> length of the working day, conflict over the
> intensity of labor, trends in
> the rate of surplus-value, the composition of
> capital, and the rate of
> profit, etc.
>
> The appropriate empirical tests of Marx's theory are
> in terms of these
> conclusions derived from Marx's assumption of
> abstract
> labor-times. Rakesh made a similar point in recent
> posts, I believe.
>
> An important example from physics of an explanatory
> variable that is not
> directly observable is "force" in Newton's laws of
> mechanics. Force is
> presumed to exist, and to be the cause of the
> acceleration of masses, but
> force cannot be observed and measured independently
> of its effects on the
> acceleration of masses.
>
> Ajit seems to want a theory of price in terms of
> observable variables
> only. Ajit, is that so? Do I understand you
> correctly? If so, then
> why? Why do you think that only observable
> variables are permissible in
> economic theories?
>
> Marx called such economic theories "vulgar
> economics" - vulgar because
> they "stick to the realm of appearances" and have no
> idea of the inner
> unobservable determinants of these appearances.
>
> Thanks for the discussion.
>
> Comradely,
> Fred
>
> On Mon, 7 Jun 2004, ajit sinha wrote:
>
> >
> > --- Fred Moseley <fmoseley@MTHOLYOKE.EDU> wrote:
> > Ajit: (2) If, as you say below, that "abstract
> labor"
> > only shows up in money terms but its measure is in
> > labor terms, then could you tell me how do you get
> > your money values first and then how do you go
> about
> > translating those money values to labor values?
> > _________________
> > Fred: This will take a longer answer. I realize
> now
> > that your earlier question about how abstract
> labor is
> > measured is different from what I originally
> thought.
> > My answer to you in my last message about the
> > measurement of abstract labor had to do with the
> high
> > level of abstraction of Part 1 of Volume 1 (the
> > "simple circulation of commodities"). Since most
> of
> > the recent OPEL discussion about Marx's theory of
> > money initiated by Rakesh was in terms of this
> high
> > level of abstraction, that was also the implicit
> > assumption of my answer. However, I argue that
> Marx's
> > theory of price becomes more complicated once we
> reach
> > capitalist production and the circulation of
> capital
> > in Parts 2 and 3 of Volume 1 (and beyond). In Part
> 1
> > ("simple circulation of commodities"), commodities
> are
> > assumed to be present, with given quantities of
> > socially necessary labor-time contained in them.
> Money
> > is derived as the necessary form of appearance of
> > socially necessary labor-time, and prices are
> > determined as proportional to socially necessary
> > labor-times (with the inverse of the value of
> money as
> > the factor of proportionality, as in my original
> > message): (1) Pi = Li / Lg
> > ______________
> > Ajit: But both your Li and Lg are known at this
> stage?
> > ___________________
> > Fred: "Simple circulation" is analyzed according
> to
> > the symbolic formula: C - M - C in which the
> > commodities assumed present are first sold for
> money
> > and this money is then used to purchase other
> > commodities. Then, beginning in Part 2, the level
> of
> > abstraction changes to the circulation of CAPITAL,
> > expressed symbolically to begin with in Chapter 4
> in
> > the abbreviated version of the "general formula
> for
> > capital": M - C - M' where M' = M + dM In the
> > circulation of capital, the starting point is not
> > already produced commodities (C), but rather a
> > quantity of money (M) advanced as capital. This
> > initial quantity of money-capital (M) provides the
> > initial givens in Marx's theory of price and
> > surplus-value in Part 3 (and beyond). This initial
> > money-capital (M) is divided into two components:
> > constant capital advanced to purchase means of
> > production (mp) and variable capital advanced to
> > purchase labor-power (lp). Marx emphasized in
> Chapters
> > 7 and 8 of Volume 1 that these two components of
> the
> > initial money capital play entirely different
> roles in
> > the determination of the price of the output and
> the
> > resulting surplus-value. The money constant
> capital is
> > transferred to the price of the output, and
> becomes
> > the first component of the price of the output,
> and
> > thus cannot be a source of surplus-value. This
> given
> > money constant capital advanced is added together
> with
> > the money new-value produced by current labor in
> order
> > to determined the aggregate price of commodities
> > _________________
> > Ajit: But how do you know how much is this " money
> > new-value" produced by the labor?
> > ____________________
> > Fred: (I have argued on many occasions that Volume
> 1
> > is about the capitalist economy as a whole).
> > Therefore, in capitalist production, which is
> preceded
> > by the advance of money capital, the determination
> of
> > prices is different from the determination of
> prices
> > in "simple circulation". Instead of equation (1),
> we
> > have: (2) P = C + N = C + m L In this equation,
> the C
> > is taken as given, as the initial money-capital
> > advanced to purchase mp. This given money constant
> > capital is transferred to the price of the output,
> and
> > becomes the first component of the price of the
> > output. The L is also taken as given, as the total
> > quantity of current socially necessary labor-time
> in
> > the economy as a whole. This total quantity of
> labor
> > is made homogeneous and added together by the
> given
> > skill and intensity multipliers, as discussed in
> > previous messages.
> > _______________
>
=== message truncated ===
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