Re: [OPE-L] basics vs. non-basics

From: Ian Wright (wrighti@ACM.ORG)
Date: Fri Oct 07 2005 - 12:47:33 EDT 

Allin, Paul, Ian, Ajit

Thanks for all the feedback, it's been very helpful.

There are lots of possible ways to fix the problem with the Sraffian
price equation, some of which are in the literature. But the point is
that it is broken. And not in a small, unimportant way, but in a big,
important way: in general it does not determine prices for an
arbitrary number of commodities.

The question then becomes: in what way do the possible fixes change
the traditional understanding of the meaning of Sraffa's critique?

I wonder whether this question has not been adequately addressed. For
example, the problem has been given an uniformative name: "problem of
self-reproducing non-basics" rather than, say, "incomplete theory of
price in a state of self-replacing equilibrium".

Statements along the lines that "prices are determined once the
technology and real wage are given", or that the "uniform rate of
profit is determined by the basic system", are prima facie false,
unless such statements are accompanied by an explicit solution to the
problem of "self-reproducing non-basics".

-Ian.

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