From: Andrew Brown (A.Brown@LUBS.LEEDS.AC.UK)
Date: Mon Jan 30 2006 - 13:44:28 EST
Thanks Ian, It may be insignificant but the notion of Marx's LTV being 'redundant' or 'inconsistent' does not capture the notion you are stressing of there being 'no necessary relation' between value and price systems. E.g. labour-time could be redundant even if there is such a relation. I just had a quick look at Steedmans' 'Marx after Sraffa'. His summary of key points at the end does *not* stress the 'no necessary relation' point. It stresses redundancy and inconsistency. In fact, Steedman argues that values are derivative of the profit rate, rather than vice verse (since production techniques are chosen according to the principle of profit maximisation). In that sense there is a relation between values and prices, on Steedman's account, but allegedly running in reverse direction to that in Marx's theory. Imo, the economic basis for refuting neo-R critique lies in the necessity for there to be limits on prices, to ensure enough needs of workers are met, and enough profit needs of capitalists are met, across the economy and through time. These limits are given by SNLT. The theory of exploitation shows in essence how the system actually enforces these limits. But it is folly to think that at any point in time the aggregate equalities actually hold at market prices because the limits take effect only through rupture and crisis. Andy -----Original Message----- From: OPE-L [mailto:OPE-L@SUS.CSUCHICO.EDU] On Behalf Of Ian Wright Sent: 30 January 2006 17:09 To: OPE-L@SUS.CSUCHICO.EDU Subject: Re: [OPE-L] price of production/supply price/value Hi Andy > Which references would you suggest most clearly put the Neo-R critique in this way? > Steedman's famous book (which I haven't studied closely) doesn't really pursue this line of > argument systematically, in the sense that he is much more concerned with systematically > showing redundancy and inconsistency of Marx's LTV. The disconnect of labour value and price in the aggregrate is implicit from Sraffa onwards. Sraffa's reduction to dated labour representation is a function of the profit rate (r); hence, according to neo-Ricardians, price is irreducibly dependent on income distribution (the value of r). In contrast, Sraffa's representation of labour values (implicit in footnotes and appendices) is invariant over income distribution, and does not depend on r. Hence there is an "informational gap" between the two accounting systems. Samuelson's Sraffa-inspired 1971 paper in Journal of Economic Literature brings this out fairly clearly (his "eraser" critique). Pasinetti emphasises the disconnect between the dual accounting systems in his classic and very clear presentation of the neo-Ricardian critique of Marx's vaue theory in "Lectures on the Theory of Production". Steedman repeats Samuelson's eraser critique (his "scissors" or two prongs diagram; can't quite recall how he describes it), and adds new criticisms. Fast-forwarding, Abraham-Frois and Berrebi's "Prices, Profits and Rhythms of Accumulation" (1997) is probably the most mathematically complete and concise presentation I know. They derive a condition that must be satisfied for all Marx's conservation claims to hold. The usual suspects -- zero profits, uniform organic compositions of capitals and production in `standard' proportions -- are those special cases that satisfy the condition. The critique is, essentially, that *there is no economic reason* why the condition should hold -- hence the disconnect. (Again, I don't agree with this critique, but I appreciate its logical force). Best, -Ian.
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