Re: [OPE-L] price of production/supply price/value

From: Ian Wright (wrighti@ACM.ORG)
Date: Mon Feb 13 2006 - 18:48:12 EST

Hi Andy

> Before detailing my view, I am afraid I am therefore going to have to nit-pick
> your own as follows.


> Your argument [with neo-R hat] is actually quite curious. Rather than
> arguing that the neo-R case is the general case and hence refutes the
> LTV, you are arguing that the neo-R case is an 'important' special case
> and hence refutes the LTV. Doesn't this mean that your 'special' case is
> in some sense not so special but is in fact general?

Yes (I explain why below). In contrast, I have entertained the idea
that the special case of uniform wages and uniform profits does not
correspond to a possible state of a more general dynamical theory. If
that were so, then the special case would not be important. That would
require constructing such a general dynamic theory and proving that
the special case was not on any possible state-space trajectory. It
would be an "impossible" state, and therefore irrelevant.

> Your argument
> crucially rests on the view that there is an 'intimate relation' between
> the general case and the special case. The meaning of 'intimate
> relation' must be, as far as I can tell, that the special case shows
> that, in the general case, SNLT cannot have any relation whatsoever with
> price. I.e. no 'necessary relation' in the special case indicates no
> necessary relation in the general case. Could you spell out why you
> think this?

It's a good question. Assume that the special case, or rather the
infinite set of them, *are* possible economic configurations. Then
there are points in the trajectory of the dynamics in which Marx's
value theory breaks down, stumbles. There will be breaks in the causal
chain. (Note that Steedman's critique is of the form of showing the
absence of necessary relations between labour-time and price

Assuming (and it's a big assumption) that there is a theory about
labour-values causing feasible reproduction relations in a dynamic
context then at best the theory can only be true "sometimes", and in
general will be false, and hence cannot be a complete law of motion of
the system. That's all the N-R critics need do -- to give
counter-examples. It's much easier to destroy than create. And in the
absence of such a dynamic theory, and given the special case
counter-example, then it seems reasonable to conclude that no such
theory exists. (I do not conclude this, but I am arguing for the
importance of the N-R critique for value theory).

By comparison, in classical mechanics we can explain the trajectory of
closed systems in terms of the principle of conservation of energy.
But suppose that some anti-Newtonian critic finds cases in which the
transformation of kinetic energy to potential energy does not hold.
And furthermore that in these cases the conservation rule in principle
cannot explain the relations between the variables of the system. That
would be very troubling for classical mechanics.

> By way of context, I would say that Marx's static
> transformation demonstrates that prices of production and SNLT are
> likely to be very close *relative* to the magnitude of actual
> fluctuations due to boom and bust (the chapter of Michael Perelman's
> that he gave a link to recently on this list nicely discusses such
> dynamics). I would say that this shows there is a dynamically necessary
> relation between SNLT and price and that this is very clear prior to the
> transformation of the inputs. Hence transformation of the inputs is not
> very important. But before I elaborate let me give you a chance to
> answer my questions above.

You can rule out the special case (e.g., Fred, TSS, F&M), but as I
mentioned, I am not happy with the reasons given for simply ruling it
out. But if you don't rule it out then any dynamic theory has got to
deal with the anomaly, becuase the special case is a "moment" in a
more general dynamic theory.


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