From: Ian Wright (wrighti@ACM.ORG)
Date: Sat May 27 2006 - 15:26:11 EDT
Hi Ajit > Hi, Ian! Thanks for reading and commenting on the > paper. I find your above statement about Sraffa's > mistake quite perplexing, since the question of > capitalists' consumption or non-consumption does not > come up anywhere in Sraffa's scheme including the > dated labor approach. Indeed. It is omitted. > The dated labor approach only > shows you how the price can be resolved into wages and > profits only. The power to (1+r) according to "dates" > does not imply any historical dates--it represents the > unending chane of production at a given point in time > only. Yes I know. I did not claim that the "dated" representation refers to historical time. The error in Sraffa's dated labour representation is that the price of money-capital, r, is not reduced to its labour cost. It's a real-cost accounting error to not reduce it. It necessarily follows from Sraffa's surplus equations that money-capital is a commodity and r is its price, once the physical distribution of the surplus is specified. Section 4 of the paper deduces this result. There's a simple low-dimensional numerical example of a corn economy at the end of the paper that presents the Sraffian real-cost accounting error. The results hold for arbitrary numbers of commodities. >Sraffa's system does not allow movement of time, > so the question of what happens to the commodities > produced at a given point of time has no implications > for his results. I think you are clearly making a > mistake in interpreting Sraffa here. For precision and clarity, we should first answer this question: Do we interpret Sraffa's surplus equations to represent a state of self-replacing equilibrium or not? If the answer is "no", then real costs in general are undetermined, including labour-value. Nothing much can be said about real costs as we're talking about a novel distributional event with an undistributed surplus. If the answer is "yes" then real costs in general are determined, including labour-value. But in this case Sraffa's real-cost accounting is faulty, as manifested in the dated labour representation. > Not really! All you have to do to get over this > confusion is to think of Sraffa's system with a given > rate of profits, as Sraffa does, and not given wages. > Your confusion will simply melt away. Cheers, ajit Section 3 of the paper goes into detail. Best wishes, -Ian.
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