From: glevy@PRATT.EDU
Date: Fri Jun 09 2006 - 06:54:06 EDT
> This all stems from your taking a quite different dimension for > capital than I and almost all other Marxian economists do. > We generally treat capital as being a stock of money, or=20 > convert it using the MELT to a quantity of person hours. > You treat capital as a flow. This is quite contrary to > the whole historical background which gave rise to the debate > on the transformation problem. In Ricardo the problem was > to explain why things like wine put away to mature rose > in price compared to this years wine. The argument was that > the wine represented a stock of value which had to earn > a return similar to the general rate of profit or rate > of interest. It has generally been assumed that in dealing > with the transformation problem one has to deal with stocks > of fixed capital. Sraffa certainly recognises this and that > is why he goes on to introduce joint production. PaulC : A quick last intervention before I send my 'going away' post. You may be right about Sraffa and Ricardo, but be wrong about Marx. Within the context of Marx's theory of the formation of an average rate of profit, capital must take the form of money capital since otherwise it could not flow freely from one branch of production to another. I.e. the mobility of constant capital (as well as the mobility of labour-power) is assumed: there are no 'barriers to exit'. The 'transformation problem' in Marx does _not_ deal with the presence of fixed capital: in effect, all constant capital is assumed to take the form of circulating capital. The presence of money capital, at that level of analysis, does _not_ assume interest or banking capital, etc.: all it means is that capital takes a form that allows it to be transferred between branches of production. Sorry, but I won't be able to read replies for a while. In solidarity, Jerry
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