From: Allin Cottrell (cottrell@WFU.EDU)
Date: Thu Jun 15 2006 - 13:09:44 EDT
On Thu, 15 Jun 2006, Ian Wright wrote: >> Now in Ian's Sraffian system you don't need prior price data to >> calculate the LC coefficients for the goods, but you do need to >> know the rate of profit. This means that Ian's coefficients can't >> function as the sort of independent explantory factor needed by an >> LTV. > > A sufficient condition to calculate real-cost labour values is > knowledge of the real wage, the technical coefficients and the > direct labour coefficients... OK, the real wage will do it instead of the rate of profit: another distributional variable. The point remains that "real-cost labour values" are insufficiently independent; they change with any change in the distribution of income. > Hence, real-cost labour values are independent of any nominal > price magnitudes, and can function as an independent explanatory > factor for prices, unlike Sraffian labour values that cannot > (e.g., Samuelson's eraser critique, Steedman's two prongs etc.). These critiques are based on a counter-factual equalized rate of profit, and even taken at face value they don't show that standard labour values -- I decline to call them "Sraffian" because although Sraffa uses them, they're in no way specific to him -- can have no independent explanatory role. What they show is that labour values will not exactly predict prices, with an error of approximation related to the level of the rate of profit and the variance of organic composition. Allin
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