From: ajit sinha (sinha_a99@YAHOO.COM)
Date: Tue Jul 10 2007 - 13:08:38 EDT
--- Jurriaan Bendien <adsl675281@TISCALI.NL> wrote: > Ajit argued a long time ago (against Jim Devine): > > "Value" is defined at the point where there is no > realization problem. Whenever supply and demand (and > they are not demand and supply schedules) do not > match, market prices > diverge from value. > http://archives.econ.utah.edu/archives/pen-l/1995m06.c/msg00024.htm > > I do not know if he still believes that, but I don't > think it follows, unless you make it a tautology. I > think supply and demand (on some definition) could > match, even although market prices and values > diverge. That is, the value/price divergence may > have not necessarily have to do with supply-demand > fluctuations. At most you could say that In Marx's > model, if supply and demand match, goods sell at > production prices. But these production prices may > still diverge from values. > > It's almost as though Ajit thinks here that > supply-demand balance and equal exchange are the > same thing, and I don't think they are. > > A case to which Marx refers is the unequal exchange > of industrial and agricultural goods (their terms of > trade). The output of agricultural goods could be > fairly stable (bar the odd bad harvest) and the > demand for agricultural goods could be fairly > stable, yet agricultural goods trade below their > value and industrial goods trade above their value. > > Jurriaan ________________________ I read the exchange with Jim Devine with interest and a sense of nostalgia. As far as Marx's theory is concerned, I stand by pretty much everything I said there. Of course, I no longer think that equality of the rate of profits requires the system to be at the centre of gravitation, that is, supply being equal to the effectual demand--but Marx along with Smith and Ricardo did. In my writings, demand refers to Adam Smith's "effectual demand". I again do not understand what you disagree with. I think you are confusing the issue by introducing "equal" and "unequal" exchange etc. These things are not the issue here. Cheers, ajit sinha ____________________________________________________________________________________ It's here! Your new message! Get new email alerts with the free Yahoo! Toolbar. http://tools.search.yahoo.com/toolbar/features/mail/
This archive was generated by hypermail 2.1.5 : Tue Jul 31 2007 - 00:00:06 EDT