From: Fred Moseley (fmoseley@MTHOLYOKE.EDU)
Date: Sun Oct 21 2007 - 15:34:46 EDT
Hi Jerry, I will repeat myself and say that I think that the proponents of the TSSI have made the following important contributions to Marxian scholarship, even though I disagree with them on some issues. 1. They have argued that Marx’s theory is not based on the logical method of simultaneous determination, contrary to the prevailing Sraffian interpretation of Marx's theory, but is instead based on the logical method of temporal or sequential determination (similar in this respect to the theory of the monetary circuit and much of Post-Keynesian theory). Even if the TSSI turns out to be wrong on this issue (and I think they are mostly right), they will have contributed to the development of Marxian theory by forcing a thorough consideration of this fundamental issue, and this probably would not have happened without the TSSI. Jerry, don’t you think this is a contribution? 2. Relatedly, they were the first to criticize the Okishio Theorem on the grounds that the Okishio Theorem is based on a different theory from Marx’s theory – linear production theory which assumes simultaneous determination. Most clearly, in Marx’s theory, the rate of profit is determined prior to prices of production (by the ratio of the aggregate totals of surplus-value and capital invested), whereas in linear production theory, the rate of profit is determined simultaneously with prices of production (plus also prices of production in Marx’s theory are industry totals, and prices of production in linear production theory are unit prices). Therefore, conclusions reached by the Okishio Theorem do not necessarily apply to Marx’s theory. Almost all the prior (i.e. pre-TSSI) discussion of the Okishio Theorem had implicitly assumed (and most of the discussion continues to assume) that Marx’s theory is the same as linear production theory, and so that the Okishio Theorem applies to Marx’s theory (as Okishio himself claimed). But the TSSI has questioned that fundamental assumption, and this has opened up an important new debate in the evaluation of Marx’s theory of the rate of profit. I think this is another significant contribution. Jerry, don’t you? 3. Relatedly again, they have forced a more thorough consideration of the issue of current cost vs. historical cost valuation of constant capital. I disagree with them on this issue, but I think they have raised an important problem, which most people continue to ignore: if constant capital is revalued to current cost, this involves a real loss to the firms. If one simply ignores the loss, and revalues the constant capital to current cost, then the rate of profit will be increased. But what happens to the loss? Is it simply written off the books, without any negative consequences? How should the loss be taken into account? I am not sure what the right answer to this question is, but I think it is an important question, that has been raised by the TSSI. Jerry, don’t you think this is a contribution? Comradely, Fred ---------------------------------------------------------------- This message was sent using IMP, the Internet Messaging Program.
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