Re: [OPE] [1] Marxian equilibrium & reply to Wright.

alejandro_agafonow@yahoo.es

Dear Dave:

Market doesn’t lack criteria to redirect labour toward the production of useful effects. Such criteria are lacking in Marxist theory of the market.

It is not true that (1) market prices tend to be proportional to their values. The truth is just the contrary, that is, (2) that values tend imperfectly to be proportional to market prices. Values spin around market prices.

Due to the fact that -as I argued when answering Ian Wright- labour time has not any link with the utility a commodity provides to consumers, if you accept the premise (1) you don’t have any mechanism to determine the social character of production, unless you trust in  a planner to determine that character (Cockshott & Cottrell didn't even propose this). This was until short time the option chosen by Marxists, and The ABC of Communism of Nicolai Bukharin and Evgeni Preobrazhenski expressed the usual way to follow:

«[…] it must be free from anarchy of production, from competition between individual entrepreneurs, from wars and crises. […] If all the factories and workshops together with the whole of agricultural production are combined to form an immense cooperative enterprise, it is obvious that everything must be precisely calculated. We must know in advance how much labour to assign to the various branches of industry; what products are required and how much of each it is necessary to produce; how and where machines must be provided. These and similar details must be thought out beforehand, with approximate accuracy at least; […] Without a general plan, without a general directive system, and without careful calculation and book-keeping, there can be no organization. But in the communist social order, there is such a plan.» (Bukharin y Preobrazhenski, 1920: Chapter III, Marxist Internet Archive)

A mechanism -either the temperature setting or the market- must have a goal or purpose, a software that tells to it toward which way turn the system. What is the reason? That, on the contrary, the mechanism itself wouldn’t have any raison d’être. An economy must serve to human necessities. If serves to natural laws of physics, cost of production or metaphysical laws of Greek gods, it wouldn’t have any sense for humans –unless we worship Greek gods.

Sincerely,
Alejandro Agafonow

----- Mensaje original ----
De: Dave Zachariah <davez@kth.se>
Para: Outline on Political Economy mailing list <ope@lists.csuchico.edu>
Enviado: domingo, 10 de febrero, 2008 13:15:28
Asunto: Re: [OPE] [1] Marxian equilibrium & reply to Wright.

on 2008-02-09 13:35 Alejandro Agafonow wrote:
> In consequence, LVT lacks criteria to redirect socially necessary 
> labour toward the production of useful effects that count with 
> consumers’ endorsement, a remark the Russian economist Boris Brutzkus 
> originally made in his debate with Alexander Chayanov, Stanislav 
> Strumilin y Eugen Varga, before to be exiled from USSR.
>
>  
>
> How can you state Ian that labour has the same regulative effect of a 
> temperature setting, if labour precisely lacks the program that would 
> show it toward which goal reorient the system? That is, labour itself 
> can’t be a regulator as far as lacks the criterion that determines its 
> socially necessary character. This socially necessary character only 
> can be offered by consumer preferences –-and in the past some Marxist 
> added the preferences of a dictator, shamefully Oskar Lange among them.
>
>  
>

Hi Alejandro,

I think you are misreading "socially necessary" here. If we leave aside 
Marx's formulations for a moment and consider the "labour value" of a 
good or a service to be "the social labour time necessary to reproduce 
it under existing conditions of production". That leaves out any 
conflation with "consumer tastes".

I don't understand why you say it lacks any criteria to redirect social 
labour toward "production of useful effects that count with consumers’ 
endorsement".

The theory states that market prices tend to be proportional to labour 
values. If this is true then implicitly there has to be mechanisms to 
that counter-act supply-demand discrepancies that cause deviations from 
the set of proportional prices. A commodity in high demand will have a 
price above the price proportional to its labour value. Its supply has 
to increase -- i.e. social labour must be redirected to its production 
-- in order to bring its price back into equilibrium. The reverse holds 
for commodities in low demand.

Why must a mechanism have a goal or purpose?

//Dave Z

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