Re: [OPE] Market socialism [the false assumption of the law of value]

From: Alejandro Agafonow (
Date: Thu Jul 03 2008 - 05:17:13 EDT

By the way Zachariah. When I say that you “have to avoid the pernicious normative interpretation of market economies”, I refer to this “normative interpretation” qua positive theory. As a market socialist I advocate a “normative interpretation” qua programme to be achieved.
But always based in a realist “positive theory” of market economies where false prices have the goal of signalling the right direction for the allocation of labour time.
I support the fixation of prices to marginal costs on the part of socialists managers acting in a catallactic market, that is, a mandatory price mechanism.
The goal of this mandatory price mechanism is one that has conquered the hearts and minds of several generations of economists, from Adam Smith to Vilfredo Pareto and Oskar Lange. The devolution of the proceeds, which characterizes the capitalist market economy, to the citizens in the form of an expansion of the scale of production until prices equalize marginal costs.
Even Pareto recognized that this is possible only in a socialist economy!
Kind regards,A. Agafonow

----- Mensaje original ----
De: Dave Zachariah <>
Para: Outline on Political Economy mailing list <>
Enviado: jueves, 3 de julio, 2008 9:42:19
Asunto: Re: [OPE] Market socialism [the false assumption of the law of value]

Alejandro Agafonow wrote:
> This is not good. Not even as a hypothesis. If this would be true, why 
> C&C devised a planner that consciously reallocates labour time 
> following supply and demand signals?

Alejandro, it seems to me that you have mixed up the issues at stake here.

  1. The labour theory of value, as a theory of how economies governed
      by market exchange operates.
  2. The possible use of labour values in a planned economy.

If you have a planned economy with some sort of prices there is no 
market mechanism by which they can gravitate around labour values. This 
says nothing about whether the labour theory of value holds as a 
scientific theory about market exchange.

> Because labour rotates around prices, as I agued here some time ago. 
> The reallocation of labour time doesn’t happen spontaneously. You need 
> planners or entrepreneurs consciously reallocating labour.

You claimed that 'labour values spins around prices' some time ago, and 
I claimed it was nonsensical but you never replied to this argument: For 
a given commodity-type during a period of time its labour value 
(singular) is fixed or slowly varying but there is a multitude of market 
prices that vary over time and space.

Therefore it would be conceptually wrong to say that 'price is the 
center of gravity for labour value'.

//Dave Z
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