Andrew here, replying to Simon (ope-l 1063):
1. Why measure values in money? Because the TSS interpretation is an
*interpretation* of Marx, and he did so. There is both an "immanent" and
"extrinsic" measure of value in his work--see, e.g., first pg. of Ch. 3,
Vol. I.
2. Why measure price in labor-time? For convenience. The key thing
that is really needed to to distinguish between price value differences
due to the redistribution of value and price-value differences due to
a change in the monetary expression of value. In the Ch. 9, Vol. III
transformation, e.g, Marx assumed a constant monetary expression of
value when he derived the aggregate equalities (see p. 266, Penguin/
Vintage). One way of doing this is to convert money prices into
labor-time sums. This is equivalent to correcting money prices by
deflating for changes in the relation between money and labor-time.
If you don't like thinking of labor-time prices, think of constant
monetary expression of value prices.
3. I do not really understand Simon's last point. It has something to
do with whether the aggregate transformation equalities are derived
from the TSS equations or whether the equations are derived from the
equalities. I'd like to ask him to explain this further, then I'll
answer. In particular, there might be two different meanings of "derive"
being used. I.e., on the basis of the equations, the aggregate equalities,
value/price and surplus-value/profit, then follow. (That the value and
price profit rates are identical is built into the equations.) On the
other hand, those of us who have "discovered" the TSS interpretation in
one form or another "derived" it by re-thinking the meaning of the
terms of his transformation, for instance, noting that the initial
terms aren't value or means of production and labor-power, but constant
and variable capital.
In any case, even were I to agree with Simon that the equality of
total value added and total price added is good enough, which I don't,
the "new solution" is far from an adequate representation of Marx's
value theory. The profit rate differs, the price equations imply that
the Okishio theorem is correct and Marx's law of the falling rate of
profit is internally inconsistent, and, as my recent posts on the
"transformation problem" and "Torrens vs. Marx" have shown, ALL
models in which input prices (values) must equal output prices (values)
are simply incompatible with the determination of value by labor-time.
WHEN ONE STIPULATES THAT THE VALUE (PRICE) OF A COMMODITY MUST BE THE
SAME AT TWO DIFFERENT TIMES, NO MATTER HOW MUCH THE LABOR-TIME NEEDED
FOR ITS PRODUCTION HAS CHANGED, ONE HAS STIPULATED THAT LABOR-TIME
IS IRRELEVANT TO THE DETERMINATION OF ITS VALUE (PRICE).
Andrew Kliman