In a recent exchange between Fred and Paul C., Fred writes:
> Paul C. has asserted in several recent posts that "one cannot have a theory
> of surplus-value without a theory of relative prices." This assertion is
> simply false.
> I have presented an aggregate theory of surplus-value in my 1993 paper on
> the transformation problem in Marx's Method (which I summarized in a
> recent post (2441)), which does not depend in any way on a theory of
> relative prices. This aggregate theory of surplus-value depends
> primarily on the assumption that the total money value added in the
>capitalist economy as a whole is proportional to the total current labor
>in the capitalist economy as a whole.
I don't know if this is what Paul C. had in mind, but there is one sense in
which surplus value depends unavoidably on relative prices: other things
equal, the rate of profit or surplus value expressed in monetary terms
[these are equal if e.g. one adopts the new solution's definition of the
value of labor power] is inversely related to the real wage, i.e. the price
of labor power relative to the consumer price index
(appropriately defined). To suggest otherwise is to imply that the wage
rate is not a price.
Consequently, I don't see how the condition Fred mentions above guarantees a
positive (aggregate) level of surplus value. Translated into a one-good
economy, Fred's condition states that l/(1-a) = constant, where l is the
direct labor input and a is the constant capital coefficient (pure
circulating capital model). Supposing a < 1, this stipulation is consistent
with a range of profit (and surplus value) levels, *including zero*,
depending on the level of the real wage rate.
Suppose instead we stipulate that the real wage share of net product is
constant, i.e.
wl/(1-a) = constant. Positive profits exist if and only if the wage share
is less than one. Fine. But this imposes a condition on relative prices,
i.e. on the real wage, which must be proportional to the ratio Fred states
above. So his story, if sufficient to guarantee positive aggregate surplus
value, necessarily imposes a condition on relative prices---or one
particular relative price, in any case.
In solidarity, Gil