This is a reply to Andrew's (2557) on whether or not he and Ted's
interpretation of Marx's transformation from values to prices of production
requires multiple periods.
I have assumed throughout my discussions of this issue that technology is
constant, as I think Marx also assumed in his determination of prices of
production in Part 2 of Volume 3, and as KM have assumed in all their
published articles on the transformation problem that I have seen.
I have argued that Marx's theory of prices of production is presented as a
transformation that takes place entirely within one period, in the sense
that if technology remained constant in the next period, the prices of
production and the rate of profit would also remain constant in the next
period. As long as technology remaines constant, the equalization of profit
rates in subsequent periods would still result in the same prices of
production and rate of profit. There is never a hint in all of Marx's
writings that that the transformation process takes place over multiple
periods, or that the prices of production which are determined in his
illustrations would change further in subsequent periods as a result of the
transformation process alone.
In contrast, according to KM's interpretation, even though the rate of
profit is equalized in each period, the prices of production and the rate of
profit keep changing from period to period, even without changes in
technology, solely because of the transformation of values into prices of
production. This is why I have argued that KM's interpretation of the
transformation requires multiple periods.
Andrew asked in his last post:
I'd like Fred to clarify whether there is another reason prices of
production and the general rate of profit should not change even if input
prices change and, if so, whether there is textual or other support for
this stipulation.
My response:
Yes, of course, if input prices change in subsequent periods, prices of
production and the rate of profit will also change. My argument has to do
with your "if" clause: in Marx's theory of prices of production (which
assumes technology constant), there is no reason for input prices to
continue to change from period to period. As long as technology is
constant, the input prices will remain the same, and so will the prices of
production and the rate of profit. In KM's interpretation, on the other
hand, the input prices continue to change from period to period, solely as a
result of the continuing transformation process, and therefore the prices of
production and rate of profit also continue to change. Again, this is why I
argue that KM's interpretation of the transformation requires multiple periods.
And, again, there is absolutely no textual evidence for this multi-period
interpretation of Marx's theory of prices of production.
Comradely,
Fred