Alejandro R:
> >Im interested in knowing why does Ajit think that $1 = 1 hour of
> >labor is an "absurd assumption"? As we have seen, he has been making
> >this statement in many posts, but I havent found a clear explanaition
> >for this yet.
> >
> >Of course, I dont want to direct this question only to Ajit, but also
> >to other people who, I think, is near to his particular
> >interpretation (like Paul C., Allin C., David L.)
Paul C in #5104:
> I think that the basic objection is that the question of the price
> level should first theoretically be solved without assuming fiat
> money. It should be solved initially for economies with commodity
> money as these are both conceptually and historically prior to
> systems of fiat money since fiat money involves dealing with state
> finance which is outside the scope of discussions of value theory.
> Given commodity money, one is not at liberty to assume that a
> particular ratio exists between labour time and money, since
> gold must be treated as a branch of production like any other.
> Its value must depend upon conditions of production in the gold
> industry.
Alejandro R.:
Thanks for your clear response.
The fact is that Marx assumes $1 = 1 working day in his
transformation procedure. I think you agree with this. This assumption
is explicit in the case of his letter to Engels. I dont think it is
an "absurd assumption". So, what would be the explanaition for this?
Re your point: I dont think Marx is "assuming fiat money" when
assumes $1 = 1 working day. Moreover, one can interpret his
assumption in the framework you are suggesting, i.e. a "money
commodity" so that, e.g. $1 = 1 ounce of gold.
Let us suppose a stationary economy, without fixed capital. Given the
transformation of values into production prices one can distinguish
in any commodity (including gold) 2 numbers: the labor-time
*objectified* in this commodity (i.e. its labor-value) and the labor-
time *appropriated* by the capitalist through selling this commodity
(i.e. its labor-production price).
Both, labor-values and labor-production prices can certainly be
expressed also in terms of money-gold. So we have money-values and
money-production prices. Money-value is the *monetary representation*
of the labor contained into the commodity and money-production price
is the *monetary representation* of the labor appropriated effectively
by the capitalist.
Focus in gold: 1 ounce of gold *contains* a certain amount of labor-
time which differs from the labor-time it socially *represents*,
correponding to its production price. Under these conditions, the
SOCIALLY prevailing relation between gold and labor time is given,
NOT by the labor time *contained* in gold (as happens in Vols I and
II), but by the labor time REPRESENTED by one ounce of gold, i.e.
by the inverse of its labor-production price, not by the inverse of
its labor-value.
Note that put in these terms the determination of the relation
money/labor time is not as "arbitrary" as Marx's examples suggest.
Re a particular point you raise:
> money as these are both conceptually and historically prior to
> systems of fiat money since fiat money involves dealing with state
> finance which is outside the scope of discussions of value theory.
Why is "state finance outside the scope of discussions of value
theory"?
Alejandro R.