[OPE-L:7425] [OPE-L:957] Re: value and price

Gerald Levy (glevy@pratt.edu)
Fri, 7 May 1999 06:25:16 -0400 (EDT)

Ajit wrote in [OPE-L:955]:

> Who said that all the inputs must be bought at the same time etc.?

I thought you did. If I am mistaken, then I stand corrected.

> It is you who said that there was something called input prices and
> output prices and they differed from each other due to lapse of
> time between the two.

No, I didn't say that was the reason *why* they differ. They differ since
they represent different commodities: "inputs" (the means of production
and labour-power needed to produce the commodity output during the next
period) and "output" (the commodity output for the preceding period). [Of
course, this isn't quite correct since the constant fixed capital
purchased in one period would depreciate over a multi-period of time].

> Now, you are saing that there is lapse of
> time for "input prices" itself, so you don't have *an* input price
> for a commodity but several. This should create serious problem for
> your own formulation and bring to you the problem with your
> understanding of the concept of prices.

It's not a problem for me since I don't accept the "law of one price".

> As far as my position is
> concerned, it creates absolutely no problem. Price is defined only
> for a point in time. Whether the commodity is bought to be used as
> input or whatever is not even the concern for the definition of
> price. In a well defined "market" one price prevails for a
> commodity at a given point of time.

Since you are making an empirical suggestion, what is the empirical
evidence that you are referring to? Moreover, since you evidently include
this to mean contemporary markets, perhaps we should have a discussion of
price determination in oligopolistic markets (the most common "defined"
market type in contemporary capitalist economies).

> Let's suppose a commodity is produced and
> is unsold for sometime, in the meanwhile the technology changes and
> the price of such commodties fall. What happens to the old
> commodity? Its price falls too.

Yes, it's price drops, including possibly to -0-. Even if the price
dropped to -0-, there would be conditions in which the commodity might
not be able to be sold (there are plenty of examples of this in

> Why? Because there can be only
> one price of a type of commodity in one market at a given point in
> time.

The LOOP abstracts from such questions as brand loyalty, advertising, and
product differentiation. In other words, it abstracts from what
happens *typically* in oligopolistic markets.

In solidarity, Jerry