From: Ian Wright (wrighti@ACM.ORG)
Date: Fri May 26 2006 - 15:55:37 EDT
Hi Ajit Thanks for forwarding this paper. It's another excellent paper from you that draws out the implications for value theory of the work of Sraffa. I have learnt a lot from reading your work on this issue, and I admire the way you very carefully and logically deduce the anti-essentialist conclusions. Of course, these conclusions regarding value theory are conditional on Sraffa's PCMC being free from error. I believe there is an important error in Sraffa's work. In essence, Sraffa's reduction to dated labour representation commits a real-cost accounting error. Sraffa fails to count the labour-cost of capitalist consumption, and therefore fails to properly distinguish between production with and without a capitalist class. The reasons why Sraffa's commits the accounting error are complex, but I believe it is fundamentally due to a shift in Sraffa's problematic away from an analysis of the necessary relations that obtain in a state of self-replacing equilibrium to the contingent relations that obtain under conditions of a change in the distribution of income. This shift occured in the 20's as partially documented by Kurz and Salvadori. Contrary to what you say in your paper, I believe that Sraffa's surplus equations fail to adhere to a strict objectivism, and hence this shift in Sraffa's problematic is not progressive. For example, the rate of profit becomes conditional on the subjective classification of worker consumption goods as either subsistence or a share of the surplus. Once Sraffa's real-cost accounting error is fixed then very different conclusions may be drawn from his work regarding the theory of value. Sraffa remarks that his results "cannot be reconciled with *any* notion of capital as a measurable quantity independent of distribution of prices" (his emphasis). But this statement is not an accurate description of his own theoretical framework. In a state of self-replacement, there are *many* measures of capital independent of prices, of which labour-value is one example. But such real-cost measures *are* dependent on the distribution of real income (i.e. the composition of worker and capitalist consumption). Sraffa deduces prices by the exogenous distribution of nominal income, but somehow thinks that labour-costs can be deduced without a similar exogenous distribution of real income. Once the distribution of real-income is specified then the simultaneous satisfaction of all Marx's aggregrate conservation claims is a theorem in Sraffa's theoretical system, i.e. the neo-Ricardian critique of Marx's value theory falls. If the distribution of real-income is not specified, then, contra Sraffa, labour-values are undetermined. I have a tentative working paper on all this, which may be of interest: In post-script http://65.254.51.50/%7Ewright/realCost.ps In PDF http://65.254.51.50/%7Ewright/realCost.pdf I'd be happy to debate these issues, either online or offline, with a view to mutual understanding. My current thinking is that the nihilistic conclusions regarding value theory are not justified by Sraffa's work, once the above criticisms are applied. In sum, I agree that your conclusions follow from Sraffa's work. But the conclusions are based on a faulty starting point, which is the failure to properly account for real-costs. Best wishes, -Ian. P.S. This paper by Jorgen Sandemose tackles the very same issues of the relationship between Sraffa, Wittgenstein and value theory, but draws very different conclusions: "The World as a Game in Sraffa and Wittgenstein: A Case Study in Modern Bourgeois Ideology", Research in Political Economy, 19.
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