[OPE-L:3817] Re: Re: Re: m in Marx's theory

From: Ajit Sinha (ajitsinha@lbsnaa.ernet.in)
Date: Thu Sep 14 2000 - 03:30:22 EDT

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Fred B. Moseley wrote:

> Responses below to Ajit's 3811:
> On Mon, 11 Sep 2000, Ajit Sinha wrote:
> >
> > This is not true Fred. It only shows that you have not understood the
> > so-called traditional interpretation of the transformation problem. Your "m"
> > is nothing but the translator that maps labor accounts to money accounts or
> > vise versa. In the traditional formulations there were many m's. For example
> > the condition that total gross prices of production equals total value
> > basically gives you an "m"; similarly, the condition that total profits equal
> > total surplus value gives you an "m" too. Bortkiewicz has his own "m".
> > Duncan's "m" is just one in a series of m's. Eatwell uses the standard
> > commodity to solve the problem of m. However, the problem with you,Carchedi,
> > etc. are that you don't understand that the determination of m is the problem.
> > You guys simply assume that one hour of labor is equal to one dollar, and then
> > claim that you have solved the problem. But all it says to people like us is
> > that you simply have not understood the problem.
> Ajit, you continue to misunderstand Marx's theory. In Marx's theory,
> there is ONLY ONE m for the whole economy. m in Marx's theory is the
> quantity of money new-value produced per hour of ABSTRACT labor. An hour
> of abstract labor (i.e average social labor) in any industry is assumed to
> produce the SAME AMOUNT of money new-value as an hour of abstract labor in
> any other industry. THAT IS THE NATURE OF ABSTRACT LABOR. The fact that
> there are "many m's" in the standard interpretation is itself unmistakable
> proof that this is a misinterpretation of Marx's theory. In Marx's
> theory, abstract labor in different industries does not produce different
> amounts of money new-value, but rather the same amount. In the standard
> interpretation of Marx's theory, on the other hand, there is no abstract
> labor; there are only different concrete labors, with different mi's.


So you are basically saying that you have not read any traditional literature,
right? The system in the traditional literature has only one degree of freedom. So
there can be only one "m" for a solution. The point is that whether "m" is given by
the condition that total money value of net output equals total live labor, or total
amount of direct and indirect labor equals total money value of gross output, or
total money profit is equal to total surplus value, or value and price of money
commodity is equal, etc., etc. are all almost equally good and bad candidates for
your "m". The literature has not been able to theoretically establish which one
solves the problem. And your solution that I just assume m to be something is only
an indication that you have neither understood the literature nor the problem.

> >Ajit:
> > So all you are saying is that if you follow the marxian theory, even in
> > theory, you cannot determine surplus value, rate of profits, and prices of
> > production etc. because you don't know what the "m" is nor do you know what
> > determines this "m". However, everything depends on it. But that's what i have
> > been saying. You don't have a theory of anything.
> Ajit, what do you mean there is no theory of surplus-value (no theory of
> anything!)? Here is the theory of surplus-value (Marx's theory of
> surplus-value, I submit):
> 1. Whatever the given values of m and V, surplus-value is produced IF AND
> ONLY IF the total length of the average working day is greater than V / m,
> i.e. greater than the time necessary for the average worker to produce
> money new-value equal to the variable capital, i.e. greater than the
> "necessary labor-time" (Ln).


Since you don't know the value of "m", how do you know V/m will be less than the
"observed" L? So you have no way of saying that there is surplus value in the

> Fred:
> 2. The MAGNITUDE OF SURPLUS-VALUE is equal to m ( L - Ln). If m is
> changed, this does not affect the essentials of the theory. Marx assumed
> that the magnitudes of all the monetary variables (prices, components of
> capital, etc.) would change proportionally. So the ratios between the
> monetary variables would remain the same. L and Ln would also remain
> unchanged.


Assumptions don't make a theory, Fred. I would suggest that you should stick to your
arguments and not drag Marx and other people in it all the time because you are
making them look real bad.

> Fred:
> 3. From this theory of surplus-value, the following important phenomena
> of capitalist economies are derived (thereby attesting to its empirical
> explanatory power): conflict over the length of the working day, conflict
> over the intensity of labor, inherent technological change, periodic
> crises, etc., etc. None of the explanations of these important phenomena
> requires a full explanation of the determination of m. For example, the
> conflict over the length of the working day. Whatever m is, and whatever
> determines m, a longer working day will produce more money new-value, and
> hence more money surplus-value, than a shorter working day. Hence it is
> in the interests of capitalists to lengthen the working day (or at least
> resist attempts by workers to reduce the working day), which leads to the
> inherent conflict over the working day.


You have not derived any of the above things that you claim. What gives you the
impression that the traditional interpretation has no explanation for such

> Fred:
> Ajit, why isn't this a theory of surplus-value? It is perhaps incomplete
> in some respects (as indeed all theories are), but it still has impressive
> explanatory power, despite its incompleteness.


As I have explained time and time again. You have no theory of surplus value because
your surplus value crucially depends upon the value of m, which you admit that
neither you know nor you have any means of knowing.

> >Ajit:
> > Fred, you are reasoning in circle--and this is no dialectics. First you say
> > that prices of production (your total money value of industry output produced)
> > is *derived* by first making the proposition that m.L = V + (C + V)r, you
> > claim that in this equation V, C, L, and m are given. From here you derive
> > your r. Then you go on to determine your prices of production as (C + V) (1 +
> > r). When you were asked how is your m given. You say m is equal to [(C + V) (1
> > + r) - C]/L. So first you take an m to derive your r and then you take your r
> > to derive your m. In words, up till now you have been claiming that you were
> > deriving the prices of production. But to explain your m you find that you
> > have to, in effect, take prices of production as *given*. There is no need to
> > drag Duncan in it, because he is not doing any of the sort of things you are
> > doing. And you should also know that up till now you have been rejecting the
> > NI approach of deriving m and claiming rather that m is given because you know
> > that once you accept the NI approach, your logic crumbles.

> Fred:
> No, I am not arguing in circles. I am NOT arguing that m is DETERMINED by
> NV/L. I am arguing that Marx assumed that m is determined INDEPENDENTLY
> of NV. Then is it assumed that NV is determined by the equation NV =
> mL. From this it follows, as a matter of simple logic that, whatever
> determines m, if NV = mL, then m must be equal to NV / L. Not that m is
> determined by NV/L, but that m is equal to NV/L. This is just a more
> precise way of saying that, at a given point in time, m must have a unique
> value; it is not "arbitrary", as you have claimed.


In your reasoning you simply have two unknowns in one equation. You claim not to
know NV (this is your difference with the NI approach) and determine it by m.L. But
then you claim that m is not known, and all you know is that it must be equal to
NV/L. This is a classic case of trying to determine two unknowns with one equation.
That's why your theory is mumbo jumbo, which you unfortunately keep attributing to

> I am NOT saying that r is used to derive m. Where do you get this?


I get this because I, who seems to be doing all the thinking in this debate, worked
out your equations with which you agreed with.What you say is not what I'm concerned
with. What your reasoning leads to is what I'm concerned with.

> Ajit:
> > So Fred you have destroyed your whole edifice your self. You say Marx
> > determines "On the assumption that it takes two hours of labor to produce
> > an amount of gold equal to one shilling, each hour of gold labor produces
> > 0.5 shillings worth of gold, so that m in all industries (e.g. cotton
> > yarn) is equal to 0.5 shillings per hour." By the way, how did Marx
> > determined that two hours of labor produces 0.5 shillings worth of gold? It is
> > not clear to me whether gold is the money commodity here and 0.5 shilling is
> > simply certain weight of gold or shilling is in silver and there is a certain
> > exchange relation between gold and silver assumed here. My sense is that the
> > assumption here is that gold is the money commodity and half shilling is
> > simply certain amount of gold. So the question is how does Marx know that it
> > is two hours of labor that produces 0.5 shilling of gold. Gold is not found
> > scattered on the beach where labor could simply pick it up. Gold is produced
> > by labor and various raw materials and heavy machineries. So when Marx says
> > that it takes two hours of labor to produce 0.5 shillings of gold, he must, in
> > theory, have calculated the direct as well as the indirect labor needed to
> > produce 0.5 shillings worth of gold. Now to derive the indirect labor content
> > of the half shillings of gold Marx will not only need to know the technology
> > in the gold industry but the technological configuration of the whole basic
> > sector in the system. So, now according to you Marx, of course, did assume the
> > Sraffian technology given to him to derive his m. How else, otherwise could he
> > do this? So we have come a full circle. And i'm getting tired of going round
> > and round.
> Fred:
> Marx did not calculate m (or the value of gold) from given physical
> inputs. Marx simply took the value of gold as GIVEN, as I quoted in my
> last post from C.I: 314. You are going round and round only because you
> refuse to admit that Marx had a fundamentally different logical method
> from Sraffa.


The logical method you are attributing to Marx, Fred, has neither logic nor method
in it. The proposition that two hours of labor in gold sector produces 0.5 shillings
of gold has to have some way of determining those hours. He needs Sraffa's whole
basic sector to do so. He has got no other way of doing it. Do you? Let me guess,
you simply assume it as "given"!

> Ajit:
> >
> > The whole literature on the transformation problem, which you seem to reject,
> > is about this problem. That's why i say you have not understood the literature
> > that you have rejected.
> As explained above, the "whole literature on the transformation
> problem" is about an entirely different problem from the determination of
> Marx's m. By the nature of abstract labor, m cannot have multiple
> values. I would say that I have understood the transformation literature,
> but you, like this literature, have not understood Marx's theory. One of
> the main points that you apparently don't understand is this: due to the
> nature of abstract labor, there is one and only one m for the economy as a
> whole.


Well, another proof of what I suggested in the beginning. Now I'm very tired and
extremely bored with this debate. There is not much I'm interested in saying on this
anymore. Cheers, ajit sinha

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