[OPE-L:3936] Re: Re: Re: Re: Re: m in Marxs theory

From: Rakesh Bhandari (bhandari@Princeton.EDU)
Date: Mon Oct 02 2000 - 10:28:21 EDT

There are a lot of charges of who is not responding to whom. I 
continue to disagree with Fred and Alejandro about whether the inputs 
are "untransformed" after the completion of the second tableau (I 
think the problem of transforming the inputs can only be and is 
indeed raised then because only at this point do we have the concept of 
prices of production at which the "inputs" would presumably have 
bought) and about what determines the value transferred from the means of 
prodution (to me it seems clear that it is the value of the means of 
production --not the money sum paid for them--that determines the 
value transferred).

As for the controversy about m:

It is Duncan who introduces the labor value theoretic concept of the 
monetary expression of value and its inverse of the value of money. 
And he does tell us how to calculate both from (reworked) GDP data, 
right? In his hypothetical example the former is $15 and the latter 4 
minutes. Now one could of course argue that such calculation does not 
prove that  abstract (productive) labor in one hour actually produces 
the $15 of value (one does not need such a labor theory of value to 
argue against the injustice of profit income or the human unfreedom 
implicit in private ownership of the means of production, Ajit and 
Gil both seem to be saying as they reduce Marx's basic critique of 
political economy and theory of surplus value to ethics). For 
Duncan's implication to hold, however, the labor theory of value 
would at the least have to be free of internal contradiction.

Moreover, Ajit, as I understand you, you are arguing that in his 
transformation tableaux Marx has no way to convert total value to a 
dollar price quantity so that total cost price (also a dollar price 
quantity) can be subtracted from it to arrive at total profit which 
if then divided by total cost price would yield r or the mark up.

Yet if profit is to explained on the basis of the law of value, the 
monetary expression of value has to be taken as given and fixed in 
order to rule out the possibility of profit via simple money 
inflation. I understand Paul B to have agreed with Fred on this, and have
not understood your reply. 

Marx  can fix the monetary expression of value at .5 shillings per abstract
labor hour (value of one shilling  as two hours) or anything else as long
as he sticks with it  throughout his presentation. Only this way can he 
explain the  formation of the general industrial rate of profit on the
basis of  the law of value alone. Again if Marx had been trying to arrive
at  the correct relative prices, he would need to know the exact monetary 
expression of value and determine it from within the transformation 
tableau, but he's trying to resolve the contradiction between the  average
rate of profit and the law of value, to show how the former  not only does
not modify or contradict the former but can be 
fully explained on the basis of the latter.

For this purpose, it is perfectly reasonable and necessary to take 
the monetary expression of value as fixed and given, perhaps much 
like the neo Ricardians,as Meek explains, have to take the scale of 
production and technical as invariant  in order to carry out the
investigation of 
specific problems.

All the best, Rakesh

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