[OPE-L:3946] Re: Re: Re: Re: Re: The Transformation Problem

From: Rakesh Bhandari (bhandari@Princeton.EDU)
Date: Wed Oct 04 2000 - 08:51:44 EDT

In 3944 Lefteris Tsoulfidis noted:

>(3) It seems to me that the question of time does not appear in the 
>TP in ch. 9. Time and
>investment behavior appear in ch. 10 and after.  The TP in ch. 9 is 
>discussed purely in
static terms and really constitutes  an exercise in logic

This is not true. As I noted to Allin who did not reply, Marx is 
already investigating in ch 9 why the prices of production in a 
particular sphere are undergoing changes of magnitude (see capital 3, 
p. 265ff. Vintage; see also p. 270-1 where marx refers to the rise of fall
of the portion of cost price which represents constant capital in a given
sphere of production; note also p.271-2 where Marx analyzes the impact of
rising productivity). So there is no reason for the stricture that the	so
called transformation problem has to be solved on the assumption  of input
prices of production=output prices of production. Of course  if this
assumption is dropped as it should be for a temporal 
sequential approach (and why can't an exercise in logic include time 
subscripts), then there no longer need be a discrepancy between total 
surplus value and total profit that has to be arbitrarily accounted 
for by postulating revenue expenditures of exactly the right size. Of 
course one can say that within a static framework such revenue 
expenditure could account for the inequality between total surplus 
value and total profit; that is, this can be offered as an escape 
hatch if one confines herself for the sake of argument to a static 
(or more accurately replicating) world in which input prices have to 
be output prices.

>Thanks for your answer, it seems to me, however, that your critique 
>is rather sympathetic
>to the solution to the TP advanced by the three authors at least 
>more so than the "new
>approach". Now I want to make a few related points by way of questions:
>(1) What problems do you see in the circuits of capital and revenue? 
>don't	they arise
>logically from the distinction of productive/unproductive 
>consumption? Is there any
>evidence in Marx against such a distinction?
>(2) What do you mean by competitive rate of profit? If you mean the 
>uniform rate of profit
>in perfect competition I must say that such a concept is totally 
>different from Marx's
>notion of the tendential equalization of interindustry profit rate. 
>I agree though that
>S/(C+V) in value terms will differ in general from the rop in pop 
>terms, the question
>however is _by how much_ ? In the usual numerical solutions of  the 
>TP the differences
>between the two rop is negligible or not? On the other hand the 
>empirical evidence, that I
>know, shows that the two rates of profit are extremely close to each 
>other. A result that,
>in my view, shows that the distinction between the circuits of 
>capital and revenue is

Why only account for revenue? Why not interest and rent as well? Wouldn't
they also contribute to a discrepacy between the value rate of profit and
the average industrial rate of profit? 


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