# [OPE-L:4133] iterative transformation

From: Rakesh Narpat Bhandari (rakeshb@Stanford.EDU)
Date: Tue Oct 17 2000 - 02:32:45 EDT

Re 4118

>Just for the record:  I asked in my [4040] that my [4039] reply
>to Rakesh be disregarded since it was too hasty.  On reflection,
>while I would change the wording if I had 4039 to write again,
>I stand by its substance.  That is, I think Rakesh was changing
>the subject in his [4038], by envisaging a change in the
>labour-time accounts relative to the original table that we were
>trying to "transform".
>
>Allin Cottrell.

Here is the exchange.

After some attempts on my part, you finally reconstructed your
iterative tableau such that the value of the inputs determined the
sum of their prices of production:

round: 46
c	  v   profit    price   pvratio
I  243.00   81.00   96.00   420.00   1.1200
II  108.00  108.00   64.00   280.00   0.9333
III   54.00   81.00   40.00   175.00   0.8750
Tot.  405.00  270.00  200.00   875.00   1.0000

On the interpretation you're proposing, how are you going to
write the next table?  You'll have to put 420.00 at the foot of
the "c" column and 280.00 at the foot of the "v" column as these
"greater quantities" of output are put to use.  If you write 200
for aggregate profit, you've then got an aggregate price of 900,
not equal to total value.
__________________

I responded:

Why would I write 200 for aggregate profit for the next period?
Instead maintain r as 1.3, then aggregate value or price in the next
period is 910, profit or sv is 210. It would be unreasonable for it
not to increase since more labor time will now be embodied in the
final product.

For we now have 300 wage goods in physical units, suppose that each
ten buys a working day. So we have 30 full time workers.

In the previous period we had  286 wage goods in physical units, so
only 29 full time workers.

A working day produces roughly the same total value in both
periods--30 (30/910; 29/875). the rate of exploitation rises
slightly. 29 workers produced \$200 profit, now 30 workers produce
\$210 in profit.  Again, no unreasonable changes. Actually the kind of
change which should be a mark in favor of Marx's method!

The introduction of time subscripts or the treatment of the
transformation as one period in a realistic sequence (Carchedi)
renders Marx's value theory logical enough that it can be tested
against reality. Is this really something you want to fight against?

All the best, Rakesh
_______________________

This was your reply in 4039 (note how much of my reasoning you left out):

>
>  >   If you write 200
>  >for aggregate profit, you've then got an aggregate price of 900,
>  >not equal to total value.
>
>  Why would I write 200 for aggregate profit for the next period?
>  Instead maintain r as 1.3, then aggregate value or price in the next
>  period is 910, profit or sv is 210. It would be unreasonable for it
>  not to increase since more labor time will now be embodied in the
>  final product.

Argh!  Where is this increase in labour time supposed to be
coming from?  In your last post the increase in output was
simply the result of an increase in the physical productivity of
labour!  Now it suddenly requires an increase in labour input.
You're changing the subject as fast as I can show you what's

Total price doesn't equal total value, so you fix it up by
increasing the total value, when by assumption we're trying to
produce the price-of-production counterpart of a _given_ value
system (the original table).

Now I _really_ give up.

Allin.
____________

Now despite your exclamation, Allin, I clearly explained where this
increase in labour time was coming from. You will see that as usual
you cut me off where I provide my reasoning, which I shall show below
to be solidly grounded in Marx's reasoning.

I have not changed my argument once though you have yet to understand
it while complaining about my obstinate inability to understand
another point of view: if the transformation tableau is understood
not in terms of simple reproduction but rather as one period in a
realistic sequence in which all variables are time subscripted, the
transformation disappears.

That there is a transformation problem under the conditions of simple
reproduction or equilibrium is to me nothing more than a curio. If
only the Marxists had the social power to dismiss it as such.

reconfigure your  a simple reproduction table as such a period in a
sequence.

There is thus no reason for me or anyone with the slightest interest
in reality to assume at t+2 the total value/price will be the same as
total value/price at t+1.

All I had to show was that all such changes are reasonable which is
what I tried to show. And to which you did not respond. From my
perspective, the transformation is complete; in your language we have
already produced the price of production counterpart of a given value
system at t+1. The pv's, the r, and the total mass of profit/value
can, and should be expected to be, different at t+2.

At any rate, such a sequence is clearly what Marx had in mind. To
take one of many passages:

...the development of labour productivity contributes to an increase
in the existing capital value, since it increases the mass and
diversity of use values in which the same exchange value is
represented, and which form the material substratum, the objective
elements of this capital, the substantial objects of which constant
capital consists directly and variable capital at least indirectly.
The same capital and the same labour produce more things that can be
transformed into capital, quite apart from the exchange value. These
surplus labour also, and can in this way form additional capital. The
mass of labour  that capital can command does not depend on the its
value but rather on the mass of raw and ancillary materials, of
machinery and elements of fixed capital, and of means of subsistence,
out of which it is composed, whatever their value may be. SINCE THE
MASS OF LABOUR APPLIED THUS GROWS, AND THE MASS OF SURPLUS LABOUR
WITH IT, THE VALUE OF THE CAPITAL REPRODUCED AND THE SURPLUS VALUE
NEWLY ADDED TO IT GROWS AS WELL.  Capital 3, p. 356-7. vintage

Once the transformation is understood as period in the kind of
sequence Marx understood capitalist dynamics to imply (and if you
wish I can provide 4 or 5 more quotes like this from Capital 3 and
TSV), then the assumptions which I made are not arbitrary in the
least. They are in fact not only Marx's assumptions, they are the
only realistic ones.

Whether the transformation does not hold in those conditions which
most interest neo classical economists is of little interest. Of
little theoretical interest. It of course has been of great use in
the bourgeois war, often carried out by Marxist economists, against
Marx's theory of value.

At some point, I hope it becomes clear that the transformation
problem is nothing but a great comedy of errors, with some of the
most serious, no bullshit Marxists as the leading funny men.

Yours, Rakesh

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