[OPE-L:4358] Re: 'natural price'

From: Andrew Brown (Andrew@lubs.leeds.ac.uk)
Date: Sun Oct 29 2000 - 16:22:50 EST

Hi Rakesh,

On 29 Oct 2000, at 9:56, Rakesh Narpat Bhandari wrote:

> >Rakesh,
> >
> >1) Marx is saying in the footnote (just prior to chapter 6, Vol. 1)
> >that over the 'long period of time' there is an 'average price' that is
> >'ultimately' determined by value.
> Yes, he says that over the long term a merchant or a mfg cannot count 
> on selling above value in order to secure the formation of capital.

No. He is saying that it in reality, hence in the reality of the 
merchant, there is an 'average price'. He is further equating average 
price to 'natural price' clearly having in mind his analysis of prices 
of production in Vol 3. This is an average over time. Over 'the long 
period' in fact. This term average is very strong and very clear 
textual evidence. Marx didn't have to use it but he did. He is not a 
fool. It is not a mistake. He knows its implications. It can mean 
nothing else than that prices exhibit an average over time, equal to 
the price of production (probably some modified form of price of 
production, for tax, for example). I'm inclined to disagree with Marx 
on this (I don't have the concrete knowledge to say one way or the 
other really as mentioned in my previous post). I don't think it 
matters to the logic of Marx's argument. But there is no way one 
get away from the term 'average'! It's there!

> But this does not mean that the unit price of production is not 
> itself exhibiting a tendency to fall over time.

So why does he say 'average' then? What possible meaning can 
this term 'average' have if there is no stability in the observed price 
over time?

> You missed my point that Marx has not yet introduced the production 
> process by means of which a permanent tendency towards a decline in 
> unit values is indeed achieved. If Marx could have introduced this at 
> this point, it would have only strengthened his argument that outputs 
> (assuming a constant value of money) cannot over the long run be sold 
> at inflated prices in order to secure the formation of capital. The 
> outputs have to simply embody more value than the inputs though how 
> this happens through the circulation of commodities is the puzzle of 
> this chapter.

Marx has absolutely no need to 'strengthen' his argument in chs.5-
6, imo. Bringing in production explicitly certainly won't make any 
difference because he is concerned only with exchange at this 
stage (this is his concern because capital appears as a 
phenomenon of exchange). The footnote we are discussing involves 
vol 3 'assumptions', despite being in vol.1; see below.
> As has already been discussed at length, Marx later says that the 
> outputs have to embody sufficiently greater value that the moral 
> depreciation of the inputs which they embody does not so reduce the 
> value they represent that the formation of capital is undermined. 
> Moral depreciation is the result of the continuous decline in unit 
> values; Marx cannot introduce this phenomenon in this footnote at 
> this point.

The footnote is an aside. He introduces value / price divergence, 
which cannot really be entertained yet. Precisely because he is 
invoking aspects which should belong at more concrete stages he 
does it in a footnote. Because he is implicitly invoking prices of 
production he is implicitly switching to Vol 3 'assumptions' (better 
to say level of abstraction!!). You can't invoke prices of production 
whilst retaining Vol 1 level of abstraction! Thus, in fact, the 
*footnotes* of Volume 1 are very revealing about the later volumes 
because Marx can allow himself to talk about more concrete levels 
of abstraction in these footnotes (another example, somewhere 
early on Marx mentions 'wages' in a footnote, only to indicate that 
'wages' is a category as yet having no 'existence' until later in the 
presentation - in this case later in Volume 1)

> I would think it obvious that any case for Marx's commitment to long 
> term unit stationary prices of production would be based on a. more 
> than a footnote where Marx is trying to constrict the possible 
> explanations for increase in value and b. vol 3 chapters where Marx 
> uses the language of Smith and Ricardo to carry out an immanent 
> critique.

re 'a':
Marx is not trying to 'constrict' anything. He is taking the fact of 
(generalised) SV and asking what can possibly cause it. Only 
labour power / labour can. This conclusion holds throughout all 
further levels of abstraction. It is not a constriction but a fact. (So 
Marx's argument goes anyway). 

re 'b':
As above, this is a 'volume 3' level comment; and the term 'average' 
is entirely unambiguous.

> How is it possible to think Marx believed in a phenomenon such as 
> long term or stationary unit prices of production when a. he 
> announces at the start of capital the inverse movmenet of unit value 
> and use value, b. the lays bare and how why the production process is 
> continuously revolutionized, c. he develops the concept of release of 
> capital, d. he develops the concept of moral depreciation, e. he 
> analyzes how as unit values decline and the mass of use values grows, 
> capital is continously able to absorb more surplus labor.

Well maybe the continuous technical change (lowering of unit 
values) takes time. First one technology predominates for a 'long 
period', then another for the next 'long period'. Would be worth 
checking the Classical Political Economists view. Presumably this 
is all based upon empirical evidence anyway. The CPE's and Marx 
could verify empirically whether prices tended to an average or not. 
Whatever, it seems to me doubtful that such an average really 
exists for, inter alia, some of the reasons you state. It is more 
plausible that it once existed - at the time of CPE say. But I don't 
know. I'm not that bothered because the theory doesn't rest on it, 
as I mentioned already.

> Again, I think it's a mistake to read Marx's commitment to long term 
> natural prices or long term centers of gravity based on one footnote 
> when much of his theory has not even been developed yet.
> >Moreover, he mentions Smith and Ricardo in just this
> >context without any qualification regarding their centre of gravity
> >concept.
> True but center of gravity is not the term used. Natural price is.

But 'natural price' *is* centre of gravity for Smith and Ricardo! 
Surely Marx would explicitly disavow this connnotation whilst 
invoking the term?  

> >I am doubtful as to the validity of this 'empirical average' notion but I
> >can't read the footnote any other way. I would be quite happy to
> >drop any idea that this 'regulating price' exhibits stability over
> >periods of months and years.
> have to differentiate between stability in relative and absolute 
> terms. The classicals failed to do this rigorously.

I'm not sure why your point here is germane.

> >On a different matter:
> >
> >My interpretation of Ilyenkov is a minority one. But let me just say
> >that my interpretation is at odds with your 'successive
> >approximations' reading of 'Capital'. Ilyenkov sees Marx as
> >'developing' the law of value. This is an immanent development not
> >an ongoing setting and relaxing of arbitrary assumptions. I mention
> >this because you often invoke Ilyenkov re the transformation
> >problem (and don't get me wrong, I am delighted that you do, even
> >if I don't agree with your interpretation).

> I do not think Ilyenkov would disagree that Marx's hypothesis not only 
> required logical development but pertained to the real developmental 
> tendencies of capital.

As I interpret Ilyenkov:

1) He would not use the term 'hypothesis' here.

2) For him dialecto-logical development and real development are 
one and the same thing.

Many thanks,


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