# more on the one invariance condition

From: Rakesh Narpat Bhandari (rakeshb@Stanford.EDU)
Date: Thu Nov 02 2000 - 12:46:23 EST

```>On Wed, 1 Nov 2000, Rakesh Narpat Bhandari wrote:
>
>>  Now Allin objects that I have preserved the two equalities by
>>  trickery. But it makes no sense to read the second equality as also
>>  an invariance condition.
>>
>>    It would make no sense to keep the mass of surplus value invariant
>>  with total value as we modify the cost prices since Marx defines
>>  surplus value as total value minus cost price.
>
>As I've said before, I don't accept that the above is Marx's
>"definition" of surplus value.	It's a derivative statement of
>what surplus value amounts to, good only on the assumption
>that cost price = value of inputs.

Allin,
the underlying argument is clear here.

after the transformation of the ouputs, we

(1)total value=>sum of prices of production
(2)mass of surplus value=>sum of branch profits.

The putative problem now is to transform the inputs such that not
only do the above two macro, asymmetric determinations  hold but the
magnitudes of the sum of the prices of production, sum of branch
profits and rate of profit remain as they were determined in the so
called value scheme.

The two macro asymmetric determinations are thus claimed to be two
invariance conditions as well. Or three if we count the so called
value rate of profit.

Since we are not changing the indirect and direct labor in the
system, I agree that total value remains invariant and that the sum
of the prices of production should remain determined thereby. This
gives us one asymmetric determination and one invariance condition
for the solution of the problem. That is, in the completed
transformation not only must the sum of production prices remain
determined by total value; the total value by which it is determined
remains invariant from the unmodified scheme.

I now argue that maintainence of the second asymmetric determination
does not imply that it too must be turned into an invariance
condition. All vol 3 textual evidence suggests that Marx defined
surplus value as total value minus cost price (or total capital
advanced or value of capital advanced, never as the value of the
input means of production and wage inputs); therefore, if cost price
is modified due to a transforming of the price of the inputs, so
should the available mass of surplus value and the rate of profit
determined in terms of it (now modified mass of surplus
value/modified cost prices) be modified.

Yet if one does not hold invariant the mass of surplus value and rate
of profit as derived from the so called value scheme--and this seems
to be your underlying point, Allin--then how can one say that the
economic magnitudes in the completed transformation tableau have been
determined by value? Have we not given up value determination?

I argue that this is not true.

In the Gouverneur-Bhandari iterative method, it is the modified mass
of surplus value which is determined prior to, and then itself used
to determine, the modified average price rate of profit and then the
sum of branch profits such that its sum remains determined by the
mass of (modified) surplus value. The asymmetric value theoretic
determination implied in (2) is maintained in each stage of the
iteration and in the final, equilibrium state.

That two false invariance conditions are not met (invariance of the
mass of surplus value and the so called value rate of profit for the
postulation of both of which there is no textual evidence in Marx) in
no way implies the violation of the second asymmetric determination.
This is my (I believe) original argument.

Both asymmetric determinations hold in the iterative process. We are
left not with the unexpected collapse of Marx's macro, asymmetric,
value theoretic determination of economic magnitudes (Moseley) but
rather with a demonstration that Marx was correct that it is possible
to go wrong in the determination of the average rate of profit and
prices of production if the cost prices are left unmodified.

Again, I subscribe to the iterative process only to meet objections
on the enemy's terrain of equilibrium. I do not think the output's PV
ratios should be applied to the inputs, as Gouverneur seems to think.
Marx was correct to recognize that the inputs would have to be
modified and leave it at that.

Yours, Rakesh
```

This archive was generated by hypermail 2b29 : Thu Nov 30 2000 - 00:00:04 EST