[OPE-L:4544] reply to Fred (4)

From: Rakesh Narpat Bhandari (rakeshb@Stanford.EDU)
Date: Mon Nov 20 2000 - 04:36:11 EST

>5.  Beyond the textual evidence, I think the methodological reason Marx
>took constant capital and variable capital as given is the following:
>According to Marx's logical method, it is not possible at the beginning of
>the theory to provide a full explanation of the magnitudes of constant
>capital and variable capital.  C and V (understood as the actual
>magnitudes of money-capital invested in the real capitalist economy to
>purchase means of production and labor-power) are identically equal to the
>price of production of the means of production and means of subsistence,
>respectively.  Therefore, an explanation of C and V requires an
>explanation of prices of production.  However, prices of production
>involve the equalization of profit rates across industries.  According to
>Marx's method, it is not possible at this early stage of the theory to
>explain the equalization of profit rates, which is an aspect of the
>distribution of surplus-value.  Before Marx analyzed the distribution of
>surplus-value in Volume 3, he first determined the total amount of
>surplus-value to be distributed in Volume 1.  For that purpose, Marx took
>the actual magnitudes of C and V as given.  The actual magnitude of C is
>transferred to the price of the output (equation 2 above), and the actual
>magnitude of V is subtracted from the new-value produced to determine the
>actual surplus-value (equation 3 above).

Surplus value is dM or M' minus M. The discovery of this formula is 
obviously not the main point of volume I

We learn rather in volume I that the magnitude of dM/M is given by a 
simple formula

      c/v + 1

Whether the means of production and subsistence exchange at value has 
no bearing on the direction of these relationships.

I take volume one to be an explanation of why over the course of 
capital accumulation, the numerator and denominator tend to move in 
inverse direction while C, V and S all tend to rise in absolute terms.

>According to this interpretation, in Volume 1 Marx provided a partial
>explanation of the determination of the given magnitudes of C and V.  Marx
>provisionally assumed in Volume 1 (and 2) that the given magnitudes of C
>and V are proportional to the labor-times required to produce the means of
>production and means of subsistence, respectively.

Oh, Marx is not only assuming this; he is himself determining the 
magnitude of the money sums laid out as constant and variable capital 
on the assumption that goods are exchanged at (or in proportion) to 

This is why Marx himself notes the need to modify cost price. The 
money sums for example which he has his capitalists in his own 
transformation tableaux lay out is based on the assumption that the 
means of production and subsistence exchange at value (Marx also 
seems to have assumed that the monetary expression of labor time was 
one in ch 9).

>  In other words, he
>assumed that these given magnitudes of C and V are determined solely by
>these labor-time quantities.  In reality, the determination of C and V is
>more complicated than that.  The prices of the means of production and the
>means of subsistence are affected by other factors besides labor-times
>(although labor-times remain the main determinants of C and V).

Well on that we are agreed.

>However, this partial explanation of C and V DOES NOT CHANGE THE
>MAGNITUDES OF C AND V.  The magnitudes of C and V continue to be taken as
>given, as the actual quantities of money-capital invested in the real
>capitalist economy.  The difference is that, with this provisional
>assumption, these given magnitudes are partially explained (but only
>In Volume 3, after the determination of prices of production, the given
>magnitudes of C and V are more fully explained as equal to the prices of
>production of the means of production and means of subsistence.

So Marx had not until volume 3 allowed the outputs to sell at prices 
of production but the money sums invested as constant and variable 
capital were always given in terms of the prices of production 
operative in a real capitalist economy?

So Marx has to transform the outputs but not the inputs?

It makes more sense to me to assume that Marx not only had assumed 
but generally only allowed that  both the inputs and outputs 
exchange at prices proportional to their values until volume 3.

This *controlling* assumption makes no difference for the nature of 
the relationships between variables in which he was interested (see 

In fact why is Marx interested in price value deviations? Not in my 
opinion because it matters much at all for the variables in terms of 
which he determines the laws of motion but because he is attempting 
to explain why to the agents caught up in bourgeois production the 
categories in everyday life objectively do contradict the law of 
value. For Marx, the objectivity of appearance has to be accounted 
for; it cannot be dismissed as mere subjective illusion. This gets 
into questions of epistemology and ideology; moreover, it brings Marx 
closer to Bourdieu's ideas about habitus and perhaps even some 
Heideggerian notions. But we can leave that aside for now!

>However, once again, this more complete explanation of the given
>magnitudes of C and V in Volume 3 does not alter these given
>magnitudes.  C and V continue be taken as given, as the actual amounts of
>money-capital invested in the real capitalist economy.  The same actual
>magnitudes of constant capital and variable capital that are taken as
>given in the determination of surplus-value in Volume 1 are also taken as
>given in the determination of prices of production in Volume 3.  That is
>why C and V DO NOT HAVE TO BE "TRANSFORMED" from "direct prices" to prices
>of production.

We disagree that this is exactly what Marx is calling for. I simply 
disagree that Marx would have agreed that the inputs and outputs 
should be transformed into the same unit prices of production. And I 
also argue that even if one does stipulate this, both equalities can 
be maintained as long as one follows the steps in the iteration which 
I have proposed or completes the transformation in terms of the set 
of equations which I propose.

>As I have said before, I think that Marx's logical method with respect to
>the determination of C and V, as described above, can be characterized as
>"positing the presuppositions."  The initial quantities of C and V are
>first "presupposed" (and used to explain S), and then they are
>"posited" (explained or determined, in stages).

I read Marx as not allowing commodities to exchange in terms of a 
category which he has not yet derived.


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