[OPE-L:4600] Re: Re: Re: Re: Part of My Confusion on theTransformation

From: Ajit Sinha (ajitsinha@lbsnaa.ernet.in)
Date: Mon Dec 04 2000 - 05:05:33 EST

Rakesh Narpat Bhandari wrote:

> Ajit,
> I understand that you think the transformation procedure needs a
> numeraire like the standard commodity (if I understand Meek) so that
> there is aggregate price invariance of the total output with
> distributional shifts.  So you won't allow me to read Marx as having
> fixed that the monetary expression of value before the original
> tableau (you said that I was a faux scholar to have assumed that this
> is how Marx was proceeding).  But of course Marx was assuming such a
> fixed value of money (you said that I took the quote out of context;
> I have more for you if you wish); perhaps in ch 9, Marx has assumed
> that the unit of account is  an hour of labor time, as Sweezy finds a
> reasonable interpretation. But something like this has to be correct;
> otherwise Marx would not have set the sum of simple prices (or
> values) in his first tableau equal to the sum of prices of production
> in the second tableau.


Rakesh, to measure something you need to have something to measure it with.
Now, if the measure of the thing that you are measuring is changing, then
how much it is changing and whether it is changing or not crucially depends
upon whether whatever you are measuring it with remains constant or not. Let
us suppose that you want to measure the length of an iron rod over different
seasons. Our theory suggest that its length should be relatively larger
during summer and smaller during winter. Let us suppose that to measure the
length of the iron rod we have chosen a copper rod. Now, if the length of
the copper rod itself is affected by the variation in temperature, then we
lose the ground to establish the fact that the length of the iron rod has
changed by so much or if at all. Thus to prove our hypothesis about the iron
rod we need to first establish that the copper rod will not be affected by
the change in temperature. If we could do that then we have an invariable
measure for our purpose in this context. Otherwise, our theory about the
variation in the length of the iron rod becomes baseless. Note the point
that assuming that copper rod remains invariant through changes in
temperature is not satisfactory in this case. So now you can understand that
you or fred or Marx or even God has no power to fix the monetary expression
of value. You have to have a theoretical argument that proves that when
prices of all the commodities are changing, how could your monetary
expression of value remain constant. This is your first theoretical problem,
unless you establish this first, all your subsequent moves on the board are
baseless. This is true for you, Fred, and TSS, etc. as well.

> You said you want go any further unless I drop this assumption; will
> you reconsider since I am simply beginning with the same assumptions
> and equations Sweezy gave us. I don't think Paul C or Allin think
> that the assumption regarding the unit of account is terribly
> unreasonable, especially as an interpretation of Marx's own procedure.


You don't seem to understand Sweezy's point. If you measure value in
labor-time units, then of course values don't change during the
transformation procedure, since they are independent of prices of
production. But you are imposing a price value relationship in terms of your
monetary expression of value at the outset, and then you go on to suggest
that during the transformation procedure all the prices are changing but
your initial price-value relationship in terms of monetary expression of
value remains constant. This is illegitimate. You need to first show how do
you arrive at your initial price-value relation in terms of monetary
expression of value, and then go on to show how this relationship will
remain invariant even when all other prices are changing. I hope this
clarifies my point to you.

I don't think there is any need to go through the tables at this stage.
Cheers, ajit sinha

> The original simple price, simple reproduction situation
> (1) c1 + v1 + p1 = c1 + c2 + c3
> (2) c2 + v2 + p2 = v1 + v2 + v2
> (3) c3 + v3 + p3 = p1 + p2 + p2
> Transformation equations for prices of production.
> (4) (1 + r) c1x + v1y = x(c1 + c2 + c3)
> (5) (1 + r) c2x + v2y = y(v1 + v2 + v3)
> (6) (1 + r) c3x + v3y = r[(x[c1 + c2 + c3]) + (y[v1 + v2 + v3])]
> (7) (c1+c2+c3+v1+v2+v3+p1+p2+p3) - [x(c1 + c2 + c3) + y(v1 + v2 + v3)] =
>       r[(x[c1 + c2 + c3]) + (y[v1 + v2 + v3])]
> My equation seven defines on the left hand side surplus value as the
> invariant total price (the first term) minus cost price (which itself
> is modified by the transformation procedure); this is then set equal
> to the sum of branch profits as they appear on the right hand side.
> As I have been trying to explain I do not think the mass of surplus
> value should remain invariant in the complete transformation as cost
> price is modified.
> There is no doubt that in Marx's *incomplete transformation* he holds
> total total price, total cost price and total surplus value invariant.
> But I argue that it was not Marx's idea that if we were going to keep
> the first fixed (total price) and modify the second (cost price) that
> the third (total surplus value) should remain fixed too. After all,
> Marx never did the complete transformation and even assuming that he
> would have accepted a simultaneous approach, he never specified what
> should remain invariant in this complete procedure.
> Allin tried to tease out the implicit definition of surplus value in
> the way he carried out the iteration, and I do not think he has
> denied his definition (value of the outputs minus the value of the
> inputs) leaves him unable to fend off an adding up theory of price.
> How does my set of equations not maintain the second equality? How is
> surplus value to be defined?
> Would you at least consider giving me your textually based
> understanding of what Marx's *definition* of surplus value is?
> Thanks, Rakesh

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