[OPE-L:4873] Re: Give us some NUMBERS, Fred! (was: rent and the working class)

From: Steve Keen (s.keen@uws.edu.au)
Date: Sun Feb 11 2001 - 16:57:01 EST

I have yet to read the papers on the TSSI; I will when time permits. But I
can't help making a comment here.

The implication of Andrew's reply is that it is quite valid TSSI Marxian
methodology to let all or many things change in the fundamental
analysis--that there should be no equivalent of the 'ceteris paribus'
clause so frequently resorted to by neoclassical economists.

I argue that Marx did have such a construct, but unlike the fallacious use
of c.p. by neoclassical economists (where they use it to presume
non-linkage between economic sectors, and then later generalise their
analysis as if that presumption remains true when they aggregate), Marx's
was guided by a structured dialectic--where the 'c.p.' clause would be
relaxed at a later stage, and the consequences of doing so would be
honestly explored.

For example, one thing which could also change the general profit rate
would be market movements in wages. Did that form a part of Marx's
explanation of the origin and magnitude of surplus? No, because:

"For the time being, necessary labor supposed as such; i.e. that the worker
always obtains only the minimum of wages. This supposition is necessary, of
course, so as to establish the laws of profit in so far as they are not
determined by the rise and fall of wages or by the influence of landed
property. All these fixed suppositions themselves become fluid in the
further course of development." (Marx 1857, p. 817.)

In contrast, in what I have seen of the TSSI methodology, 'All these fixed
suppositions themselves become fluid' at the outset.

I very much doubt that Marx would have claimed such a methodology as his own.

At 10:57 AM 2/11/01 -0500, you wrote:
>Fred Moseley writes in OPE-L 4865:
>"Kliman and McGlone's interpretation [i.e., the temporal
>single-system interpretation] of Marx's "prices of production" is
>erroneous.  According to their interpretation,
>"prices of production" continue to change from period to period,
>ANYWHERE IN THE ECONOMY!  (See for example, the 14 periods in
>Andrew and Ted's numerical example in their first (1988)
>Fred, just how do you think you know the changes in prices aren't
>the result of productivity changes?  What is it that creates the
>difference between input and output prices in the *initial*
>It might well be a difference in productivity in period 1 as
>against period 0, and all the changes in periods 2, 3, etc. are
>part of the adjustment of prices in response to that productivity
>Marx never said that productivity changes can't have an *ongoing*
>influence on prices of production, did he?
>BTW, as Eduardo has pointed out to me, it is just NOT true that
>Marx's theory is that prices of production cannot change
>independently of changes in productivity.
>They change also, Marx says, due to changes in the general profit
>rate.  H
>e also tells us that the general profit rate changes in response
>to changes in *market prices* -- whatever their cause.
>Marx is exceedingly clear about the latter point.  See Ch. 6 of
>_Capital_, Vol. III.
>Hence, changes in market prices influence prices of production.
>Also, I think it is really time for you to put up or shut up.
>When you presented your argument, I pointed out immediately that
>it is YOU as a physicalist/simultaneist who must conclude that the
>productivity of labor can change without prices of production
>changing, contrary to your claim that "prices of production change
>if AND ONLY IF there is a change in the productivity of labor
>somewhere in the economy."
>You tried to evade my response in your usual manner, by claiming
>that your "method" isn't the Sraffian "method."
>But I couldn't care less about your method.
>I care about your NUMBERS and their implications.
>You keep trying to run away from having to produce any numbers.
>Why might that be?
>Well, you can run but you sure can't hide.
>Here's an example in which productivity rises, for which I'd like
>you to produce changes in the price of production:
>There is a two-sector economy, in which workers live on air.
>In sector 1, 4 bu. of seed corn and 2 units of living labor yield
>5 bu. of corn output.
>In sector 2, 4 bu. of corn and 2 units of living labor yield 5 bu.
>of gold (the money commodity).
>In the next period, labor productivity rises; in each sector, 1
>unit of living labor (instead of 2) is required to produce a unit
>of output.
>Really, it is time you produced some NUMBERS instead of just a
>string of unsupported assertions.
>Andrew Kliman
Dr. Steve Keen
Senior Lecturer
Economics & Finance
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