[OPE-L:4883] Re: RE: Give us some NUMBERS, Fred! (was: rentand theworking class)

From: Rakesh Narpat Bhandari (rakeshb@Stanford.EDU)
Date: Tue Feb 13 2001 - 01:38:24 EST

Andrew K writes in 4881

>In reply to OPE-L 4879.
>Rakesh, I'll be happy to answer your questions, but it is almost
>impossible for me to carry on a discussion when you change the
>subject like this.  Can you please slow down and deal with one
>thing at a time?
>You objected to the example I posed to Fred on the ground that it
>was "dualistic" (I think you mean physicalist).

I mean both. Neither Fred nor Alejandro accepts that there is a 
physical or value scheme and a price scheme. One does not begin with 
former and then transform it in another. Again, this is what you are 
asking Fred to do. I thought you agreed with both of them on this; 
hence, my surprise that you would throw up such a challenge.

>   I pointed out
>that I was only testing the truth-value of a specific claim that
>he himself made -- that his (simultaneist) "prices of production
>change if AND ONLY IF there is a change in the productivity of
>labor somewhere in the economy."  To test this, I gave him an
>example in which the productivity of labor rises and asked him to
>give me changed prices of production.  I noted that I knew of no
>other way of testing the truth-value of that claim, and asked
>whether you did.

Again, this makes no sense to me. Fred is arguing that Marx's own 
transformation tables are complete.

Now Fred seems to be saying that those prices of production are only 
allowed to change if there is a change in the productivity of labor. 
The idea behind this claim seems to be that only as a result of a 
change in the productivity of labor could there be a substantial 
enough change for the resultant (theoretical) prices to serve again 
as centers of gravity or long term average prices.

For example, market prices could diverge from Marx's own prices of 
production for a variety of reasons: failed coordiation between 
supply and demand; accidents; temporary or seasonal demand shifts, 
etc. And these reasons could apply on the input or output side.

But if we abstract away these interferences, it is still possible for 
the c and v in each or all of the five branches and prices of 
production to change. But the reason they will now change will be 
technical change alone. And that's by definition.  For example, the 
c/v ratios will tend to rise or the s/v ratios will tend rise.

These changes in monetary magnitudes only insofar as they are a 
result of changes in the technical conditions of production are alone 
allowed to transform prices of production--Marx simply abstracts away 
from the other reasons c and v or s/v could change. So there is a 
moment of idealization in Marx's theory of prices of production.

Marx tries to get at something underneath market prices which 
explains them. He assumes demand equals supply though such imbalances 
have great influence on actual prices in any given period; he tries 
to explain prices of production solely in terms of the monetary 
variables of c, v and s/v, and he only allows those to change as they 
have been changed by changes in the productivity of labor, though 
again in the real world the money invested as c or v or the surplus 
value extracted will not change only due to changes in the 
productivity of labor.

But it is only those changes that result from a change in the 
productivity of labor that are important for the determination of 
prices of production as 'centers of gravity.'

At least that's how I understand the argument to restrict changes in 
prices of production to those changes brought about by changes in the 
productivity of labor.

In my opinion, the more important question remains whether due to 
that restriction itself, it is impossible (since productivity is 
rising continously if not in a single branch then at least in the 
system as a whole) to accept the Sraffian formalism in which input 
and output prices are set equal, so as to remove one of the equations 
and make a solution possible. Here I think I agree with you, Giusanni 
and others.

>You haven't answered.  You haven't proposed an alternative test.
>You do, however, continue to object to my test.

Yes, i am surprised you offered such a test.

>Okay, so if my test is no good, how would *you* propose to test --
>quantitatively -- Fred's claim that "prices of production change
>if AND ONLY IF there is a change in the productivity of labor
>somewhere in the economy"?  I'm interested in a rigorous test, not
>a verbal argument.

As implicit above, I think said restriction is built into the 
definition of price of production.
>Finally, what was that stuff about my post being co-written?

Of course your post was not cowritten. What I am saying is that by 
asking Fred to take as his given a physical system, you seemed to be 
undermining the interpretation you share with others.

Yours, Rakesh

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