[OPE-L:4997] RE: Re: Re: causes of changes in prices of production

From: Drewk (Andrew_Kliman@msn.com)
Date: Tue Feb 20 2001 - 10:46:41 EST

A reply to Fred's OPE-L 4992.

He wrote:  "your interpretation explicitly abstracts from market
prices.  Even if changing market prices were another possible
cause of changes in prices of production, this would not explain
why your prices of production change."

No Fred, this isn't so, and that's why the Chapter 6 evidence
matters, as does your invention of an evil twin profit rate to
immunize your interpretation against it.  First, you confuse an
interpretation with a specific illustration of the interpretation
under particular circumstances.  The TSSI does not abstract from
market prices.  Quite the contrary.  I will be happy to provide
references if you need them.

Second, the specific illustration (in Kliman and McGlone's 1988
paper) does not abstract from market prices either.  What we
wrote, and what you quoted, is that it abstracts from market price
*oscillations*.  That is, as the CONTEXT in which the quote
appears makes clear, we depicted only the movement of values and
production prices in our periods 1 through 14.  We did not depict
the movement of market prices around the prices of production
during that time-span.  For instance, in period 1, prices of
production are assumed to reign, and they are assumed to reign in
period 2 as well.  But between periods 1 and 2, i.e., in period
1.1, 1.2, 1.3, etc. (keep in mind that the length of a period is
arbitrary), market prices can deviate from prices of production.
We chose not to depict such situations; that is all.

There is, however, a different sense -- a sense quite pertinent to
the present discussion -- in which we did not abstract from market
prices.  One way of putting this is that we did not abstract from
a change in market prices *before* period 1 commences.  Keep in
mind that market prices are just prices at which things are
actually bought and sold.  Thus prices of production are
particular market prices, and "value prices" are other particular
market prices.  Now, what we depicted was a situation in which,
prior to period 1, the output prices were one set of market
prices -- "value prices" -- and in period 1, the output prices
were a different set of market prices -- production prices.

Hence, market prices changed between period 0, let's call it, and
period 1.  Those changes in market prices caused the general rate
of profit, values, and production prices to change and to keep
changing.   Marx nowhere wrote, to my knowledge, that the effects
of the initial change in market prices all had to be immediate,
that there couldn't be lagged effects.  As Allin notes, that is
all that is going on in the illustration in question.


Andrew ("Drewk") Kliman
Dept. of Social Sciences
Pace University
Pleasantville, NY 10570 USA
phone:  (914) 773-3968
fax:  (914) 773-3951

Home:  60 W. 76th St. #4E
New York, NY 10023 USA

"The practice of philosophy is itself theoretical.  It is the
critique that measures the individual existence by the essence,
the particular reality by the Idea."

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