[OPE-L:7407] Re: Re: RE: Commodity money in a Sraffian system

From: Rakesh Bhandari (rakeshb@stanford.edu)
Date: Sat Jul 06 2002 - 14:29:18 EDT

Paulo writes in 7404

>Gary, it seems to me that Marx`s argument is that gold can not have a price
>because its price would be it own self. By definition price has to be the
>expression of value in something different from the thing which is 
>being measured.
>It  seems to me therefore that one can not interpret that phrase as being
>something equivalent to considering gold as the numeraire. The numeraire is
>tipically a way of closing a system which presents more variables 
>than equations.
>Chosing a numeraire allows for the closure of the system. Marx does 
>not seem to be
>closing any system!
>Paulo Cipolla

Yes indeed Marx attempted to demonstrate why capitalism was not a 
closed but an open system susceptible to historical change by its 
very contradictions.

So yes isn't there a big difference between a theory which must 
select (and construct) a numeraire with (as Blaug emphasises) no real 
world significance in order to close a system of equations in order 
to throw into analytical relief a wage/profit frontier and a theory 
which attempts to explain why in the bourgeois mode of production the 
form of appearance of economic magnitudes has to be money which as a 
result of this function carries the seeds of economic contradiction 
and crisis?

Didn't Marx critique Ricardo for understanding money in terms mainly 
of its exchange faciliating role in what was imagined to be a system 
of preconciled quasi-barter (see excellent Aoki analyisis)?  How does 
Sraffa's construction of the standard commodity as numeraire overcome 
the problems which Marx isolated in Ricardo's theory of money? How 
can the standard commodity even be said to be money in any sense 
since it changes with every change in the productive configuration? 
And since the standard commodity does change with every change in the 
technical conditions, what kind of solution to Ricardo's wil o wisp 
search for an invariant standard of value is this?

At any rate, did Sraffa himself think he had advanced or supported 
Marx's or Keynes' critique of classical political economy's theory of 
money with his analytical construction of the standard commodity?

All the best, Rakesh

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