From: Paul Cockshot (firstname.lastname@example.org)
Date: Mon Aug 26 2002 - 10:10:47 EDT
On Sunday 25 August 2002 18:22, Fred B. Moseley wrote: > This is a response to Gary's (7534) and (7535). Gary, I would like to > refocus the discussion back to the original question of the method of > determination of the rate of profit (which I think you were trying to do > too). I would like to return later to the very important empirical > question of the relative explanatory power of Marx's theory and Sraffa's > theory, which has come up in recent posts. > > > 1. The question is: is the rate of profit uniquely determined by the > technical conditions of production and the wage rate (and a numeraire)? > Gary and Gil have argued that the answer to this question is yes. The > technical conditions and the wage rate determine a system of n equations > (one for each of the n industries) in (n+1) unknowns - n absolute prices > and the rate of profit. If, in addition, the price of one commodity (the > numeraire) is set =1, then the rate of profit is uniquely determined, > along with (n-1) relative prices. > > It follows from this argument that Marx's logical method - of first > determining the rate of profit independently prices of production, and > then assuming this predetermined rate of profit in the determination of > prices of production - is wrong. The rate of profit cannot be anything > other than the rate of profit uniquely determined in Sraffian theory by > the technical conditions and the wage rate. > > > 2. I argue that the crucial flaw in Gary and Gil's argument is that it > assumes that the exchange-value of the numeraire, or the money commodity > (e.g. gold), is determined in the same way as the prices of all other > commodities, i.e. that the gold industry participates in the equalization > of profit rates like all other industries. This means that there is an > equation for the gold industry that is essentially the same as all the > other equations, i.e. that the price of gold is equal to production costs > plus the average profit. > The gold industry can not be the key issue here. Assume state fiat money instead if that is a problem.
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