[OPE-L:7604] Gold in the Transformation Problem

From: Gil Skillman (gskillman@mail.wesleyan.edu)
Date: Thu Sep 05 2002 - 09:38:24 EDT

Was:  Re: Re:  Re (etc)

Rakesh, you write

>Now are you continuing to defend the inclusion of the gold industry in the 
>transformation process? Or are you neither defending nor criticizing such 
>inclusion and moving on to fiat money?

As I see it, it isn't a question of "defending the inclusion of the gold 
industry" in Marx's transformation analysis (or correspondingly in the 
Sraffian price of production equations).  The relevant questions are rather 
(a) whether Marx intended to categorically exclude gold from his K.III 
Chapter 9 analysis on the sort of historical grounds raised by Fred, 
despite Marx's earlier announcement that he intended to abstract from such 
historically specific considerations, and (b) whether it is logically 
possible to maintain Fred's/Marx's claim about the prior determination of 
the rate of profit *given* capitalistically produced commodity money.

On (b), as far as I can tell, no one has disputed my demonstration that 
*given these conditions* there is an inconsistency in the claim that the 
rate of profit is determined analytically prior to prices of 
production.  The question is whether this demonstration is relevant to 
Marx's, and thus Fred's, analytical project, which brings us to (a).  Since 
Marx is dead, we have no way of settling the matter, so I won't bother 
trying.  Marx does not clarify the matter either way in Ch. 9, and 
presumably neither side of this discussion pretends to be able to go back 
in time to read Marx's mind or to recall him from the dead to figure out 
the answer.  But the discussion has at least given rise to a new (or at 
least not previously obvious) theoretical insight about the economic 
conditions under which Marx's/Fred's conclusion do and do not hold.

My original intention upon joining the discussion between Gary and Fred was 
to begin with the scenario of commodity money and then move directly to 
that involving fiat money.  But in light of discussion prompted by the 
first scenario, I think it's necessary first to ask Fred about the ground 
on which he advances (or understands Marx to advance) the theoretical 
conclusions we're discussing. So I'll wait for Fred before moving on to the 
case of fiat money.


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