[OPE-L:8577] long term centers of gravity?

From: rakeshb@stanford.edu
Date: Wed Mar 12 2003 - 08:31:19 EST

I recently had a chance to read Gary M's critique of TSS and Fred's 
paper at his website on this topic.

After reviewing the passages which they cite, I continue to find no 
evidence that Marx believed  that the value of commodities 
remained stable over the long term. To be sure, Marx clearly 
believed that there were powerful forces against  most sectors of 
the economy or most  industrial branches (excepting for example 
natural monopolies)  making profits above or below the average 
over the long term.  I believe that this is all Marx meant by the idea 
of market prices gravitating prices of production over the long term, 
i.e., the idea that in most cases no sector will make much more or 
less than the average rate of profit. 

In adopting Smith's and Ricardo's ideas about natural price, Marx 
was thus accepting only their vision of the competitive equalization 
of profit rates over most sectors of the economy over time. 

However, the claim that unit commodity values are stable over the 
long term simply does NOT follow from the classicals' and Marx's 
recognition that in most cases (Fred and I both have discussed 
exceptions such as the gold industry) a sector's or industrial 
branch's profit rate will tend to converge towards the average over 
the long term.  Unit commodity values do not have to be stable 
over the long term in order for market prices to gravitate towards 
prices of production such that the profit rate  tends to equalize 
across most sectors over the long term. In fact there is no reason 
why the latter could not obtain with unit values falling (as they in 
fact do) at different rates in different sectors or branches as a 
result of the unevenness of continuous (or inteperiodic) technical 
change. That Marx assumed constant values in his expanded 
reproduction schemes just indicates their distance (Grossmann 
was the first to recognize) from an actual diachronic theory of 
capitalist dynamics, not the extent to which Marx had committed 
himself to the idea of equiibrium values. 

I don't think a single passage cited by Gary or Fred however even 
suggests that Marx thought the value of the commodities remained 
constant over the long term. This is an assumption from neo 
classical or equilibrium economics.     I have quoted even Ricardo 
saying that the value of commodities is changing daily! Marx was a 
less dynamic thinker than Ricardo?! 

As far as I can tell, neither Fred nor Gary has cited evidence from 
Marx against the TSS breaking of the input=output price 
assumption (Ernst, Carchedi, Freeman, Kliman).  I think there is 
even less evidence from the real world of capitalist dynamics. 


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