Re: (OPE-L) Re: Say's Law in Marxian Theories?

From: A.B.Trigg (A.B.Trigg@OPEN.AC.UK)
Date: Thu Feb 26 2004 - 09:08:34 EST

Many thanks for the Shoul reference, which I have missed. And thanks for
welcoming back a flllow comrade 'lurker'!

-----Original Message-----
From: Gerald A. Levy [mailto:Gerald_A_Levy@MSN.COM] 
Sent: 25 February 2004 13:28
Subject: (OPE-L) Re: Say's Law in Marxian Theories?

Good morning, Andrew T.

> This is something that I am currrently grappling with, so it is very
useful for you to raise it. My reading of the Grossmanite defence
against the Say's Law charge is that Grossman assumes that prices are
equivalent to values, as in Capital vs I and II, and therefore supply is
assumed equal to demand. Now the same charge has been levelled against
the Marxian reproduction schema that Marx assumes that supply and demand
are in balance, and therefore Marx assumes Say's Law to hold. The reply
might be that Marx considers the reproduction schema as a special
extreme in which balanced growth takes place; he explores the unlikely
conditions under which supply and demand are in balance. By
demonstrating how difficult it is to achieve this balance Marx in fact
falsifies Say's Law, showing that supply does not automatically create
demand. Does this seem a sensible interpretation? <

Shoul (_QJE_, 1957) is very good on this topic, I think (see reference
below). A rather large part of Marx's analysis of the process of
capitalist circulation in Volume II can be seen as a critique of Say's
Law.  His examination of the reproduction schema -- which reveal the
abstract, formal possibility of crisis -- could be seen in this light.

> Any comments gratefully received, or relevant references I should 
> check
out. <

Have you seen Bernice Shoul (1957) "Karl Marx and Say's Law" in _The
Quarterly Journal of Economics_, LXXI [reprinted in  Joseph H. Spengler
(ed.) (1960) _Essays in Economic Thought: Aristotle to Marshall_.
Rand McNally & Company].   Her dissertation is also relevant to this
Shoul was a  follower of Grossman so her perspective on this topic is
relevant. Oddly, Shoul's _QJE_ article wasn't cited by Rosenthal -- I
guess John wasn't aware of it.

It's good to hear from you again.

In solidarity, Jerry

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