Re: [OPE-L] standard commodity

From: ajit sinha (sinha_a99@YAHOO.COM)
Date: Thu Mar 17 2005 - 08:40:11 EST

--- Andrew Brown <A.Brown@LUBS.LEEDS.AC.UK> wrote:

> Hi Ajit,
> No doubt I am missing the point, so thanks for
> persevering. Hopefully some helpful comments
> below...
>Ajit:  I think you are missing the fundamental point.
> is
>       one thing to say that all languages are dynamic and
>       evolve and change so talk about meaning of words is
>       meaningless and quite another thing to establish
> under
>       what conditions words do have meaning and how it is
>       impossible to assign the same meanings to the words
>       when those conditions change.
> Andy:
> You make a big claim regarding economic science and
> value in the conclusion to the paper. It is not a
> claim that Paul C. actually wants to make, I think.
> Rather, it stems from your previous work on Sraffa.
> I am focusing on this big claim which is basically
> that there is no true commensurability of values
> between different basic systems, which severly
> limits economic science. We might say that there are
> no 'laws' that apply to prices through technical
> change. Now, when big claims like that are being
> made I think it legitimate to consider whether a
> shift of focus might put the claim in better light,
> or indeed cast doubt upon it. And it seems to me
> there is a clear and unambiguous reason to believe
> that the claim you make is too bold. Quite simply,
> one can prove incommensurability between different
> systems (before and after technical change) by
> noting that the new system will have a new machine
> (usually what happens with technical change) hence
> the price vector of the new system will be
> incommensurable with that of the old.
But on what basis you can make that claim? Your claim
would need an argument like what we have provided in
our paper. Our paper is showing a more general and
stronger result that even when there is no new machine
in the system, just a change in the input output
configuration makes it impossible to compare prices in
the two systems. So i really don't understand your
> Ajit:
>       I don't agree with the
>       way you are presenting the problem. There is no
> such
>       thing as "new" basic good. Similarly, your
> statement
>       that "I simply do not see what is so significant
> about
>       showing incommensurability under the relatively
>       superfical special case where 'technical change'
>       maintains qualitative identity of all goods in the
>       economy, merely involving new input or output
>       magnitudes." As a matter of fact the question of
>       technical change or for that matter any kind of
> change
>       does not arise in Sraffa's given input-output
> tables.
>       ______________________
> Andy:
> Two points: 1) if the Sraffian system can't deal
> with technical change it is presumably useless for
> understanding the economy? and / or the economy
> (prices, wages, profits, rent, interest etc.) cannot
> be understood?;
Whether the Sraffian system can deal with technical
change or not is a separate question. People who are
interested in developing the so called constructive
part of Sraffa are able to do a lot with it and are
quite able to deal with technical change. My own
reading of Sraffa is different. I think Sraffa was
interested in developing a critique of economic
theory, at least that's what he explicitly claims, and
not developing a system to understand the economy. How
do you understand an economy? By developing a theory
about it. Sraffa’s project was to show that the
predominant theory designed to understand the economy
did not have grounds to stand on. The emperor had no
2) in your paper you do introduce
> 'technical change' in the sense of new input
> combinations. And indeed you compare prices between
> these two systems. All I am asking is why attach
> such significance to this when, in reality, change
> entails new machines not just new combinations of
> old machines and workers?
I simply don't understand your problem. If I can prove
something without introducing new machines whereas the
same thing can be proven by introducing new machines
then don't you think that my approach is more robust?
Secondly, if your purpose is to critique a theory,
then your critique is more robust if you can develop
it within the parameters of their theory without
introducing any extraneous factors.
I grant Paul's point that
> this may have some use in terms of an immanent
> critique of general equilibrium theory, but I do not
> think it justifies the bold claims you make in the
> conclusion, since these claims can be made on far
> simpler and more profound grounds, as I suggest
> above.
I don't understand how by introducing extraneous
factors such as new machines you make your ground more
profound? It comes close to the childish criticisms
such as your assumptions are not realistic--as if
Arrows and Samuelsons don't know that!
> Actually I can show you less potatoes weighing more
> than more potatoes! Anyway, the question is what
> does
> substance of value mean. What does this substance do
> in determining prices? And from your point of view,
> why the substance is not something like petrol or
> electricity? As we all know, when it comes to
> measuring labor even at any given point in time, let
> alone over periods of time, we have to not only deal
> with the heterogeneity but also some sort of
> "fictitious" labor and not the "real" labor given
> the
> "socially necessary" clause. Cheers, ajit sinha
> Andy:
> Ignoring pedantery about potatoes (!), some answers
> to your questions: 'substance' in this case simply
> refers to the 'stuff' contained by commodities that
> explains their price magnitude, like the potatoes in
> the sack (no pedantery now..).
In no commodity I have found hours of labor being
contained like cotton or feather stuffed in my pillow.
You can break any commodity to the last atom and you
will not find your "stuff" anywhere. So what kind of
"stuff" is this? Secondly, and more importantly, how
does it explain their price magnitude? Let's not dance
around it. Let's see how far your version of the LTV
This substance makes
> us spend alot of our lives dealing with it, with the
> value of things. Commodities are in general neither
> objectifications of electricity nor petrol!
Why not?
If you
> agree that social labour is distributed in our
> society then you agree that 'labour' has a unit, and
> you are enabled to use this unit to grasp capitalism
What is "social labor"? And if this "social labor" is
distributed in our society then what makes you think
that electricity and petrol are not distributed in our
> -- no it cannot in general be directly measured,
> especially due to impossibility of assessing
> differences between labour in different industries,
> but there is a common unit (though we cannot
> empirically measure it directly) and prices do the
> job of measurement for us (very imperfectly). All
> this is much clearer once we consider capital but
> all the above is more abstract than that.
see how quickly it gets you in a quagmire! First you
say that the "stuff" explains their (commodities)
magnitude of prices. Then you go on to say that prices
do the job of measuring the “stuff”. I see the dog
chasing his tail. And interestingly in this case the
tail is invisible since you admit that the "stuff"
cannot be measured. Cheers, ajit sinha

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