Re: [OPE-L] standard commodity

From: ajit sinha (sinha_a99@YAHOO.COM)
Date: Mon Mar 21 2005 - 09:51:38 EST

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

> The next point is they key one. You write ' It is,
of course, obvious that one cannot compare prices of a
qualitatively new good with any previous prices, but
this does not mean that if there are some
qualitatively new goods in the system it ipso facto
invalidates comparison of prices of all other goods
that have remained qualitatively the same.'
This is actually where we disagree, and where my
previous posts have been poorly expressed. Let me try
again. Recall that a numeraire is an arbitrary index
of exchange value. The exchange value of a good is not
really the 'price' of the good (expressed in the
numeraire). The exchange value of the good is not
really a scalar at all. It is a vector containing the
quantity of each respective good in the economy that
will exchange for one unit of the good in question.
Or, as Marx puts it, a given commodity does not really
have 'an' exchange value rather it has as many
exchange values as there are other goods in the
economy: one car = (1000 mars bars; 0.5 houses; 0.01
aeroplanes; 200 televisons, etc.). It is this true
concept of exchange value that becomes incommensurable
just as soon as one new good turns up in the economy.
So from your example, 1 mars bar = 1/1000 car, 1
airplane = 100 cars, 1 television = 1/200 cars. Now
let us suppose that after technical change we have 1
mars bar = 1/1005 cars, 1 airplane = 90 cars, 1
television = 1/190 cars, and 1 “new good” = 20 cars.
Now can we at least say that the price of mars bar in
terms of car has fallen, the price of airplane in
terms of car has fallen and the price of television in
terms of car has risen? If not, why not?
Surely, I hear you - and many an economist - cry, one
good good isn't really that important? Well, the only
way to vindicate the strong intuition that that a
change in one good between systems does *not* make
'exchnage value' incommensurable between systems is to
accept that 'exchange value' is itself just an index
of something else.
I simply don’t understand why? What do you mean by
What is that other thing?.... it is value!! In other
words, your strong intuition that the addition of one
or two new goods isn't that 'significant' is in fact a
display of your implicit belief that there is a real
thing called 'value' that is distinct from exchange
value! This is why a theory of value is central to
Your above statement makes absolutely no sense to me.
One view is to say that the 'utility' of the exchange
value vector is little changed by the change of just
one good. Herein lies the roots of subjective value
theory. Another is to say the labour time represented
is little changed. Herein lies the roots of a
materialist LTV. This is all quite simple really. Marx
does it just a pargarph or two at the strat of
'Capital'. But note: you have to understand all this
*before* you can understand what comes later in
'Capital'. This is precisey because what comes later
is going to appear like 'mumbo jumbo' to common sense
I don’t think you are displaying a good understanding
of either the subjective theory of value or Marx. One
new good or 50 new goods make no difference. As long
as there are some old goods, their prices can be
compared in terms of some old good.
My question is: what is this relationship between
labor-time and price? And particularly when, according
to you, this labor-time cannot be measured? '
Well, in terms of magnitude, it is a broadly positive
relationship, don't you think? Albeit there are
different OCCs, there's crises, there's ecomnomic
rent. So it's pretty chaotic.
And this is what you want to stand as an alternative
to Sraffa? Kinda too chaotic and mumbo-jumboish, no?
But there is likely a pretty strong positive
relationship when dealing with (ceaselessly changing)
avereage and in aggregate (obviously not an exact
proportionality though, contra the usual
interpretation of Marx's famous aggregate equalities).
How do you move to aggregates and averages when you
are dealing with relative prices of commodities?
Wasn’t that the subject matter we were dealing with?
Economists from Ricardo (93%) to Joan Robinson (let
alone your co-author, as Rakesh appropriately pointed
out) seem agreed on this.
Forget about “economists”. First of all, I have read a
few economists too and I’m in a business of
interpreting real good and tough ones and so there is
no need to get side tracked on interpretation issues.
Secondly, as you know, I’m a pretty arrogant sort of a
chap. I don’t care what sort of a name you throw at
me, if I disagree I would be happy to argue with the
person rather than argue second hand. So the best way
to get anywhere with me is to develop your own
arguments without throwing names.
On 'measure' I mentioned that you haven't quite
parahprased me correctly. We can't 'see' the weight of
an object but it still has weight doesn't it? We could
measure it on a pair of scales, using 'weights'. These
'weights' are analogous to prices and are the
'external measure' of weight. The immanent, invisible
measure of weight is the quantitative aspect of the
force of weight (gravity) itself (in units appropriate
to this force). This immanent measure is analogous to
labour-time. It's a useful analogy but like all
analogies it ain't perfect....   Still mumbo-jumbo?
Yes! Because I can change “labor-time” with anything I
want and the analogy will remain intact. In any case,
an analogy is not a substitute for a theory. All it
can do is to help someone understand a theory. You are
smart enough to know that all this is mumbo-jumbo, so
I don’t understand why you are writing them. You are
simply either not reading them after writing or not
thinking about the nature of the problem you are
dealing with. If you are someone who can read Marx,
Sraffa, Wittgenstein, Hume, and others and claim to
have some understanding of them, then you must be able
to think through your own thoughts. How can you
present this kind of unorganized thoughts as an
alternative to serious work like Sraffa’s? You have to
be more serious than that. I am trying to force
people, particularly modern day “value theorists”, to
think clearly on important theoretical issues for
their own good. It is no good to oppose ajit sinha
without any understanding of the issues involved, as
Rakesh does. Cheers, ajit sinha

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