Re: [OPE-L] price of production/supply price/value

From: Ian Wright (wrighti@ACM.ORG)
Date: Thu Jan 26 2006 - 12:44:01 EST

Hi Rakesh

> the question I am getting at is simple: how can we speak of price/value
> divergences if price of production is itself a form of value? If price
> of production is a form of value, then how can a form of value diverge
> from value? Donkeys may be a form of animal, but
> we don't speak of donkeys diverging from animals.

Say that "age" is a "form of time". Jim tends to lie about his age and
subtracts 5 years when filling out forms. Bob tends to lie in the
other direction and adds 5 years. If we sum the age on the forms, the
aggregate age is equal to the actual time that Jim and Bob have been
alive. But the individual ages diverge from the actual time.

The purpose of my example is to suggest that terminological
considerations aren't sufficient to ground your claim that there there
isn't divergence between values and price of production.

> There seems to be a lot terminological confusion in Marx.
> What I am proposing is that we call simple price one form of value and price
> of production another form of value (neither of course is market
> price, so we can
> still speak of a divergence between value and price;
> for example the difference between market price and price of production is
> a practically important divergence between price and value, but not
> the difference between
> price of production and simple price which is simply a difference between
> two forms of value).  Simple price and price of production are both
> forms of value;
> however the former is counterfactual and the latter is actually
> social valid (I think
> Paul C and Allin grant that there is at least a weak tendency towards
> profit rate
> equalization). Hence
> my equation value=price of production=supply price.

You can do that. But, according to the neo-Ricardian formalisation of
the transformation problem, it is difficult to believe that price of
production is a form of value, because the accounting doesn't add up
-- there is non-conservtion of value in price. Simplifying a lot, the
ages on the forms do not add up to the total time Jim and Bob have
been alive.


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