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

From: Ian Wright (wrighti@ACM.ORG)
Date: Mon Jan 30 2006 - 12:09:20 EST

Hi Andy

> Which references would you suggest most clearly put the Neo-R critique in this way?
> Steedman's famous book (which I haven't studied closely) doesn't really pursue this line of
> argument systematically, in the sense that he is much more concerned with systematically
> showing redundancy and inconsistency of Marx's LTV.

The disconnect of labour value and price in the aggregrate is implicit
from Sraffa onwards. Sraffa's reduction to dated labour representation
is a function of the profit rate (r); hence, according to
neo-Ricardians, price is irreducibly dependent on income distribution
(the value of r). In contrast, Sraffa's representation of labour
values (implicit in footnotes and appendices) is invariant over income
distribution, and does not depend on r. Hence there is an
"informational gap" between the two accounting systems. Samuelson's
Sraffa-inspired 1971 paper in Journal of Economic Literature brings
this out fairly clearly (his "eraser" critique). Pasinetti emphasises
the disconnect between the dual accounting systems in his classic and
very clear presentation of the neo-Ricardian critique of Marx's vaue
theory in "Lectures on the Theory of Production". Steedman repeats
Samuelson's eraser critique (his "scissors" or two prongs diagram;
can't quite recall how he describes it), and adds new criticisms.
Fast-forwarding, Abraham-Frois and Berrebi's "Prices, Profits and
Rhythms of Accumulation" (1997) is probably the most mathematically
complete and concise presentation I know. They derive a condition that
must be satisfied for all Marx's conservation claims to hold. The
usual suspects -- zero profits, uniform organic compositions of
capitals and production in `standard' proportions -- are those special
cases that satisfy the condition. The critique is, essentially, that
*there is no economic reason* why the condition should hold -- hence
the disconnect. (Again, I don't agree with this critique, but I
appreciate its logical force).


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