Re: [OPE-L] workers' consumption and capitalists' consumption

From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Tue Jun 13 2006 - 11:17:24 EDT

>(2) How can you deal with this? You may try to put a
>condition on your system that does not allow such
>possibility. You may say that my example violates your
>assumption of simple reproduction schema. Before we
>get to what this assumption implies, note one
>immediate conclusion: This situation must arise in all
>expanded reproduction schemas--where your accounting
>principle logically breaks down.

But, Ajit,  as Cutler et al and then TSS  pointed out the
Sraffian formalism has to break down
in the face of price-reducing technical change,
for there can be no such technical change
from the big bang to eternity if input prices must always
equal output prices.

Your formalism can handle
changes in distribution, but distributional shares
are more stable than technology in a capitalist economy.
So by fixing technology to focus on distribution, you have
chosen the less interesting problem.

It would be better to measure momentum than position, so to speak.

>(3) Given your position that capitalists' necessary
>consumption is out of last round of production, your
>assumption of simple reproduction schema implies that
>the given system with its given wages and profits must
>not only remain frozen for all conceivable future but
>also it must have been frozen for all conceivable
>past. In other words, the corn equation with its wages
>at 0.001 tons of corn per hr. of labor must exist from
>the big bang to eternity! Because, anywhere in the
>past or the future if the system diverged from this
>frozen state, it can do only by breaking your
>accounting principle.
>(4) Up till now I have not mentioned Marx in this
>context, simply to keep the focus on the logic of the
>issue rather than create emotional outbursts and
>quotation mongering. But it is true that Marx derives
>his labor-values exactly the way I have been doing it
>for the so-called Sraffian labor-values.

Marx is interested in the continuous reduction of unit
values as the mass of use values rise. His whole theory
is meant to throw light on the consequences on the relations
of production from the accelerated development of the
forces of production. His theory does not focus
on the effect of distribution on relative prices (save the short
chapter, chapter 13?, in Capital 3). This is obvious
to anyone but an equilibrium economist. It should
also be said that Marx does not adequately theorize
the consequences of a growing mass of use values and
rising physical productivity. In this sense, TSS is faithful
to Marx because this school shares his blind spot, as I
have argued many times on this list.


>labor-values are derived directly from the technique
>in use and it has nothing to do with wages or profits.
>It is true that in some quarters (including Joan
>Robinson) people think that labor-values also depend
>on demand as it also represents the distribution of
>total social labor into various sectors. But I have
>shown in my paper, 'Some critical reflections on
>Marx's theory of value' in the Westra and Zuge edited
>book by Palgrave, which I think you have seen, that
>this interpretation hits the dead end pretty quickly.
>So, fact of the matter is that whatever you are doing
>with your real cost accounting, it is not what Marx
>was doing. Cheers, ajit sinha
>Do You Yahoo!?
>Tired of spam?  Yahoo! Mail has the best spam protection around

This archive was generated by hypermail 2.1.5 : Fri Jun 30 2006 - 00:00:03 EDT