Re: [OPE-L] questions on the interpretation of labour values

From: Diego Guerrero (diego.guerrero@CPS.UCM.ES)
Date: Mon Feb 26 2007 - 06:05:20 EST


I would say Marx mentioned market prices a few times in Capital, mostly
to deemphasize their importance, compared to prices of production,
which are long-run equilibrium prices.



Marx often uses the same terms for different concepts. It is true that he
uses "market price" as you say in most cases. But when I say "market price
(m)" I am thinking in long-term prices too, and I believe that Marx
sometimes does the same. The 'm' include the prices of the commodities of
the sectors where many reasons make their actual rates of profit differ-year
after year and in average terms!!-from the uniform rate of profit included
in their production prices.

1) Think of the influence of the ground-rent. When analysing the absolute
rent Marx writes that "it is possible for agricultural products to be sold
above their price of production and below their value, while, on the other
hand, many industrial products yield the price of production only because
they are sold above their value". He is clearly thinking of a long-term
price, I believe, not in short-tem fluctuations.

2) Think of taxes. Many sectors use gasoline as an input: the price of the
gasoline is persistently over its production price, not due to short-term
fluctuations of any kind, but due to the tax system of almost all actual
societies where the State is present. In the other pole you have a lot of
agricultural products that systematically receive subsidies from the State
that lower their market prices compared with their production prices .

3) And think of the following as a general reflection: "if there are taxes,
payments to unproductive labor, rents, or interest payments, the tendency
may be to equalize net profits after deducting these items" (Foley, 1982, p.
46). It is clear that it is a "tendency", not a short-term fluctuation, and
also that the resulting prices, that include gross profits, not just net
profits, would be different from production prices in all those cases.

However, I think now that I should perhaps call my 'm' prices "actual
 prices" instead of "market prices" even if the ambiguity could remain in
this case too. I was aware of this problem and I mentioned it in a footnote
of my paper. W hat do you think?



Nowhere that I know of did Marx

suggest that the initial inputs in the determination of values and
prices of production should be market prices.  Please correct me if I
am wrong.  The one sentence that you quote from Chapter 10 of Volume 3
does not suggest that that the initial inputs in the determination of
prices of production should be market prices; rather it suggests that
we should also examine the process through which rates of profit are
equalized (i.e. the process of competition and the mobility of capital).

Again, it seems to me that what you are suggesting is your extension of
Marx's theory to market prices, not Marx's own theory of prices of
production and treatment of market prices in Capital.



I agree that Marx assumes m = p in Capital III. But I would add:

1) We should go beyond and develop a more finished theory in order to
capture 'closely' the reality of the market.

2) In many places Marx opens the door to doing so and substituting market
prices for production prices, since he says simply "price", not "production
price", and the extension you say I am doing could be plainly done. Think
for example of the following quotation from Capital I:

"The values of the means of production, i. e., the cotton and the spindle,
which values are expressed in the price of twelve shillings, are therefore
constituent parts of the value of the yarn, or, in other words, of the value
of the product".


"A portion of value replacing constant capital, or representing past labour,
which was used up in the form of means of production in making the
commodity; in a word, the value, or price, which these means of production
carried into the production process of the commodities" (C.III, ch. L).


"It is the labour necessary for the production of particular articles, for
the satisfaction of some particular need of society for these particular
articles. If this division is proportional, then the products of various
groups are sold at their values (at a later stage of development they are
sold at their prices of production), or at prices which are certain
modifications of these values or prices of production determined by general
laws" (III, ch. 37).


My disagreements with you have mainly to do with the role of market
prices in Marx's theory, as explained above.

I would hope that we could agree about Marx's theory of prices of
production in Volume 3 (inputs valued at p, not m; m is your extension
of Marx's theory).



If you insist that this is only the "extension" I do of Marx's theory, then
I think we agree in most of the rest. But I think that, as May said, this is
only "a preliminary" issue. Let's go beyond.



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