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

From: Diego Guerrero Jiménez (diego.guerrero@CPS.UCM.ES)
Date: Sun Mar 11 2007 - 17:42:20 EDT

----- Original Message ----- 
From: "Pen-L Fred Moseley" <fmoseley@MTHOLYOKE.EDU>
Sent: Friday, March 09, 2007 3:06 PM
Subject: Re: [OPE-L] questions on the interpretation of labour values

Quoting Diego Guerrero <diego.guerrero@CPS.UCM.ES>:

> Hi, Fred,
> You wrote:
>> Thanks, I am glad to finally understand your "m".  And I would say that
>> you have finally explained more clearly what you mean by "m".  This is
>> a very important point, and should not be buried in footnote 24 of your
>> paper.  It should be discussed and emphasized the first time you
>> mention "market price" on p. 2, especially since your defintion is
>> different from Marx's usual one.  And in the text, not in a footnote.
>> And maybe briefly mention in your abstract.

> Thanks for your wise advice.
> I meant that I am happy of having explained my point about _market prices_ 
> a
> bit better. Allin made the same point as you, and I must insist that the 
> _m_
> I used in my paper are not daily prices. In fact, all direct values and
> prices, production values and prices, and market values and prices, have 
> to
> be understood as both important categories of the LTV and social averages 
> of
> actual magnitudes in a triple sense: time, place and individuals. When one
> says the value of a litre of milk last year was 2 minutes of labour, or 
> its
> price one euro, this should be understood as an average of social (not
> individual) values in different places, days, months, etc. And the same
> applies to production prices and market prices. The fact that I did not
> clarified the point sufficiently shows that I did not put due attention to
> the foreseeable reaction of readers, but also shows how important is the
> inertial understanding or the pervasiveness of tradition in using words 
> and
> terms, since in the last instance I cannot see any a priori reason to
> clarify the point MORE in the case of market prices than in the case of
> direct and production prices.

But you are using direct prices and production prices in the usual way,
so no special clarification is necessary.  On the other hand, you are
using market prices in an unusual way, and not in Marx's usual way, so
special clarification is necessary to alert your readers to this
important difference from the traditional usage.


This is true. Thanks.


>>> Therefore, it seems like if it were a question of names and of levels of
>>> abstraction. Therefore what I am reclaiming makes sense to me: we have 
>>> to
>>> change from the usual approach in just two levels (values and prices of
>>> production) to a more complete approach in 3 levels:
>>> 1) in the first level we make m = w;
>>> 2) in the second, m = p;
>>> 3) finally, m = what Marx calls "real price of production", that is
>>> different from w and p.
>>> What do you think?
>> I think that you are largely correct here, and that it is important to
>> move on and extend Marx's theory to lower levels of abstraction.
>> However, I also think that it is also important to continue to show and
>> emphasize that Marx's determination of prices of production in Volume 3
>> is logically correct and complete (so far as it goes, excluding more
>> concrete levels of abstraction).  Borkeiwicz' critique is wrong,
>> because it is based on a misinterpretation of Marx's logical method.
>> This point needs to be firmly established as the latest chapter in the
>> long debate on the "transformation problem".  Then the next chapter
>> would be the extension of Marx's theory to lower levels of abstraction,
>> as you suggest.
>> I agree that this next chapter should become a priority, but I also
>> want to make sure that we finish this latest chapter.
>> Comradely,
>> Fred

> I agree with what you say about volume III and Borkiewicz (btw, have you
> read the excellent discussion made by Rodríguez-Herrera, A. (1994): Le
> travail et la formation des prix, Louvain-la-Neuve: CIACO?). But let me
> insist in the idea that the important point is to see how labour processes
> explain market processes, i.e. values explain prices. But in the _process 
> of
> explanation_ the fact that values are more abstract than prices of
> production does not mean that we need to obtain universal agreement on the
> former BEFORE beginning to analyse the latter. Likewise, we don't need to
> solve all problems with the concept of production price or the
> _transformation problem_ before dealing with long-run market prices (_m_) 
> as
> regulating daily prices.
> Let me claim for the importance of _m_. Some sectors are structurally more
> indebted than others. If the rate of profit that is equalized among sector
> has to be computed AFTER paying interests, then _m_ will differ from pop.
> Should we take the pop as the regulating price of one Kw-hour, or _m_
> instead? Let's take the commercial sector selling clothes or whateve.
> Shouldn't we include the huge differences in the costs of paying a square
> metre in a luxurious downtown shop compared with a shop in the most 
> outlying
> district of the same town? Or take the case of tobbaco, whisky, 
> gasoline...
> Their taxes have been much more than the average of all commodities for
> decades: shoud we interpret this as a daily deviation?

Diego, I am not saying that we have to solve all the problems with
respect to prices of production "BEFORE beginning to analyze prices of
production".  I just want to make sure that the former task is
completed and is widely recognized as such.  But that doesn't mean that
work should not go forward on market prices (as long-run
center-of-gravity prices at a lower level of abstraction).

How about this:  you continue to push forward on market prices (along
with others), and I will work some more on prices of production (along
with others), and I will try to catch up with you later (and of course
it doesn't have to be an either/or, but as a matter of priorities)?



I agree with the idea that a division of labour is not a bad thing. But let 
me say that I am not posing a question concerning the lower level of 
abstraction alone. I am concerned mainly with the question of the 
relationships between direct and production values/prices. The question is 

Let me distinguish 4 things:

1 direct value                     2 direct price

3 production value          4 production price

1 and 3 are quantities of (abstract) labour. 2 and 4 are quantities of 
money. There are several interpretations of the transformation problem in 
this respect. The prevailing one (Samuelson, Sraffa, etc.) conceives of it 
as a simple passing from 1 to 4. This in my opinion conflates some aspects 
that should be separate. Shaikh's view for example divides the passing from 
1 to 4 in two movements: from 1 to 2, and second from 2 to 4. But Shaikh 
shares with the prevailing interpretation the idea that you can neither go 
back from 4 to 2 and 1, nor from 2 to 1. This is why he criticizes Foley's 
(and NI's) or Itoh's double idea that you can go for and back between labour 
and money, and also that you can go down and up between 1 or 2, and 3 or 4.

I think that Duménil expressly acknowledges the existence of 3, which, I 
believe, others don't share. I would like to know whether you and others 
think or not that 3 exists.

This is related with what I answered to one Ian's question: for me 1 and 3 
are different quantities of (vectors of) abstract labour expressing the same 
quantity of vector l, the vector of (concrete) direct labour coefficients.

What do you think of all this?

Best regards,


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