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

From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Sun Apr 15 2007 - 12:53:08 EDT

>Hi Rakesh,
>The kind of scenario that you suggest (constant and more or less
>proportional changes of values for all commodities) is possible, but
>there is no indication in this passage that this kind of scenario is
>what Marx had in mind.
>And, even in this case, if the prices of production of outputs remain
>constant over longer periods of time, then so will the prices of
>production of the inputs, and thus the prices of production of the
>inputs will be equal to the prices of production of the outputs, as I
>have argued.

Don't think has to follow.

To some extent I do think Marx gets trapped by 
Smith's Newtonian image of value as a center of 
gravity, which is of course meant to invest the 
market with an equilibrium tendency. And the 
astronomical metaphor is of course the crux of 
the matter.

  Smith's metaphor is however ideological and 
apologetic, and also grounded in an economy of 
manufactures in which the revolutionization of 
the forces of production has not yet become 

So as an immanent critique of Smith's reversion 
to an adding up theory of value as a center of 
gravity, Marx does at times seem to accept the 
dubious equilibrium idea that value remains fixed 
over the long term only to show that Smith's 
natural (long term center of gravity) price 
arrived at adding up the equilibrium wage, profit 
and rent is in fact only the transformed value, 
price of production. At its most basic level, 
Marx's theory of the price of production is 
simply the critique of Smith's adding up theory 
of value, which includes a demonstration of why 
it has a hold over those trapped in bourgeois 

But in terms of Marx's own understanding of 
capitalism as the impetuous development of the 
productive forces--and here one need only consult 
the following section of Capital 3, speaking of 
Korsch see also his chapter on the law of value 
in his Karl Marx-- there is actually no room for 
unit values which remain fixed over the long or 
even medium term as after all there need only be 
productivity gains in some of the capital good 
industries each period for there to be general 
decline in unit values in each period.

Indeed given that the tendential periodic 
overproduction of capital goods is not a source 
of insurance but anarchy in capitalism--see here 
Allin's and my comments on simple 
reproduction--there is likely to be real (not 
perfect) competition among Div I producers on the 
basis of fairly constant technical improvements 
which will force competitors to make use of the 
superior goods and thereby continuously reduce 
unit values. In other words, my argument for 
perpetual disequilibrium and the continuous 
reduction of unit values is grounded in 
Grossman's theory of  capitalist dynamics, not 
simply exegetical evidence.

>In addition, I think that Marx thought that prices of production would
>remain constant prolonged periods because the values of commodities
>remain more or less constant over longer periods and would change only
>occasionally for any single commodity.  At least this is what he
>assumed in his theory of prices of production.

But unit values will change as long  there is 
drop every production period in the value of only
some of the means of production. And that is 
overwhelmingly likely. The static formalism
simply has to force data to meet its theoretical 
assumptions as Guisanni has long argued.

>>As far as I can see this is the only passage from volume 3 that
>>either you or Allin has quoted to demonstrate that Marx believed that
>>unit values were even roughly constant over time.
>I would say that you have not provided any textual evidence in which
>Marx states that he assumes in his theory of prices of production that
>the values of commodities change “ceaselessly”.

OK, but I have given reasoning for why this is 
so, and unit values only have to change in some 
mop commodities for there to be a general change 
in unit values. I grant of course the uneven-ness 
of productivity across the branches of the 
economy (which of course creates all kinds of 
problem for value equilibrium).

Yet still  unit values will change interperiodically.

I don't see anyway around this other than to say 
that in the prosperity phase of the business 
cycle, all (no luxury good) capitals maintain the 
same OCC as they accumulate so that unit values 
will only change once capital and labor saving 
technical changes are introduced in the 
depression phase triggered by a shortage of 
labor. To counter TSS I think one must accept 
much of dynamics of the Uno School as represented 
for example by Sekine. Otherwise there is no 
ontological and epistemological basis for the 
assumption of fixed unit values over even the 
long term.

>  The textual evidence
>that you have cited at the end of Chapter 9 of Volume 3 makes the
>theoretical point that changes in prices of production are caused by
>changes in the values of commodities, either in the final goods or in
>the means of production that are inputs for the final goods.  Marx does
>not state in these pages that he assumes that values are changing all
>the time for all commodities.  He simply argues that, when prices of
>production do change, they change because of a change of values.  This
>argument implies nothing about the frequency of these changes.

But that cuts both ways. Neither for you nor for 
me. I am happy to say that Marx's whole emphasis 
is capitalism's impetuous development of the 
productive forces and the consequences of the 
resultant inverse growth between use values and 
unit values. This is of course screamingly 
obvious in the next section of Capital III.

>You INFER from these pages that Marx assumes that the values of all
>commodities are changing all the time.  But that is an inference that
>you are making; it is not an inference that Marx made.  So I don’t
>think these pages provide any support for your interpretation.


>Rakesh, are you arguing that constant capital is valued at the actual
>historical prices of production of the means of production (at the time
>the means of production were purchased)?  If so, then I think this is
>clearly a misinterpretation of Marx’s theory.  There is tons of textual
>evidence, which I have presented on numerous occasions (but not
>recently), that Marx assumed that constant capital is valued at the
>CURRENT prices of production of the means of production (as inputs, as
>already evidenced by the purchase of the means of production on the
>market).  So that, if there is a change in the current prices of
>production of the means of production on the market, then the value of
>the constant capital invested in all similar means of production still
>in process (i.e. before the output produced with these means of
>production are sold) is revalued to equal the current prices of
>production of these means of production.

I think the rate of profit should be calculated 
in terms of the historic costs of capital while 
the value transferred should be determined in 
terms of the current value of the means of 

Yours, Rakesh

>Rakesh, do you agree or disagree with this?
>This message was sent using IMP, the Internet Messaging Program.

This archive was generated by hypermail 2.1.5 : Mon Apr 30 2007 - 00:00:17 EDT