Re: [OPE-L] Truncating Marx's "Capital"

From: Riccardo Bellofiore (riccardo.bellofiore@UNIBG.IT)
Date: Mon Sep 03 2007 - 11:51:17 EDT

Dear Fred,

very quickly, because work has begun again at full speed.

1. I have in mind Shaik's Ph.D. thesis (it is 
1974, I guess, if not 1973) and, yes, the 
iterative solution. I go by heart, so I am not 
sure. It is a line which was also pursued by 
Morishima, and took up again ideas from Shibata 
and Brody.

2. about TSSI my position here is the same as David (Laibman). I quote:

"the sequential calculation has to go in one of two
directions.  Either you embrace a theoretical conception of time by
working out the value-formation process under assumed constant social
and technical conditions of production; or you allow technology, the
rate of exploitaton, etc. to change as the iterations proceed.  The
former corresponds to the Shaikh-Morishima-Nuti iterative solution, and
leads to the stationary result also obtained by simultaneous calculation
(Meek, Sraffa, etc. -- and Laibman!).  ...  It is based very
clearly, I believe, in Marx's premise that value theory is about laying
bare the underlying structure in a given set of market-based social
relations.  The alternative -- the TSSI variety of "temporal" analysis,
in which everything constantly changes and therefore no convergence
takes place -- is, in my view, the abandonment of any chance at a
theoretical perspective; it is pure empiricism, the systematic
confounding of fortuitous experienced phenomena with their
deep-structural determinants.  It is not really a "single system"; it is
rather an eclectic mishmash in which values, prices of production and
market prices are all merged into one another and cannot be
distinguished, and in which theory, in Marx's sense, plays no role."

As I said, it is methodologically very similar to 
Mises' rejection of equilibrium theorizing.

3. "Makes better sense of the theory as a whole": 
from which point of view? The TSSI lately rescued 
the Principle of Textual Exegesis by Stigler. It 
is very contexted, and it cannot be taken for 
granted, or as THE criterion in any absolute 
sense. If it is just assumed and put outside the 
theoretical questioning, this is strictly 
speaking dogmatism (cfr. Hegel, Introduction to 
the Phenomenology of the Spirit). Now, the key 
move of TSSI is, thanks to the PTE taken for 
granted, to say that their interpretation is no 
more an interpretation, it is Marx's himself 
speaking. And here's again dogmatism. I pointed 
this in London twice, in a discussion on Kliman 
(what I think is now the Intro and the Conclusion 
of the book) at the HM conference 2005, and at a 
AHE plenary on pluralism in 2006. Of course I 
didn't convinced the TSSI people there, and I 
think I can live with that. I am glad that you 
agree that all this is non-conclusive. For me it 
is even less conclusive, since for me the real 
problem in Marx is NOT the transformation, but 
the argument according to which value exhibits in 
money only labour. It is here that Marx's 
argument is problematic. If that argument is 
correct (or, if not, if it is reconstructed), 
then the change of form in prices cannot but 
redistribute the same quantity of labour. Of 
course, the TSSI simply cannot understand that 
for somebody there are problems in Marx, serious 
problems, which have nothing to do with the 
transformation (see the repeated criticism by 
Kliman). When I presented my Ghost and vampire 
paper in London, Freeman based his comments as a 
discussant on ONE phrase on the transformation 
were it was said that generally it is seen as 
problematic. That's it.

4. However, I cannot understand how one can makes 
better sense of a theory if it bases himself on 
inaccurate translations, and this is the case of 
the English translations: so, the debate should 
be done on the original texts if one wants to put 
in question the other readings against the 
original Marx.

5.The Italian works I quoted were intervention in 
the debate on Marx. Cini is 1974 in a 
non-mathematical version, a mathematical version 
wa published early 1980s but the paper is surely 
earlier. Laise-Pala-Valentino is 1977 (I wrote, I 
guess, not Valentino but Tucci in my prior mail, 
because later Tucci worked with Laise in books 
over Wicksell and Walras). They were discussing 
the transformation problem within the LTV. 
Probably for you (and me) the 
Laise-Pala-Valentino is the most interesting (and 
it stresses the essentiality of a material 
interpretation of the wage: and it does so as a 
criticism against the Sraffians' reading). Again, 
I go by heart. They criticised the positions of 
those who used the simultaneous solution against 
Marx, for the presumed inessentiality of labour 
quantities in the transformation, a point raised 
by Napoleoni in 1966, much earlier than Steedman.

6. You write:

"Previously existing quantity of money capital is 
taken as given in the determination of the value 
and prices of production of the output at the end 
of the circuit"

This looks new to me, it seems that you now take 
that "existing" in a temporal meaning. Now, 
either we fall back in the discussion clarified 
by Laibman, or that money magnitudes have to do 
with elements of constant and variable capital 
sold at their prices of production, so why it is 
that relevant? That money magnitudes are 
simultaneously given with prices anyhow.

7. I guess Ronchon is Rochon. May you give me the reference?

8. Graziani does not bother very much with the 
transformation problem, and rightly so. The 
theory of the monetary circuit is a true 
macro-class-monetary approach, that interprets 
valorization at the level of analysis of Book I, 
with capital as a whole versus the working class. 
In that perspective, the determination of prices 
is subsequent, and not relevant to valorization. 
You can check reading the very, very short paper 
by Graziani in the IJPE 1997 I edited.

I have not read the next messages (I am now going 
to read the last OPE-L messages of the last few 
days), so I apologize if some of this is 
redundant or out of focus.


At 21:53 -0400 30-08-2007, Fred Moseley wrote:
>Quoting Riccardo Bellofiore <riccardo.bellofiore@UNIBG.IT>:
>>In a sense, Fred, this was not already there in Shaikh 1974 or the
>>like, without the excessive stress on the non-equilibrium etc.?
>Riccardo, which Shaikh article do you have in mind?  The “iterative”
>solution to the transformation, or something else?
>Shaikh’s “iterative” solution is not really sequential determination,
>because the fundamental givens are still the physical quantities, and
>he comes to the same prices of production and rate of profit as
>simultaneous determination.
>>The TSSI claims that there is no convergence to the Sraffian solution
>>but I doubt that, it seems to me that (as the the Austrian Mises
>>would do: he too was critical of equilibrium theorizing!) they simply
>>say that the conditions may change between one period and another.
>Kliman and McGlone have changed somewhat with respect to this issue.
>In their original article, their numerical example does converge to the
>simultaneous determination solution (in the 13th period).  In this
>case, their interpretation is essentially the same as Shaikh’s
>“iterative” solution, but they interpret the iterations as real
>historical periods, rather than purely logical iterations within a
>given period.  In their later articles, their numerical examples
>include only two periods, but these two periods must be followed by
>subsequent iterations.  David Laibman has argued that the futher
>iterations don’t seem to converge.
>Riccardo, why do you think they should converge?
>David, can you help us out on this question?
>>If one wants to interpret Marx "correctly" should work directly on
>>the German, and do a true hermeneutical work. Those who have done
>>that certainly do not come out with ONE Marx to be put to test, and
>>not a finished business for certain. So Kliman has to resort to a
>>peculiar, disputable hermeneutical criterion, by the Neoclassical
>>Stigler. This becomes dogmatic as soon as that criterion is put
>>outside discussion.
>“Makes better sense of the theory as a whole” makes sense to me as a
>reasonable criterion by which to evaluate competing interpretations.
>But of course this criterion is still very subjective, and in the end
>(usually) not conclusive objectively.
>But I still think that it is a useful criterion to consider, in order
>to get a better idea of the relative strengths and weaknesses of
>different interpretations, even if it (usually) does not result in
>universally accepted conclusions.

>Riccardo, please tell us more about these Italians and their theories
>of sequential determination.  Were they interpreting Marx’s theory or
>were they unrelated to Marx’s theory directly?  What kind of questions
>were they analyzing?  Did they criticize simultaneous determination?
>Another type of theory, that you know a lot more about than I do, and
>that also seems to assume sequential determination, at least in some
>versions, is the “theory of the monetary circuit”.  For example,
>Ronchon has a few very brief and inadequate discussions of sequential
>determination, but no critiques of simultaneous determination.  Does
>Graziani discuss this issue?
>Marx’s theory and the theory of the monetary circuit are similar in
>that the analytical framework for both theories is the circulation of
>money capital:
>       M – C … P  …  C’ –  M’
>This circuit of money capital suggests sequential determination,
>because capital exists first in the form of money capital in the sphere
>of circulation, and this previously existing quantity of money capital
>is taken as given in the determination of the value and prices of
>production of the output at the end of the circuit.
>The sequential theory of price assumed by Ronchon is the Post-Keynesian
>“mark-up” theory of prices, according to which:  P = kW, where k and W
>are taken as given in the determination of P.

Riccardo Bellofiore
Dipartimento di Scienze Economiche
"Hyman P. Minsky"
Università di Bergamo
Via dei Caniana 2
I-24127 Bergamo, Italy
direct    +39-035-2052545
fax:      +39 035 2052549

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