[OPE] Kristjanson-Gural on Kliman _Reclaiming Marx’s Capital_

From: Ian Wright <wrighti@acm.org>
Date: Tue Sep 23 2008 - 14:44:07 EDT

Posted on History of Economics mailing list.

----------------- HES POSTING -----------------
------------ EH.NET BOOK REVIEW --------------
Published by EH.NET (September 2008)

Andrew Kliman, _Reclaiming Marx’s Capital: A Refutation of the Myth of
Inconsistency_. Lanham, MD: Rowman and Littlefield, 2007. xvii + 231
pp. $65 (hardcover), ISBN: 978-0-7391-1852-8.

Reviewed for EH.NET by David Kristjanson-Gural, Department of Economics,
Bucknell University.

In _Reclaiming Marx’s Capital_, Andrew Kliman, Professor of Economics at
Pace University, sets out to do what his title suggests; his approach,
however, is somewhat unexpected. Kliman does not attempt to defend
Marx’s value theory by claiming it is correct, or by arguing that it is
superior to other theories. Instead he attempts to show that the widely
accepted claim that Marx’s value theory is inconsistent is incorrect.
By revisiting how value is defined, Kliman attempts to show that Marx’s
value theory, properly specified, does not encounter logical
difficulties; the belief that Marx’s value theory is inconsistent is a
myth. In defending his claim, Kliman provides an impressive
contribution to the ongoing debate concerning how best to interpret and
develop Marx’s theory of value, one that deserves careful consideration
and response not just from those who are actively working in this area,
but from those who continue to accept the conventional view that Marx’s
theory is logically flawed without subjecting that view to sufficient

According to Kliman, the myth of inconsistency arises from two errors of
interpretation shared by both Marx’s advocates and his critics. First,
value is understood to occupy a separate system from that of prices and
as a result a system of values (in units of labor) needs to be
transformed into a system of prices (in units of currency). Kliman
contends that values and prices, in fact, constitute two expressions of
a single system, a system that may be denominated in labor units and in
money units with the monetary expression of labor-time acting to convert
values from labor units to money units and vice versa. This approach,
which Kliman shares with several contemporary theorists, interprets the
labor value of the constant capital component of a commodity’s value as
being defined by the exchange-value of the means of production and not
by its value. Second, the constant capital is valued simultaneously
with the commodity itself and not, as Kliman argues should be done,
according to the exchange-value of the means of production in the
previous period (not however at its historical cost).

The crux of Kliman’s thesis is that the myth of inconsistency arises
because theorists incorrectly interpret Marx’s concept of value as
occupying a separate system from prices and have wrongly calculated its
magnitude using the value of constant capital from the current period as
opposed to the prior period. These errors lead to the conclusion that
Marx’s value theory is inconsistent and also imply that value is
redundant since prices are determined physically by the matrix of
physical coefficients and the real wage. However, Kliman argues that a
temporal, single system interpretation of value does not encounter
inconsistencies -- it is possible therefore to interpret Marx’s value
theory in a way that creates consistency between his definitions and
premises on the one hand and his results on the other. The failure to
replicate Marx’s results is not therefore evidence of logical error on
Marx’s part but a failure on the part of his critics to properly
interpret Marx’s text.

To defend his claim, Kliman introduces Stigler’s (1965) “principle of
scientific exegesis” -- a criterion for resolving disputes concerning
contending interpretations of a text. He argues, quite convincingly,
that unless one is willing to “specify conditions under which one would
be willing to concede that one’s interpretation is incorrect,” (p. 61)
one is simply asserting, dogmatically, that one’s own interpretation is
superior. Kliman argues that it is not sufficient simply to find
textual references which support one’s interpretation since this in
analogous to choosing data that supports one’s empirical claim.
Instead, the principle of scientific exegesis holds that an
interpretation ought to be preferred if it is able to establish
coherence between definitions and premises on the one hand and
conclusions on the other. Kliman argues that contributors to the debate
either do not recognize the existence of alternative interpretations of
the text or do not provide criteria for evaluating the merits of their
interpretation over others.

Kliman then sets out to demonstrate that while simultaneous
interpretations are unable to establish coherence between their
interpretation of Marx’s definitions and premises on the one hand and
his conclusions on the other, his temporal, single system approach can.
  He introduces a number of simple corn models to demonstrate both the
determination of value and prices and the effects of changes in
technology on the rate of profit and he compares the results of a
simultaneous dual system interpretation with his own. In the case of
the transformation problem he argues that simultaneous valuation dual
system approaches such as those by Bortkiewicz and Winternitz imply that
the profit rate is physically determined and that the dual equality of
total prices and total profit and total surplus value and total profit
can not hold simultaneously. Single system approaches, because they
value constant capital according to its exchange-value, do not encounter
these inconsistencies. In the case of the tendency of the rate of
profit to fall, Kliman argues that the Okishio theorem relies on
simultaneous valuation of input and output; once this is replaced by
temporal valuation the rate of profit falls on the introduction of
productivity enhancing technological change.

The strength of Kliman’s contribution lies in his commitment to engaging
in scholarly debate. Kliman shows the historical lineage of various
approaches, clearly defines his criteria for preferring one
interpretation to another, clearly states and provides arguments in
defense of the temporal single system interpretation and effectively
identifies the main areas of disagreement. If his arguments withstand
scrutiny, he will have accomplished a significant feat. For these
reasons, _Reclaiming Marx’s Capital_ provides a significant contribution
to the literature.

Kliman’s work could benefit from an elaboration of certain points and a
reconsideration of others. A more systematic integration of the
monetary expression of labor-time would certainly help. His critique of
Okishio relies crucially on the monetary expression of labor-time but he
doesn’t provide readers with sufficient analytics to support his
assumptions concerning how and why the monetary expression of labor-time

Kliman also does not support his claim that all simultaneous approaches
are physicalist. He distinguishes single system and dual system
approaches but often uses dual system analyses to show results and then
claims these apply to simultaneous single system approaches. He
critiques two of these latter (Loranger and Moseley) but omits others
(Roberts, Kristjanson-Gural) which specifically contradict his claims.

His own commodity corn models abstract from both the redistribution of
value among industries and the role money plays in storing value between
periods. His claim that value must be determined temporally because
otherwise “value appears or disappears” is not adequately substantiated
as a result. Kliman’s thesis could be strengthened if he reconsidered
his wholesale rejection of simultaneous valuation in favor of a position
which defends a single system approach as consistently reproducing
Marx’s results while at the same time challenging those who favor a
single system simultaneous approach to develop a consistent explanation
of changes in values and exchange values that refute Okishio.

Kliman’s book succeeds not in spite of these criticisms but rather
because of them. By carefully identifying and systematically critiquing
key elements of the received wisdom concerning Marx’s value theory,
Kliman permits a more thorough analysis of controversies concerning how
best to interpret Marx’s value theory and opens new terrain in the
ongoing efforts to finish the work that Marx initiated.

David Kristjanson-Gural is Associate Professor of Economics at Bucknell
University. His recent published research examines the role of demand
in the determination of value and prices in Marxian value theory and the
effect of changes in demand on the monetary expression of value.

Copyright (c) 2008 by EH.Net. All rights reserved. This work may be
copied for non-profit educational uses if proper credit is given to the
author and the list. For other permission, please contact the EH.Net
Administrator (administrator@eh.net; Telephone: 513-529-2229). Published
by EH.Net (September 2008). All EH.Net reviews are archived at

-------------- FOOTER TO EH.NET BOOK REVIEW --------------
EH.Net-Review mailing list

----------------- FOOTER TO HES POSTING -----------------
ope mailing list
Received on Tue Sep 23 14:47:28 2008

This archive was generated by hypermail 2.1.8 : Wed Dec 03 2008 - 15:12:31 EST