[OPE-L:285] An odd fact brough to light by Duncan Foley's post

Alan Freeman (100042.617@compuserve.com)
Wed, 18 Oct 1995 13:54:39 -0700

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Duncan Foley's post, which I found thought-provoking, has made me aware of
an odd fact; I didn't mention either the transformation problem or the Okishio
Theorem in my list of wannados, and nor I think did Gerry (I haven't gone
back and checked so apologies if this is wrong). But by and large in the initial
discussion, they didn't figure.

To some extent this isn't surprising since the original proposal was 'the
plans' and neither Okishio nor the transformation 'problem' existed when
Marx was drawing these up. They are Twentieth Century creations.

But since I have spent most of the last fifteen years of study on these two
questions, and with Andrew I think they are the key to unlocking the 'lost
tradition of the real Marx', it is an odd fact that I didn't raise it. Maybe I
thought it would come out in the general discussion of value.

I wouldn't change my view; I don't think this discussion fits best on this
forum as an explicit topic. I think the issues involved will crop up in their
own time and in context. But do others feel different?

One way to approach it might be to deal instead with what I think are a
well-defined set of important questions which have arisen in relation to
these topics,which we have found controversial, which do appear in
Marx, and which might be useful to spend some time on. They are:

1) the value of money.
2) the meaning of 'socially necessary', aka 'reproduction values' (is the value
of a good equal to the labour *now* socially necessary to (re)produce it?)
3) abstract labour

What does the team think?

Duncan wrote
The relation between the transformation problem and the Okishio theorem
has been discussed: by Gerard Dumenil in his papers in the 1980s on the
rate of profit and transformation problem, and by me in Understanding
Capital (Harvard Univ Press, 1986) and Money, Accumulation and Crisis
(Harwood Academic, 1986).

I don't think there's need for further modeling at this level of the
discussion of the problem. If the value of labor power, in the sense of
the wage share in value added, remains constant, rather than the real
wage, there are viable technical changes that will lower the rate of
profit (though not necessarily all viable technical changes will do so.)
I think effort now on understanding the empirical patterns of technical
change and modeling its dynamics (see, for example, Dumenil and Levy's
Economics of the Profit Rate (Elgar, 1994) or their article in the most
recent issue of Metroeconomica, for some interesting suggestions) is more
likely to bear fruit.