[OPE-L:1090] Re: individual prices in Volume 1

Duncan K Foley (dkf2@columbia.edu)
Fri, 16 Feb 1996 12:41:17 -0800

[ show plain text ]

Reply to Fred.

I think prices of production arise in a lot of particular cases of
neoclassical general equilibrium. I talked about this in my Bergamo paper
and cited Dana, Rose-Anne, Monique Florenzano, Cuong Le Van, and
Dominique Levy, Dominique. 1988b. Asymptotic Properties of a Leontieff
Economy. CEPREMAP Working Paper No 8814. Forthcoming in the Journal of
Economic Dynamics and Control for a more complete examination of the
issue. So it's not clear to me that there's any logical inconsistency.

In considering the comparative statics or dynamics of the theories, we
should be careful to specify what variables are exogenous. You can't
shift the wage in neoclassical models, because they are an endogenous
variable. You could shift the wage, or the value of labor power, in some
Marxian/Classical models which take the real wage to be exogenous.