# [OPE-L:1197] Re: Response on TSS, part II: Details

akliman@acl.nyit.edu (akliman@acl.nyit.edu)
Thu, 22 Feb 1996 15:08:55 -0800

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Andrew here,

I've decided I don't have enough stamina to deal with all the issues
raised or reiterated by Allin, Paul, and Gil in one lump. So I'll
respond issue by issue. I've already clarified any ambiguity regarding
my proof that simultaneous valuation makes labor-time irrevelant to the
determination of value. What I'll take up now is Allin's contention
that simultaenous and temporal valuation are just different methods
of *accounting* that come to the same conclusions.

So as not to put words in Allin's mouth, I quote from his ope-l 1110:

[when values are simultaneously determined] "any changes in labour
requirements that have occurred in the current period relative to the
last are applied retrospectively to the valuation of the inputs.

What would appear as a difference between this period's input values
and this period's output values, on historic labour-embodied accounting,
is transposed into a difference between this period's input values and
_last_ period's output values."

I will demonstrate that this is completely false, via a simple example.

Assume 50 qtrs. of corn and 50 units of living labor are used to produce
100 qtrs. of corn. Assume the input value of corn is one, or assume
simultaneous valuation. In either case, the output value of corn is
equal to 1.

Now assume that in the next period, 50 qtrs. of seed corn are again used,
along with 30 units of living labor, to again produce 100 qtrs. of
corn. The temporally-determined value of corn at the end of this
second period equals 0.8, but the simultaneously-determined input =
output value is 0.6.

According to Allin's claim the difference between the input and output
values of this second period, 1 - 0.8 = 0.2, should equal the difference
between the simultaneously determined output value of the first period
and the simultaneously determined input value of the second period,
1 - 0.6 = 0.4 (I'm assuming he didn't mean -0.4). Thus, Allin is
claiming that 0.2 = 0.4.

Conclusion: TEMPORAL AND SIMULTANEOUS VALUATION IMPLY DIFFERENT
RELATIONS OF DETERMINATION. THEY ARE *NOT* TWO EQUIVALENT METHODS
OF ACCOUNTING.

If Allin wishes to suggest that this should not be particularly
worrisome to simultaneists because this is a one-sector example, I'd
urge him to try a multi-sector example and see what happens.

The above conclusions also apply to simultaneously determined prices that
differ from values.

Andrew Kliman