[OPE-L:2194] Re: Transforming the Transformation

ernst@pipeline.co (ernst@pipeline.com)
Mon, 13 May 1996 23:48:48 -0700

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A few days ago, Simon wrote:

I'm sorry for the delay, but I am enmeshed in tedious admin here. Anyway,
py is net output in money terms and lx is (productive) labour hours worked,

then anything which alters the ratio lx/py by definition alters the value
money. If productivity changes are ruled out by assumption 3, then by your
assumption 2 yes, the value of money will change. (There are other
possibilities too: inflation of course, but also a firm transferring some
its shop-floor labour into its marketing and sales department.)

I suppose this matters if you want to derive a price from a labour-time via

the value of money. Is this what is troubling you?

John now says:

I, too, apologize for delay. The fault, to some extent,
can be placed upon an erratic server. Some messages get out,
others do not. Oh, well. You ask, "What is troubling you?"
I'm not sure "trouble" is the right word. But let's
consider a few things.

a. We seem to have the possibility of a change in the value
of money with
1. No technical change.
2. No change in the labor time used to
produce any commodity including a
money commodity should we designate one.

b. More important, the concept of value we've been looking at
seems to one that can be used as an inter-temporal
measure of anything only when we make some fairly extreme

c. In CAPITAL, Marx seems to use "value" differently. For example,
for him, do two amounts of labor that are concretely identical
create the same amount of value? Or, put another way, does
the average labor hour in one country create the same amount of
value as the average labor hour in another? As I recall, in
Part VI of Vol. I, Marx does not agree that it does. Indeed,
he seems to look at the value added and then use the value of
money itself in terms of labor hours to determine the abstract
labor hours that are added to the value of the inputs.

d. How is this relevant to our "transforming the transformation
problem"? It would seem that to move from a set of prices of
production to the corresponding set of values, we would have
to use the value of money itself to convert the prices of
production to values. Since, for the most part, the value
of money is assumed constant in CAPITAL, we could choose
some arbitrary amount of abstract labor time and assign it
to a certain quantity of the money commodity. We can then
see the various prices of production as certain quantities
of abstract labor.

e. As you can see, like you, I am not into deriving prices from
values since in the above the values themselves are only known
by the way in which they are expressed -- prices.

f. The advantage of the "method" I purpose is that both before
and after the transformation one can make comparisons
as the economy traverses from one period to the next. The
downside is that I, like Marx, assume that the economy has
a money comodity whose value is constant. From ope-l@anthrax.ecst.csuchico.edu Tue May 14 00:09:17 1996
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I have to compliment you for your very nice quiz. I did not answer,
but if I would have done it, I would have LOST: I did not send a message
simply because I thought that Rakesh answer was the right one, and I agreed
completely with that one.

So, count me among the losers.


Riccardo Bellofiore e-mail: bellofio@cisi.unito.it
Department of Economics Tel: (39) -35- 277505 (direct)
University of Bergamo (39) -35- 277501 (dept.)
Piazza Rosate, 2 (39) -11- 5819619 (home)
I-24129 Bergamo Fax: (39) -35- 249975