[OPE-L:2440] Re: How many periods?

Fred Moseley (fmoseley@laneta.apc.org)
Sun, 2 Jun 1996 18:10:41 -0700

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Thanks very much to Alan for his helpful recent posts (2425) and (2431) -
especially the former - in our continuing discussion of the transformation
problem. I don't have time for a full response now, but I just want to
quickly respond with my latest thoughts.

I am beginning to think more and more that a large part of our differences
are due to the fact that we are operating at different levels of
abstraction, and that our views may be more compatible that it has appeared
in recent discussions.

I am interpreting Marx's theory of prices of production presented in Part 2
of Volume 3 at a higher level of abstraction - one that assumes long-run
equilibrium prices at a certain point in time. (The assumption of constant
technology is not really necessary according to my interpretation because
the determination of prices of production has to do with the redistribution
of surplus-value in one period of production. Technological change makes
sense only with multiple periods, as in the TSS interpretation.)

Alan and Andrew, etc. are interpreting Marx's theory of prices of production
in Part 2 of Volume 3 at a lower level of abstraction - one that does not
assume long-run equilibrium and that analyzes changes in prices of
production over time under the assumption of technological change. I have
thought much less about this lower level of abstraction - and obviously need
to think much more about it.

But I continue to insist that Marx's theory of prices or production in Part
2 of Volume 3 is at the higher level of abstraction - we will obviously have
to discuss this more. The point I want to emphasize now is that if Marx's
theory is interpreted at this high level of abstraction, then this theory is
complete and logically consistent, and completely answers Bortkiewitz'
criticisms. All that is needed to answer Bortkiewitz and modern-day
Sraffian critics is the recognition that Marx's logical method differs from
the standard Sraffian interpretation of Marx's method in two fundamental

1. the rate of profit is determined prior to the prices of production, by
the prior analysis of Volume 1, not determined simultaneously with prices of
production, as in the Sraffian interpretation.

2. the inputs of constant capital and variable capital are taken as given
in terms of money-capital, not derived from given technical conditions and
the real wage.

It is not necessary to assume multiple periods, technological change, etc.
in order to answer Bortkiewitz's critique.

Now, what happens to this theory of prices of production at a lower level of
abstraction with technological change, etc.? That is obviously the next
question and ultimately the most important question. But it is not
necessary to answer this question in order to answer Bortkiewitz.
Bortkiewitz' critique can be answered on the basis of Bortkiewitz' own high
level of abstraction (long-run equilibrium) - which I think was also Marx's
level of abstraction in Part 2 of Volume 3 (although certainly not the end
of Marx's theory).

I hope that this provides some basis for further progress in our comradely
attempts toward better mutual understanding and hopefully eventual
reconciliation of our views. I look forward to your response continuing the
discussion when I return.