[OPE-L:4828] Re: new solution and the rate of surplus-value

Ajit Sinha (ecas@cc.newcastle.edu.au)
Mon, 21 Apr 1997 01:02:00 -0700 (PDT)

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At 10:04 PM 4/20/97 -0700, Fred Mosely wrote:
>This is a belated response to Ajit's (4785) on whether or not the rate of
>surplus-value as defined by me and the "new solution" (especially in
>Duncan's version) - i.e. in
>money terms rather than labor-time terms - is affected by capitalist
>Ajit's latest argument is to why our definition of the rate of
>surplus-value IS affected by capitalist consumption is the following, in
>Ajit's words: (the numbers 1 and 2 are my numbers for later reference):
> 1. Given a money commodity, [a change of capitalist consumption will
> change the composition of the net output] and A CHANGE IN THE COMPOSITION
> Now, given your money wages, the profit-wage ratio would change, since
> profit is nothing but the money value of net output minus money wages.
> 2. Above you say that V is given by money wages and S is *determined by
>the "quantity of living labor*. NOW, PLEASE TELL US HOW THIS "QUANTITY OF
>same as I have suggested above, ie. total money value of net output is put
>equal to total living labor time, then you cannot escape my conclusion. If
>you think you can, then you will have to prove it, rather than just assert
>it. (emphases added)
>First, my answer to 2: According to my interpretation (I answer for
>myself here and let Duncan and others answer for the "new solution", if
>they wish), money value added (MVA) is related to the quantity of living
>labor (LL) by the following equation (which I have discussed in a number of
>recent posts, but maybe before your time, Ajit):
> MVA = m LL
>where m is the inverse of the value of money, or the "monetary expression
>of value". Assuming a given m, as Marx did (e.g. 0.5 shillings per hour),
>then MVA is determined by LL and will change IF AND ONLY IF LL changes.
>Now, with that basic assumption in mind, my answer to 1: It follows from
>this assumption that a change of capitalist consumption will change the MVA
>IF AND ONLY IF it changes LL. You say that "a change in the composition of
>the net output will MOST LIKELY change the money value added." My answer
>is the same: a change in the composition of the net output will change the
>money value added IF AND ONLY IF it changes LL.

If this is your defence, then I must say it is almost as absurd as the TSS
approach, and is at quite a distance from the 'new solution'. You *assume*
that the value of m is *given* and *constant*. On what basis you assume such
things? The whole idea of the 'value of m' is besically under criticism; and
you simply assume it to be given and constant. Who gives the value of m? How
do you get it? And on what logic, the value of m be constant when the
composition of net output changes, given your LL being fixed?

By the way, Marx assumed an one to one relation between commodity value and
money commodity on the *assumption* that labor theory of value holds. An
assumption he later relaxed, as we all know.

Cheers, ajit sinha

ps. I hope to respond to Duncan Foley's post on wages in a day or two.