[OPE-L:4907] Re: ideal vs real value

Michael Perelman (michael@ecst.csuchico.edu)
Sun, 4 May 1997 14:45:34 -0700 (PDT)

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Gerald Levy wrote:
> In [4905], I wrote:
> > Michael P wrote in [OPE-L:4904]:
> > > The zero sum game is not inconsistent with crises.
> > I agree.
> Oops! I misread your sentence, Michael.
> I do not think that capitalist crises can be modelled as a zero-sum game.
> What do you believe happens to capital values in a crisis? Do you think
> that they are only redistributed amongst different players in the game,
> i.e. capitalists and other classes, or can aggregate value decline during
> the slump?
> In solidarity, Jerry

I believe that the devalorization of individual capital is very
important, but ...

Let me offer a possible conceptualization of a crisis. Keep in mind
Marx's understanding that a trivial matter can set off the crisis.
Suppose that we begin with a financial panic, just to see what happens
to capital values. What I as a capitalist might see will be a sudden
decline in my capital value. Other capitalists will see the same thing
-- but what is really taking place is a decline in the monetary value of
my capital. The total value of all capitals can be unchanged, even
though I may may not be able to sell my product at the moment.

The crisis itself is not a zero sum game, but the conservation of
capital values can still hold.

By the way, I have not thought this through deeply, so I can be
convinced to change my mind.

Michael Perelman
Economics Department
California State University
Chico, CA 95929
Tel. 916-898-5321
E-Mail michael@ecst.csuchico.edu