[OPE-L:4920] Re: Sraffa's Non-Proof

john ernst (ernst@pipeline.com)
Mon, 5 May 1997 12:51:49 -0700 (PDT)

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Responding to me, Ajit writes:

At 10:04 AM 5/1/97 -0700, John E wrote:

>Your point is well-taken. For real prices to appear in these
>n-commodity models, we should be able to designate one of the
>commodities as the money commodity and express all prices in
>terms of it. Here, I think n must be greater than 2. Using
>those prices, we could make inter-temporal comparisons of prices.
>In this way, the models can become models of an economy in time
>rather than "at the moment."
>This is precisely what I have never found in Sraffa.

John, why do you think Sraffa bothered to develop the standard commodity? To
overcome a particular problem Ricardo's labor theory of value had gotten him
into, and had become the single most important theoretical cause for the
fall of the Ricardian economy. This is the problem of arbitrary money
commodity. My impression is that most of the Marxist scholars who went into
introducing money in the transformation problem debate did not read Sraffa's
'introduction' to Ricardo. This would have clarified a lot of intricate
theoretical issues and saved them a lot of mistakes as well as time. The
standard commodity is of help for one kind of intertemporal comparison, ie.
when real wages or profit changes and everything else remain constant. The
problem of choice of the unit of measure is a serious theoretical problem,
which not many Marxists show a good appreciation for. May be Riccardo would
like to say something on this. Cheers,
ajit sinha

To which I respond:

Of course, Sraffa does have a standard commodity. And, indeed, it
does solve some of Ricardo's problems. That said, it is still
unclear to me how one can substitute the standard commodity
for a money commodity. That is, I think there are problems with
such a substitution. Before I list a few, let me say that I
do not see these problems as a shortcoming in Sraffa's work. Again,
the work itself was not designed to be a critique of Marx nor was
it intended to be a model of an economy. Only to those who use
his effort along these lines does the following apply:

1. At what "prices" are the inputs of the second period in a
Sraffa model purchased given technical change? If prices are
given only in terms of the standard commodity, are the inputs
to priced according to the standard commodity of the first
period or the second, given that technical change affected the
standard commodity from one period to the next.

2. Do capitalists hoard the standard commodity? Are bank reserves
made up of quantities of the standard commodity? Can one readily
exchange the standard commodity for "dollars", "pounds", "yen", etc.?

3. Is debt measured in terms of the standard commodity? Are payments
to be made in terms of the standard commodity?

4. How do capitalists measure their depreciation funds? Again, is it
in terms of the standard commodity?


Those are some of the problems I see with the application of Sraffa's
work to Marx's work. Since you mention the transformation problem,
I'd like to hear your comments on my "The High Cost of Prices", posted
to OPE-L.

Obscurantist as always,