[OPE-L:5139] Re: Can Ajit's price theory fly?

Paul Cockshott (wpc@cs.strath.ac.uk)
Wed, 28 May 1997 07:06:45 -0700 (PDT)

[ show plain text ]

> Yes, *his* theory -- to my knowledge, Sraffa's published works don't say
> anything about the relation between the output prices of one period and
> inputs prices of the next. Nor does he claim to have a price theory.
Surely in the absence of a wholesale sector, and under the simplifying
assumption of fixed production periods the output prices of period n
have to be the input prices of period n+1. This is because there
is only one set of transactions occuring between any two production
cycles. The set of prices at which these transactions occur must
be both the output prices of the previous period and the input
prices of the next.

If we introduce a distinct wholesale sector that buys the product
at the end of the first period and then sells it before the start
of the second period, then we have two distinct sets of transactions
and two distinct sets of prices possible.

But if we do this, we must explicitly show the wholesale sector and
its profit and loss accounts in our model.