[OPE-L:5192] Re: production and realization

andrew kliman (Andrew_Kliman@msn.com)
Fri, 6 Jun 1997 03:31:06 -0700 (PDT)

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A reply to Ajit Sinha (OPE-L 5081):

In my ope-l 5044, I quoted the following:

"although price, being the exponent of the magnitude of a
commodity's value, is the exponent of its exchange-ratio with money, it does
not follow that the exponent of this exchange-ratio is necessarily the
exponent of the magnitude of the commodity's value. Suppose two equal
quantities of socially necessary labour are respectively represented by [1
unit of y] and [$1] .... [$1] is the expression in money of the magnitude of
the value of the [1 unit of y], or its price. If circumstances [!] now allow
this price to be raised to [$2], or compel it to be reduced to [$0.50], then
although [$0.50] and [$2] may be too small or too large to give proper
expression to the magnitude of [y's] value, they are nevertheless prices of
[the unit of y], for they are, in the first place, the form of its value, i.e.

money, and in the second place, the exponents of its exchange-ratio with
money. If the conditions of production, or the productivity of labour, remain

constant, the same amount of social labour-time must be expended on the
reproduction of a [unit of y], both before and after the change in price. ...
The magnitude of the value of a commodity therefore expresses a necessary
relation to social labour-time which is inherent in the process by which value

is created. With the transformation of the magnitude of value into the price
this necessary relation appears as the exchange-ratio between a single
commodity and the money commodity which exists outside it. [If money is not
immediately a commodity, the relation of course appears as the exchange-ratio
between a single commodity and the currency unit which exists outside it --
AJK.] This relation, however, may express both the magnitude of value of the
commodity and the greater or lesser quantity of money for which it can be sold

under the given circumstances. The possibility, therefore, of a quantitative
incongruity between price and magnitude of value, i.e. the possibility that
the price may diverge from the magnitude of value, is inherent in the
price-form itself." Capital I, Vintage, p. 196.

Ajit, in response, proceeded to "explain" to me "what Marx is
talking about. First of all you have to keep in mind that Marx in the first
two volumes of capital assumes that value ratios represent price ratios on
the average."

This is not correct. There are a lot of things wrong with it. But I'll just
note the most immediately relevant one: it is not until the end of Ch. 5 of
Vol. I that Marx introduces the assumption that prices = values. The quote,
however, is from Ch. 3.

Andrew Kliman