# [OPE-L:5369] Re:Luxuries in the New Solution

=?EUC-KR?B?t/m1v7nO?= (rieudm@nownuri.net)
Thu, 14 Aug 1997 20:58:23 -0700 (PDT)

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A reply to Andrew's ope-l 5368.
Andrew said,
>>>assume that the "value of labor-power" is zero. So it is given.<<<
>>>Wages are also zero. Then it is clearly the case that the NS, like<<<
>>>all other simultaneist interpretations, contradicts Marx's claim<<<
>>>that production conditions in luxury industries affect the general<<<
>>>rate of profit.<<<
Yes, his example itself is correct.
In fact, this is one of the two cases in the simultaneist system.
1)wage=0 case 2)full automation case(i.e. l=0)
To think in the Sraffian way will clarify point.
>From the simultaneist system, p=(pA+wl)(1+r), the general rate of profit(r)
is determined by only the structure of matrix A(i.e. max. eigen value).
In two cases mentioned above, the system becomes p=pA(1+r).
Then, as is well known, because the input coefficients of luxury sector are
zero, they can't affect the magnitude of max. eigen value.
This is why Sraffians reject Marx's thesis.
Therefore, if we want to show that Marx's thesis is right in the framework
of simultaneist, the point is to show that there can be change of r which
is independent from the structure of A.
But, in three cases two of which are mentioned above, it is impossible.
The 3rd case which is more important in the sense that it is not "non-existent"
in reality, is exactly the case in which value of labor-power is reduced to
the value of wage bundles, ie. w=pb. In this case, because p=(pA+pbl)(1+r)
=p(A+bl)(1+r)=pA*(1+r), r is determined by only the structure of A*.

Then andrew is right? My thought is somewhat different.
Remember why Marx argued that the production conditions in luxury sectors
affect the genenral rate of profit. I think it's because of the rate of
profit equalization process through the capital movement between sectors.

This is my view.
Rieu