[OPE-L:6335] Re: Historical, real and current costs

Sun, 22 Mar 1998 11:01:09

Partial response to the PIAF:

> Date: Sat, 21 Mar 1998 10:43:42 -0500 (est)
> From: Gerald Levy <glevy@pratt.edu>
> To: ope-l@galaxy.csuchico.edu
> Subject: [OPE-L] Re: Historical, real and current costs

> Again we disagree. Yes, I know: the _reason_ the assumptions are
> made is to simplify the math. But, at what cost?
> For example, the assumption that c=0 in this context means that after
> production time, there can be no flow of value from labor.

I think you meant "working time", not "production time". Right?
"After prodution time" what we have is "circulation time", and
certainly there is no flow of value (transferring of value) during
the circulation time.
I think the transferring of value is carried out during the "working
time", i.e. during the time living labor is being consumed. During
the time in which the commodities "are abandoned to the sway of
natural processes, without being at that time in the labour-process",
there cannot be transferring of value, simply because the commodities
are NOT in the labor process and therefore living labor is not being

> In other words, the assumptions themselves lead to misleading and
> perverted results.

I don''t see what are the "perverted results" now. The construction
of a multiproduct example (having c > 0) with the charateristics we
are discussiong is possible. However, this only complicates the
numbers. Are you saying that the alleged "perverted results" come
from the c= 0 assumption?

> > Why would a multiperiod example change the issues in discussion?
> Im not sure it would since the issue being discussed concerns what
> happens (and can happen) _within_ a period.

Sorry, Jerry, I meant "multiproduct"!

> > Additionally, "corn models" are not Andrew's. For example, Duncan
> > use a "corn model" to explain his reading of the falling rate or
> > profit in his book Understanding Capital (I recently received a copy!)
> > Duncan says on p. 131: "A numerical example of this process may help
> > to explain it. Suppose, for simplicity, that we are in the corn
> > economy of Ricardo; hence there will be only one produced commodity
> > and prices will be proportional to labor values."
> But, Duncan clearly indicates above that the corn model is Ricardian in
> origin. No claim is made that Marx adopted a corn model.

This is interesting!
The fact, as you can check in the book I mentioned (surely is in
your marvelous library), is that Duncan uses the "corn model" to
present his point about *Marx''s* theory of the FRP. So, you may be
implying that Duncan is holding a *Ricardian interpretation* of
Marx''s FRP for the simple fact that he uses a "corn model".
Conversly, as Tugan has a multiproduct example, you would imply that
this is a Marxist interpreation. Your dividing line between Ricardian
and Marxian intrpretations is being set according to the number of
commodities the authors take into account to illustrate their
arguments, not by their conceptual foundations.Of course, if this is
what you mean, I disagree.

> > I ask: Do your complaints about "Andrew's corn model" apply also to
> > Duncan's examples?
> Please ... Alejandro. Andrew does not adopt "models". He uses "examples"
> and/or "illustrations".

Right. I apologise to Andrew, but "corn model" is an usual term.

> > I don't remember --maybe I wasn't in the list--
> > that you have suggested this issue to Duncan to be discussed. I have
> > the impression (maybe wrong) that you seem to believe that the only
> > person in the world using "corn models" is Andrew [...]
> Wrong.

I believed that.

> > Do you think that such a
> > kind of results are also present in Duncan's work.
> Your question is too vaguely worded. I.e. I dont know which of Duncans
> (many) works you are referring to.

Well, I was talking about the book I had mentioned: "Understanding
Capital" in which a corn model is presented to illustrate Duncan''s
interpretation of *Marx''s FRP*.

> (... however, it may indeed be that Duncan and I have disagreements on
> this matter. E.g. I think that Duncan tends to believe that there is less
> of an analytical/philosophical gap between classical political
> economists and Marx than I accept. I.e. I think he sometimes sees Marx
> as a continuation of the classical tradition, whereas I think that Marx
> surpassed that tradition. In other words, I think that Marxs "paradigm"
> was fundamentally different from the classical "paradigm". Sometimes I
> think that Duncan believes that they were operating within the same
> general paradigm. But I dont want to misrepresent Duncan here so we can
> talk about this issue if Duncan wants to).

I agree with you that "the gap" you mention exists. But I think that
it is manifested in more conceptual grounds than the nature of the
examples the authors present. In particular, if examples are "corn
models" or "multiproduct cases" is no so relevant. The dividing line
includes things such a (a) the determination of value by labor time,
which "Ricardian" authors tend to discard or (b) the temporal
nature of capitalist cycle, which these authors also discarded
by using the "simultaneous" formalism in which the production period
is considered to be a zero-time entity.

> > All this is something funny for me because, almost one year ago,
> > Duncan kindly read my paper on the Okishio Theorem. His FIRST COMMENT
> > was that I should use a "corn model" and avoid the cumbersome matrix
> > algebra!
> If one were to adopt (temporarily) a "corn model" to develop an internal
> critique of Ricardo or Okishio then that would be a different matter from
> adopting a "corn model" which claims to be an interpretation of Marx
> and/or a statement about capitalist reality.

Well, but I''m still in the dark regarding the real importance of the
"corn model" as dividing line. I mean, Duncan could easily rewrite his
equations in matrix algebra, a multiproduct version of his example.
Are you claiming that for this simply fact, he is allowed to say that
he''s presenting an "intretation of Marx and/or a statement about
capitalist reality"?

OK Jerry, we''ll follow next week, if I have time! Thanks for your