[OPE-L:6375] RE: Re: Historical, real and current costs

C. J. Arthur (cjarthur@pavilion.co.uk)
Sun, 29 Mar 1998 21:04:06 +0100

>A reply to Andrew K's post
>Yet I do not understand this comment of yours, Chris:
>"But one has to be very careful - for example in a multi-good economy in which
>most products are 'dry' the price level rises between these two times when
>equalisation of profit kicks in."
>I gather that you're going back to the original problem of the wine fermenting
>example. The price of wine is greater than the price of a good that requires
>the same amount of labor, because, due to its longer production period,
>interest accrues as a "cost" of the wine. Marx's solution to this paradox is
>that surplus-value is redistributed from other branches to the wine branch, so
>the fact that it sells above value means only that other goods sell below
>value, but total price = total value.
>This much I understand. But I do not understand the connection of this to the
>change in the price level. Are you saying that, if we have two phenomena
>occurring at once (a rise in the price level *and* redistribution of
>surplus-value), it is necessary to separate them analytically in order to see
>how each, individually, affects things? I agree with this, of course, and it
>is another way of explaining the method of the one-good example: it is a
>_ceteris paribus_ assumption, in that it allows us to examine the effect of a
>change in the price level independent of redistribution of surplus-value.
>But I'm not sure this is what you're saying.

Yes I am saying something lke that - we always have to specify carefully
what is being abstracted out.