# [OPE-L:4438] Re: What is Volume 1 about?

From: Fred B. Moseley (fmoseley@mtholyoke.edu)
Date: Sat Nov 04 2000 - 01:25:22 EST

```Hi Alejandro,

Thanks for these very interesting comments.

On Fri, 3 Nov 2000, Alejandro Ramos wrote:

> Here Dickinson's article mentioned in 4423:
>
> A COMMENT ON MEEK'S 'NOTES ON THE TRANSFORMATION PROBLEM'
>
> I would like to suggest that, in their handling of the "transformation
> problem," Bortkiewicz, Sweezy, Winternitz, Meek and others are introducing
> unnecessary complications, due to their pursuing a will-o'-the wisp. Having
> obtained three equaitons with four unknowns (the second set of equations on
> p. 101 of Meek's article), they then look round for a fourth condition in
> order to make the problem determinate. But the problem *is* in the nature
> of reality, indeterminate. For x, y and z are not three different,
> independent variables. Only ther ratios are significant, and need to be
> determined. Values and prices are quantities of different dimensions,
> measures in different units. Values are measured in quantities of
> labour-time. Prices are measures in terms of money. In each of the three
> different departaments of produciton values are conveted into prices by
> means of a multiplier x, y or z. Each multiplier implies a factor relating
> labour-time to money. The absolute value of this factor is of no
> significance. It does notmatter whether an hour of labour-time corresponds
> to 1 franc, 10 francs of 100 francs. Only the *ratios* of x, y and z are
> relevant to the transformation problem. Given the ratios, the actual prices
> can be arrived at by the use of a *numeraire*, the magnitude of which in
> immaterial.
> Thus there are really only three unknowns, the rate of profit and the two
> ratios x:y:z. These can be determined from the three equations. No fourth
> condition is needed.
> The idea of equaiton the sum of prices (or of any prices) to the sum of
> values (or of any values) is nonsense. To equate a ratio of prices to a
> ratio of values might make sense."
>
> H.D. Dickinson, University of Bristol.
>
> --------------

Thanks for posting Dickenson's comment.  Is this all there is to the
published comment or article?  I thought I remembered more than that.

> Now, if one checks Tugan-Baranowksy 1905 original presentation, his
> "prices" are in money and his "values" in labor-time, exclusively. He
> doesn't refer, however, to "prices" as pertaining exclusively to Vol III
> and "values" to Vol I. Nor does this Dickinson himself.

Is there an English translation of Tugan-Baranowsky?  It is interesting
that T-B adopted the "two system" interpretation, but Bortkiewitz did
not.  I always thought that Bortkiewitz was based on T-B.

So I looked again at Bortkiewitz' "short article" in the appendix to
Sweezy (ed.), *Karl Marx and the Close of His System* by
Bohm-Bawerk.  Bortkiewitz does follow T-B in that he presents the
determination of prices of production in terms of a three-department
reproduction scheme, but he differs with respect to the precise meaning of
"value" in Volume 1.  Although Bortkiewitz seems to suggest that this
difference is of no importance.  Bortkiewitz says on p. 205 (footnote 1):

"Tugan-Baranowsky sets up his value schema IN TERMS OF LABOR UNITS INSTEAD
OF MONEY UNITS.  THIS IS LEGITIMATE ENOUGH, but it turns attention away
from the real difference between the value calculation and the price
calculation."

> You write in 4430:
>
> >So I guess the "labor-value" interpretation of Volume 1 must have been
> >somehow "in the air" in the 1950s and starts to show up in the literature
> >with Dickenson and Seton.  I wonder how it all started.  And, even more
> >importantly, I wonder what textual evidence there is to support it, since
> >Marx is talking about money and prices and exchange from Chapter 1 on.
>
> I couldn't check it but it seems to me that the key author here is Meek,
> referred by Dickinson.

I think you are mistaken about Meek.  I looked again at his 1956 book and
he follows Bortkiewitz.  He is like Sweezy - he is not clear on his units
and definitions, but he follows Bortkiewitz, so he must NOT adopt the "two
system" interpretation.  Dickenson, on the other hand, clearly does.  So
it looks like Dickenson and Seton are the key figures.  Are they following
T-B?

> Their reading is strongly linked with the idea the Marx's "first table" in
> III.9 is exclusively "about values" and the "second table" is exclusively
> "about prices". Magnitudes in "second table" are "derived" from the "first
> table". At the same time, it is interpreted that the "first table"
> corresponds to "Marx's analysis *in Volume 1*", which would deal
> exclusively with "values", interpreted only as value-substance, labor time.
>
> So there is a complete separation between "value substance" and "value
> form", a separation manifested in the 2 "tables" (or "systems") and even in
> the idea that "values" are *exclusively* labor magnitudes and prices are
> *exclusively* money magnitudes. Marx's idea that prices are only forms of
> VALUE is, at this point, lost. As Dickinson writes, each commodity would
> have a "multiplier" linking labor-time and money. The expression of labor
> time as money is not general.

Yes, this is what I was trying to tell Ajit a while back.  There are n
transformation multipliers in this interpretation, which is different from
Marx's m for the economy as a whole

> This strange theoretical construction "sounds good" because seems to
> express Marx's determination of value by labor-time and this is why it
> convinced many Marxists over many years. What is missing is that money
> prices themselves are only an objective expression of labor time and that
> labor time must be expressed as money, given the peculiar characteristic of
> the capitalism, i.e. the prevaling "private exchange".

Yes indeed.

Thanks again for these interesting comments.