**Next message:**Rakesh Narpat Bhandari: "[OPE-L:4480] Re: Re: Re: Re: Re: Re: what is Volume 1 about?"**Previous message:**Rakesh Narpat Bhandari: "[OPE-L:4478] Re: Re: Re: Rakesh on Luxemburg"**In reply to:**Rakesh Narpat Bhandari: "[OPE-L:4474] Re: adding up theories of price"**Next in thread:**Rakesh Narpat Bhandari: "[OPE-L:4483] adding up theories of price"**Reply:**Rakesh Narpat Bhandari: "[OPE-L:4483] adding up theories of price"**Messages sorted by:**[ date ] [ thread ] [ subject ] [ author ]

As Marx assumes throughout a constant monetary expression of labor value (see Grossmann), total output whose value remains a fixed magnitude (as it does throughout the transformation exercise) cannot rise in price simply by a change in cost alone. The completed transformation exercise attempts to modify cost price by a transformation of the inputs. If costs change while total value remains constant, prices simply cannot rise, though they do in Sweezy's and Duncan's solutions. But this is ruled out in Marxian theory due to its acceptance of Ricardo's critique of Smith. Therefore, the consequence of a change in cost prices can only be an opposite change in the other component into which total value is resolved: surplus value. It has never made any sense to postulate that the mass of surplus value remain invariant in the transformation. (1) C => k + s If not only C but also the monetary expression of labor value remains constant--as they do in the transformation--then it is impossible for (2) (k+a) + s = C + a {a can be positive or negative) Under both Ricardian and Marxian assumption, this expresses the consequence of a modification of cost price (k + a), the whole point of the completed transformation (3) C => (k + a) + (s-a) The conditions which a successful complete transformation must meet rather are the following: A. the modified sum of surplus value still determines the sum of profits B. the sum of profits still derives entirely from unpaid newly added value by labor This gives the transformation equations which I have proposed. (5) c1 + v1 +s1 = c1 + c2 + c3 (C) (6) c2 + v2 +s2 = v1 + v2 + v3 (V) (7) c3 + v3 +s3 = s1 + s2 + s3 (SVA) (8) (C + V + SVA) - (C + V) = s1 + s2 + s3 the set of transformation equations should then be: (9) (1+r) c1x + v1y = Cx (10) (1+r) c2x + v2y = Vy (11) (1+r) c3x + v3y = r(Cx + Vy) (SVB) (12) (Cx + Vy + SVB) - (Cx + Vy) = r(c1x + v1y) + r(c2x + v2y) + r(c3x + v3y) The invariance condition of course is (13) (C + V + SVA) = (Cx + Vy + SVB), In my equations, x, y and r can be solved; the equations do not overdetermine the system As the total value remains as constant the monetary expression of labor value throughout out the transformation exerise, the sum of prices in both schemes have to be set to equal each other, which is given in (13). There is no other invariance condition allowable on Marxian premises. The mass of surplus value is also set to equal to the sum of branch profits. SVA does not and should not equal SVB as cost prices have been modified. See (1)-(3) There are two equalities indeed but only the one invariance condition which derives from Marxian theory. All the best, Rakesh

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