(OPE-L) Re: Dynamic value and natural price

From: Philip Dunn (pscumnud@DIRCON.CO.UK)
Date: Wed Nov 12 2003 - 07:34:47 EST

Quoting paul cockshott <clyder@GN.APC.ORG>:

> >
> > To measure it we need to do a least squares fit to price data:
> >
> > minimize with respect to x the square of  (y - Mx)
> >
> > where x is a vector of hourly natural real wage rates, y is a vector
> > of recognized labor activity, measured by money, expressed in hours.
> >
> > In other words y is equal to a vector of firms' absolute value added
> > (nominal value added in dollars times the absolute value of money).
> > M is a matrix.  The element M(f,t) gives the hours worked in firm f
> > by workers of skill type t.  We need to have the number of firms much
> > greater than the number of skill types to get a good fit.
> >
> > The dimensions of y and M are hours.  x is dimensionless -- wages
> > measured in money hours divided by clock hours.
> >
> > -------------------------------------------------
> > Whatdo you expect these xs to be, >1 or <1?
> Phil:
> I would expect them to be dispersed around a mean of 1, but I have not tried
> prove that yet.
> Paul:
> -----------------------------------------
> That would surprise me since wages on make up part of the value added.
> If you did get a mean of 1, you would now have a measure of exploitation
> by comparing your 'natural real wages' with the wages actually paid.


Then ratio of the real to the absolute price systems is equal 1 + the ratio of
aggregate profits to aggregate wages. So real prices and wages are bigger
numbers than absolute prices and wages. Agreed, wages are part of value added.
But just as the mean hourly real wage is 1, so the mean rate of absolute money
value added (per hour of labour time worked) is 1.  This pretty certainly means
that the mean natural real wage rate is 1.

I don't think the ratio of actual real wages to natural real wages says any
thing about exploitation. If some actual rate was very much greater than the
natural rate, that might indicate unproductive labour.  It would certainly
indicate a problem of some sort.


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