Re: (OPE-L) Re: Hume and constraint based theories

From: ajit sinha (sinha_a99@YAHOO.COM)
Date: Wed Nov 19 2003 - 00:49:37 EST

--- Ian Wright <ian_paul_wright@HOTMAIL.COM> wrote:
Ajit: I think you are compartmentalising things that
are in causal interaction with each other. For
example, I have a computer model of a simple commodity
economy. The causal interaction between labour values
and prices results in an efficient allocation of
social labour time, at which point prices are
proportional to labour values. Irrespective of whether
this is a good or bad, relevant or irrelevant model
for understanding real economies, it is nonetheless a
real dynamical system, which can be an object of
scientific study.
True! But the causal direction of your computer model
is given by you. You have told your model that when
one sector receives higher returns for their one-hour
of labor than the other does some people from the
other sector move from their sector to the higher
labor-remuneration sector. So there is a causal impact
on the supply of these commodities, which has impact
on the prices. But in the real world, outside of the
computer, this may not happen. People may not have the
right information to behave that way. It may not be
easy to move from one kind of work to another, so the
inertia keeps them where they are and after some time
differential labor remuneration becomes conventional.
The point I'm trying to make is that once you let
things move on historical time then you are dealing
with infinite variables, but to theorize you need to
work with a few variables only and assume that the
other variables either have no impact on those
variables or they remain constant. But both these
assumptions are ultimately arbitrary. Thus your theory
can never move on real historical time. So all
theories are abstraction from real time.
Ian:  It just so happens that I try to understand it
by employing ordinary differential equations, not
simultaneous equations. This leads me to explain what
happens dynamically in terms of a theorem that states
that labour values are global attractors for prices.

But what causes prices to move in your model?
Differential rates of profit--> movement of capital-->
changes in supply--> changes in prices toward labor
values? Let me ask you one question? What makes you
think that changes in supply will not change the
values themselves, i.e., on what grounds you think
that the methods of production is independent of gross
output? If you have not implicitly assumed constant
returns to scale? What makes you think that these
changes in supply will have no impact on labor
productivities through learning by doing or some other
kinds of technical changes? So your model is not
necessarily running on real time. It is running on the
artificial time of your model. You can learn from it
but cannot claim to know how real world works. You
see! Most of economics from Adam Smith onwards
believed that there is something like 'natural prices'
or 'prices of production' around which market prices
(i.e., real daily prices) fluctuate. Garegnani and his
followers think that Sraffa's prices are also the
natural prices or the center of gravitation of market
prices. I don't.
Ian: Does your philosophy rule out the existence of
the object I have constructed? Does it rule out my
explanation for its behaviour over time? Or does it
have nothing to say about it? Presumably the causal
interactions that are instantiated when the model is
run are a figment of my imagination? I would really
like to know if I've been labouring under such a
delusion! -Ian.

Of course they are figments of your imagination. What
else they could be? Your model has got what you have
put into it, nothing more. The universe has got more
things than you and I can imagine. As I have said,
your dynamic theory runs on an artificial time not
real time. Sometimes it may give a good forecast about
certain variables and sometimes it may not. It could
just be a chance--we will never know. But the theories
are about convincing others. Given the cultural melieu
in which you are propounding your theory, it may be
highly convincing to others, as your theory may be
using assumptions and received knowledge that are
highly acceptable in the cultural melieu today. But we
should keep in mind that 'the world is flat' was a
highly convincing theory sometime ago in their
cultural melieu. This explains why a major paradigm
shift in one area of knowledge has influence on other
areas of knowledge too. It simply changes the cultural
Thank you for your very thoughtful posts on this
subject. Cheers, ajit sinha

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