Re: [OPE-L] price of production/supply price/value

From: Ian Wright (wrighti@ACM.ORG)
Date: Wed Jan 25 2006 - 12:18:42 EST


I think this direction is in general right, but to nail down the
argument requires more. I too think that Marx's starting point is

Marx's chapter 9, Vol. 3 has an interesting argumentative structure.
It seems to go like this (although more than happy to be corrected by
others more well-versed in this issue):

(i) Counterfactually, assume (a) the rates of surplus-value in sectors
are uniform and also (b) assume that prices exchange at values.

(ii) Deduce from these assumptions that rates of profit are
non-uniform, which contradicts the principle of uniform returns to
capital invested.

(iii) Conclude, then, that (a) and (b) are false; that is rates of
surplus-value are not uniform and there are price/value divergences.
Surplus-value is redistributed to capitalists according to capital
invested, rather than the number of workers they employ in their

The problem with this argument is step (iii): you can't conclude that
*both* (a) and (b) are false from the contradiction in (ii). Of
course, the fact that Marx doesn't transform cost prices, and lacks a
general equilibrium framework, is cause for further doubt regarding
the precise details of his argument, at least if we do the Bortkiewicz
thing and abstract from the dynamic process of the formation of the
general rate of profit.

The problem with simply specifying a MELT to translate between prices
of production and values, as you are proposing, is that, according to
the neo-Ricardian critique, not all Marx's aggregates (total profit =
total surplus-value, total price = total value, and rate of profit =
value rate of profit) will hold. According to this formalisation of
the problem, there is no MELT that can do this, including Foley's. So
the quantitative connection between value and price accounting is
missing, and Marx's thesis of conservation of value in price fails.

So that's why I think the argument requires more, even if I agree with
the direction you are taking it.



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