Re: [OPE-L] Ajit's Paper on Sraffa and Late Wittgenstein

From: Ian Wright (wrighti@ACM.ORG)
Date: Fri May 26 2006 - 15:55:37 EDT

Hi Ajit

Thanks for forwarding this paper. It's another excellent paper from
you that draws out the implications for value theory of the work of
Sraffa. I have learnt a lot from reading your work on this issue, and
I admire the way you very carefully and logically deduce the
anti-essentialist conclusions.

Of course, these conclusions regarding value theory are conditional on
Sraffa's PCMC being free from error.

I believe there is an important error in Sraffa's work. In essence,
Sraffa's reduction to dated labour representation commits a real-cost
accounting error. Sraffa fails to count the labour-cost of capitalist
consumption, and therefore fails to properly distinguish between
production with and without a capitalist class.

The reasons why Sraffa's commits the accounting error are complex, but
I believe it is fundamentally due to a shift in Sraffa's problematic
away from an analysis of the necessary relations that obtain in a
state of self-replacing equilibrium to the contingent relations that
obtain under conditions of a change in the distribution of income.
This shift occured in the 20's as partially documented by Kurz and
Salvadori. Contrary to what you say in your paper, I believe that
Sraffa's surplus equations fail to adhere to a strict objectivism, and
hence this shift in Sraffa's problematic is not progressive. For
example, the rate of profit becomes conditional on the subjective
classification of worker consumption goods as either subsistence or a
share of the surplus.

Once Sraffa's real-cost accounting error is fixed then very different
conclusions may be drawn from his work regarding the theory of value.
Sraffa remarks that his results "cannot be reconciled with *any*
notion of capital as a measurable quantity independent of distribution
of prices" (his emphasis). But this statement is not an accurate
description of his own theoretical framework. In a state of
self-replacement, there are *many* measures of capital independent of
prices, of which labour-value is one example. But such real-cost
measures *are* dependent on the distribution of real income (i.e. the
composition of worker and capitalist consumption). Sraffa deduces
prices by the exogenous distribution of nominal income, but somehow
thinks that labour-costs can be deduced without a similar exogenous
distribution of real income.

Once the distribution of real-income is specified then the
simultaneous satisfaction of all Marx's aggregrate conservation claims
is a theorem in Sraffa's theoretical system, i.e. the neo-Ricardian
critique of Marx's value theory falls. If the distribution of
real-income is not specified, then, contra Sraffa, labour-values are

I have a tentative working paper on all this, which may be of interest:
In post-script

I'd be happy to debate these issues, either online or offline, with a
view to mutual understanding. My current thinking is that the
nihilistic conclusions regarding value theory are not justified by
Sraffa's work, once the above criticisms are applied.

In sum, I agree that your conclusions follow from Sraffa's work. But
the conclusions are based on a faulty starting point, which is the
failure to properly account for real-costs.

Best wishes,

P.S. This paper by Jorgen Sandemose tackles the very same issues of
the relationship between Sraffa, Wittgenstein and value theory, but
draws very different conclusions:
"The World as a Game in Sraffa and Wittgenstein: A Case Study in
Modern Bourgeois Ideology", Research in Political Economy, 19.

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