# Re: [OPE-L] questions on the interpretation of labour values

From: Diego Guerrero (diego.guerrero@CPS.UCM.ES)
Date: Tue Feb 27 2007 - 16:26:37 EST

```I see there is a lot of email directed to me. I would like to answer all (if
I get time) but I will begin with the latest.

___________________________________

Ian writes:

<<Assume the duration, intensity, etc. is given.
.
Assume the technique has been chosen.
.

"A" depends on the "physical conditions of production" that obtain at
any given time. "A" may change in response to prices, but that is not
the issue.

If labour values in principle require knowledge of price magnitudes
for their calculation then labour values cannot explain prices. It is
like saying that a thermometer measures temperature but temperature
depends on the current reading of the thermometer.

I think that the independence of values from prices, in a static
equilibrium context, is necessary to understand the causal
interdependence of values and prices in a dynamic context. Projecting
back the causal interdependence in the dynamic case to argue that they
need not be independent in the static case may lead to trouble.>>

________________________________________

Hi, Ian,

I disagree: there is a problem of misunderstanding due to the (lack of)
correspondence of terms and concepts. Remember my table (I apologize for the
use of fonts that are perhaps incompatible with other internet fonts; I am
attaching a word file with the table which, remember, is just a
simplification of the paper's table):

A (quantities of labour)
B (quantities of money)

Level I
1a. Direct values (wH)
1b. Direct price (w)

Level II
2a. Production value (pH)
2b. Production price (p)

Level III
3a. Market value (mH)
3b. Market price (m)

What you write in the second last paragraph shows, I believe, you are
thinking "(a)":

(a): <<If level I in principle requires knowledge of level II for their
calculation, then I cannot explain II.>>

But what I say is "(b)", which can be decomposed in three statements:

(b):

First: whether A requires B, or not I and II are defined from labour and
III.

Second: A explains B even if A is expressed by means of B.

Third: Marx does and we should use I and II in order to explain the real
quantities (III).

Best,

Diego

(The same applies to Ajit, who has just adhered to your thermometer simile)

----- Original Message -----
From: "Ian Wright" <wrighti@ACM.ORG>
To: <OPE-L@SUS.CSUCHICO.EDU>
Sent: Tuesday, February 27, 2007 7:52 PM
Subject: Re: [OPE-L] questions on the interpretation of labour values

> Hi Diego
>
>> But note that the mH are neither more nor less dependent on market prices
>> than the pH or the wH are. When you write that "A* is the technique
>> augmented by workers consumption" you are probably thinking that A* is a
>> physical matrix and as such independent from other variables. But A*
>> depends
>> on both labour and prices. On the one hand the magnitude of each
>> coefficient
>> depends on the duration, intensity, etc., of the labour process.
>
> Assume the duration, intensity, etc. is given.
>
>> On the other hand market prices clearly co-determine A and A*: if the
>> price of gold
>> were lower than the prices of aluminium and steel, the cars would
>> probably
>> be built in gold. Leontief was aware of this.
>
> Assume the technique has been chosen.
>
>> And if you put aside the physical matrices and look directly at labour,
>> how do you measure the labour "included" in the means of production?
>> You need to turn to A again, but A depends on market prices.
>
> "A" depends on the "physical conditions of production" that obtain at
> any given time. "A" may change in response to prices, but that is not
> the issue.
>
> If labour values in principle require knowledge of price magnitudes
> for their calculation then labour values cannot explain prices. It is
> like saying that a thermometer measures temperature but temperature
> depends on the current reading of the thermometer.
>
> I think that the independence of values from prices, in a static
> equilibrium context, is necessary to understand the causal
> interdependence of values and prices in a dynamic context. Projecting
> back the causal interdependence in the dynamic case to argue that they
> need not be independent in the static case may lead to trouble.
>
> Best wishes,
> -Ian.

```

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