Re: [OPE-L] Truncating Marx's "Capital"

From: Fred Moseley (fmoseley@MTHOLYOKE.EDU)
Date: Sat Sep 01 2007 - 21:08:08 EDT

Hi David, thanks for your reply.  A few comments below.

Quoting David Laibman <dlaibman@SCIENCEANDSOCIETY.COM>:

> Hi Fred,
>    Well, very quickly.  In my *Science & Society* article, "Rhetoric
> and Substance ... The New Orthodox Marxism," which was reprinted in the
> TSS-edited collective work, *The New Value Controversy and the
> Foundations of Economics*, I argued -- and, I like to think, pretty much
> demonstrated -- that the sequential calculation has to go in one of two
> directions.

I would replace “sequential determination” with “the TSSI version of
sequential or temporal determination”.  Sequential determination does
not necessarily go over multiple historical periods, as in the TSSI.
Sequential determination can also apply to a single period (as in my
interpretation of Marx’s theory), in which:  (1) costs in the period
are taken as given (equal to the long-run average cost of the means of
production and labor-power consumed) in the determination of the prices
of the output; and (2) the rate of profit in the period is taken as
given, as determined by the prior theory of the total surplus-value.

This sequential determination is clearly expressed by Marx’s simple
equation for prices of production (at the bottom of p. 265 in the
Vintage edition of Volume 3):

	price of production = k + r’k

This type of sequential determination does not lead to the same results
as the Sraffa-type simultaneous determination.  The difference is
perhaps most clearly seen by the different conclusions concerning the
effects of a change in the distribution of capitals across industries
with different compositions of capital.  According to Sraffian
simultaneous determination, a change in the distribution of capital
would have no effect on the rate of profit and prices of production,
because it does not change the technical coefficients and the real
wage.  On the other hand, according to the type of sequential
determination I am suggesting, a change in the distribution of capital
would usually change the rate of profit and hence prices of production,
because such a redistribution would usually change the overall
composition of capital for the economy as a whole, upon which the rate
of profit depends in part.

> Either you embrace a theoretical conception of time by
> working out the value-formation process under assumed constant social
> and technical conditions of production; or you allow technology, the
> rate of exploitaton, etc. to change as the iterations proceed.

I don’t understand your second case.  In their published discussions of
the transformation problem, Kliman and McGlone always assume that
technology remains constant.  In fact the main problem with their
interpretation, in my view, is that their “prices of production”
continue to change from period to period WITHOUT any changes in
technology, which is contrary to Marx’s concept of prices of
production, as long-run center-of-gravity prices, which change only if
technology and the productivity of labor change.

> The
> former corresponds to the Shaikh-Morishima-Nuti iterative solution, and
> leads to the stationary result also obtained by simultaneous calculation
> (Meek, Sraffa, etc. -- and Laibman!).  I call this the *Theoretical
> Time/Consistent Structure* Interpretation: TT/CS.  It is based very
> clearly, I believe, in Marx's premise that value theory is about laying
> bare the underlying structure in a given set of market-based social
> relations.  The alternative -- the TSSI variety of "temporal" analysis,
> in which everything constantly changes and therefore no convergence
> takes place -- is, in my view, the abandonment of any chance at a
> theoretical perspective; it is pure empiricism, the systematic
> confounding of fortuitous experienced phenomena with their
> deep-structural determinants.  It is not really a "single system"; it is
> rather an eclectic mishmash in which values, prices of production and
> market prices are all merged into one another and cannot be
> distinguished, and in which theory, in Marx's sense, plays no role.  It
> is ironic, and in fact rather sad, that this retreat into total eclectic
> empiricism is put forward in the name of "reclaiming" Marx!

This is unfair, or at least inaccurate (I know it was written quickly).
  Neither my sequential determination nor the TSSI is based on “total
eclectic empiricism”.  Marx’s labor theory of value is used to explain
the total new value produced, the total surplus-value, and the general
rate of profit, as I have discussed many times.  Plus, in my
interpretation, the initial givens (C and V) are eventually explained
as equal to the prices of production of the means of production and
means of subsistence, which in turn depends mainly (although of course
not entirely) on the labor-times required to produce these goods.  This
is a different interpretation of the labor theory of value from the
standard (i.e. your) simultaneous interpretation, but it is still a
theory.  Let’s not go over the top, as they sometimes do.


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