Re: [OPE-L] equilibrium and simultaneous vs. sequential determination

From: Fred Moseley (fmoseley@MTHOLYOKE.EDU)
Date: Sat Sep 22 2007 - 12:39:15 EDT

Quoting Ian Hunt <ian.hunt@FLINDERS.EDU.AU>:

> Dear Fred,
> Well you do on the Sraffa model need as many equations as there joint
> products. Incomplete goods are not a problem (Sraffa -or Schefold-
> deals with them also) and, of course, the prices are book prices for
> depreciated fixed capital and part constructed products.

Hi again, would you please give references to Sraffa or Schefold that
deals with incomplete outputs as joint products?  I have never seen
this.  Thanks.

> If the framework works they will hold for the more complicated case,
> I would have thought. But you might be right if you are suggesting
> that it is not the most elegant framework for dealing with varying
> turnovers of constant capital,

It’s not a matter of elegance.  I argue that Sraffa’s theory is not a
valid theory of long-run equilibrium prices when unequal turnover
periods across industries is taken into account.  Real-world
equilibrium prices are not determined simultaneously along with the
prices of “partially completed products” and “partially used up fixed
capital” as “joint products” at the end of each and every “least
turnover period”.


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