Re: [OPE-L] Okishio Theorem - does anyone think it is relevant?

From: GERALD LEVY (gerald_a_levy@MSN.COM)
Date: Wed Nov 07 2007 - 08:01:19 EST

Hi Anders:

>>If no one thought that it was relevant, then why was
>>there so much time and effort allocated to answering it?
>Because of the immense political effect. This is why the debate in
>what kind of paradigm you can say that Marx was inconsistent, forgot
>to correct the input prices, that profit rates cannot fall when there is
>increased productivity etc. etc.

There was NO "immense political effect", Anders. This was the case both
after Bohm-Bawerk issued his critique and the Sraffa-inspired critique
of the late 20th Century.  I know of no radical who rejected Marxism
because of the TP or a critique of the TRPF.  Do you? The effect - to the
that there has been - has been among economists and students of
economics.  Certainly, the charge of inconsistency never became an issue
in any mass struggle.

If one goes back and actually reads Okishio, he presented no awful
(at least for Marxists) political conclusion.  His 1961  article "Technical
Change and the Rate of Profit" concluded simply:

"..capitalistic classes can raise the rate of profit, if labourers fail to
an increase of wages. Thus the movement of the rate of profit is
determined by the struggle between conclicting classes".

Admittedly, he did write that the barrier to capital is capital itself
but rather emphasized that there is a relation between the rate
of profit and class struggle.  This is hardly a terrible political or
theoretical position and I think it has some basis in what Marx
actually wrote.

>  My hunch is that if he had been
>satisfied with his own solutions to the transformation problem
>problems - he would have published Capital III himself.

I know of no evidence to that effect or even that a solution
to what has come to be called the TP was a major concern
of Marx.

>From Howard and King, A history of Marxian Economics,
>Vol. 1, chap. 2 it emerges - IMO - that Marx and Engels was well
>aware of the transformation problem, but none of them were able to
>formulate a *completely* satisfying solution - otherwise this would
>not still have been a problem - so many eager and bright minds have
>studied this problem -

The "Prize Essay Competition" showed that this was a concern of
Engels, not Marx.  And, in any event (as I recall the competition,
as summarized by H & K) it was basically a challenge for others to
give their guess as to what Marx's answer was. I.e. the person who
first explained what Marx's answer was would win the competition.
Thus, clearly, Engels believed that the answer to the challenge was
found in Volume III itself.  In other words, that Marx had himself
arrived at a fully satisfactory answer. So, clearly he thought that the
controversy would be settled (post-humously) by Marx.

>and so far  - before TSS - the result have
>been - that either you reject or ignore Marx' value theory - or you
>are stuck with the transformation problem.

No.  That has not been the conclusion of all  contributions to
that debate before TSS.  You might not be satidfied with some
of those "solutions" but they did not all require that "you
reject or ignore Marx's value theory".  Did Foley and Levy/Dumenil,
for instance, reject or ignore Marx's value theory?

>Like the TSSI I am convinced that Marx was not simultaneist, he was a
>profoundly dynamic, dialectic thinker, but his use of "long-run
>equilib. models has shaped the subsequent debate. That's why I am
>much less condemning of those who have not yet seen the TSSI-light.

The transformation problem then really becomes transformed into the

How can a level of Marx's analysis  in which comparative statics (i.e.
period analysis)
was employed be transformed at a more concrete level of abstraction into a
truly and
completely dynamic model?

This is a worthwhile question to ask, but it is one that requires that those
seek the answers move beyond merely interpreting Marx's theory.

In solidarity, Jerry

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