>What you need to show is that, at an exchange rate that permits
>balanced trade,
>there is not a set of voluntary trades (willingly entered into by
>the owners of
>the respective commodities) that would produce a potential pareto improvement
>in at least one country with no potential pareto loss in the other.
What I want to show, Peter, is that the national specialization and
the concommitant international trade that would reduce social labor
time not only in each nation but in that giant ant colony as a whole
may not be undertaken as a result of exploitation.
>
>In pure production models (without relations of production), the implicit
>exchange rate is 1:1 in labor hours. As soon as you distinguish between hours
>of work and commodity price (due to variable rates of exploitation), you need
>to specify the exchange rate explicitly.
I don't think so. In my example, there is barter between countries
and monetization only within England. In this case it wold not make
any sense for English capitalists to barter one piece of cloth for a
bottle of Portuguese wine. While Portuguese workers understand that
specialization in wine and trade would allow them to reduce their
collective labor time, the English capitalists don't save any money
by producing two units of cloth. They end up with one unit of cloth
and one unit of wine for the same invested monetary sum that
expresses 150 hours whether they produce each good by themselves or
produce two units of cloth while trading one for a bottle of wine.
The English capitalists have no incentive to go for trade while the
English workers and Portuguese workers do. But the English
capitalists are in a position to block trade that would allow for the
reduction of labor time in each nation and in the intl system as a
whole.
>Incidentally, it is not necessarily
>the capitalists who trade. The capitalists may sell their output to trading
>houses which then engage in trade (as was the Japanese case). If
>your model is
>properly specified, this should not make any difference.
Can't see the need for anything as complex as traders.
Ricardo defended international trade as a labor saving mechanism
('the facility of production' was for him the key question, as Meek
quotes him in Smith, Marx and After). The question I am putting is to
what extent do capitalist relations of exploitation militate against
the use of this specific and other mechanisms (e.g, mechanization)
for the reduction of social labor time.
Ricardo is confident that given the opportunity for specialization
and intl trade, i.e., without state interference, the intl division
of labor will develop to become a giant labor saving device. But
there could be other barriers to the saving of labor than
protectionism and state interference in general.
Rakesh
