Chris Burford wrote: "the marxian law of value, probably cannot be falsified, but may be "true".
"The only empirical study I know about it is by Paul Cockshott and Allin Cottrell showing that it could fit with macroeconomic data, I think for Scotland if I recall correctly." There have been numerous studies like this (not only by Cockshott and Cottrell, but also by Ochoa, Shaikh, Petrovic, Guerrero, Maniatis & Tsoulfidis, and others). But their results are not meaningful. The strong cross-sectional correlations they find are SPURIOUS CORRELATIONS, correlations that stem only from their failure to control for variations in industry size. (It is not surprising, nor meaningful, that the total value of output and the total price of output are both large in large industries and small in small industries.) Once one DOES control for variations in industry size, the correlations between values and market prices simply disappear. I found this, using US data, in a study published in the Cambridge Journal of Economics last year. More recently, Rubén Osuna has found the same thing, using Spanish data, in a study that's part of his superb dissertation on the temporal single-system interpretation of Marx's value theory. The references are: Kliman, Andrew J. 2002. The law of value and laws of statistics: sectoral values and prices in the US economy, 1977–97, _Cambridge Journal of Economics_, vol. 26, 299-311 Osuna Guerrero, Rubén. 2003. _Un Modelo Secuencial para el Cálculo de Precios. El Caso Español 1986-1994_. Ph.D. dissertation, Departamento de Análisis Económico I, Facultad de Ciencias Económicas y Empresariales. Universidad Nacional de Educación a Distancia (UNED), Spain. However, properly understood, the law of value does generate a falsifiable hypothesis that has not been falsified: productivity increases tend to reduce commodities' prices. My preliminary computation for the US during the past 1/2 century indicates that a 1 percentage point increase in multifactor productivity leads, ceteris paribus, to almost exactly a 1 percentage point decline in the CPI. Andrew Kliman
