RE: RE: Re: marx's proof regarding surplusvalue and profit
>If you want more specificity, consider another two-good economy. >Sector A produces 10 units of A, using 9 units of A and 1 unit of >labor. Sector B produces 3 units of B, using up 2 units of A and >1 unit of labor. So there's a positive net product of B, 3 units, >and a negative net product of A, 10 - 9 - 2 = -1 unit. Now under >the interpretation in question, the per-unit value of A is 1 and >the per-unit value of B is also 1, so the total value of the net >product is 2. Imagine that workers' wages are *very* low, so that >surplus-labor, the total value of the net product minus the value >of wages, is very close to 2. If, however, the relative price of >A in terms of B is greater than 3, then profit -- measured >simultaneously -- will be negative. So we have surplus-labor but >negative profit. Why would anyone carry out production of a good worth half as much as its inputs? What you appear to have proved here is that if workers are employed to destroy valuable items, then profit will be negative. I suppose that would be news to the analysts who covered boo.com or something, but probably not to anyone else. I'm probably being thick here, but I don't see how your assumption about the relative prices of A and B is a legitimate one here; unless the less stylised version of this argument has some compelling reason why production of B would take place under these relative prices, I'm not sure that this conclusion can be established dd ___ Email Disclaimer This communication is for the attention of the named recipient only and should not be passed on to any other person. Information relating to any company or security, is for information purposes only and should not be interpreted as a solicitation or offer to buy or sell any security. The information on which this communication is based has been obtained from sources we believe to be reliable, but we do not guarantee its accuracy or completeness. All expressions of opinion are subject to change without notice. All e-mail messages, and associated attachments, are subject to interception and monitoring for lawful business purposes. ___
Re: RE: Re: Re: marx's proof regarding surplusvalue and profit
>I'm not sure what the below is in response to, but briefly: Andrew, If you are going to address me, please use my name at some point. Please do not use the passive voice as Jim D in replying to one of claims. "It has been asserted that..." For example, you could have said "I'm not sure what Rakesh [or Bhandari] is responding to below, but briefly.." Devine could have said: "It is asserted *by Bhandari* that Fred's criticism of me has echoes of the young Strachey's criticism of Robinson, but this assertion is baseless." At the very least, claims should remain tied to authors for the purposes of clarity. Secondly, please do not give me orders most especially when they are opaque. We Marxists should not be in the business of bossing people around. You order me not to confuse classical equilibrium prices with the simultaneist equilibrium stationary prices. But you don't tell me what the difference is and you don't prove that Marx does not use the latter. So you have VERY OBNOXIOUSLY given me an order without clarifying what it is or why I should heed it. Thirdly, I think your point that classical equilibrium prices are not themselves a force but a resultant of forces is valuable, though I need to think about it. It seems that the whole discussion is shot through with metaphors from physics. Fourthly, I am not clear as to what classical equilibrium prices are; my reading of Ricardo does not suggest to me that he meant by them what many interpreters mean by them; my reading of Marx suggests that his price theory is much more dynamic than Ricardo's, so it is not obvious to me that Marx recognized the existence of classical equilibrium prices. Rakesh > >Marx generally thought that market prices tend to fluctuate around >equal-profit rate prices -- classical equilibrium prices. (I >would dispute your reading of the end of Vol. II and Ch. 9 of Vol. >III if I had time.) Such prices have theoretical interest to me. >They do not exert any force -- they are the outcome of the >workings of various forces. Real magnitudes determine derivative >magnitudes like averages, not v.v. > >All of this has zip to do with the "equilibrium" -- stationary -- >prices and the associated "equilibrium" profit rate of >simultaneism that we critique. Do not confuse the two. > >The latter is of no interest whatsoever. This is a very strong claim, and you give me no reasoning or no citation where the reasoning behind this very strong conclusion can be found. Rakesh > > >I have no position on the rest. I'd need to study the question >carefully. > >Andrew Kliman
RE: RE: RE: Re: marx's proof regarding surplusvalue and profit
Mat: "I have perused a couple of your papers on the web" The published stuff is usually better in order to gain a basic understanding of the issues from the ground up. For economists who understand the technicalities of some of the other interpretations, the piece I'd recommend one reads first is "A Temporal Single-system Interpretation of Marx's Value Theory," published in ROPE 11:1, in 1999. Mat: "Pardon my slowness," I don't think you're slow at all. Mat: "but can you give me a baby explanation of the negative product issues again. When you say that 10 of A are produced and workers consume 5 and 8 are used up so that the net product is -3, I'm assuming the deficit was possible because there was an already existing stock of A, right?" There's an already existing stock in any case. If workers eat their 5 units before the 10 are produced, then the period must have started with a stock of at least 13 units, 5 + 8. Assume that it was 13 units. Then since only 10 units are produced, the end-of-period stock is 3 units less than the start of period stock. That's the negative physical surplus of A, - 3 units. Alternatively it is gross output minus consumed input minus physical wages. The economy cannot *reproduce* itself next period, using the *same* technology, on the same scale, without a *reserve* stock of at least 3 units of A. In other words, to have reproduction on the same or larger scale without technical change, the initial stock of A would have to be at least 16 units, not 13. To anticipate what might be coming down the line, the following kind of thing is quite possible. During even-numbered minutes, 10 units of A are produced, while 12 units are used up, and 15 units of B are produced, while 8 units are used up. During odd-numbered minutes, it is the opposite: 15 units of A are produced, while 8 units are used up, and 10 units of B are produced, while 12 units are used up. So EVERY minute -- always -- there's a NEGATIVE net product of one good. This is so even though over each two-minute span, 25 units of each good is produced while only 20 units is used up, and thus the economy can grow over time without drawing down stocks to zero. "But it would seem that either you don't include those three used up this period that were produced in the previous period OR you include all of the stock of A that pre-existed in your net calculation--either confine the calculation to that produced in this period or include all periods." I'm not sure I understand this. You can compute the net product (actually, physical surplus, since physical wages are also deducted) in the top example either as end-of-period stock minus start-of-period stock, or, equivalently, as gross output minus used up input minus physical wages. The basic relations are end-of-period stock = start-of-period stock - consumed input - physical wages + gross output net product = gross product - consumed input physical surplus = net product - physical wages I hope this helps. If not, catch me in Boston and I'll try again. Drewk
RE: RE: Re: marx's proof regarding surplusvalue and profit
Drewk, I'll have to admit I have perused a couple of your papers on the web and I'm interested in understanding your argument(s). I have looked at some of your and your colleagues stuff in the past but I have not really devoted myself to a careful study. I am always interested in anything that can help me understand Marx--and thus capitalism, as well as some other things--better. Pardon my slowness, but can you give me a baby explanation of the negative product issues again. When you say that 10 of A are produced and workers consume 5 and 8 are used up so that the net product is -3, I'm assuming the deficit was possible because there was an already existing stock of A, right? But it would seem that either you don't include those three used up this period that were produced in the previous period OR you include all of the stock of A that pre-existed in your net calculation--either confine the calculation to that produced in this period or include all periods. Again, I apologize for what probably seems like a question from an intro student, but I want to understand this point, which seems like one central to the temporal view. mat
RE: Re: marx's proof regarding surplusvalue and profit
Mat Forstater wrote: "I don't see the problem with the notion of a physical surplus. The surplus product is production over and above production of the (socially and historically determined) means of subsistence. Yes, according to one interpretation of Marx, but not others. But let's stick with this. Imagine a two-good economy. During the "period," 10 units of each good is produced, workers consume 5 units of each good, and 8 units of good A (and 0 of B) are used up. Then the physical surplus of A is 10 - 8 - 5 = -3, and the physical surplus of B is 10 - 5 - 0 = 5. So there is no "the" physical surplus. There's a physical deficit of A, a physical surplus of B. "Total labor time (TLT) - necessary labor time (NLT) = surplus labor time (SLT). If TLT > NLT, SLT is positive, and there must be a physical form of the goods produced during SLT, no?" Yes and no. There will in general be surpluses of some goods and deficits of others. E.g., more cars produced than used up and consumed by workers, but less steel produced than used up. There will be negative net products of some goods "produced" during the SLT. Car workers produce a physical surplus of cars during their SLT, but a negative physical surplus of steel. Steelworkers produce a positive physical surplus of steel but a negative physical surplus of coal. Etc. So you have to look at the whole economy. But when you add it up, there's no reason why the aggregate physical surplus of anything has to be positive, especially during a short time-span -- minute, hour, day, week. If you want more specificity, consider another two-good economy. Sector A produces 10 units of A, using 9 units of A and 1 unit of labor. Sector B produces 3 units of B, using up 2 units of A and 1 unit of labor. So there's a positive net product of B, 3 units, and a negative net product of A, 10 - 9 - 2 = -1 unit. Now under the interpretation in question, the per-unit value of A is 1 and the per-unit value of B is also 1, so the total value of the net product is 2. Imagine that workers' wages are *very* low, so that surplus-labor, the total value of the net product minus the value of wages, is very close to 2. If, however, the relative price of A in terms of B is greater than 3, then profit -- measured simultaneously -- will be negative. So we have surplus-labor but negative profit. This was just a simple example for intuitive purposes. It is much more restrictive than the proof in my paper, which again, I'll be happy to send folks. Drewk
RE: Re: RE: Re: Re: marx's proof regarding surplusvalue and profit
I don't see the problem with the notion of a physical surplus. The surplus product is production over and above production of the (socially and historically determined) means of subsistence. My understanding is that the time required to produce the means of subsistence is necessary labor time. Total labor time (TLT) - necessary labor time (NLT) = surplus labor time (SLT). If TLT > NLT, SLT is positive, and there must be a physical form of the goods produced during SLT, no? There is another sense in which I might agree with you, but that would only hold if we also rejected the notion of "surplus labor time" as well. But if we accept SLT, then it is hard for me to imagine how there is no physical surplus product. But I might be convinced. >I actually do deny the existence of a physical surplus, in the >real world.
Re: RE: Re: Re: marx's proof regarding surplusvalue and profit
>I actually do deny the existence of a physical surplus, in the >real world. ok Andrew you deny the existence of A physical surplus. > >The concept is appealing, but ultimately meaningless. Physical >things are heterogeneous, and there are surpluses of some, >deficits of others. There cannot be any "the" physical surplus. now you deny the existence of THE physical surplus. Granted there is not a single dimension in which this physical surplus can be expressed. Granted that with technical progress--say computers--it would be difficult for example to determine how many more computer means of production in which the surplus value is embodied. But I think it's a mistake to deny that with rising productivity there is indeed some rough sense in which we can say that the mass of surplus value even if it falls falls relative to the advanced capital is in fact being expressed in a greater physical quantity of means of production and wage goods, even if we have no precise measure for that physical quantity. If you deny this, you miss a crucial source of the elasticity and explosiveness of accumulation. My criticism of the TSS school again is that it is anti physicalist. And again here is Marx on the matter: Here is an example of Marx's ability to understand the surplus in both its aspects: ...the development of labour productivity contributes to an increase in the existing capital value, since it increases the mass and diversity of use values in which the same exchange value is represented, and which form the material substratum, the objective elements of this capital, the substantial objects of which constant capital consists directly and variable capital at least indirectly. The same capital and the same labour produce more things that can be transformed into capital, quite apart from the exchange value. These things can serve to absorb additional labour, and thus additional surplus labour also, and can in this way form additional capital. The mass of labour that capital can command does not depend on the its value but rather on the mass of raw and ancillary materials, of machinery and elements of fixed capital, and of means of subsistence, out of which it is composed, whatever their value may be. SINCE THE MASS OF LABOUR APPLIED THUS GROWS, AND THE MASS OF SURPLUS LABOUR WITH IT, THE VALUE OF THE CAPITAL REPRODUCED AND THE SURPLUS VALUE NEWLY ADDED TO IT GROWS AS WELL. Capital 3, p. 356-7. vintage Rakesh
Re:Re: RE: Re: Re: marx's proof regarding surplusvalue and profit
Drewk wrote: >The silence about this issue is deafening. > >What's the sound of one side suppressing Marx? You have only to >listen to the silence. Doug wrote: >Wow, heavy. You mean if this suppression hadn't occurred, we'd be >living under socialism by now? Dear Doug: By your reaction, you are proving Drewk right. And that is not funny. Manuel PS: In fact the important point in Drewk's message was that you can't define *a* physical surplus. How do you measure it? In tons? In litres? In a bundle of commodities so ingeniously arranged that it always corresponds to the weighing of each component in the product? No, definitely you can't add pears and apples. Drewk was not calling for revolution, was he?
Re: RE: Re: Re: marx's proof regarding surplusvalue and profit
Drewk wrote: >The silence about this issue is deafening. > >What's the sound of one side suppressing Marx? You have only to >listen to the silence. Wow, heavy. You mean if this suppression hadn't occurred, we'd be living under socialism by now? Doug
