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The transformation of values into prices on the basis of random systems revisited

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  • Bertram Schefold

    (Goethe-Universität)

Abstract

The paper first defends the importance of the transformation of values into prices on the basis of textual analysis against those who believe that Marxian economics can dispense with prices of production and should be built on values and market prices only, or that the theory of the forms of value matters just for commodities, not for capital, or that one should only have prices of production, forgetting about values. It is shown that P = M is the lynchpin of the Marxian system, regarding the theory of the forms of value as well as the theories of exploitation and accumulation. Second, two proofs of the equality of the mass of profits P and total surplus value M are presented on the basis of random systems. This transformation is compared with Sraffa’s use of the standard commodity for the transformation of values into prices. The third part concerns the interpretation of these results in the light of the fact that Marxian economics hinges on P = M, but that the assumption of random systems is more narrow than the conditions regarded as necessary by Marx or Engels and broader than modern critics, from Bortkiewicz to Sraffa, thought.

Suggested Citation

  • Bertram Schefold, 2019. "The transformation of values into prices on the basis of random systems revisited," Evolutionary and Institutional Economics Review, Springer, vol. 16(2), pages 261-302, December.
    • Handle: RePEc:spr:eaiere:v:16:y:2019:i:2:d:10.1007_s40844-019-00140-6
    DOI: 10.1007/s40844-019-00140-6
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    References listed on IDEAS

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    1. Roberto Veneziani & Luca Zamparelli & Simon Mohun & Roberto Veneziani, 2017. "Value, Price, And Exploitation: The Logic Of The Transformation Problem," Journal of Economic Surveys, Wiley Blackwell, vol. 31(5), pages 1387-1420, December.
    2. Shaikh, Anwar, 2016. "Capitalism: Competition, Conflict, Crises," OUP Catalogue, Oxford University Press, number 9780199390632.
    3. Bertram Schefold, 2013. "Approximate surrogate production functions," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 37(5), pages 1161-1184.
    4. Simon Mohun & Roberto Veneziani, 2017. "Value, Price, And Exploitation: The Logic Of The Transformation Problem," Journal of Economic Surveys, Wiley Blackwell, vol. 31(5), pages 1387-1420, December.
    5. F. Seton, 1957. "The "Transformation Problem"," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 24(3), pages 149-160.
    6. Skourtos, M, 1991. "Corn Models in the Classical Tradition: P. Sraffa Considered Historically," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 15(2), pages 215-228, June.
    7. Quaas, Friedrun, 1994. "Wolfgang Muhlpfordt and the "Transformation Problem": Some Remarks on Articles by Howard and King and Gilibert," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 18(3), pages 323-326, June.
    8. Christian Gehrke & Heinz D. Kurz, 2018. "Sraffa’s Constructive and Interpretive Work, and Marx," Review of Political Economy, Taylor & Francis Journals, vol. 30(3), pages 428-442, July.
    9. Bertram Schefold, 2016. "Profits equal surplus value on average and the significance of this result for the Marxian theory of accumulationBeing a new contribution to Engels’ Prize Essay Competition, based on random matrices a," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 40(1), pages 165-199.
    10. Christian Bidard & Guido Erreygers, 2007. "Potron and the Perron-Frobenius Theorem," Economic Systems Research, Taylor & Francis Journals, vol. 19(4), pages 439-452.
    11. M. C. Howard & J. E. King, 1987. "Friedrich Engels and the Prize Essay Competition in the Marxian Theory of Value," History of Political Economy, Duke University Press, vol. 19(4), pages 571-589, Winter.
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    Citations

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    Cited by:

    1. Kenji Mori, 2019. "A comparison of the stochastic approach to the transformation problem with Marx’s original assumptions," Evolutionary and Institutional Economics Review, Springer, vol. 16(2), pages 315-317, December.
    2. Schefold, Bertram, 2022. "What Remains of the Cambridge Critique? Potential Conclusions and Directions for Further Research Following from Recent Investigations in Capital Theory," Centro Sraffa Working Papers CSWP53, Centro di Ricerche e Documentazione "Piero Sraffa".
    3. Luis Daniel Torres-González, 2020. "The Characteristics of the Productive Structure Behind the Empirical Regularities in Production Prices Curves," Working Papers 2016, New School for Social Research, Department of Economics.
    4. Tsoulfidis, Lefteris, 2021. "Capital Theory Debates: New Developments and Direction," Centro Sraffa Working Papers CSWP51, Centro di Ricerche e Documentazione "Piero Sraffa".
    5. Kiichiro Yagi, 2021. "Special feature: promenade in the history of economic thought," Evolutionary and Institutional Economics Review, Springer, vol. 18(2), pages 463-464, September.
    6. Bertram Schefold, 2021. "The transformation of values into prices on the basis of random systems revisited: reply to my commentators," Evolutionary and Institutional Economics Review, Springer, vol. 18(1), pages 317-334, April.
    7. Torres-González, Luis Daniel, 2022. "The Characteristics of the Productive Structure Behind the Empirical Regularities in Production Prices Curves," Structural Change and Economic Dynamics, Elsevier, vol. 62(C), pages 622-659.
    8. Jacobo Ferrer-Hernández & Luis Daniel Torres-González, 2021. "Eigenvalues and Eigenlabors: On Iliadi’s, Mariolis’, Soklis’, and Tsoulfidis’ Explanation of the Empirical Regularities in Price Curves," Working Papers 2119, New School for Social Research, Department of Economics.
    9. Michael Gaul, 2024. "A Discussion of Marx’s Account of Technical Progress by Means of Wage Curves and Their Historical Evolution," Review of Radical Political Economics, Union for Radical Political Economics, vol. 56(2), pages 267-299, June.

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    More about this item

    Keywords

    Marxian economics; Transformation problem; Labour values; Theory of distribution; Capital theory; Random matrix;
    All these keywords.

    JEL classification:

    • B14 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Socialist; Marxist
    • B24 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Socialist; Marxist; Scraffian
    • B16 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Quantitative and Mathematical
    • C65 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Miscellaneous Mathematical Tools
    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis

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