Dispelling arguments against our work –but not in a polemical way
We want to dispel some arguments against our work (here or here), but we want to clarify that we take them seriously, and we assume them as real possibilities for us to rectify whatever is needed to rectify, or not, etc.
- We’re proposing a paper against the ‘center of gravity’ argument, and we’re proposing a paper which purportedly unites Marx and Walras. How is this possible? First of all, I would ask the scientific Marxist economist community to do the actual math. It’s all I ask. I didn’t started off from an a priori hypothesis to be confirmed or adjusted in a ad hoc manner, for example. I entered empirical investigation to only then conclude results a posteriori.
- What we obtained working through Marx’s own arithmetic formulas on vol 3 (which is important, for example, on the percentage form or decimal form of the profit rate, which does give you different results in terms of the equality between market prices and prices of production –the equality would be broken if you use the one digit decimal- this mathematical difference is only minor in relation to the profit rate –whether you use the full decimal or the one digit decimal, it is still the same profit rate, this is true- but in terms of prices it does changes everything, and saying otherwise is not getting the point at all –or not doing the actual math at all-. It is not a minor aspect that this difference is precisely the difference between Marx’s own math, and current nowadays contemporary Marxist mathematics…), was that there’s no ‘center of gravity’: whether labor time, or value understood as labor time expressed in money terms, or even prices of production or market prices, all of this which are, up to a point, candidates within the Marxist community to be centers of gravitation for prices. We found a third magnitude which even extracts surplus value from market prices, and so the dual gravitation or gravitation in itself becomes highly problematic: just like there’s no correspondence between labor time and surplus value and variable capital on Ramos’ MELT, there’s no correspondence (in terms of magnitudes, of course) between all of these concepts and prices. There’s no absolute identity, and so magnitudes are mobile and not fixed at all (which is what a Ricardian would want). This goes counter and against walrasian equilibrium, which we don’t purport for Marx to ever have acknowledged nor accepted nor proposed at all. Marx uses the category or word equilibrium, but by this he meant (we think, of course, in our opinion) the ceteris paribus of satisfied supply-demand which is even an abstraction by Marx, and which doesn’t even exist in Marx’s economics itself precisely because of the manifestation of overproduction and underconsumption itself. It's just the complementary necessity between production and realization. This small notes are not about crises, so we will just mention that without entering in a systematic explanation of the workings of supply and demand, but this is the main point we want to make: Marx’s does uses the word equilibrium, but he uses it just like the phrase ‘center of gravity’, as a metaphorical and pedagogical tool, and not as neoclassical equilibrium at all.
- And we aren’t using it in the neoclassical way either: we’re saying that walrasian correlative movements, oscillatons and ‘equilibriums’ can be applied even way more deeply and beyond the walrasian framework itself, in this case, in terms of relative magnitudes and prices (as we already said in our original blogpost). There’s no constant, there’s no center, but there’s a relative oscillation admitted in Marx on prices, precisely, in his value-form chapter added to the later editions of vol. 1 of Capital. There’s a supply and demand in Marx, but its simply not neoclassical, just as there’s an equilibrium, and its not neoclassical either. The best formulation is not the one about a center of gravity, but Schumpeter’s formulation (taken as a pedagogical metaphor, and notas Schumpeter’s economics at all): all magnitudes and variables are mobile and move around each other, instead of around a ‘center’. This goes against any form of constant and walrasian static or dynamic equilibrium (even in a marshallian reformulation, etc).
- So we’re not saying Mongiovi’s argument about profit rates being constants and the need for prices of production and market prices to always be the same (they're not, and they're different magnitudes all the time, against any ricardianism). In terms of the profit rate, prices of production and market prices may differ by using any decimal at all, but in terms of the equality between market prices and production prices, and their determinations in value and profit appropriation according to unequal and heterogeneous organic compositions, the difference is completely pertinent and imperative.
