Re: on money

[Rakesh Bhandari <rakeshb@xxxxxxxxxxxx>]

In reply to Andrew T

> Rakesh.
> Where has it been demonstrated that money hoarding is inconsistent
> with a Sraffian system? As I read it, the Sraffian price equations
> are established with quantities given.

That giveness, that reification of course is a mistake in my opinion
as it  effaces the source of the output quantity and the surplus;
outputs are never given but result from on the ongoing struggle over
the length and intensity of the working day. The output quantity is
an index of the battle over the working day, and thus cannot be
conceptually divorced from labor value.

Marx after  all criticized Ricardo for forgetting that though the
technical means  for surplus labor may exist, that does not make
surplus labor exist  in reality. "For this to occur, the labourer
must be compelled to  work in excess of [necessary] time, and this
compulsion exerted by
capital. This is missing in Ricardo's [and Sraffa's workrb] and
therefore the whole struggle over the regulation of the normal
working day."
TSVII, p. 406 I think this quote has been unduly ignored.

The technical conditions (or a blueprint thereof) do not themselves
yield a surplus--only the possibility thereof; for that  to occur
there  must be unpaid alienated living labor time and labor values
have to be brought in to understand the real process, as Shaikh puts
it.

http://archives.econ.utah.edu/archives/ope-l/2002m06/msg00089.htm


>  This leaves open the way in which the quantity of output is
> determined, depending upon aggregate demand and money. If money is
> hoarded this will impact upon aggregate demand and generates the
> possibility of criss, as developed by Marx in Theories of Surplus
> Value. The numeraire may be something of a red herring.
> Andrew (Trigg)



I don't agree that the emphasizing of the difference between money
and numeraire is a divagation. A condition of possibility of a
general crisis is that economy be a monetary one; a monetary economy
is not a numeraire economy. The difference between money and
numeraire has to be articulated if one wants to establish the
conditions of possibility of a general crisis. I agree, as Edward
Nell has said, that the Sraffian price equations are not committed to
full employment and that they are compatible with Keynesian
unemployment equilibrium. But this does not mean that they actually
establish the possibility thereof  in the structure of an economy
which is modelled after all without money and thus without capitalist
exchange and without  monetary uncertainty. I believe that Paul
Davidson over on the post keynesian list serve  reached the same
conclusion a long time ago. He had some tussle with Gary Mongiovi in
that part of cyber space. Marx's labor theory of value is not a pure
production model; it has what he calls a qualitative side or what
Fred M and others call a value theoretic explanation of the necessity
of money, of what money has to represent in a commodity producing
society. As John Weeks and others have shown, Marx theory of labor
value and theory of money are intrinsically intertwined. This is only
one way in which Marx represents a rupture from the classical
economists. Moishe Postone has explored others.

Max Adler too but his analysis of the value form has yet to be
assimilated into Anglo Marxism. I understand the thrust as follows:



Adam Smith recognized that objects exchange due to the division of
labor. Marx then asks not only why did this division of labor arise
but also whose labor is it that is divided.
To the latter question Marx answered that it society's labor that is divided.
So then we understand that while Smith argued that exchange of
commodities is an exchange of equal quantities of labor, Marx
analyzes the situation further to show that this labor is not
personal or invididual labor but a social substance, some aliquot of
the labor at the disposal of a society.

So what does it mean to say that social labor is a substance? It
means that individuals producing in society is the starting point,
that production by a Robinsonade individual outside society is just
as much an absurdity as the idea that language could develop without
people living and speaking together. It is a recognition that men
must associate and depend on each other and more to the point depend
on social production. Man is in short a zoon politikon. This is the
starting point (it may even be understood as a transcedental
condition as Max Adler argued).

It is thus society that has labor time at its disposal and that
depends on social labor for its reproduction just as the individual
depends on society for her consciousness, individuation and
reproduction: the individual activity of every single person is only
a mode of functioning of the species, and it is this social and
abstractly general labor time that is expressed by way of its
products in the exchange relationship.


Yours, Rakesh