Re: LTV

[Bruce McFarling <ecbm@xxxxxxxxxxxxxxxxxxx>]

On Wed, 22 Nov 2000 22:32:30 -0500 (Eastern Standard Time),
"Alan G. Isaac" <aisaac@xxxxxxxxxxxx> wrote, under the title,
"Re: LTV":

>There are actually many parallel questions that
>have been asked, since there is no single LTV
>out there. (Which is also telling, btw.)
>The LTV as a theory of price determination
>can be developed under very restrictive conditions
>but despite some rescue attempts is pretty clearly
>useless. (See the cases I listed in my post to
>Barkley.) This led to a series of defensive tactics,
>wherein the LTV was redefined *not* to be a theory
>of price determination by of something else.

But what about people who believe that defining a
theory of value to be a theory of price is IN THE
FIRST INSTANCE a redefinition of the idea of a "theory
of value".  After all, the whole idea of "exploitation"
of labour involves the notion of the price that "should"
be charged and where the income accruing "should" be
allocated.

In short the argument, which is the attractive one on
the ground in many nooks and crannies of developing
countries, that the labour values do not correspond to
market prices because there are thieves running the
show, and the discrepency reflects the differing success
rates for different thieves.

After all, it seems to have been partly in answer to the
*simplified* understanding of the LTV that the
neoclassical theory of value was developed, in which
factors of production in a freely competitive market system
receive as a reward the value that they contribute to
production, and discrepencies are either the transitory
reward to entrepreneurs who guess well or the durable
result of interference with the freely operating market
system.

The difficulties in pinning down the relation between
labour value and prices, and hence pinning down the
"magnitude of the theft" are real, because the LTV
shares all the problems of any theory of value that
treat the contribution of factors as if they had a
seperable value that sums to the value of the product.
But a Labour Theory of Price was a dead end from the
beginning, except in the sense of a mark-up over
the wage bill, and I don't think that backing out of
this dead end should be characterised as a redefinition
of the original question.  It seems more like a
redefinition of the morass that the original question
had evolved into.

>The one ``something else'' that had some possible
>claim to plausibility, in my view, is long run
>relative prices. But (again see my post to Barkley)
>you have to give up a lot of the economy to go
>this route.


Virtually,

Bruce McFarling, Shortland, NSW
ecbm@xxxxxxxxxxxxxxxxxxx