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The Other Sraffa - Surprises in the Archive?

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h) Stefano Perri (University of Macerata, Italy)
The Standard System and the Tendency of the (Maximum) Rate of Profit to Fall. Marx and Sraffa: There and Back

The Standard System was presented by Sraffa, in Production of Commodities by Means of Commodities as a "purely auxiliary construction", as far as the determination of the relative prices and the relation between the wage rate (actually, the wage share) and the rate of profit are concerned. However it plays also an important role in Sraffa's interpretation and reconstruction of the Classical and Marxian economic theory. Sraffa himself, after the publication of Production of Commodities by Means of Commodities, underlined that the Standard System is the analytical solution both of Ricardo's invariable measure and Marx's transformation of value into prices.

The Standard Relation between the wages and the rate of profit shows that the latter depends, from the one hand, on the relation between the value of the net product and the value of capital and, from the other hand, on the wage share of the net product. The Standard System is a construction based on the real system where changes in the distribution of surplus do not cause the relation between the net product and the value of capital to vary. In this framework Sraffa compared the Standard System to Ricardo's invariable measure and Marx's sector with an average organic composition of capital. In this paper it is shown that Sraffa's construction is more suited to play the role of Marx's average sector rather than the role of Ricardo?s invariable measure.

The Standard Relation is discussed in Production of Commodity by Means of Commodity in a static framework, i.e. with regard to the analysis of the changes in distribution of a given surplus. However, during the 1940s Sraffa strongly rejected Bortkiewicz's critique of Marx's theory of the falling rate of profit. In other words, Sraffa supported the analytical aspect (although not the historical perspective) of Marx's theory, However, when writing his notes, Sraffa believed that even in the "real" system the relation between surplus and capital does not vary when the distribution of income changes. This paper shows that the Standard Commodity can be used to analyse the dynamic problem of the falling rate of profit. In fact, it shows that when the relation between the value of constant capital and the direct labour employed increases, the maximum rate of profit of the economic system falls, even when we drop the "hypothesis" of the independence from the distribution of income of the ratio between net product and capital. It aims to reconstruct how Sraffa would have developed his ideas about the Marxian law of the falling rate of profit if he had written his notes again after the publication of Production of Commodities by Means of Commodities.

INTERNATIONAL CONFERENCE
sponsored by
Department of Economics
Faculty of Economics
University of Bergamo

THE OTHER SRAFFA. SURPRISES IN THE ARCHIVE?

December 21-22, 2010
aula 3, via Salvecchio 19
University of Bergamo - Bergamo Alta, Italy