Two consecutive steps in transformation: from Values to Prices and from Sectoral Rates to a Weighted Common Rate

Melendez-Plumed, Vicenc (2016): Two consecutive steps in transformation: from Values to Prices and from Sectoral Rates to a Weighted Common Rate.

Abstract

Karl Marx in chapter 9 of Capital, Volume III, remove profits from the cost-price of sectors so as to calcultate the production prices. If instead of doing so, we keep them we can obtain a set of production prices at the existing sectoral rates of profit in value terms which are proportional to values. This proportionality, based on the rate of surplus value, is only lost when trying to apply the resulting Marxian (wheigthed) rate of profit to the employed sectoral capitals measured in this proportional production prices. The common rate can only be applied by artificially establishing a price that modifies the common unit of the sectoral values.

• Item Type: MPRA Paper
• Language: English
• Keywords: Sectoral rates of profit in value terms; Rate of surplus value; Production prices; Labour value
• Subjects: B - History of Economic Thought, Methodology, and Heterodox Approaches > B5 - Current Heterodox Approaches > B51 - Socialist ; Marxian ; Sraffian

References

Marx, Karl “Ch. 9: Formation of a General Rate of Profit (Average Rate of Profit) and Transformation of the Values of Commodities into Prices of Production”. Capital. Volume III. https://www.marxists.org/archive/marx/works/1894-c3/ch09.htm