Production Prices Systems as derived from Labour Values Systems

Melendez-Plumed, Vicenc (2018): Production Prices Systems as derived from Labour Values Systems.

Abstract

Slightly changing Karl Marx procedure to calculate his production prices by keeping surplus value in the price cost of commodities, allows us to envisage a labour values system as a production prices system. The current industry rates of profit, in labour terms, are used in the calculation of these production prices which will be equalized afterwards. This work presents an alternative approach to calculate production prices and the rate of profit based in the eigenvalue and the eigenvector of the Leontief matrix. This allows us to see production prices systems as derived from labour values systems and keeping them proportional. Only after the industry rates of profit equalization occurs, i.e., when a similar remuneration to all capitals has to be assured, will prices differ necessarily from values. Prices and labour values initially form a unique system from which prices become autonomous.

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

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