Content area
Full text
This paper presents an interpretation of the quantitative dimension of Marx's value theory in which prices and values are determined interdependently and within historical time. This interpretation is then shown to refute allegations that his value theory suffers from internal inconsistencies. Among the issues considered are Marx's law of the falling rate of profit, the alleged redundancy of value, value determination under joint production, and the `transformation problem.' The `single-system' interpretation of values and prices as interdependent eliminates the alleged inconsistencies that pertain to magnitude; the 'temporal' interpretation of value and price magnitudes as determined in historical time eliminates the alleged inconsistencies that pertain to determination.
1. The Centrality of the `Internal Inconsistency' Issue
For more than a century, the main line of critique of Marx's value and profit rate theories, coming from both Marxist and non-Marxist economists, has been an internal one. That is, rather than arguing that these theories lack fruitfulness or empirical relevance, the critics have for the most part attempted to show that they suffer from insuperable internal inconsistencies. Indeed, this line of critique makes argumentation superfluous: if Marx's theories are untenable even in their own terms, they must necessarily be revised or rejected. As Brewer (1995, p. 140) has put the point recently,
It might be possible to argue that Capital was a success in Marx's own terms.... Even by this standard, however, Capital must be counted a magnificent failure. ... Much of the debate over Marx's economics has focused on [the internal coherence of his value theory and law of the tendential fall in the profit rate], and for good reason. If both fail, as they do, not much is left.
During the past decade and a half, however, researchers from around the world, often unknown to one another, have been engaged in an elemental rethinking of the issues, out of which a new interpretation of the quantitative dimension of Marx's value theory has begun to crystallize. First dubbed the `temporal single-system' interpretation in Skillman (1995), it vindicates the internal consistency of Marx's most challenged theoretical results without relinquishing his theory's quantitative determinacy or absorbing it into the theories of his critics.' The aims of the present paper are to acquaint a general audience of economists for the...