Introduction

My aim in this chapter is to re-intepret Marxian economics from the vantage point of the theory of labor-value developed in Chapter 9, which I consider a reformation of Marx’s own theory by means of logical tools that were not avail­able in Marx’s time.

Classical economics is a sophisticated dynamic theory of capitalism that ana­lyzes the motions of the different factors and their causal relationships. This anal­ysis is carried out against the background of a system of production prices taken as fixed until the forces of the economy generate a new system of production prices. The prevailing system of production prices is not necessarily the system of market prices as observed in the public square, but rather a sort of ‘theoretical’ structure around which the market prices ‘oscillate’. These production prices are constituents of what I shall call a classical equilibrium, namely a reproducible state of the economy. Clearly, the theory does not claim that the economy is ever found in such a state, but only that it “moves around” that equilibrium, which is subject to constant strain. The equilibrium price is analogous to what dynamic theory calls a “sink”.

In developed capitalism, the action of the investors in the financial markets seeking the highest returns for their capitals - this process is called ‘arbitrage’ - unleashes a tendency to the establishment of a uniform rate of profit. The level of this rate depends upon many factors like the strength of the trade unions, the scarcity of labor for certain industries, the political risks, and so on: it is the unin­tended consequence of the actions of many agents, and also of natural forces.

As Theorem 9.3.2 suggests, once a technology and uniform rate of profit (a system of production prices) is established, and acquires certain stability, it induces an abstract labor relation among the different expenditures of labor inputs, and a corresponding reduction of the heterogeneous labors, giving certain weights to the different tasks. These weights or ponderations determine the equilibrium wages up to some positive scaling. This scaling is not arbitrary but has a maximum, as well as a minimum level determined by the reduction: the abstract labor relation sets the range within which the level of the salaries can move in equilibrium. What this means is that, keeping the technology, as well as the relative prices unchanged, the profit rate can move only within a certain range. In order to prove this, which is nothing but the fundamental Marxian theorem, we need some previous definitions.

10.2