Fabio Petri: Nonsubstitution Theorem, Leontief Model, Netputs: Some Clarifications

Centro Sraffa is pleased to announce that Centro Sraffa Working Paper (CSWP) N. 20, Nonsubstitution Theorem, Leontief Model, Netputs: Some Clarifications, by Fabio Petri, is now online and available for public access at the following link

Abstract

 The nonsubstitution theorem concerns long-period technical choice and relative prices, and was so understood in its first (1951) formulations, but the modern advanced micro textbooks that present it do not make this clear, rendering the theorem impossible to understand for students. These modern presentations derive from a reinterpretation of the Leontief model as a ‘timeless’ economy in Walrasian equilibrium, capable of positive production in spite of zero initial endowments of all inputs except labour: an unacceptable interpretation, made possible by a use of netputs, to describe the economy’s production possibilities, that is illegitimate in this case even from a strictly neoclassical perspective. The notion of a ‘timeless’ economy disappears from the textbook presentations of the Leontief model and of the nonsubstitution theorem, but the result is that the nature of the model and of the prices to which the theorem refers is not clarified, inevitably leaving students utterly confused. This note remembers the true nonsubstitution theorem, points out that it had been correctly enunciated by Samuelson (1961), and suggests that the current inability to present it in a correct way is due to the absence of the notion of long-period prices from the theoretical horizon of contemporary neoclassical value theory. The paper opens with clarifications on the meaning of the Leontief model which prepare the ground for the discussion of the problem with netputs. 

  

You will find all information about past issues of the Centro Sraffa Working Papers, as well as rules for submission and authors' guidelines, on the Centro Sraffa website

Income distribution and the size of the financial sector

por Carlo Panico and Antonio Pinto

 

 

Centro Sraffa is pleased to announce that Centro Sraffa Working Paper (CSWP) N. 15, Income distribution and the size of the financial sector, by Carlo Panico and Antonio Pinto.

 

 
Abstract

The paper deals with the influence of the size of financial industry on income distribution. In opposition to Piketty’s position, it argues that the wage share is influenced by changes in the size of the sectors of the economy, by the input composition of the productive structure and by the ability of the workers to capture the increases in productivity. The process of financialization experienced in the recent decades has affected these three elements. Among other things, it has enhanced the ability of the banking industry to affect the formation of monetary policy and legislation, which in turn can have had some bearing on the workers’ ability to appropriate the increases in productivity. After describing Piketty’s interpretation of the rise in inequality and discuss his views on the theories of distribution, the paper illustrates different representations of the financial sector proposed by the literature, underlining the relevance of considering this sector as an industry. By following these lines the paper describes how an enlarged size of the banking industry can increase inequality.

Resumen

El artículo trata sobre la influencia del tamaño de la industria financiera en la distribución del ingreso. En oposición a la postura de Piketty, se argumenta que la participación de los salarios es influenciada por los cambios en el tamaño de los sectores de la economía, por la composición de inputs de la estructura productiva y por la capacidad de los trabajadores para capturar el aumento de la productividad. El proceso de financiarización experimentado en las recientes décadas ha afectado a estos tres elementos. Entre otras cosas, ha mejorado la capacidad del sector bancario para afectar a la elaboración de la política monetaria y la legislación, que a su vez puede haber tenido algo que ver con la menor capacidad de los trabajadores para apropiarse de los incrementos en la productividad. Después de describir la interpretación de Piketty del aumento de la desigualdad y discutir sus puntos de vista sobre las teorías de la distribución, el trabajo muestra  las diferentes representaciones del sector financiero propuestas por la literatura, subrayando la importancia de considerar a este sector como una industria. Siguiendo estas líneas, el documento describe cómo un gran tamaño de la industria bancaria puede aumentar desigualdad.

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Saverio M. Fratini: A Note on Reswitching and Intertemporal Prices. CSWP 5

Centro Sraffa announces that the Centro Sraffa Working Paper (CSWP) n. 5, A Note on Reswitching and Intertemporal Prices, by Saverio M. Fratini, is now online and available for public access at the following link

 

Bliss (1975) claims that reswitching is nothing but an ‘optical illusion’ due to the exclusion of non‐stationary price sequences from the analysis. The present paper is aimed at developing this point. The standard case for choice of techniques and reswitching is reformulated in terms of Arrow‐Debreu intertemporal prices and the conditions making these prices stationary are highlighted separately. It is then shown that the analysis of the choice of techniques in terms of ‘switch points’ requires the stationary conditions.

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The Centro Sraffa Working Papers (CSWP) are aimed at promoting and disseminating economic research based on the revival and development of the classical approach to value and distribution along the lines developed by Piero Sraffa.

Contributions sharing this perspective are welcome in all fields of economic theory, history of economic thought, policy analysis, economic history and methodological debate.
 For full Statement and Author Guidelines please go to Centro Sraffa Working Papers

Seminar Organised by Centro Sraffa in collaboration with Department of Economics, Roma Tre University

Centro di Ricerche e Documentazione "Piero Sraffa" announces upcoming seminar organised in collaboration with Department of Economics, Roma Tre University

Antonella Stirati (Roma Tre University)
Real wages in the business cycle: an unresolved conflict between theory and facts in mainstream macroeconomics

A. Stirati

Sergio Parrinello 
A search for distinctive features of demand-led growth models (CSWP n. 2)

S. Parrinello

Please, go to www.centrosraffa.org for the complete list of seminars and events at Centro Sraffa.
For further information, please write at the address: centro.sraffa@uniroma3.it
Thursday 5 June 2014, h. 16:00, room 22

Sergio Parrinello: A Search for Distinctive Features of Demand-led Growth Models(CSWP)

Recibimos del Centro Sraffa Working Paper (CSWP) el segundo trabajo, en esta ocasión realizado por  el  profesor Sergio Parrinello.

Abstract

Este trabajo tiene como objetivo una evaluación crítica y constructiva de algunas extensiones del análisis de Keynes de la demanda efectiva a largo plazo y el crecimiento. La crítica se dirige a una interpretación causal única en los modelos de crecimiento de la demanda y de la noción de utilización de la capacidad normal en tales modelos adoptados. Un argumento positivo intenta encontrar una caracterización distintiva de dichas ampliaciones en los términos productivos y financieros que hacen efectivos los cambios autónomos de la demanda agregada. Esto sugiere una noción de utilización de la capacidad normal como un rango de distribuciones de la de utilización normal, en relación con la elección de minimización de costes técnicos y de la persistencia de las expectativas de largo plazo de los precios normales subyacente en las decisiones de inversión. En tal contexto, el análisis de largo plazo con precios normales debería evitar un doble crecimiento estable, donde los precios relativos constantes de los bienes de capital se corresponden con las proporciones constantes entre sus existencias totales.

Abstract

This paper aims at a critical and constructive assessment of some extensions of Keynes’s analysis of effective demand to the long period and growth. A criticism is addressed to a single-cause interpretation of the demand-led growth models and to the notion of normal capacity utilization adopted in such models. A positive argument tries to find a distinctive characterization of those extensions in the productive and financial conditions that make effective the autonomous changes in aggregate demand. It suggests a notion of normal capacity utilization as a range of distributions of normal utilization, related to the cost minimizing choice of techniques and to the persistence of the long term expectations of normal prices underlying the investment decisions. In such a context a long-period analysis with normal prices should avoid a dual steady growth where constant relative prices of capital goods correspond to constant proportions among their total stocks. 

Centro Sraffa is pleased to announce that the Centro Sraffa Working Paper (CSWP) n. 2, A Search for Distinctive Features of Demand-led Growth Models, by Sergio Parrinello, is now online and available for public access at the following link:
  The Centro Sraffa Working Papers (CSWP) are aimed at promoting and disseminating economic research based on the revival and development of the classical approach to value and distribution along the lines developed by Piero Sraffa.

Contributions sharing this perspective are welcome in all fields of economic theory, history of economic thought, policy analysis, economic history and methodological debate.
 For full Statement and Author Guidelines go to 

http://www.centrosraffa.org/centrosraffaworkingpapers.aspx

Andrea Ginzburg: Two translators: Gramsci and Sraffa (CSWP)

Recibimos del Centro Sraffa Working Paper (CSWP) un muy interesante trabajo de Andrea Ginzburg :

 Two translators: Gramsci and Sraffa

Abstract

"A través de los Cuadernos de la Cárcel y los escritos dejados por Sraffa, es posible intentar una reconstrucción de las trayectorias intelectuales tomadas por los dos autores y descubrir convergencias inesperadas, así como las diferencias obvias. El concepto clave aquí empleado es el de la "traducibilidad de los lenguajes científicos '. A partir de este concepto, Boothman ha argumentado, que se detiene el carácter "abierto" del marxismo de Gramsci. El tema de la traducibilidad de las lenguas está también presente en Sraffa: en las notas escritas  después del importante punto de inflexión teórico del verano de 1927 donde declara su intención de escribir un libro que consistirá en la traducción de Marx al Ingles, que reside en la traducción de la "metafísica" de Hegel en la de Hume. Se puede demostrar que esas cuestiones tienen una importancia destacada en el pensamiento de Gramsci y que nos ayudará a entender el significado y la importancia de la Producción de Mercancías por Medio de Mercancías".