Marx, Sraffa, Rawls and the Limits of Mainstream Economics
Friday, Jan. 6, 2017 3:15 PM – 5:15 PM
- Chair: William McColloch, Keene State College
Time to Bring Sraffa out of the Closet
AbstractThis article argues that it is time for Sraffians to take a moral stand and add a “normative” theory which judges most profits to be unjustifiable to Sraffa’s “positive” theory of price and income determination. Specifically it is argued that what we might call the “fundamental Sraffian theorem” implies a better moral critique of capitalism than the “fundamental Marxist theorem,” and four common justification for profits are rebutted.
Employment in a Just Economy
AbstractThis paper is based on the ideas of political philosopher John Rawls and suggests that in a just economy full employment would have to go beyond the implications of NAIRU. Rawls argues that the just economy is one which would be created behind a veil of ignorance, that is to say, without knowing where we would end up in the society’s distribution of talent and other attributes. If we were to create it from scratch we would not create the kind of labor markets that exist currently, because we would be too concerned about ending up among the excluded, i.e., those without full time jobs which today in the U.S. is still 10% of the labor force or some 15 million adults. This is substantial but it does not even include at least 7 million additional people who have dropped out of the labor force altogether or the 2.3 million in jail! Hence, the “natural” in the natural rate of unemployment is a misnomer, insofar as unemployment does not occur in nature. The concept is especially misleading, because many economists and media commentators inappropriately but invariably equate it with “full” employment as Martin Feldstein did in the January meeting of the American Economic Association. As a consequence, endemic un- and underemployment is accepted as an inevitable attribute of the labor market. This is insidious inasmuch as the concept assumes that the institutional structure of the labor market is held constant. However, with creative restructuring of that market our aim should be to bring unemployment down to the minimum feasible rate which in the U.S. is most likely around 1.2%,--the rate which prevailed in 1944 and which probably represents the lower bound attainable. Instead of the prevailing system, the right to work needs to be recognized as a natural right, because the right to life depends upon it. Several ways are proposed to create an inclusive labor market that distributes the available work in a more equitable fashion than the current system and envisions a just economy that risk-averse people would be willing to enter at random, i.e., without knowing where they would end up in it.
Time, Constant Capital, Accumulation, Sustainability, and Marx's Economic Theory
AbstractIn the Grundrisse, Marx remarked that all economics ultimately reduces itself to an economy of time. In addition, Marx gave great prominence to the subject of the duration of the working day and, even more, by the historical perspective that ran through his whole body of work. Finally, the time required for the turnover of capital is a major factor in the rate of profit. One aspect of Marx's analysis of time was his concept of the "mortal leap." Marx's mortal leap bears some similarity to Keynes's animal spirits; however, Marx's analysis was much deeper than Keynes'. Very little analysis following Marx delved more deeply into the moral leap or into the nature of constant capital. For example, Keynes, as Schumpeter made clear, gave virtually no attention to the question of replacement investment, which reflected technical change and its resulting moral depreciation. The point of this paper is to suggest that the questions surrounding the nature of time in a capitalist economy offer fertile ground for considering Marx's contribution in this matter.
- B3 - History of Economic Thought: Individuals
- B5 - Current Heterodox Approaches