On the Exposition of the Transformation of Commodity-Values into Production Prices in the Third Volume of <i>Capital</i>—A Textual Analysis

Abstract

The article is about the exposition of the Karl Marx’s concept of production prices in his main work Capital. It focuses on the structure of the central text in question, Chapter 9 of the third volume, on “transformation [Verwandlung] of commodity-values into production prices”. The actual content and structure of the chapter has to some degree been overlooked or distorted in the literature. The aim of the article is to establish (or re-establish) a sound view of the chapter, freed from prejudices nurtured by—especially—a theory of price formation which, albeit “modernized” by i.a. Walras, dates back to Steuart and Ricardo. These prejudices have had an immense significance for misunderstandings of the Marxian theory of measure of value and standard of prices reflected in the text of the chapter mentioned. For this reason, the article is furnished with an Appendix, underlining the difficult situation for Marxist-minded research today. It should be noted that it is not an objective of the article to discuss any extant interpretation of Marx’s exposition. However, the paradigm of criticism that was introduced early in the 20th century by Ladislaus von Bortkiewicz is used as a perspective. Specific references—other than to Marx’s own texts—are held at a minimum in the article proper. I have chosen such a mode of approach because I find that misunderstandings of the chapter are evenly distributed among authors regardless of how their views on the “transformation” collide. On the other hand, such a consciousness of “misunderstandings” among commentators certainly does imply that the author should at least shortly clarify his own view of the main problems in the paradigmatic criticism mentioned above. In the first section, I point out the importance of Marx’s way of presenting his concept of the composition of capital. In the next, I make some remarks on the concept of the socially necessary labour time and its relation to abstract labour. In the third and fourth, I investigate Marx’s different models of analysis. In the fifth section, it will be shown how Marx, contrary to contentions of traditional criticism, but in harmony with his treatment of the capital composition and necessary labour time, is operating with a double point of departure: He treats the inputs of a production period as given as values, i.e. as individual use value-entities; paralleling this, he treats them as transformed to production prices. There follows a sixth section, where I point out the core of the critique that Bortkiewicz presented of the chapter, focusing on the need for a uniform expression of economic denominations. Since Bortkiewicz’s criticism contained all the important germs to the objections against Marx refuted in my article, this section also serves to spread light over the rest of my argument. After the overview mentioned above, I round off with a summary.