The Peschian Value Paradox: A Key to the Function of Vocational Groups

Abstract

To commemorate the twenty-fifth anniversary of the death of Hein? rich Pesch, I have chosen to present in brief outline the value theory of this famous Catholic economist.1 It has particular interest for us today, since we are commemorating also the anniversaries of the great ency? clicals, Rerum Novarum and Quadragesimo Anno. It is my belief that Heinrich Pesch's Lehrbuch der National?konomie2 can be called a com? mentary the former and the source book of the latter encyclical. I hope that this paper will indicate that an understanding of Pesch's theory of value and the related theory of markets contributes to an un? derstanding of the problem?which is the concern of Catholic scholars today?of the price function of the Vocational Groups, the organization of society so strongly recommended in Quadragesimo Anno. I. The Competitive Price the Optimum We might well sum up this German Jesuit's value theory in the para? dox: the competitive price is the optimum; but competition leads to a divergence from this optimum. That the competitive price is the optimum is a fundamental proposi? tion of almost every brand of economics. In recent years this classical heritage has been forged Lange and others into an essential tool of socialistic economics. Heinrich Pesch, too, has made this economic dic? tum a focal point of his price theory. For example, in the treatise value it is stated that demand and supply by their competition are able to bring about such a of value, which most corresponds to the fundamentals of objective determination (1, 49). More speci? fically, in the treatise price it is claimed on the supposition of nor? mal conditions, this whole process of trial-and-error in the determina? tion of market price will lead to the approximately correct result; the market price can be considered as the approximate value with reference to the objective factors ultimately determining the exchange value . (V, 37). Finally, the competitive price is shown to equal the just price,