Abstract
After the publication of Production of Commodities by Means of Commodities ( Sraffa, 1960 ), a lot of attention was devoted to ‘reswitching’, that is to the fact that a technique is cost-minimising at two disconnected ranges of the rate of profits and not so in between these ranges. We owe Krishna Bharadwaj (1970, Schweizerische Zeitschrift für Volkswirtschaft und Statistik, 106, 409–429) an important contribution to the debate by stating and proving a general result concerning the maximum number of switches between two techniques that have at least one switch point on the wage-frontier. She proved that the maximum number of switches coincides with the number of distinct commodities, without double counting, that enter directly or indirectly into at least one of the alternative methods of production. This means that if the alternative methods produce a commodity that is basic in both techniques, then non-basics in both techniques play no role in this, whereas if the alternative methods produce a non-basic commodity in at least one technique, then a role is played also by those non-basics that enter directly or indirectly into the production of at least one of the alternative methods of production. JEL Code: B12, B21, B31, B51, D24, D51
Highlights
After the publication of Production of Commodities by Means of Commodities (Sraffa, 1960), a lot of attention was devoted to ‘reswitching’, that is to the fact that a technique is cost-minimising at two disconnected ranges of the rate of profits and not so in between these ranges
An important contribution to the debate by stating and proving a general result concerning the maximum number of switches between two techniques that have at least one switch point on the wage-frontier
She proved that the maximum number of switches coincides with the number of distinct commodities, without double counting, that enter directly or indirectly into at least one of the alternative methods of production
Summary
After the publication of Production of Commodities by Means of Commodities (Sraffa, 1960), a lot of attention was devoted to ‘reswitching’, that is to the fact that a technique is cost-minimising at two disconnected ranges of the rate of profits and not so in between these ranges. This is so not least because whereas in the first period mentioned Marx’s analytical contribution played hardly any role in Sraffa’s constructive work, in the second and partly in the third period it became a major touchstone of his own construction He elaborated his own argument in terms of a close scrutiny of Marx’s labour-value based theory of the rate of profits and prices of production and was keen to see how far it got one and why in the end it could not be sustained. It is only in systems with a surplus that more than one type of products can possibly play a role, because in the no-surplus economy all products are needed directly or indirectly in the production of all products, that is, are basics as Sraffa later called them.
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