Critique of Capitalist Price Theory

[RedMaterialist]

I was reading Wage, Labor and Capital recently and came across Marx's statement about price being the cost of production, which, I believe, was also the classical explanation of price. Price is the total cost of production, but does not include the part of the cost not paid by the capitalist. The difference is profit or the surplus value added by the worker or working class.

The neo-classicals, starting with Jevon, Marshall and carrying through with Mankiw, et al., of course do not admit that the worker produces anything without getting paid for it. They say that price is determined by the paid cost of production, plus the risk of the capitalist, the marginal utility of the product to the consumer, and now, the "opportunity cost" of production.

It doesn't seem to me that any of these neo-classical theories have ever been proven with real scientific data, in fact, the last theory, opportunity cost, is admitted as not being able to be quantified under any accounting analysis. They say it is an economic cost but not an accounting cost, in other words, it can't be accounted for.

I was curious if any socialist economist has ever specifically attacked these neo-classical theories or if someone on this this thread could direct me to any books specifically on this issue.

Thanks.

[cyu]

do not admit that the worker produces anything without getting paid for it.


Interesting that property protection for the capitalist provides value to the capitalist, yet employees help in funding their own oppression.

[argeiphontes]

Well, they are merely internally consistent tautologies based on a particular ideology. IMO. Kliman and Freeman's Temporal Single-System Interpretation (TSSI) rehabilitates all results obtained by Marx, so Marxian econ is also internally consistent. But that's not the question you're asking.

I haven't come up with anything concrete, but I'll keep looking into it when I get the hankering. Some places to do research, though:

EconPapers: http://econpapers.repec.org/RAS/pfr102.htm (points to Alan Freeman)
Monthly Review: http://monthlyreview.org/
Union for Radical Political Economics: http://www.urpe.org/about/abouthome.html
(their journal isn't free-access so you need an institutional login for most or all work)
Andrew Kliman's Homepage: http://akliman.squarespace.com/
Kapitalism101: https://kapitalism101.wordpress.com/
Google search results for "Marxist critique of marginalism": http://scholar.google.com/scholar?q=marxist+critique+of+marginalism&hl=en&as_sdt=0&as_vis=1&oi=scholart&sa=X&ei=rrafUuyjD63ksASxkIHgDw&ved=0CCkQgQMwAA

Have at it! ;)

[Vilhelmo]

I was reading Wage, Labor and Capital recently and came across Marx's statement about price being the cost of production, which, I believe, was also the classical explanation of price. Price is the total cost of production, but does not include the part of the cost not paid by the capitalist. The difference is profit or the surplus value added by the worker or working class.

It was my understanding that "price" simply meant the market price while "value" meant the technologically necessary costs of production & the difference between "price" & "value" was "Economic Rent", a form of "unearned income".


I was curious if any socialist economist has ever specifically attacked these neo-classical theories or if someone on this this thread could direct me to any books specifically on this issue.


Classical economists distinguished between "earned income", derived from labour, & "unearned income" derived from privilege.
Neo- or Anti-classicals deem all income equally earned regardless of how it was acquired.
Both views involve a moral judgment.

Whereas Feudalism rewarded privilege, Capitalism was supposed to reward work.

I highly recommend the work of Michael Hudson.

[Dodo]

I have a question about this as well. What is the modern Marxist counter arguments for "subjectivist value theories" as opposed to "labor theory of value" ? I do not think Marx's political economic theories are important and that much relevant to today(Marxism to me is his method)