Sraffa’s Explanation of Money Price

Howard Nicholas ()
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Howard Nicholas: Erasmus University Rotterdam

Chapter Chapter 5 in Explorations in Marx’s Theory of Price—Why Marx Is Still Relevant for Understanding the Modern Economy, 2023, pp 123-159 from Palgrave Macmillan

Abstract: Abstract In this chapter I outline and critically evaluate Piero Sraffa’s implicit explanation of the money price of a commodity from the perspective of Marx’s analysis, noting at the outset that Sraffa did not leave behind an explicit explanation of the money price of a commodity in any of his major works. The basic argument I develop is that Sraffa’s conception of the value of the commodity causes him to have an illogical and counterintuitive implicit explanation of the money price of a commodity. It requires him to explain the relative money price of the commodity by the relative quantity of commodity inputs denominated in terms of an artificially constructed numéraire commodity, the Standard commodity, and the aggregate money price level by the quantity of money used to facilitate the exchange of commodities for one another relative to the quantity of these commodities as a composite. This in turn requires him to illogically see changes in relative money prices taking place independently of changes in aggregate money prices and, counterintuitively, deny the influence of the productivity of labour on both the relative money prices of commodities and aggregate money price level.

Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-56564-8_5

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DOI: 10.1057/978-1-137-56564-8_5

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