Demystifying Sraffa’s Theory of Value in the Light of Arrow and Debreu
AbstractThis paper compares the models of Arrow and Debreu  and Sraffa , and concludes that (1) the models are informationally distinct conceptions of a capitalist economy, (2) they support radically distinct – though complete and entirely correct – theories of value, (3) the prices in the two theories are different both in terms of definitions and values, (4) in Sraffa‘s model it is impossible to define constant returns to scale, while in Arrow-Debreu this property is admissible, and (5) in Arrow-Debreu the interpersonal income distribution is determined whereas in Srafa‘s model the distribution of income between workers and capitalists is undetermined.
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Bibliographic InfoPaper provided by Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung) in its series MAGKS Papers on Economics with number 201150.
Length: 21 pages
Date of creation: 2011
Date of revision:
Publication status: Forthcoming in
constant returns to scale; theory of value; relations of production; counterfactual information; prices; exchange values; income distribution; general equilibrium; capital; marginal product;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-12-13 (All new papers)
- NEP-HME-2011-12-13 (Heterodox Microeconomics)
- NEP-PKE-2011-12-13 (Post Keynesian Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Samuelson, Paul A. & Etula, Erkko M., 2006. "Testing to confirm that Leontief-Sraffa matrix equations for input/output must obey constancy of returns to scale," Economics Letters, Elsevier, vol. 90(2), pages 183-188, February.
- Kurz,Heinz D. & Salvadori,Neri, 1995.
"Theory of Production,"
Cambridge University Press, number 9780521443258, October.
- Naqvi, Nadeem, 2007. "Constant returns to scale and economic theories of value," MPRA Paper 5306, University Library of Munich, Germany.
- Hahn, Frank, 1982. "The Neo-Ricardians," Cambridge Journal of Economics, Oxford University Press, vol. 6(4), pages 353-74, December.
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