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Alternative approaches to labor values and prices of production: Theory and evidence

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  • Moraitis, Thanos
  • Basu, Deepankar

Abstract

In this paper, we explore two approaches to estimating classical prices of production: the Standard Interpretation and the New Interpretation of Marx’s value theory. Our study utilizes (a) a circulating capital model using harmonized input–output data from the World Input–Output Database (WIOD) for 37 countries for the period 2000–2014, and (b) a capital stock model for the US economy using input–output and other relevant data for the period 2017–2021. Across all models, we estimate labor values (direct prices), prices of production, and the uniform rate of profit. We test for deviations between direct prices, production prices, and market prices using various measures. Our analysis of the WIOD data reveals significant heterogeneity among countries and an advantage of the NI method over the SI. For the US case, our findings support the empirical relevance of direct prices in market price formation, but our estimated prices of production deviate significantly more from both market and direct prices than reported in the literature.

Suggested Citation

  • Moraitis, Thanos & Basu, Deepankar, 2026. "Alternative approaches to labor values and prices of production: Theory and evidence," Structural Change and Economic Dynamics, Elsevier, vol. 78(C), pages 171-187.
    • Handle: RePEc:eee:streco:v:78:y:2026:i:c:p:171-187
    DOI: 10.1016/j.strueco.2026.03.009
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    JEL classification:

    • B51 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Socialist; Marxian; Sraffian

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