Between Sraffa and Marx: Pasinetti and the New Interpretation of the Labour Theory of Value

The contribution examines value production and income distribution within Marx’s theoretical framework, emphasizing the methodological approach initiated by Pasinetti. Our analysis begins with a re-reading of Classical theories articulated in the analytical languages of von Neumann, Leontief, and Sraffa. Pasinetti offers an analytically coherent solution to the ‘problem of the transformation of values into prices of production.’ By reformulating Pasinetti’s linear transformation in accordance with several key assumptions from Sraffa, we highlight the central points of contention surrounding the new macroeconomic interpretation of Marx’s value theory and its relationship with Sraffa’s price system. We will discuss three points: i. Sraffa’s notion of the ‘proportional wage’ and the New Interpretation’s concept of wage as ‘unallocated purchasing power’ are founded on a relationship between the wage share of the net product and the rate of profit that remains independent of prices; ii. the equality between value added and labour employed is not an arbitrary choice but a substantive condition; iii. Pasinetti’s transformation procedure, consistent with the macroeconomic perspective of value based on Sraffa and the New Interpretation, underlines the significance of the labour category in the creation of new value as derived from his theoretical construct of the ‘natural economic system.’