The epistemology of transformation: a criticism of the neoricardianism

ABSTRACT

In the solution of the “transformation problem”, Marx erred in believing that the profit rate determined in the value system was the mediation between values and production prices. This error invalidates Marx’s “doble postulate”, according to which the sum of values equals the sum of prices and the sum of surplus value equals the sum of profits. By using a linear operator from the value system, it is possible to fully determine the average profit rate and the system of production prices. ln this way, we can preserve Marx’s fundamental epistemological postulate, according to which the realm of essence (values) determines the realm of transparent reality (prices).

KEYWORDS:
Transformation problem; value theory; prices