Gil concludes his long response to Ajit with the following: Thus, as I'verepeatedly shown, one can make the same (valid) political economic points within the Walrasian framework that one can make within the Sraffian >framework, with the important difference that the former is arguably more >descriptive of capitalist reality--markets for labor power and capital do, >in fact, exist. So far as I can tell, nothing Ajit has said here changes >that assessment. > >In solidarity, Gil I generally agreed with most of the points Gil was making regarding the Arrow-Debreu framework, but I am baffled a bit on two counts by these last comments. First, with regards to making the same (valid) political economic points in both the A-D and Sraffian systems - do you think Gil that the A-D world can meaningfully articulate an economic system where a surplus (and hence exploitation) exists as an equilibrium result? Before you mention Roemer and his notion of exploitation as unequal labor exchange, which I understand, I wonder if you would explain how an A-D neoclassical would feel comfortable with an economic surplus as an equilbrium result, and therefore a profit opportunity that paradoxically is not being taken advantage of in equilbrium? That a Sraffian can feel comfrotable with such a result seems to me to imply at least some political differences. Second, I know no economic theorist who would claim that the A-D model is at all an attempt at descriptive reality. That is not the purpose of the research program. Instead, the purpose is to raise certain counterfactual questions about potential equilibria that can be evaluated for their Pareto optimality or not. The approach is to find SUFFICIENT conditions for certain results to be logically examined. Mostly, as Frank Hahn has argued so forcefully (Ie, in his short book _On Equilibrium_), this research provides a negative heuristic for outlandish claims for the superiority of free markets, etc. Whether the intellectual energy that has gone into this research is worth the results, is another question of course. The Sraffian approach to GE is a bit different. It begins by saying given certain input coefficients and usually a real wage bundle, then what, if any, are the NECESSARY prices and profit rate rate, that are entailed by such data, given the added economic condition that the profit rate is positive and equal. And then, let's investigate what happens to these prices and profit rate as certain data are changed or new conditions introduced. Steve *********************************************** Stephen Cullenberg office: (909) 787-5037, ext. 1573 Department of Economics fax: (909) 787-5685 University of California [EMAIL PROTECTED] Riverside, CA 92521 http://www.ucr.edu/CHSS/depts/econ/sc.htm
