Yes, I am assuming that the capital good, or commodity, still has a currently valid socially determined use-value. To have exchange-value , a commoidty must have use-value. Without current use-value, there is no exchange-value to relate to price. The costs to the current seller which are based on that obsolete exchange-value cannot underpin the current price. Charles Brown >>> Eugene Coyle <[EMAIL PROTECTED]> 09/01/99 12:07PM >>> The cost to the seller only has some relation to what it can be sold for depends on whether the capital good has been suceeded by new technology and whether the output of the machine is still desired. If technology has moved on, a machine which cost $500 million might now be scrap. Right now, nuclear plants which cost several billion dollars are changing hands in the US for $100 million or less. Of course nuclear has special considerations. Gene Coyle Charles Brown wrote: > Don't the costs to the seller for getting the capital good have some relation to >what the buyer pays for it ? > > Charles Brown > > >>> Michael Perelman <[EMAIL PROTECTED]> 08/31/99 10:57AM >>> > The problem that Ajit ignores is that most capital goods do not have a *price*. For >example, a > specialized piece of capital goods may be specific to my firm. It might have a very >low value for any > other firm or have to be sold for scrap. If an accident destroyed this machine, I >would buy a new one. > > What is its price? The cost of a new machine? Its price on the second hand market, >which is as yet > undetermined? Prices are hard enough to calculate. What is its value? > > Ajit Sinha wrote: > > > I find it hard to believe. If a capital good has no value in the market today, >then of course it > > should be valued at zero dollars. However, all firms do have some market value, >which must be arrived > > at by some estimation of the value of old capital goods today. Cheers, ajit sinha > > > > > > > > > > > Ajit Sinha wrote: > > > > > > > We take the price of the computer today to value the capital stock. What is the > > > > problem with that? Cheers, ajit sinha > > > > > > -- > > > Michael Perelman > > > Economics Department > > > California State University > > > Chico, CA 95929 > > > > > > Tel. 530-898-5321 > > > E-Mail [EMAIL PROTECTED] > > -- > > Michael Perelman > Economics Department > California State University > [EMAIL PROTECTED] > Chico, CA 95929 > 530-898-5321 > fax 530-898-5901
