Temporal Single System Interpretation
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Temporal Single System Interpretation or TSSI refers to a new interpretation of the transformation problem controversy in Marxian economics. TSSI claims Karl Marx was literally correct in his description of the formation of a general rate of profit and the equalisation of profit rates (in Das Kapital Volume 3), and that there are no important logical or mathematical errors in his theory of value. In TSSI it is argued these problems arise only when Marx's text is misinterpreted within the alien theoretical frameworks of general equilibrium theory, comparative statics and linear production theory.
In general, supporters of TSSI claim that they have Marxist orthodoxy on their side, and criticise their opponents for falsifying Marx's own stated intentions, engaging in a sometimes vociferous, politicised debate about the theoretical issues. Indeed, an international academic faction of TSSI sympathisers and supporters has been formed around the journal Critique of Political Economy led by Dr. Andrew Kliman and Dr. Alan Freeman. The most wellknown critics of TSSI are Prof. Duncan K. Foley and Prof. David Laibman (economist and editor of the Marxist journal Science & Society).
The reference to "temporal" conveys that the production and distribution of new product-values according to a set of prices should be analysed in the medium of time, i.e. it occurs through a process of successive mutual adjustments of labour-time, product-values, prices of production and market prices. It is argued that this process cannot be pictured by static equilibrium models. Unlike in "simultaneist" interpretations, prices and values of inputs and outputs of production are not determined at the same time, but sequentially, since it takes time to produce any good.
The reference to "single system" conveys that any time, both values and prices are present in the process, and connected with each other (they are sequentially determined, but in one system). This contrasts with some other interpretations of the transformation problem, according to which separate systems of labour-values and prices are modelled.
Most of the controversy about TSSI revolves around the problem of how the complicated economic processes of a capitalist economy can be both realistically described, and described in a mathematically rigorous way. However, some opponents of TSSI complain that it is impossible to find any intelligible statement of TSSI in plain English.
Supporters of TSSI typically believe that neo-classical economics does not offer any insights or concepts that could be helpful in understanding a capitalist market economy. Consequently any dialogue between Marxian and neo-classical economists is usually regarded as pointless, because the respective viewpoints are incommensurable. Critics of TSSI are typically less willing to abandon a concept of market equilibrium, and consider that at least something can be learnt from equilibrium economics.
[edit] References
- Andrew Kliman's website [1]
- Andrew Kliman, Reclaiming Marx's Capital; a Refutation of the Myth of Inconsistency. Lexington Books, 2007
- Critique of Political Economy [2]
- Research in Political Economy, Vol. 17, 1999. [3]
- Freeman, A., and Carchedi, G. (Eds), Marx and Non-Equilibrium Economics. Edward Elgar, Cheltenham, 1996.
- Duncan Foley, "Review of Carchedi and Freeman (eds.), Marx and Non-Equilibrium Economics" [4]
- David Laibman, Value, Technical Change, and Crisis: Explorations in Marxist Economic Theory. ME Sharpe, 1992.
- R. Dorfman, P. Samuelson, R. Solow, Linear programming and economic analysis, New York 1958
