Mark Blaug on the "Sraffian Interpretation of the Surplus Approach"

In a paper published in HOPE Mark Blaug (1999) has put forward a critical assessment of Piero Sraffa's interpretation of the classical economists and the literature inspired by it, including some of our works (Kurz and Salvadori 1995, 1998a, 1998b). Due to space constraints we can offer only a summary of some of our arguments in response. For obvious reasons we must essentially proceed in terms of assertive statements. The reader interested in the full argument and the evidence from the writings of the classical authors in its support is invited to visit our home pages and click on the link to “Understanding ‘Classical' Economics: A Reply to Mark Blaug” (Kurz and Salvadori 2000). We begin with a few preliminaries (section 1) and then turn to the “Sraffian” and Blaug's alternative interpretation of the classical approach to the theory of value and distribution (sections 2 and 3).

1. Preliminaries

First, Blaug's exposition is organized around the distinction between “rational” and “historical” reconstructions (213). We do not find his definitions of the two concepts useful and observe that he himself does not employ his definitions in a consistent manner and quickly distances himself from the maxim he proposes.¹ We agree with Blaug that any interpretation of earlier authors should be faithful to what these authors wrote. The question then is how the Sraffian interpretation, or any of the competing interpretations, including Blaug's, fares vis-à-vis this criterion (see sections 2 and 3 below).

Second, Blaug conjectures that the content of the classical theory is unavoidably betrayed by modern formulations because of their concern with analytical rigor and mathematical formalization (229, 232, 233 n. 13). As against this we recall, for example, the untiring efforts of David Ricardo and his followers to elaborate a coherent theory of value and distribution.² Blaug also contends that the mathematical form implies “read[ing] Smith and Ricardo and Marx through Walrasian-tinted glasses” (229). Here Blaug mistakes the form of an argument for its substance. The real issue appears to be this: While Ricardo was explicitly in favor of analytical rigor and mathematical precision, he did not think that economic laws could indiscriminately be established like mathematical truths with regard to all spheres of socioeconomic life. In his letter to Thomas Malthus of 9 October 1820 he wrote:

Political Economy you think is an enquiry into the nature and causes of wealth—I think it should rather be called an enquiry into the laws which determine the division of the produce of industry amongst the classes who concur in its formation. No law can be laid down respecting quantity, but a tolerably correct one can be laid down respecting proportions. Every day I am more satisfied that the former enquiry is vain and delusive, and the latter only the true objects of the science. (Ricardo 1951–73, 8:278–79; all emphases in quotations are ours)³

Third, and most important, there is no doubt that the classical economists were concerned with an economic system incessantly in motion. They were keen to explain the dynamism of the modern economy, its growth and structural change. Contrary to Blaug's claim (215), this has never been denied by us or any of the “Sraffian” authors, let alone Sraffa himself. Hence the problem is not whether these “dynamic” issues were part and parcel of classical economics—of course they were—but rather how the classical economists dealt with them. That is the crucial question. The ingenious device of the classical authors to see through the highly complex system in motion consisted in distinguishing between the “market” values of the relevant variables—prices of commodities and rates of remuneration—and their “natural” values. The former were taken to reflect all kinds of influences, many of an accidental or temporary nature, whereas the latter were conceived of as...