This article constructs time-varying labour value measures free of such restrictions and shows that they call for a radical re-evaluation of this century’s debate on value. We exhibit a counter-example to the Okishio theorem in which labour-saving innovation leads to a continuously-falling profit rate, and a dynamic approach to the classical problem of transforming values into prices in which the sum of values is equal to the sum of prices while the sum of profits remains equal to the sum of surplus values. Elsewhere we have exhibited a computer simulation model using these values. A dynamic value measure is thus practical, necessary, and the basis for a general reconstruction of economics.
The article provides the first public presentation of the TSS profit rate ‘fish’, independently discovered by Andrew Kliman; this demonstrates the clear divergence between the ‘simultaneist’ profit rate of the standard interpretation, and Marx’s own, temporal profit rate. The simultaneist rate rises indefinitely whilst Marx’s rate falls indefinitely.
This article was presented to the mini-conference of the International Working Group on Value Theory at the annual conference of the Eastern Economic Association, New York, March 1994