[Marxism] William Stanley Jevons

[Rakesh Bhandari]

Aside from neoclassical economists, Marxists struggle with a labor value
theory of price. Some Marxists just abandon price as an explanandum. But
the difficulty is clear: capitalists seem to mark up prices over their
total costs in the absence of any consideration of labor value. Many
things may affect the extent of the mark up--competition or demand curves,
for example. But the capitalists don't know labor values and the prices
can't be proportional to labor values, either, if capitalists across
branches are to enjoy roughly the same profit rate on their total costs.
Some Marxists argue that there is no real strong tendency for the profit
rate to equalize. But this does not explain why prices get marked up to
their labor values which are known or seen by the actual capitalists. Some
Sraffian theorists say that labor value turns out be a  metaphysical idea
. And that you don't need to posit its existence to understand why the
marks up are they way are. For Marx it was just clear that prices had to
reflect values; otherwise social labor would not be allocated in the
proportions to reproduce the social division of labor and thus society. 
But the Sraffians show that as long as you know certain physical
quantities and distribution is settled, you can figure out what prices
will tend to be as long you know how to use simultaneous equations. The
debate could be considered to be at an impasse, as I am sure you know very
well David.
Rakesh