Book contents
- Frontmatter
- Contents
- Editorial preface
- List of contributors
- Introduction: Cracks in the neoclassical mirror: on the break-up of a vision
- Part I Class relations in circulation and production
- Part II The Cambridge criticisms
- Part III Microeconomics
- Part IV Macroeconomics
- Part V International trade
- Part VI Property and welfare
- 14 A radical critique of welfare economics
- 15 Property theory and orthodox economics
- Part VII Marxism and modern economics
- Epilogue: The hieroglyph of production
15 - Property theory and orthodox economics
Published online by Cambridge University Press: 19 October 2009
- Frontmatter
- Contents
- Editorial preface
- List of contributors
- Introduction: Cracks in the neoclassical mirror: on the break-up of a vision
- Part I Class relations in circulation and production
- Part II The Cambridge criticisms
- Part III Microeconomics
- Part IV Macroeconomics
- Part V International trade
- Part VI Property and welfare
- 14 A radical critique of welfare economics
- 15 Property theory and orthodox economics
- Part VII Marxism and modern economics
- Epilogue: The hieroglyph of production
Summary
Introduction
Orthodox economics neglects property theory in favor of value theory. In place of an explicit theoretical description of capitalist property relations, orthodox economists have built into price theory an imaginative array of myths, metaphors, parables, emotive definitions, conventional misunderstandings, and fallacies – most of which are theoretical expressions of capitalist ideology. This ideological superstructure, which substitutes for an accurate description of property rights, is not simply grafted onto an otherwise sound value theory. Serious work in capitalist economics, such as the Arrow-Debreu model of a “private ownership economy,” rests upon the assumed existence of certain “property rights” which turn out to be mythical.
We will be concerned with property myths and misunderstandings in capitalist economics; no broad and lengthy development of property theory will be attempted here. In the first section, we give a simple formalism for describing the creation and transfer of property. In the second section, we analyze the property structure of production and the distribution-of-the-product metaphor. Section three contains the main results of the chapter which concern the “ownership of the firm,” the “ownership” of the future profits of production, and “management's prerogatives” – all in the context of a capitalist private property market economy. The section entitled “Capital theory” applies these results to capital theory and analyzes the attempts to beg property theoretic questions with loaded value theoretic definitions. The final section – on general equilibrium theory – gives an impossibility theorem for profitable capitalist competitive equilibria – which, in turn, implies the failure of the attempt by Arrow and Debreu, and others to model a competitive equilibrium in a capitalist economy with decreasing returns to scale and positive profits.
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- Growth, Profits and PropertyEssays in the Revival of Political Economy, pp. 250 - 264Publisher: Cambridge University PressPrint publication year: 1980
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