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Title:Demystifying Sraffa's theory of value in the light of Arrow and Debreu PDF Logo
Authors:Naqvi, Nadeem
Issue Date:2011
Series/Report no.:Joint discussion paper series in economics 50-2011
Abstract:This paper compares the models of Arrow and Debreu [1954] and Sraffa [1960], and concludes that (1) the models are informationally distinct conceptions of a capitalist economy, (2) they support radically distinct - though complete and entirely correct - theories of value, (3) the prices in the two theories are different both in terms of definitions and values, (4) in Sraffa's model it is impossible to define constant returns to scale, while in Arrow-Debreu this property is admissible, and (5) in Arrow-Debreu the interpersonal income distribution is determined whereas in Sraffa's model the distribution of income between workers and capitalists is undetermined.
Subjects:constant returns to scale
theory of value
relations of production
counterfactual information
prices
exchange values
income distribution
general equilibrium
capital
marginal product
Document Type:Working Paper
Appears in Collections:MAGKS Joint Discussion Paper Series in Economics, Universität Marburg

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