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About this book

This book presents a substantial collection of essays from a wide range of well respected scholars addressing several aspects of Piero Sraffa’s economics in light of continuing controversies over the interpretation that should be placed on his work. It moves beyond extant scholarship with an added emphasis on the philosophical dimension of Sraffa’s seminal work, Production of Commodities by Means of Commodities. Contributors probe new ways of thinking about the political economy of Sraffa and in doing so, alongside the comments to each contribution by other scholars, provide a cutting edge debate and discussion on non-mainstream economic theory.

This book will be of interest to academics and advanced graduate students in economics, with additional interest from scholars in philosophy and the methodology of science.

Table of Contents


Chapter 1. Interpreting the Nature of Sraffa’s Equations: A Critique of Garegnani’s Interpretation

This chapter argues that Sraffa broke away from both the classical idea of rooting theory in the notion of ‘ultimate cause’ as well as mechanical causation of equilibrium of forces. Sraffa’s idea of a system of basic goods denies the possibility of reducing production to labour and Nature alone. His system is composed of well-defined structural properties, an implication of which is that the rate of profits in all the industries must be uniform. Garegnani and his associates missed out on this insight of Sraffa and therefore imposed the classical mechanism of gravitation of ‘market prices’ to ‘natural prices’ in order to make sense of the condition of the uniform rate of profits in the equations of Sraffa’s system. The chapter shows that this produced contradictions and incoherence in our understanding of Sraffa’s theoretical achievement.
Ajit Sinha

Chapter 2. On Sraffa’s Structuralism

Interdependence between processes within a self-replacing system is the hallmark of Sraffa’s representation of the economy as production of commodities by means of commodities. This view highlights Sraffa’s structuralism since a distinctive feature of the latter is to consider collections of elements as wholes ‘subordinated to laws’, in terms of which ‘the structure qua whole or system is defined’ (Piaget, 1971). The aim of this chapter is to highlight the central role in Sraffa’s writings of the representation of the economy as a system of elements whose interdependence assigns structure to the whole system by virtue of its own self-replacing condition, while at the same time being structured by it. In Sraffa’s representation of the economy, interdependence is never likened to simple interaction between the autonomous elements of an aggregate system. Instead, interdependence is seen as a relational pattern identified by the self-replacing condition. This condition is the ‘law’ that assigns structure to the collection of processes making up the economy as a system. This essay discusses the roots and character of Sraffa’s structuralism from his early theoretical writings through his reconstruction of Ricardo’s theory of value up to Production of Commodities by Means of Commodities. Section 1 presents the aim of the essay and its organiztion. Section 2 examines Sraffa’s early criticism of Marshall’s demand and supply curves in the light of Sraffa’s discussion of Philip Henry Wicksteed’s substitution of ‘functional curves’ for the ‘descriptive curves’ associated with the Classical Economists’ view of decreasing returns. Section 3 outlines a rational reconstruction of Sraffa’s approach in terms of positional interdependence and contrasts this view with approaches based on functional interdependence. Positional interdependence is then discussed in the light of Sraffa’s distinction between causality and causation, which points to the central role of ‘one direction’ causal processes in determining the changes following a given source of change within a set of feasible transformations. Section 4 discusses the implications of Sraffa’s structuralism for construction of a political economy centred on consideration of positional interdependence between socioeconomic groups. Section 5 brings the essay to close highlighting the character of Sraffa’s Production of Commodities by Means of Commodities as the mature product of a structural heuristic open to a variety of structural configurations compatible with a set of relatively invariant parameters.
Roberto Scazzieri

Chapter 3. On Sraffa’s Challenge to Causality in Economics

The opening of Sraffa’s Archives has given the opportunity to unveil what is behind the published works, giving clues to interpret them. Among the contributions which are found in his unpublished papers, there are those related to Sraffa’s challenge to causality in economics. We argue that Sraffa’s entire research project is a struggle to escape from mechanical, i.e. causal theory, and to develop a geometrical representation of the economic structure. While a geometrical theory refers to an instant in time and is concerned with logical relations, a mechanical theory refers to processes that happen in real time, in which causality is involved. The reasons of why he embarked in such a project are complex and possibly related to his early beliefs that the requirements for causal explanations—like those which are met in physics—are too stringent to be applicable in economics, whose causes are often of metaphysical (and therefore ideological) nature. Unlike neoclassical economics, Sraffa held that change in economic realities hardly ever manifested itself in the form of infinitesimal variations in magnitudes that leave the overall structure unchanged. In that approach, change is required to find the marginal product (or utility) upon which supply-and-demand curves are derived and price and quantity are determined both in a given market on a given instant and at different times. The well-known passage in the Preface to Production of Commodities: “The investigation is concerned exclusively with such properties of an economic system as do not depend on changes in the scale of production or in the proportions of ‘factors’” (Sraffa, Production of Commodities by Means of Commodities: Prelude to a Critique of Economic Theory, Cambridge, UK, Cambridge University Press, 1960, v) can be better understood in the light of the above arguments. The issue is the difference between two instants (in which time is absent) and a change that takes place through time. By keeping change out of the scope, he was keeping the notion of causation out of his project of building a geometrical description of the economic system.
Maria Cristina Marcuzzo, Annalisa Rosselli

Chapter 4. The Meaning of Sraffa Prices

The chapter raises the issue of the theoretical content of the Sraffa system and whether it is a re-statement of the classical theory of value. It argues that there is no causal theory of prices in Sraffa who breaks through the classical circularity between distribution and value. As non-causal numerical relations among commodities, Sraffa prices serve to establish logical consistency between conditions of production and distribution of social surplus. They are the axis of a self-replacing economic system in historical time which holds until a new configuration of economic forces emerges. The axis is more securely derived from conditions of production rather than conditions of exchange. Together with the rate of profits, Sraffa prices provide the vital link between theories of economic structure and economic change.
Goddanti Omkarnath

Chapter 5. ‘Openness’ as a Methodological Principle of Sraffa’s Economic Thinking

Piero Sraffa’s Production of Commodities by Means of Commodities (1960) was path-breaking as a contribution to political economy and penetrating as a critique of the orthodox economics of the twentieth century. As Ajit Sinha recently put it, the book produced a ‘revolution in economic theory’ (Sinha, A Revolution in Economic Theory: The Economics of Piero Sraffa, London: Palgrave Macmillan, 2016; cf. Martins, “The Sraffian Methodenstreit and the Revolution in Economic Theory,” Cambridge Journal of Economics 43 (2): 507–525, 2019), the impact and significance of which continues to be investigated. At the same time, despite the depth and far-reaching implications of Sraffa’s critique of orthodox economics it was ignored by the great majority of economists, and this not only complicates our understanding of its impact on economic theory, but also creates a paradox regarding our interpretation of ‘the’ history of economics. For Sraffa, ‘the’ history of economics dates back at least to Adam Smith and David Ricardo as founders of a subject specifically understood as political economy. Yet economics today is no longer identified as political economy by most people in the field, but is conventionally said to be a science independent of history, politics, and social values, and thus makes little reference to how the social organization of the economy was a distinctive characteristic of the thinking of Smith, Ricardo, Marx, and others in the history of political economy.
John B. Davis

Chapter 6. Sraffa and Manara: The Mystery of the Last Article of Piero Sraffa

In this chapter, I present an unpublished draft of what would have been the last scientific article from Piero Sraffa. This draft intended to provide an answer to the devastating article by C. F. Manara (L’industria 1, pp. 3–18, 1968). I explain why this draft helps us to understand the importance of Manara’s paper for Sraffa—it was important for Sraffa that for any real system a Standard commodity can be constructed—and why Sraffa finally did not publish this article—he was not convinced that he had succeeded in completely overcoming Manara’s argument. In the end, I go on to show how Dupertuis and Sinha (Metroeconomica 60, 3, pp. 432–454, 2009) provide a solution that would have allowed Sraffa to publish what would have been his last article.
Yoann Verger

Chapter 7. Sraffa and Wittgenstein

This paper documents the long and very intense intellectual friendship between Sraffa and Wittgenstein through their extant correspondence. It argues that most likely Wittgenstein discarded the Tractarian thesis of a ‘picture’ theory of meaning in favour of a ‘language game’ theory of meaning in the Philosophical Investigations because of Sraffa’s consistent criticism of the metaphysical foundations of all theories based on human psychology or ‘mental processes’, since no objective data for such foundations exist. It highlights the similarity between the structural relationship between objective data in Sraffa’s system of basic goods and Wittgenstein’s rules of a language game.
Ajit Sinha

Chapter 8. Sraffa Versus Keynes on the Method of Economics: Measurement, Homogeneity and Independence

The chapter investigates the methodology Sraffa and Keynes apply in their critique of economic theories and the development of their own theory. The main focus is on their views on the measurement of economic magnitudes and the assumptions required. There are striking points of similarity in the methodology of their critique, but also contrasting approaches and divergences when they set about positively constructing their own new theory.
Anna Carabelli

Chapter 9. The Role of Sraffa Prices in Post-Keynesian Pricing Theory

Alessandro Roncaglia has been analyzing Piero Sraffa’s contributions and how they fit into the context of the developments of economic theory since the time of the classical political economists on. In particular, he has concerned himself with how the structure of Sraffa (1960) prices in Production of Commodities by Means of Commodities are to be interpreted in relation to both Sraffa’s (and our) predecessors and as a contribution to modern economic theory. In his comprehensive volume on Sraffa in Tony Thirlwall’s important series, Great Thinkers in Economics, Roncaglia (2009) identifies three major interpretations of what Sraffa has done and where he may have wished developments of his contributions to go: a Smithian interpretation, a Ricardian interpretation and a Marxian interpretation. Along with his mentor, Paolo Sylos-Labini, Roncaglia places himself in the Smithian stream. He identifies Heinz Kurz and Neri Salvadori especially in the Ricardian stream and Pierangelo Garegnani especially in the Marxian stream.
Geoffrey Colin Harcourt

Chapter 10. Garegnani’s Surplus Equation and Marx’s Falling Rate of Profits

Here I shall argue that Pierangelo Garegnani’s surplus equation can help in understanding the relationship between Piero Sraffa’s economic system and Karl Marx’s idea of a tendency for the rate of profits to fall. Garegnani’s surplus equation enables us to understand Marx’s analysis of the composition of capital in the context of Sraffa’s system, in order to identify the tendency for the rate of profits to fall, and the countervailing tendencies that act against it. This analysis is in line with Garegnani’s own view that the perspectives of Marx and Sraffa are best seen as complementary approaches, rather than opposed ones.
Nuno Ornelas Martins

Chapter 11. Sraffa’s Silenced Revival of the Classical Economists and of Marx

The standpoint of the old classical economists as well as of Marx “has been submerged and forgotten since the advent of the ‘marginal’ method”—to borrow Sraffa’s own words. The neoclassical (or ‘marginal’) paradigm, in fact, triumphantly dominated over the twentieth century (and is still dominating even now).
A serious step towards the rehabilitation of the paradigm of the old classical economists was made by Sraffa (“Introduction”, The works and correspondence of David Ricardo, edited by Piero Sraffa with the collaboration of M. H. Dobb, Cambridge University Press, Cambridge, 1951) with his remarkable ‘Introduction’ to Ricardo’s Principles, his seminal 1960 book Production of Commodities by Means of Commodities (PCMC) followed a few years later, as a logical completion of his long-standing work.
The chapter here proposed argues that (Sraffa, P., Production of commodities by means of commodities. Prelude to a critique of economic theory. Cambridge University Press, Cambridge, 1960) contribution has so far been mainly interpreted and used as a highly powered tool for destroying the foundations of neoclassical theory from a logical point of view, with the confident belief that attacking the logical side of the theory would have been sufficient to bring about its definite dismissal, which, instead, did not happen. As a consequence of all this, the revival of the classical economists and of Marx—which is one of the most characterizing feature of (Sraffa, P., Production of commodities by means of commodities. Prelude to a critique of economic theory. Cambridge University Press, Cambridge, 1960) contribution—was automatically silenced and this very fact precluded Sraffa’s theoretical framework from being used in a constructive way as a real alternative ‘vision’ to that proposed by the neoclassical market-centred paradigm.
The aim of the chapter is to underscore the crucial importance of Sraffa’s revival referred to above, by emphasizing its usefulness in providing a genuine alternative perspective and a radically different representation of the economy, compared with that provided by neoclassical theory. An attempt will be made to show the main features of the Sraffian framework in providing such an alternative ‘vision’ which, it will be argued, is now much needed, not least for suggesting far more sensible alternative economic policies than those so far pursued in the ceaseless turmoil of present day world economies.
Guglielmo Chiodi

Chapter 12. From Multipliers to the Distribution of Income: Connecting Leontief and Sraffa

The aim of this chapter is to contribute to our understanding of the relation between Leontief-based and Sraffa-based modelling. To this end we take a second look at the core properties of models belonging to either of these ‘schools’. We focus on the well-known open static Leontief model with one primary factor, and explore how this model behaves if we replace the traditional input coefficients matrix by a matrix of extended input coefficients that capture the real pay accruing to the wage earners. We show that capital can be straightforwardly introduced, and that this model generates a precise expression for the relation between the rate of profits and the wage rate. We finish by discussing the connections between this ‘extended’ Leontief model and Sraffa’s single product models.
Albert E. Steenge

Chapter 13. Definitions, Assumptions, Propositions and Proofs in Sraffa’s PCMC

An attempt is made to interpret Sraffa’s PCMC in terms of Constructive Type Theory of the Brouwer/Martin-Löf variety. To facilitate this interpretation, PCMC is considered a precise mathematical text and Sraffa’s subtitle is considered to be meaningful in this sense.
K. Vela Velupillai

Chapter 14. Sraffa’s Monetary Writings, Objectivism and the Cambridge Tradition

Panico examines how Sraffa’s “objectivist” approach can correlate with his analysis on the role of money in the theory of distribution. He delineates how Sraffa linked theoretical work with that on history and policy, moving in accordance with the academic tradition, headed by Marshall, which dominated in Cambridge before WW2. Panico also discusses the implications of Sraffa’s interpretation of the objectivist approach and of historical materialism for the study of the role of money in the theory of distribution. Finally, Panico compares the evolution of Keynes’ and Sraffa’s work on the role of money in the theory of value and distribution, underscoring the existence of close cooperation between the two.
Carlo Panico

Chapter 15. Sraffa, Money and Distribution

Sraffa’s early work on monetary Economics, his contributions to the theory of capital and his critique of neoclassical tenets are often seen as disjoint contributions. In contrast, we suggest that Sraffa’s contributions have to be viewed as a coherent whole and offer a classification of his scholarly contributions. We point to the unifying thread between his early and later work, which concerns the insufficiency of economic mechanisms or market forces to exclusively determine values (prices, profit rates and wage rates). Their simultaneous determination and consequently the overall indeterminacy of the system are important. We outline the motivations for incorporating money (in the form of credit and debt) inside the traditional Sraffian schemes, to expand the original system and harness its potential. We believe that there is both a need and scope for incorporating deferred means of payments, which are essential for the functioning of any evolved economic system.
Ragupathy Venkatachalam, Stefano Zambelli

Chapter 16. From Ricardo to Sraffa: A Quest for a Modern Classical Standpoint on Money

The topic of the chapter is the possibility of a consistency between Sraffa’s price system and Ricardo’s theory of money. Some directions in which such consistency has been looked for are discussed, focusing on a specific one based on my understanding of Ricardo’s theory of money (in Deleplace, Ricardo on Money, A Reappraisal, Abingdon: Routledge, 2017) and on some writings by Sraffa prior to Production of Commodities. As such, the chapter aims at contributing to a quest for a modern Classical standpoint on money, if by “modern Classical” one means faithful to Ricardo—the greatest Classical author on money—and consistent with a Sraffa system of prices.
Ghislain Deleplace

Chapter 17. Sraffa and the Revenue of the Owner of Non-Renewable Natural Resources: A Note on the Literature

A rich literature exists about the way to handle non-renewable natural resources in the context of classical theory. This article sums up the different approaches that we could consider when we calculate the revenue of the owner of a non-renewable natural resource in a Sraffian framework. It clarifies the concepts of differential rent, depreciation of wasting assets, Hotelling rent, and rent as a share of the product, and links this last concept with some empirical facts about non-renewable natural resource extraction industries.
Yoann Verger

Chapter 18. Antonio Gramsci’s Letters that Piero Sraffa did not Forward to the Italian Communist Party

The relationship between Piero Sraffa and Antonio Gramsci, begun in 1919, was complex, deep and extremely significant to both of their lives. It is also very difficult to probe, because it included involvement in the activity of a revolutionary party, the Italian Communist Party, which was under heavy attack from the Fascists and since 1926 had been declared illegal, and because over the decade during which Gramsci was held in prison their relationship could be kept up only through the channels offered by Gramsci’s sister in law, Tatiana Schucht, who was able to exchange correspondence with both Gramsci and Sraffa and visit Gramsci in prison. Gramsci’s letters from prison and the role played by Sraffa in forwarding them to the Italian Communist Party will be at the centre of this paper. Before getting to that point, however, we will spend some words to introduce the main characters of the story—Antonio Gramsci, Tatiana Schucht and Piero Sraffa—and to outline their relationships.
Nerio Naldi


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