To me, this is an easy question. SNALT, for a capitalist economy, is:
L = a0 (I - A)-1 y
The notation is from Luigi Pasinetti's Lectures on the Theory of Production. The idea can be empirically applied with data from national income and product accounts (NIPAs), using techniques explained in, for example, Ronald Miller and Peter Blair's Input-Output Analysis
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Professor Vienneau
In Luigi Pasinetti's Lectures on the Theory of Production he presents a solution to the transformation problem that plagues Marxists. What exactly do you think about his solution(s) to the transformation problem or the application of the standard commodity to the transformation problem. I know there are differing Sraffian views on the application of the standard commodity's usefulness such as Sinha's so I'm curious to know where you fall on this issue.
Not so sure it can be settled as easily as that, except by definition, but here is J. M. Keynes' "The general theory" which is topical, and shows how much keynesian theory has been distorted:
https://www.marxists.org/reference/subject/economics/keynes/general-theory/ch04.htm
«That the units, in terms of which economists commonly work, are unsatisfactory can be illustrated by the concepts of the National Dividend, the stock of real capital and the general price-level:—
(i) The National Dividend, as defined by Marshall and Professor Pigou,[1] measures the volume of current output or real income and not the value of output or money-income.[2] Furthermore, it depends, in some sense, on net output; [...] But it is a grave objection to this definition for such a purpose that the community’s output of goods and services is a non-homogeneous complex which cannot be measured, strictly speaking, except in certain special cases [...]
(ii) The difficulty is even greater when, in order to calculate net output, we try to measure the net addition to capital equipment; for we have to find some basis for a quantitative comparison between the new items of equipment produced during the period and the old items which have perished by wastage. [...] But, until a satisfactory system of units has been adopted, its precise definition is an impossible task. The problem of comparing one real output with another and of then calculating net output by setting off new items of equipment against the wastage of old items presents conundrums which permit, one can confidently say, of no solution. [...]
(iii) Thirdly, the well-known, but unavoidable, element of vagueness which admittedly attends the concept of the general price-level makes this term very unsatisfactory for the purposes of a causal analysis, which ought to be exact.
[...] To say that net output to-day is greater, but the price-level lower, than ten years ago or one year ago, is a proposition of a similar character to the statement that Queen Victoria was a better queen but not a happier woman than Queen Elizabeth — a proposition not without meaning and not without interest, but unsuitable as material for the differential calculus. Our precision will be a mock precision if we try to use such partly vague and non-quantitative concepts as the basis of a quantitative analysis.
[...] n dealing with the theory of employment I propose, therefore, to make use of only two fundamental units of quantity, namely, quantities of money-value and quantities of employment. The first of these is strictly homogeneous, and the second can be made so. For, in so far as different grades and kinds of labour and salaried assistance enjoy a more or less fixed relative remuneration, the quantity of employment can be sufficiently defined for our purpose by taking an hour’s employment of ordinary labour as our unit and weighting an hour’s employment of special labour in proportion to its remuneration; i.e. an hour of special labour remunerated at double ordinary rates will count as two units. We shall call the unit in which the quantity of employment is measured the labour-unit; and the money-wage of a labour-unit we shall call the wage-unit. Thus, if E is the wages (and salaries) bill, W the wage-unit, and N the quantity of employment, E = N.W.»
Wow, this is very interesting. Could you elaborate on the topic of SNALT calculation and its empirical application in one of your next publications? It will be useful for additional LTV proofs. Thank you in advance!
I think of Pasinetti more as articulately setting out the transformation problem than of solving it.
I agree that I am being somewhat simplistic in the post.
«To me, this is an easy question. SNALT, for a capitalist economy, is: L = a0 (I - A)-1 y» [L = (a0*y)/(I-A)] [y=L*(I-A)/a0] [etc.]
«being somewhat simplistic in the post»
It is not being simplistic: it is an interesting and somewhat sophisticated definition. But definitions have to be justified, have to be supported by arguments both for and against why they are *useful*. That "To me, this is an easy question” is therefore not simplistic but a bit too easy :-).
PS: a big question as always is the units in which the definition is given.
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