The Labor Theory of Value and Sraffa's Standard Commodity With Markup Pricing

Abstract

This article demonstrates relationships that are transparent in Sraffa’s standard system hold even when relative rates of profit vary persistently among industries. Even with such variations, total constant capital, total variable capital, total surplus value, and the rate of profits are unaltered by evaluation at labor values and at prices of production in Sraffa’s standard system. These results buttress those who see in the standard commodity a solution for Marx’s so-called transformation problem.

Keywords: Markup Pricing, Standard Commodity, Transformation Problem

JEL Classification: B51, C67, D33