Labor Values and Production Prices in a Sraffian Economic System with Extensive Income

ABSTRACT

This article develops an extension of Sraffian’s approach, considering a model where the economy is divided into two sectors, the industrial and the agricultural. From a system in physical units it is possible to determine labour values and prices of production. The paper analyses the determination of labour values using Morishima’s suggestion, with linear programming. It is shown that in an economic system with land scarcity the existence of positive surplus-value is not a sufficient condition for positive profits.

KEYWORDS:
Sraffian analysis; labor value; property income