------------ EH.NET BOOK REVIEW --------------
Published by EH.NET (September 2008)

Andrew Kliman, _Reclaiming Marx?s Capital: A Refutation of the Myth of 
Inconsistency_.  Lanham, MD: Rowman and Littlefield, 2007. xvii + 231 
pp. $65 (hardcover), ISBN: 978-0-7391-1852-8.

Reviewed for EH.NET by David Kristjanson-Gural, Department of Economics, 
Bucknell University.


In _Reclaiming Marx?s Capital_, Andrew Kliman, Professor of Economics at 
Pace University, sets out to do what his title suggests; his approach, 
however, is somewhat unexpected.  Kliman does not attempt to defend 
Marx?s value theory by claiming it is correct, or by arguing that it is 
superior to other theories.  Instead he attempts to show that the widely 
accepted claim that Marx?s value theory is inconsistent is incorrect. 
By revisiting how value is defined, Kliman attempts to show that Marx?s 
value theory, properly specified, does not encounter logical 
difficulties; the belief that Marx?s value theory is inconsistent is a 
myth.  In defending his claim, Kliman provides an impressive 
contribution to the ongoing debate concerning how best to interpret and 
develop Marx?s theory of value, one that deserves careful consideration 
and response not just from those who are actively working in this area, 
but from those who continue to accept the conventional view that Marx?s 
theory is logically flawed without subjecting that view to sufficient 
scrutiny.

According to Kliman, the myth of inconsistency arises from two errors of 
interpretation shared by both Marx?s advocates and his critics.  First, 
value is understood to occupy a separate system from that of prices and 
as a result a system of values (in units of labor) needs to be 
transformed into a system of prices (in units of currency).  Kliman 
contends that values and prices, in fact, constitute two expressions of 
a single system, a system that may be denominated in labor units and in 
money units with the monetary expression of labor-time acting to convert 
values from labor units to money units and vice versa.  This approach, 
which Kliman shares with several contemporary theorists, interprets the 
labor value of the constant capital component of a commodity?s value as 
being defined by the exchange-value of the means of production and not 
by its value.  Second, the constant capital is valued simultaneously 
with the commodity itself and not, as Kliman argues should be done, 
according to the exchange-value of the means of production in the 
previous period (not however at its historical cost).

The crux of Kliman?s thesis is that the myth of inconsistency arises 
because theorists incorrectly interpret Marx?s concept of value as 
occupying a separate system from prices and have wrongly calculated its 
magnitude using the value of constant capital from the current period as 
opposed to the prior period.  These errors lead to the conclusion that 
Marx?s value theory is inconsistent and also imply that value is 
redundant since prices are determined physically by the matrix of 
physical coefficients and the real wage.  However, Kliman argues that a 
temporal, single system interpretation of value does not encounter 
inconsistencies -- it is possible therefore to interpret Marx?s value 
theory in a way that creates consistency between his definitions and 
premises on the one hand and his results on the other.  The failure to 
replicate Marx?s results is not therefore evidence of logical error on 
Marx?s part but a failure on the part of his critics to properly 
interpret Marx?s text.

To defend his claim, Kliman introduces Stigler?s (1965) ?principle of 
scientific exegesis? -- a criterion for resolving disputes concerning 
contending interpretations of a text.  He argues, quite convincingly, 
that unless one is willing to ?specify conditions under which one would 
be willing to concede that one?s interpretation is incorrect,? (p. 61) 
one is simply asserting, dogmatically, that one?s own interpretation is 
superior.  Kliman argues that it is not sufficient simply to find 
textual references which support one?s interpretation since this in 
analogous to choosing data that supports one?s empirical claim. 
Instead, the principle of scientific exegesis holds that an 
interpretation ought to be preferred if it is able to establish 
coherence between definitions and premises on the one hand and 
conclusions on the other.  Kliman argues that contributors to the debate 
either do not recognize the existence of alternative interpretations of 
the text or do not provide criteria for evaluating the merits of their 
interpretation over others.

Kliman then sets out to demonstrate that while simultaneous 
interpretations are unable to establish coherence between their 
interpretation of Marx?s definitions and premises on the one hand and 
his conclusions on the other, his temporal, single system approach can. 
  He introduces a number of simple corn models to demonstrate both the 
determination of value and prices and the effects of changes in 
technology on the rate of profit and he compares the results of a 
simultaneous dual system interpretation with his own.  In the case of 
the transformation problem he argues that simultaneous valuation dual 
system approaches such as those by Bortkiewicz and Winternitz imply that 
the profit rate is physically determined and that the dual equality of 
total prices and total profit and total surplus value and total profit 
can not hold simultaneously.  Single system approaches, because they 
value constant capital according to its exchange-value, do not encounter 
these inconsistencies.  In the case of the tendency of the rate of 
profit to fall, Kliman argues that the Okishio theorem relies on 
simultaneous valuation of input and output; once this is replaced by 
temporal valuation the rate of profit falls on the introduction of 
productivity enhancing technological change.

The strength of Kliman?s contribution lies in his commitment to engaging 
in scholarly debate.  Kliman shows the historical lineage of various 
approaches, clearly defines his criteria for preferring one 
interpretation to another, clearly states and provides arguments in 
defense of the temporal single system interpretation and effectively 
identifies the main areas of disagreement.  If his arguments withstand 
scrutiny, he will have accomplished a significant feat.  For these 
reasons, _Reclaiming Marx?s Capital_ provides a significant contribution 
to the literature.

Kliman?s work could benefit from an elaboration of certain points and a 
reconsideration of others.  A more systematic integration of the 
monetary expression of labor-time would certainly help.  His critique of 
Okishio relies crucially on the monetary expression of labor-time but he 
doesn?t provide readers with sufficient analytics to support his 
assumptions concerning how and why the monetary expression of labor-time 
changes.

Kliman also does not support his claim that all simultaneous approaches 
are physicalist.  He distinguishes single system and dual system 
approaches but often uses dual system analyses to show results and then 
claims these apply to simultaneous single system approaches.  He 
critiques two of these latter (Loranger and Moseley) but omits others 
(Roberts, Kristjanson-Gural) which specifically contradict his claims.

His own commodity corn models abstract from both the redistribution of 
value among industries and the role money plays in storing value between 
periods.  His claim that value must be determined temporally because 
otherwise ?value appears or disappears? is not adequately substantiated 
as a result.  Kliman?s thesis could be strengthened if he reconsidered 
his wholesale rejection of simultaneous valuation in favor of a position 
which defends a single system approach as consistently reproducing 
Marx?s results while at the same time challenging those who favor a 
single system simultaneous approach to develop a consistent explanation 
of changes in values and exchange values that refute Okishio.

Kliman?s book succeeds not in spite of these criticisms but rather 
because of them.  By carefully identifying and systematically critiquing 
key elements of the received wisdom concerning Marx?s value theory, 
Kliman permits a more thorough analysis of controversies concerning how 
best to interpret Marx?s value theory and opens new terrain in the 
ongoing efforts to finish the work that Marx initiated.


David Kristjanson-Gural is Associate Professor of Economics at Bucknell 
University.  His recent published research examines the role of demand 
in the determination of value and prices in Marxian value theory and the 
effect of changes in demand on the monetary expression of value.

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