Amartya Sen-Sraffa, Wittgenstein, And Gramsci(2003)

1240

Journal of Economic LiteratureVol XLI (December 2003) pp 1240ndash1255

Sraffa Wittgenstein and Gramsci

AMARTYA SEN1

1 Sen Trinity College2 ldquoPiero Sraffa Convegno Internazionalerdquo Accademia

Nazionale dei Lincei February 11ndash12 2003 This essaydraws on a longer essay (ldquoPiero Sraffa A StudentrsquosPerspectiverdquo) presented there which will be published bythe Accademia For helpful discussions over many years Iam greatly indebted to Kenneth Arrow Kaushik BasuChristopher Bliss Nick Denyer Maurice DobbPierangelo Garegnani Frank Hahn Geoff Harcourt JohnHicks Heinz Kurz Brian McGuinness James MirrleesRobert Nozick Luigi Pasinetti Suzy Payne HilaryPutnam Joan Robinson Emma Rothschild Robert SolowLuigi Spaventa and Stefano Zamagni and of course toPiero Sraffa himself I am also grateful to the editor andreferees of this journal for useful suggestions

3 On this see Pierangelo Garegnani (1960 1998)Alessandro Roncaglia (1978 1999) Luigi Pasinetti (19791988) Nicholas Kaldor (1984 1985) John Eatwell andCarlo Panico (1987) Paul Samuelson (1987 2000ab)Paolo Sylos Labini (1990) and Bertram Schefold (1996)among other writings

1 Introduction

When in February this year the Acca-demia Nazionale dei Lincei had a large con-ference in Rome on the twentiethanniversary of the death of Piero Sraffa2

they were celebrating the memory of anextraordinary intellectual one who publishedremarkably little but significantly influencedcontemporary economics philosophy and thesocial sciences Sraffarsquos intellectual impactincludes several new explorations in econ-omic theory including a reassessment of thehistory of political economy (starting with thework of David Ricardo)3 He also had a criti-cally important influence in bringing aboutone of the major departures in contemporary

4 See also Wittgenstein (1953 1958) for issues relatedto this transition

5 See for example the widely used The New PalgraveA Dictionary of Economics (Eatwell Milgate andNewman 1987) Books in English on Sraffarsquos life and con-tributions include among others Ian Steedman (19771988) Roncaglia (1978) Jean-Pierre Potier (1987)Schefold (1989) Krishna Bharadwaj and Bertram Schefold(1990) Terenzio Cozzi and Roberto Marchionatti (2000)and Heinz Kurz (2000)

philosophy namely Ludwig Wittgensteinrsquosmomentous movement from his early position in Tractatus Logico-Philosophicus(Wittgenstein 1921) to the later PhilosophicalInvestigations (Wittgenstein 1951)4

The ldquoeconomist Sraffardquo is often separatedout from his other roles This is partlybecause Sraffa was professionally an econo-mist but also because his economic contri-butions seem at least superficially to standapart from his philosophical ideas Eventhough he published only a few articles andone book apart from editing DavidRicardorsquos works Sraffa is also a much-citedauthor in economics5 His economic contri-butions particularly his one bookProduction of Commodities by Means ofCommodities Prelude to a Critique ofEconomic Theory (Sraffa 1960) have gener-ated major controversies in economicsSraffarsquos works initiated a substantial schoolof thought in economic theory and yet othereconomists have argued that there is nothingmuch of substance in his writings and stillothers (most notably Paul Samuelson) have

Sen Sraffa Wittgenstein and Gramsci 1241

6 See Samuelson (1987 2000ab) See also Frank Hahn(1982)

argued that Sraffa is partly profound andpartly just wrong6

The temptation to examine ldquothe econo-mist Sraffardquo separately has certainly beenstrong And yet there is something to begained from seeing Sraffarsquos different contri-butions together No less importantly for thehistory of philosophical thought it may beimportant to reexamine Sraffarsquos interactionswith Wittgenstein whom Sraffa stronglyinfluenced in the light of Sraffarsquos relation-ship with Antonio Gramsci the Marxist theo-rist who had a strong influence on SraffaIndeed these dual relations also provide anopportunity to explore a possible ldquoGramsciconnectionrdquo in the transformation of ldquoearlyWittgensteinrdquo into ldquolater Wittgensteinrdquo

2 Wittgenstein and Sraffa

Ludwig Wittgenstein returned to TrinityCollege Cambridge in January 1929 afterhaving left Cambridge in 1913 where hehad been a student of Bertrand RussellWittgensteinrsquos return was quite an eventgiven his already established reputation asa genius philosopher John MaynardKeynes wrote to his wife Lydia LopokovaldquoWell God has arrived I met him on the515 trainrdquo

Piero Sraffa who did not know Wittgen-stein earlier had moved to Cambridge fromItaly a little over a year before Wittgensteinrsquosreturn Even though Sraffa was only 29 yearsold at that time (he was born in Turin onAugust 5th 1898) he was already well-known in Britain and Italy as a highly origi-nal economist He had obtained a researchdegree (testi de Laurea) from the Universityof Turin in late 1920 with a thesis on mone-tary economics but it was an article on thefoundations of price theory which he pub-lished in 1925 in Annali di Economia (a jour-nal based in Milan) that made him a majorcelebrity in Italy and Britain In this essay

Sraffa demonstrated that the foundations ofongoing price theory developed by AlfredMarshall (the leader of the then-dominantldquoCambridge schoolrdquo) were incurably defec-tive A significant extension of this essay inEnglish appeared the next year in theEconomic Journal (Sraffa 1926) and wasextremely influential

Sraffa also had deep political interestsand commitments was active in theSocialist Studentsrsquo Group and joined theeditorial team of LrsquoOrdine Nuovo a leftistjournal founded and edited by AntonioGramsci in 1919 (it would later be bannedby the fascist government) Indeed by thetime Sraffa moved to Britain in 1927 he hadbecome a substantial figure among Italianleftist intellectuals and was close tomdashbutnot a member ofmdashthe Italian CommunistParty founded in 1921 and led by GramsciWhile Sraffa had obtained the position oflecturer at the University of Perugia in1923 and a professorship in Cagliari inSardinia in 1926 he considered a move toBritain as fascist persecution becamestronger in Italy

Already in 1922 Piero Sraffarsquos fatherAngelo who was the Rector of BucconiUniversity had received two telegrams fromMussolini demanding that Piero shouldretract a critical account of Italian financialpolicies he had published in the ManchesterGuardian (as it happens on John MaynardKeynesrsquos invitation) It was ldquospreading mis-trustrdquo and was ldquoan act of true and real sabo-tagerdquo Mussolini complained Angelo Sraffaa courageous and resolute academic repliedthat the article stated only ldquoknown factsrdquo andthere was nothing in particular to be retract-ed Piero Sraffa had several other alterca-tions with the Italian government in theyears following and warmed to an invitationconveyed in a letter from John MaynardKeynes in January 1927 to take up a lecture-ship in Cambridge He moved to Cambridgein September that year By the timeWittgenstein returned to Cambridge inJanuary 1929 Sraffa had already established

1242 Journal of Economic Literature Vol XLI (December 2003)

7 On this see Brian McGuinness (1982) Ray Monk(1991) Paolo Albani (1998) and John Davis (2002) amongother writings

a legendary reputation in Cambridge as oneof the cleverest intellectuals around

The influence that Sraffa had onWittgensteinrsquos thinking came through aseries of regular conversations between thetwo7 What form did the influence take Itconcerned a change in Wittgensteinrsquos philo-sophical approach in the years following1929mdasha change in which conversations withSraffa evidently played a pivotal role In hisearly work (particularly in the TractatusLogico-Philosophicus) Wittgenstein used anapproach that is sometimes called ldquothe pic-ture theory of meaningrdquo which sees a sen-tence as representing a state of affairs bybeing a kind of a picture of it mirroring thestructure of the state of affairs it portraysThere is an insistence heremdashit can be said atthe risk of some oversimplificationmdashthat aproposition and what it describes must havethe same logical form Sraffa found thisphilosophical position to be altogether erro-neous and argued with Wittgenstein on theneed for him to rethink his position

According to a famous anecdote Sraffaresponded to Wittgensteinrsquos claim by brush-ing his chin with his fingertips which isapparently readily understood as aNeapolitan gesture of skepticism and thenasked ldquoWhat is the logical form of thisrdquoSraffa (whom later on I had the privilegeof knowing wellmdashfirst as a student and thenas a colleaguemdashat Trinity CollegeCambridge) insisted that this account if notentirely apocryphal (ldquoI canrsquot remember sucha specific occasionrdquo) was more of a tale witha moral than an actual event (ldquoI argued withWittgenstein so often and so much that myfingertips did not need to do much talk-ingrdquo) But the story does illustrate graphi-cally the nature of Sraffarsquos skepticism of thephilosophy outlined in the Tractatus and inparticular how social conventions could

contribute to the meaning of our utterancesand gestures

The conversations that Wittgenstein hadwith Sraffa were evidently quite momentousfor Wittgenstein He would later describe toHenrik von Wright the distinguishedFinnish philosopher that these conversa-tions made him feel ldquolike a tree from whichall branches have been cutrdquo It is conven-tional to divide Wittgensteinrsquos work betweenthe ldquoearly Wittgensteinrdquo and the ldquolaterWittgensteinrdquo and the year 1929 was clearlythe dividing line separating the two phasesSraffa was not in fact the only critic withwhom Wittgenstein had to reckon FrankRamsey the youthful mathematical prodigyin Cambridge was another Wittgenstein(1953 p xe) thanked Ramsey but recordedthat he was ldquoeven morerdquo indebted to the crit-icism that ldquoa teacher of this university Mr PSraffa for many years unceasingly practisedon my thoughtsrdquo adding that he was ldquoindebt-ed to this stimulus for the most consequen-tial ideas of this bookrdquo

Wittgenstein told a friend (Rush Rheesanother Cambridge philosopher) that themost important thing that Sraffa taught himwas an ldquoanthropological wayrdquo of seeingphilosophical problems In his insightfulanalysis of the influence of Sraffa and FreudBrian McGuinness (1982) discusses theimpact on Wittgenstein of ldquothe ethnologicalor anthropological way of looking at thingsthat came to him from the economist Sraffardquo(pp 36ndash39) While the Tractatus tries to seelanguage in isolation from the social circum-stances in which it is used the PhilosophicalInvestigations emphasizes the conventionsand rules that give the utterances particularmeaning The connection of this perspectivewith what came to be known as ldquoordinarylanguage philosophyrdquo is easy to see

The skepticism that is conveyed by theNeapolitan brushing of chin with fingertips(even when done by a Tuscan boy from Pisaborn in Turin) can be interpreted only interms of established rules and conventionsmdash


8 Wittgenstein not only admired Sraffa but also reliedon Sraffa for the safekeeping of some of his philosophicalpapers Sraffa wrote to von Wright on August 27 1958(copy of letter in Sraffarsquos handwriting in the Wren Libraryof Trinity College)

On comparing my copy of the Blue Book [ofWittgenstein] with the recently published edition[Wittgenstein 1958] I find that it contains a number ofsmall corrections in Wittgensteinrsquos handwriting whichhave not been taken into account in the printed ver-sion I suppose that he made these corrections when hegave me the book which was shortly after the death ofSkinner [in 1941] to whom it had originally belonged

indeed the ldquostream of liferdquomdashin theNeapolitan world Wittgenstein (1953 p 5e)used the expression ldquolanguage-gamerdquo toillustrate how people learn the use of lan-guage and the meaning of words and ges-tures (even though ultimately there is muchmore in any actual language than what canbe seen as just language-games)

We can also think of the whole process of usingword hellip as one of those games by means ofwhich children learn their native language I willcall these games ldquolanguage gamesrdquo and willsometimes speak of a primitive language as alanguage game

3 Reservation and Rift

Was Sraffa thrilled by the impact that hisideas had on arguably the leading philoso-pher of our times (ldquothe Godrdquo whom Keynesmet on the 515 train) Also how did Sraffaarrive at those momentous ideas in the firstplace I asked Sraffa those questions morethan once in the regular afternoon walks Ihad the opportunity to share with himbetween 1958 and 1963 I got somewhatpuzzling answers No he was not particu-larly thrilled since the point he was makingwas ldquorather obviousrdquo No he did not knowprecisely how he arrived at those argu-ments sincemdashagainmdashthe point he was making was ldquorather obviousrdquo

Sraffa was very fond of Wittgenstein andadmired him greatly8 But it was clear thathe was not convinced of the fruitfulness ofconversing ceaselessly with the genius

philosopher When I arrived in Trinity in theearly fifties as a student shortly afterWittgensteinrsquos death I was aware that therehad been something of a rift between thetwo In response to my questions Sraffa wasmost reluctant to go into what actually hap-pened ldquoI had to stop our regular conversa-tionsmdashI was somewhat boredrdquo was theclosest to an account I ever obtained Theevents were described however by RayMonk (1991) in rather greater detail in hisbiography of Wittgenstein (p 487)

In May 1946 Piero Sraffa decided he no longerwished to have conversations with Wittgensteinsaying that he could no longer give his time andattention to the matters Wittgenstein wished todiscuss This came as a great blow toWittgenstein He pleaded with Sraffa to contin-ue their weekly conversations even if it meantstaying away from philosophical subjects ldquoI willtalk about anythingrdquo he told him ldquoYesrdquo Sraffareplied ldquobut in your wayrdquo

There are many puzzling things in theSraffa-Wittgenstein relations How couldSraffa who loved dialogues and argumentsbecome so reluctant to talk with one of thefinest minds of the twentieth century Eveninitially how could the conversations thatwere clearly so consequential forWittgenstein which made him feel ldquolike atree from which all branches have been cutrdquoseem ldquorather obviousrdquo to this economistfrom Tuscany I doubt that we shall ever besure of knowing the answers to these ques-tions As far as the later rift is concernedSraffa might have been put off byWittgensteinrsquos domineering manners (carica-tured in a poem of a student Julian Bell theson of Clive Bell ldquowho on any issue eversaw Ludwig refrain from laying down thelaw In every company he shouts us downAnd stops our sentence stuttering his ownrdquo)

Sraffa might have also been exasperatedby Wittgensteinrsquos political naivete Sraffahad to restrain Wittgensteinmdashwith hisJewish background and his constitutive out-spokennessmdashfrom going to Vienna in 1938


just as Hitler was holding his triumphantprocession through the city Also eventhough both had left-wing political convic-tions Sraffa (as a seasoned political realist)could see little merit in the odd eccentrici-ties of Wittgensteinrsquos social beliefs whichcombined a romantic longing for the ardu-ous life of a hard-working manual laborerwith the hope that the communist revolu-tion would lead to a rejection of the adora-tion of science which Wittgenstein saw as acorrupting influence on contemporary life

There remains however the question ofwhy Sraffa was so reserved about the depthand novelty of his conversations withWittgenstein even at the beginning (in 1929and soon thereafter) and why the ideas thatso influenced Wittgenstein would haveseemed to Sraffa to be rather straight-forward Sraffa himself did not publish any-thing whatsoever on this subject but there isconsiderable evidence that what appeared toWittgenstein as new wisdom was a commonsubject of discussion in the intellectual circlein Italy to which Sraffa and Gramsci bothbelonged That issue I take up next

4 The Gramsci Connection

Antonio Gramsci was less reticent thanSraffa about writing down his philosophicalideas When John Maynard Keynes wrote toSraffa in January 1927 communicating thewillingness of Cambridge University to offerhim a lecturing position Gramsci had justbeen arrested (on November 8 1926 to beprecise) After some harrowing experiencesof imprisonment not least in Milan Gramscifaced a trial along with a number of otherpolitical prisoners in Rome in the summerof 1928 Gramsci received a sentence oftwenty years in gaol (ldquofor twenty years wemust stop this brain from functioningrdquo saidthe public prosecutor in a statement thatachieved some fame of its own) and wassent to a prison in Turi about twenty milesfrom Bari From February 1929 Gramsciwas engaged in writing essays and notes that

9 On the friendship between Gramsci and Sraffa seeNerio Naldi (2000) Their intellectual interactions involveda great variety of subjects and John Davis (1993 2002) hasilluminatingly investigated the impact of Gramscian notionsof ldquohegemonyrdquo ldquocaesarismrdquo and ldquopraxisrdquo on Sraffarsquos think-ing and how these ideas may have through Sraffa influ-enced Wittgenstein These possible connections are morecomplicated than the interactions considered in this essaywhich are concerned with the most elementary issues ofmeaning and communication which lie at the foundation ofmainstream philosophy

would later be famous as his PrisonNotebooks (Gramsci 1971 1975)

These notes give us considerable under-standing of what Gramsci and his circlewere interested in Sraffa was very keen thatGramsci should write down his thoughtsand to help him Sraffa opened an unlimit-ed account with a Milan bookshop (Sperlingand Kupfer) in the name of Gramsci to besettled by Sraffa As was mentioned earlierSraffa was a part of the editorial team ledby Gramsci of LrsquoOrdine Nuovo Sraffajoined the team in 1921 but he had knownGramsci from earlier on and was writingfor LrsquoOrdine Nuovo from 1919 onwards(mainly translating works from EnglishFrench and German) Working together onthis distinguished journal had broughtSraffa and Gramsci even closer togetherthan they already had been and they hadintense discussions over the years9 Eventhough they disagreed from time to timefor example in 1924 when Sraffa criticizedthe party line (the Communist Party ldquomakesa terrible mistake when it gives the impres-sion it is sabotaging an alliance of opposi-tion movementsrdquo) there can be no doubtabout the intensely productive nature oftheir interactions

Since the Prison Notebooks were in manyways a continuation of Gramscirsquos long-standing intellectual pursuits and reflectedthe kind of ideas that the circle of friendswere involved in it is useful to see howGramscirsquos notes relate to the subject matterof Sraffarsquos conversations with Wittgensteinincluding the part played by rules and con-ventions and the reach of what became


known as ldquoordinary language philosophyrdquo Inan essay on ldquothe study of philosophyrdquoGramsci discusses ldquosome preliminary pointsof referencerdquo which include the bold claimthat ldquoit is essential to destroy the widespreadprejudice that philosophy is a strange anddifficult thing just because it is the specificintellectual activity of a particular categoryof specialists or of professional and system-atic philosophersrdquo Rather argued Gramscildquoit must first be shown that all men arelsquophilosophersrsquo by defining the limits and char-acteristics of the lsquospontaneous philosophyrsquowhich is proper to everybodyrdquo

What kind of an object then is thisldquospontaneous philosophyrdquo The first itemthat Gramsci lists under this heading is ldquolan-guage itself which is a totality of deter-mined notions and concepts and not just ofwords grammatically devoid of contentrdquoThe role of conventions and rules includingwhat Wittgenstein came to call ldquolanguage-gamesrdquo and the relevance of what has beencalled ldquothe anthropological wayrdquo whichSraffa championed to Wittgenstein all seemto figure quite prominently in the PrisonNotebooks (Gramsci 1975 p 324)

In acquiring onersquos conception of the world onealways belongs to a particular grouping which isthat of all the social elements which share thesame mode of thinking and acting We are allconformists of some conformism or otheralways man-in-the-mass or collective man

The role of linguistic convention was dis-cussed by Gramsci with various illustrationsHere is one example (Gramsci 1975 p 447)

One can also recall the example contained in alittle book by Bertrand Russell [The Problems ofPhilosophy] Russell says approximately thisldquoWe cannot without the existence of man on theearth think of the existence of London orEdinburgh but we can think of the existence oftwo points in space one to the North and one tothe South where London and Edinburgh nowarerdquo hellip East and West are arbitrary and con-ventional that is historical constructions sinceoutside of real history every point on the earth isEast and West at the same time This can be

10 I should however point briefly at two issues onwhich the correspondencemdashor dissonancemdashbetweenGramscirsquos and Sraffarsquos ideas deserve much further investi-gation The first concerns what Saul Kripke (1982) callsldquothe Wittgensteinian paradoxrdquo citing Wittgensteinrsquos claimthat ldquono course of action could be determined by a rulebecause every course of action can be made to accord withthe rulerdquo Since the ldquolater Wittgensteinrdquo is so focused onrelating meaning and communication to following rulesKripke identifies this ldquoparadoxrdquo as ldquoperhaps the centralproblem of [Wittgensteinrsquos] Philosophical Investigationsrdquo(p 7) The second issue concerns how far one shouldstretch the ldquoanthropological wayrdquo of seeing philosophicalissues in particular whether ldquocustomrdquo has to be invokedonly to understand how language is used or also to go asfar as David Hume did when he argued in a passage quot-ed approvingly by Keynes and Sraffa (1938) that ldquotheguide of liferdquo was not reason ldquobut customrdquo (p xxx) Furtherdiscussion of these two issues can be found in my longerpaper cited earlier ldquoPiero Sraffa A Studentrsquos Perspectiverdquoto be published by the Accademia Nazionale dei Lincei

seen more clearly from the fact that these termshave crystallized not from the point of view of ahypothetical melancholic man in general butfrom the point of view of the European culturedclasses who as a result of their world-wide hege-mony have caused them to be accepted every-where Japan is the Far East not only for Europebut also perhaps for the American fromCalifornia and even for the Japanese himselfwho through English political culture may thencall Egypt the Near East

How exactly Sraffarsquos ideas linked withGramscirsquos and how they influenced eachother are subjects for further research10 Butit is plausible to argue that in one way oranother Sraffa was quite familiar with thethemes that engaged Gramsci in the twentiesand early thirties It is not very hard to under-stand why the program of WittgensteinrsquosTractatus would have seemed deeply mis-guided to Sraffa coming from the intellectualcircle to which he belonged Nor is it difficultto see why the fruitfulness of ldquothe anthropo-logical wayrdquomdashnovel and momentous as it wasto Wittgensteinmdashwould have appeared toSraffa to be not altogether unobvious

5 Capital Valuation and SocialCommunication

What bearing do these philosophical ideas(including the so-called anthropological


way) discussed by Sraffa Gramsci andWittgenstein have on Sraffarsquos work in eco-nomic theory In his early work particularlythe much-acclaimed essay published inItalian in 1925 and in its English variant inthe Economic Journal in 1926 which initial-ly established Sraffarsquos reputation he demon-strated that the tendency in ongoingeconomic theory led by Alfred Marshall to interpret market outcomes as havingresulted from pure competition involves aninternal contradiction when there areeconomies of large scale in the production ofindividual firms Sraffarsquos analysis led to con-siderable follow-up work about the nature of economies of scale as well as the workingof not fully competitive market formsbeginning with Joan Robinson (1933) and Edward Chamberlin (1933) These earlyeconomic contributions do not appear toturn critically on the kind of philosophicalissues addressed later by Wittgenstein or bySraffa or Gramsci

However in Sraffarsquos book Production ofCommodities by Means of CommoditiesPrelude to a Critique of Economic Theory(Sraffa 1960) the interpretational issuesare centrally important Let me try to illus-trate this with two issues discussed in thiselegant book The first of these two con-cerns the aggregation of capital and theidea of capital as a factor of productionMainstream economic theory often calledldquoneoclassical economicsrdquo can be formulat-ed at different levels of aggregation Capitalgoods such as machinery and equipmentare of course quite diverse and anyaggregative account that invokes ldquocapitalrdquoas a general factor of production mustinvolve some aggregative ldquomodellingrdquowhich is comprehensible and discussable insocial communication Also there is amuch-discussed claim that it is the produc-tivity of incremental capital (called theldquomarginal product of capitalrdquo) that can beseen as governing the value of the rate of return on capital (such as the rate ofinterest or profit)

11 There have been substantial controversies on theexact significance and reach of these and related resultssee among others Robinson (1953ndash54) Robert Solow(1955ndash56) Garegnani (1960 1970 1990) Samuelson(1962 1966) Pasinetti (1966 1974) Harcourt (1972)Dobb (1973) Christopher Bliss (1975) Steedman (19771988) Edwin Burmeister (1980) Vivian Walsh and HarveyGram (1980) Bharadwaj (1990) Bharadwaj and Schefold(1990) Mauro Baranzini and Geoffrey Harcourt (1993)Cozzi and Marchionatti (2000) Kurz (1990) and AviCohen and Geoffrey Harcourt (2002)

12 Discussed in Sen (1974) reprinted in Sen (1984)

Sraffarsquos critique disputes these claims Heshows that capital as a surrogate factor ofproduction cannot be defined in generalindependently of the rate of interest andthe so-called marginal productivity of capi-tal can hardly be seen as governing theinterest rate Indeed techniques of produc-tion cannot even be ranked in terms ofbeing more or less ldquocapital intensiverdquo sincetheir capital intensities which are depend-ent on the interest rate can repeatedlyreverse their relative ranking as the interestrate is lowered11

This is a powerful technical result We canask what difference does it makeAggregative neoclassical models with capitalas a factor of production are irreparablydamaged But neoclassical economic theoryneed not be expounded in an aggregativeform It is possible to see production interms of distinct capital goods and leave it atthat Also the kind of practical insight forpolicy that one may try to get from arguing inaggregative terms (such as the case for usingless capital-intensive techniques when laboris cheap and the cost of capital is high) is nei-ther dependent on how interest rates areactually determined nor conditional on anyvery specific model of capital valuation12

Yet at the level of pure theory the ideathat interest is the reward of the productiv-ity of capital rather than say the result ofexploiting labor (or simply the passiveresidual that is left over between the outputvalue and input costs including wage pay-ments) can playmdashand has often been madeto playmdashquite a major part in political and


13 The result holds in this simple form in the case inwhich there is no joint production the presence of whichwould make the relationship more complex but not in factuntractable See Bertram Schefold (1989)

social debates about the nature of the capi-talist system Thus the political and socialcontext of Sraffarsquos demolitional critique ofcapital as a factor of production is not hardto see once the subject matter of the cri-tique is fully seized and interpreted in linewith a classical debate stretching over sev-eral centuries Sraffarsquos findings have to beseen as a response to a particular descrip-tive accountmdashwith normative relevancemdashof the capitalist system of production andthat is where the potential social relevanceof these technical results lies

I must confess that I find it altogetherdifficult to be convinced that onersquos skepti-cism of unrestrained capitalism must turnon such matters as the usefulness of aggre-gate capital as a factor of production andthe productivity attributed to it rather thanon the mean streets and strained lives thatcapitalism can generate unless it isrestrained and supplemented by othermdashoften nonmarketmdashinstitutions And yet it is not hard to see the broad social and political vision of Sraffarsquos analysis and itsargumentative relevance for debates about taking the productivity of capital asexplication of profits

6 Prices and Two Senses of Determination

I turn now to a second example Sraffaconsiders an economy in equilibrium to theextent of having a uniform profit (or interest)rate He shows that if we take a snapshot ofthe economy with a comprehensive descrip-tion of all production activities withobserved inputs and outputs and a giveninterest rate from this information alone wecan determine (in the sense of figuring out)the prices of all the commodities as well asdistribution of income between wages andinterest (or profit)13 And if we consider ahigher and higher interestmdashor profitmdashrate

then the wage rate will be consistently lowerand lower We can thus get a downward-sloping wage-profit relationship (an almosttranquil portrayal of a stationary ldquoclass warrdquo)for that given production situation and thespecification of either the interest (or profit)rate or the wage rate will allow us to calcu-late all the commodity prices

The dog that does not bark at all in thisexercise is the demand side we go directlyfrom production information to pricesThere is no need in this mathematical exer-cise to invoke the demand conditions for thedifferent commodities which are for thisparticular analytical exercise redundant Ininterpreting this very neat result the philo-sophical foundation of meaning and commu-nication comes fully into its own It isextremely important to understand what ismeant by ldquodeterminationrdquo in the mathemat-ical context (or to put it in the ldquoanthropolog-ical wayrdquo how it would be understood in amathematical community) and we must notconfound the different senses in which theterm could be used There has been a strongtemptation on the part of the critics of main-stream economic theory to take Sraffarsquos ldquocri-tiquerdquo as showing the redundancy ofdemand conditions in the causal determina-tion of prices thereby undermining that theory since it makes so much of demandsand utilities Robinson (1961) is not the onlycommentator to display some fascinationtowards taking that route (p 57)

hellipwhen we are provided with a set of technicalequations for production and a real wage ratewhich is uniform throughout the economy thereis no room for demand equations in the deter-mination of equilibrium prices

However since the entire calculation isdone for a given and observed picture ofproduction (with inputs and outputs allfixed as in a snapshot of production oper-ations in the economy) the question as towhat would happen if demand conditionschangemdashwhich could of course lead to


14 I have discussed the distinctions involved in Sen(1978) See also Salvadori (2000) for a textual analysis ofwhat Sraffa doesmdashand does notmdashclaim regarding therole of demand Given the nature of Sraffarsquos exercise(with given commodity production) it is also clear whySraffa (1960 preface) claimsmdashrightlymdashthat there is nospecific assumption of constant returns to scale thatneeds to be invoked for his analysis The internal charac-teristics of the observed snapshot picture may of coursethemselves reflect particular market relations (and evensome underlying equilibriation) especially for theobserved uniform profit rate and universal wage rate tohave come about But Sraffa is undoubtedly right that nofurther assumption (for example of constant returns toscale) need be added to what is already entailed by theobserved snapshot picture (without any counterfactualchanges being considered)

15 Sraffa discusses a corresponding distinction in anunpublished note (D312152 in the Sraffa collectionWren Library Trinity College italics added) written in1942 (I am very grateful to Heinz Kurz for drawing myattention to it)

This paper [the forthcoming book] deals with anextremely elementary problem so elementary indeedthat its solution is generally taken for granted Theproblem is that of ascertaining the conditions of equi-librium of a system of prices amp the rate of profitsindependently of the study of the forces which maybring about such a state of equilibrium

different amounts of productionmdashis not atall addressed in this exercise14 The ten-dency to interpret mathematical determi-nation as causal determination can thuscause a major misunderstanding15

7 Value and Descriptive Importance

If Sraffarsquos results do not have anythingmuch to say on causal determination thenwhat gives them interest That questioncan be answered by considering the natureof social communication to which Sraffarsquoswork contributes First analytical determi-nationmdashnot only causal determinationmdashisa subject that interests people a good dealSraffarsquos demonstration that a snapshot pic-ture of just the production conditions of theeconomy can tell us so much about possibleprices is not only a remarkable analyticaldiagnosis it is also a finding of considerableintellectual interest to people who want tothink about the correspondence betweenquantities produced and prices chargedGramsci has argued that everyone is a

16 Robinson (1964) p 39

philosopher at some level and perhaps anexactly similar thing can be said about thefact that analyticalmdashand even mathemati-calmdashcuriosity is widespread and influ-ences our social thinking The idea that it ispossible to find out what the commodityprices are merely by looking at the givenldquoproduction siderdquo (inputs and outputs)along with the interest rate is a powerfulanalytical result

A second reason for being interested inSraffarsquos results is to understand them interms of the idea of value and the politicalcontent of that concept In classical thoughtldquovaluerdquo has been seen not merely as a way ofgetting at prices (Smith Ricardo and Marxall discussed problems in going from valuesto prices) but also at making a descriptivestatement of some social importance Tomany economists the idea of ldquovaluerdquo appearsto be thoroughly wrongheaded For exam-ple Robinson invoked positivist method-ology (she could be described as a ldquoleft-wingPopperianrdquo) to dismiss any real relevance ofthe idea of value in general and its invokingin Marxian economics in particular In herEconomic Philosophy Robinson (1964) puther denunciation thus (p 39)

On this plane the whole argument appears to bemetaphysical it provides a typical example ofthe way metaphysical ideas operate Logically itis a mere rigmarole of words but for Marx it wasa flood of illumination and for latter-dayMarxists a source of inspiration16

ldquoValue will not helprdquo Robinson conclud-ed ldquoIt has no operational content It is justa wordrdquo

The philosophical issues raised byGramsci and Sraffa and of course byWittgenstein have considerable bearing onthis question Just as positivist method-ology pronounces some statements mean-ingless when they do not fit the narrowsense of ldquomeaningrdquo in the limited terms of


17 There is a related issue in epistemology as to theextent of precision that would be needed for a putative sci-entific claim to be accepted as appropriate For this issuetoo the nature of Sraffarsquos analysis has a direct bearing inline with Aristotlersquos claim in the Nicomachean Ethics thatwe have ldquoto look for precision in each class of things just sofar as the nature of the subject admitsrdquo On this issue seeSen (1982) essay 20 (ldquoDescription as Choicerdquo) and Coates(1996) along with the references cited there I shall nothowever pursue this question further here

verification or falsification the Tractatustoo saw little of content in statements thatdid not represent or mirror a state of affairsin the same logical form This has theimplication as Simon Blackburn (1994) putit of denying ldquofactual or cognitive meaningto sentences whose function does not fitinto its conception of representation suchas those concerned with ethics or mean-ing or the selfrdquo (p 401) In contrast thephilosophical approach pursued by theldquolater Wittgensteinrdquo partly influenced bySraffa himself sees meaning in muchbroader terms17

The interpretation of value and itsdescriptive relevance have been well dis-cussed by Maurice Dobb (1937 1973) theMarxist economist who was a close friend ofSraffa and his long-term collaborator in edit-ing David Ricardorsquos collected works Dobbpointed to the social and political interest ina significant description of economic rela-tions between people Even such notions asldquoexploitationrdquo which have appeared to some(including Robinson) as ldquometaphysicalrdquo canbe seen to be an attempt to reflect in com-municative language a common public con-cern about social asymmetries in economicrelations As Dobb (1973) put it (p 45)

ldquoexploitationrdquo is neither something metaphysicalnor simply an ldquoethicalrdquo judgement (still less ldquojusta noiserdquo) as has sometimes been depicted it is afactual description of a socio-economic relation-ship as much as is Marc Blochrsquos apt characteri-sation of Feudalism as a system where feudallords ldquolived on labor of other menrdquo

Sraffarsquos analysis of production relationsand the coherence between costs and prices

18 See particularly Ricardo (1951ndash73) edited by Sraffawith the collaboration of Dobb and Dobb (1973)

(within a snapshot picture of the economy)while different from a labor-based descrip-tion in the Marxian mould is also anattempt to express social relations with afocus on the production side rather than onutility and mental conditions We candebate how profound that perspective isbut it is important to see that the subjectmatter of Sraffarsquos analysis is enlighteningdescription of prices and income distribu-tion invoking only the interrelations on theproduction side

Closely related to this perspective there isa further issue which involves addressing theclassical dichotomy between ldquouse-valuerdquo andldquoexchange-valuerdquo as it was formulated bythe founders of modern economics in par-ticular Adam Smith and David RicardoSraffa and Dobb who collaborated in theediting of Ricardorsquos collected works had sig-nificant interest in this question18 and tothat issue I now turn

8 Use Exchange and Counterfactuals

David Ricardorsquos foundational book On thePrinciples of Political Economy andTaxation published in 1817 begins with thefollowing opening passage

It has been observed by Adam Smith that ldquotheword Value has two different meanings andsometimes expresses the utility of some particu-lar object and sometimes the power of purchas-ing other goods which the possession of thatobject conveys The one may be called value inuse the other value in exchange ldquoThe thingsrdquohe continues ldquowhich have the greatest value inuse have frequently little or no value inexchange and on the contrary those which havethe greatest value in exchange have little or novalue in userdquo Water and air are abundantly use-ful they are indeed indispensable to existenceyet under ordinary circumstances nothing canbe obtained in exchange for them Gold on thecontrary though of little use compared with airor water will exchange for a great quantity ofother goods


There is a puzzle here that is of someinterest of its own and can also tell ussomething about how we may think aboutprices and values in general There are twoalternative ways of perspicuously explain-ing how gold can come to command ahigher price than water despite being somuch less important for human life Oneanswer based on the utility side of the pic-ture is that given the large amount ofwater that is generally available and theshortage of gold the so-called ldquomarginalutilityrdquo of water (the incremental benefitthat a consumer gets from an additionalunit of water) is small compared with themarginal utility of gold The other answer isthat the cost of productionmdashor of min-ingmdashof gold is much higher than that ofwater in the situation in which we examinethe economy

Neither explanation is an attempt at causal-ly explaining why and how the prices andquantities that exist have actually emergedThey are rather answers to the Smith-Ricardo question How can people under-stand why gold ldquothough of little usecompared with air or waterrdquo exchanges ldquofor agreat quantity of other goodsrdquo The cost-based explanation and the utility-based expla-nation are thus alternative ways ofexplicating what we observe by invokingideas like costs of production and marginalusefulness which can serve as means of socialcommunication and public comprehension

While Sraffa himself did not publishmuch that relates directly to this interpre-tational question (except to comment on adistinction involving the use of ldquocounter-factualrdquo concepts on which more present-ly) we can get some insight into the issuesinvolved from the writings of MauriceDobb Sraffarsquos friend collaborator andexponent Indeed in a classic paper onldquothe requirements of a theory of valuerdquoincluded in his book Political Economyand Capitalism Dobb (1937) had arguedthat a theory of value must not be seen

only as a mechanical device that has mere-ly instrumental use in price theory Even astheories of value address the ldquoSmith-Ricardo questionrdquo regarding a coherentunderstanding of the dual structure ofvalue in use and value in exchange theyattempt to make important social state-ments of their own on the nature of theeconomic world by focusing respectivelyon such matters as the incremental useful-ness of commodities the satisfaction theycan generate the labor that is used in mak-ing them or the costs that have to beincurred in their production

The inclination of classical politicalecon-omy including classical Marxian eco-nomics to expect from a theory of valuesomething much more than a purelymechanical ldquointermediate productrdquo inprice theory is of course well-knownIndeed this inclination is often taken to bespecial pleading for largely political rea-sons in a contrived justification of the rel-evance of labor theory of value Howeverthis diagnosis does the classical perspectiveless than justice since the importance ofperspicacious explanation and communica-tion is part and parcel of the classicalapproach Indeed it is important to recol-lect in this context the significance thathas typically been attached in the perspec-tives of classical political economy andMarxian economics not just to labor andproduction but also to the idea of ldquousevaluerdquo (and to its successor concept in theform of satisfactionmdashor ldquoutilityrdquomdashthatcommodities may generate) The compari-son between the two rival value theories inthe form of labor theory and utility theorywas taken to be of interest preciselybecause both made socially engaging state-ments there is no attempt here to deny thenature of social interest in utility theory asa theory of value

Indeed in 1929 in a prescient early cri-tique of what would later develop into theldquorevealed preferencerdquo approach (led by


19 Dobb (1929) p 32 It is also of interest to note thatin a letter to R P Dutt another Marxist intellectual Dobbwrote on May 20 1925 (as it happens shortly after his firstmeeting with Piero Sraffa) ldquothe theory of marginal utilityseems to me to be perfectly sound amp as explanation ofprices amp price changes quite a helpful advance on the clas-sical doctrine framing it more precisely amp forging a moreexact tool of analysisrdquo On this see Pollit (1990)

Samuelson 1938) Dobb (1929) regrettedthe tendency of modern economics to down-play the psychological aspects of utility infavor of just choice behavior (p 32)

Actually the whole tendency of modern theory isto abandon hellip psychological conceptions tomake utility and disutility coincident withobserved offers on the market to abandon aldquotheory of valuerdquo in pursuit of a ldquotheory ofpricerdquo But that is to surrender not to solve theproblem19

Indeed ldquothe problemrdquo to which Dobbrefers and to which utility theory of valuelike the labor theory caters is to make ldquoanimportant qualitative statement about thenature of the economic problemrdquo (Dobb1937 pp 21ndash22) Dobb went on to distin-guish between these two social explanationsby noting that ldquothe qualitative statement[utility theory] made was of a quite differentorder being concerned not with the rela-tions of production but with the relation of commodities to the psychology of con-sumersrdquo (p 21) In contrast the picture ofthe economy presented by Sraffa concen-trates precisely on ldquothe relations of pro-ductionrdquo and in explicating Sraffarsquos contributions Dobb (1973) pursues exactlythis contrast

There is much evidence that this contrastwas of particular interest to Sraffa himselfBut in this comparison Sraffa saw anotherbig difference which was methodologicallyimportant for him (though I know of littleevidence that it interested Dobb much)given Sraffarsquos philosophical suspicion of theinvoking of ldquocounterfactualrdquo magnitudes infactual descriptions Sraffa noted that in

20 See Sraffa (1960) pp vndashvi21 Indeed the reach of economics as a discipline would

be incredibly limited had all counterfactual reasoning beendisallowed as I have tried to discuss in Sen (2002) see alsoSen (1982) essay 20 (ldquoDescription as Choicerdquo) pp432ndash49

opting for a cost-based explanation (in linewith Sraffa 1960) we can rely entirely onldquoobservedrdquo facts such as inputs and outputsand a given interest rate without having toinvoke any ldquocounterfactualsrdquo (that is with-out having to presume what would havehappened had things been different)20 Thisis not the case with the utility-based expla-nation since ldquomarginal utilityrdquo inescapablyinvolves counterfactual reasoning since itreflects how much extra utility one wouldhave if one had one more unit of thecommodity

The philosophical status of counterfactu-als has been the subject of considerabledebating in epistemology I see little meritin trying to exclude counterfactuals in tryingto understand the world21 But I do knowmdashfrom extensive conversations with Sraffamdashthat he did find that the use ofcounterfactuals involved difficulties thatpurely observational propositions did not Itis not that he never used counterfactualconcepts (life would have been unbearablewith such abstinence) but he did think therewas a big methodological divide hereWhether or not one agrees with Sraffarsquosjudgement on the unreliability of counter-factuals it is indeed remarkable that there issuch a methodological contrast between theutility-based and cost-based stories (in theSraffian form) The difference betweenthem lies not merely in the fact that the for-mer focuses on mental conditions in theform of utility while the latter concentrateson material conditions of production (a con-trast that is easily seen and has been muchdiscussed) but also in the less-recognizeddistinction that the former has to invokecounterfactuals whereas the lattermdashin theSraffian formulationmdashhas no such need


9 Concluding Remarks

The critical role of Piero Sraffa in con-tributing to profound directional changes incontemporary philosophy through helpingto persuade Wittgenstein to move from theTractatus to the theory that later foundexpression in Philosophical Investigations isplentifully acknowledged by Wittgensteinhimself (as well as by his biographers) Whatmay however appear puzzling is the factthat Sraffa remained rather unexcited aboutthe momentous nature of this influence andthe novelty of the ideas underlying itHowever the sharpness of the puzzle is to agreat extent lessened by the recognitionthat these issues had been a part of the stan-dard discussions in the intellectual circle inItaly to which Sraffa belonged which alsoincluded Gramsci

As a result the weakness of Wittgensteinrsquosview of meaning and language in Tractatuswould have come as no surprise to Sraffanor the need to invoke considerations thatlater came to be known as ldquothe anthropolog-ical wayrdquo of understanding meaning and theuse of language There appears to be an evi-dent ldquoGramsci connectionrdquo in the shift fromthe early Wittgenstein to the laterWittgenstein though much more researchwould be needed to separate out if that ispossible at all the respective contributionsof Sraffa and Gramsci to the ideas thatemerged in their common intellectual circle

Turning to Sraffarsquos economic contribu-tions they cannot in general be divorcedfrom his philosophical understandingAfter his early writings on the theory of thefirm (and his demonstration of the need toconsider competition in ldquoimperfectrdquo orldquomonopolisticrdquo circumstances) his laterwork did not take the form of finding dif-ferent answers to the standard questions inmainstream economics but that of alter-ingmdashand in some ways broadeningmdashthenature of the inquiries in which main-stream economics was engaged I have

22 Since Sraffarsquos (1960) classic book has the subtitleldquoPrelude to a Critique of Economic Theoryrdquo there hasbeen some temptation to presume that once the ldquocri-tiquerdquomdashto which that book is a ldquopreluderdquomdashis completedSraffa would have expected it to yield an alternative theo-ry of prices and distribution If the arguments presentedin this essay are correct this presumption is mistakenSraffa was in this view trying to broaden the reach andscope of economic inquiries not just trying to find differ-ent answers to the questions standardly asked in main-stream economic theory

argued in this essay that it is possible tointerpret Sraffarsquos departures in terms ofthe communicational role of economictheory in matters of general descriptiveinterest (rather than seeing them asattempts at constructing an alternativecausal theory of the determination ofprices and distribution)22

Sraffa used analytical reasoning to throwlight on subjects of public discussion in polit-ical and social contexts In particular hedemonstrated the unviability of the view thatprofits can be seen as reflecting the produc-tivity of capital More constructively Sraffarsquoswork throws light on the importance of valuetheory in perspicacious description Thecontrast between utility-based and cost-based interpretation of prices belongs to theworld of pertinent description and social dis-cussion and the rival descriptions are ofgeneral interest these have been invoked inthe past and remain relevant today Theinquiry into alternative descriptions differsfrom the subject of causal determination ofprices in which both demand and supplysides would tend to be simultaneouslyinvolved

There is an obvious similarity here withJohn Hicksrsquos (1940 1981) classic clarifica-tion that while utility and costs are bothneeded in a theory of price determinationwhen it comes to ldquothe valuation of socialincomerdquo utility and costs provide two alter-native ways of interpreting prices withrespectively different implications on theunderstanding of social or national incomeThe measurement of social income ldquoin real


23 The extensive reach of the Hicksian contrastbetween the two alternative perspectives are among thesubjects explored in Sen (1979) In commenting on hisearlier 1940 paper Hicks (1981) remarks that ldquoI now thinkthat in my 1940 article I claimed too little for the costmeasurerdquo (p 143) A pioneering exploration of the pro-duction-based rather than utility-based evaluation ofnational income can be found in James Mirrlees (1969)Since that evaluation involves investigation of productionpossibility for real income comparisons (a quintessentiallycounterfactual exercise) Mirrleesrsquos analysis goes in a verydifferent direction from Sraffarsquos investigation of the inter-nal relations on the cost side for a given production situa-tion The point of similarity lies only in (1) the fact that acomplete theory of causal determination of prices is notneeded either for evaluation of social income or for usingvalue theory for social description of utility or costs and(2) the fact that the separation of the cost story from theutility story is involved in both the exercises

24 See Sraffa (1960) pp vndashvi Sraffa notes that ldquowhen in1928 Lord Keynes read a draft of this paper he recom-mended that if constant returns were not to be assumedan emphatic warning to that effect should be givenrdquo (p vi)That ldquoemphatic warningrdquo can be found in the preface toSraffa (1960)

terms may mean valuation in terms of utili-ty or in respect of cost and that these twomeanings are in principle differentrdquo (Hicks1981 p 142)23

In pursuing the descriptive distinctionbetween utility and costs Sraffa attachedimportance to the demonstration that hisaccount of the cost-based story (as in Sraffa1960) draws exclusively on observed infor-mation rather than having to invoke anycounterfactual presumptions This differsfrom the utility-based picture since theconcept of marginal utility is constitutivelycounterfactual How methodologically sig-nificant this distinctionmdashbetween descrip-tions with or without counterfactualsmdashinfact is remains an open question (I confessto having remained a skeptic) but it is asubject to which Sraffa himself attachedvery great importance It also relates toother methodological features of Sraffarsquosanalysis including his strenuousmdashbutentirely correctmdashinsistence that his analysisdoes not need any assumption of constantreturns to scale24

The temptation to see Sraffarsquos contribu-tion as a causal theory of price determination

(managing mysteriously without giving anyrole to demand conditions) must be resistedEverything here turns on the meaning ofldquodeterminationrdquo and the usage of that termon which Sraffa draws The sense of ldquodeter-minationrdquo invoked by Sraffa concerns themathematical determination of one set offacts from another set To illustrate the point(with a rather extreme example) a sundialmay allow us to ldquodeterminerdquo what time it isby looking at the shadow of the indicator(gnomon) but it is not the case that theshadow of the indicator ldquocausally deter-minesrdquo what time it is The value of a clockdoes not lie in its ability to ldquofixrdquomdashrather thanldquotellrdquomdashthe time of day

It would have been very surprising if inhis economic analysis Piero Sraffa were notinfluenced by his own philosophical positionand had stayed within the rather limitedboundaries of positivist or representationalreasoning commonly invoked in contempo-rary mainstream economics In addressingfoundational economic issues of generalsocial and political interest (some of whichhave been discussed over two hundredyears) Sraffa went significantly beyondthose narrow barriers It is I suppose com-forting to know that there were not manyPiero Sraffas but one

REFERENCES

Albani Paolo 1998 ldquoSraffa and Wittgenstein Profileof an Intellectual Friendshiprdquo Hist Econ Ideas 63pp 151ndash73

Baranzini Mauro and Geoffrey C Harcourt eds 1993The Dynamics of the Wealth of Nations GrowthDistribution and Structural Change Essays inHonour of Luigi Pasinetti NY St Matinrsquos Presss

Bharadwaj Krishna 1988 ldquoSraffarsquos RicardordquoCambridge J Econ 121 pp 67ndash84

mdashmdashmdash 1990 ldquoSraffarsquos Return to Classical Theoryrdquo inBharadwaj and Schefold (1990) pp 53ndash81

Bharadwaj Krishna and Bertram Schefold eds 1990Essays on Piero Sraffa Critical Perspectives on theRevival of Classical Theory London Routledge

Blackburn Simon 1994 Dictionary of Philosophy NYOxford U Press

Bliss Christopher J 1975 Capital Theory and theDistribution of Income Amsterdam North-Holland

Burmeister Edwin 1980 Capital Theory andDynamics Cambridge Cambridge U Press


Chamberlin Edward H 1933 The Theory ofMonopolistic Competition Cambridge MAHarvard U Press

Coates John 1996 The Claims of Common SenseMoore Wittgenstein Keynes and the Social SciencesCambridge Cambridge U Press Digital ed 2001

Cohen Avi and Geoffrey C Harcourt 2002ldquoWhatever Happened to the Cambridge CapitalTheory Controversiesrdquo J Econ Perspect 171 pp199ndash214

Cozzi Terrenzio and Roberto Marchionatti eds 2000Piero Sraffarsquos Political Economy A CentenaryEstimate London Routledge

Davis John B 1993 ldquoSraffa Interdependence andDemand The Gramscian Influencerdquo Rev PolitEcon 51 pp 22ndash39

mdashmdashmdash 2002 ldquoGarmsci Sraffa and WittgensteinPhilosophical Linkagesrdquo Europ J Hist EconThought 93 pp 384ndash401

Dobb Maurice H 1929 ldquoA Sceptical View of theTheory of Wagesrdquo Econ J 39156 pp 506ndash19

mdashmdashmdash 1937 Political Economy and CapitalismLondon Routledge

mdashmdashmdash 1955 On Economic Theory and SocialismCollected Papers London Routledge

mdashmdashmdash 1973 Theories of Value and Distribution sinceAdam Smith Ideology and Economic TheoryCambridge Cambridge U Press

Eatwell John Murray Milgate and Peter Newmaneds 1987 The New Palgrave A Dictionary ofEconomics London Macmillan

mdashmdashmdash 1990 Capital Theory London MacmillanEatwell John and Carlo Panico 1987 ldquoSraffa Piero

(1898ndash1983)rdquo in Eatwell Milgate and Newman opcit pp 445ndash52

Garegnani Pierangelo 1960 Il capitale nelle teoriedella distribuzione Milan Giuffregrave

mdashmdashmdash 1970 ldquoHeterogeneous Capital the ProductionFunction and the Theory of Distributionrdquo RevEcon Stud 373 pp 407ndash36

mdashmdashmdash 1990 ldquoQuantity of Capitalrdquo in EatwellMilgate and Newman op cit

mdashmdashmdash 1998 ldquoSraffa The Theoretical World of thelsquoOld Classical Economistsrsquordquo Europ J Hist EconThought 53 pp 415ndash29

Gramsci Antonio 1957 The Modern Prince and OtherWritings London Lawrence Wishart

mdashmdashmdash 1971 Selections from the Prison Notebooks ofAntonio Gramsci Quintin Hoare and GeoffreyNowell Smith eds London Lawrence Wishart

mdashmdashmdash 1975 Letters from Prison Lynne Lawnertrans and ed London Jonathan Cape

Hahn Frank H 1982 ldquoThe Neo-RicardiansrdquoCambridge J Econ 64 pp 353ndash74

Harcourt Geoffrey C 1972 Some CambridgeControversies in the Theory of Capital CambridgeCambridge U Press

Hicks John 1940 ldquoThe Valuation of Social IncomerdquoEconomica 7 pp 104ndash24

mdashmdashmdash 1981 Wealth and Welfare Collected Essays onEconomic Theory vol 1 Oxford Blackwell

Kaldor Nicholas 1984 ldquoPiero Sraffardquo Cambridge JEcon 81 pp 1ndash5

mdashmdashmdash 1985 ldquoPiero Sraffa (1898ndash1983)rdquo ProceedingsBritish Academy 71 pp 615ndash40

Keynes Johan Maynard and Piero Sraffa 1938ldquoIntroductionrdquo in An Abstract of a Treatise ofHuman Nature 1740 A Pamphlet Hitherto Unknownby David Hume John M Keynes and Piero Sraffaeds Cambridge Cambridge U Press

Kripke Saul A 1982 Wittgenstein on Rules and PrivateLanguage Cambridge MA Harvard U Press

Kurz Heinz D 1990 Capital Distribution andEffective Demand Studies in the Classical Approachto Economic Theory Cambridge Polity Press

mdashmdashmdash ed 2000 Critical Essays on Piero SraffarsquosLegacy in Economics Cambridge Cambridge UPress

Kurz Heinz D and Neri Salvadori 2000 ldquoPieroSraffarsquos Contributions to Economics A BriefSurveyrdquo in Kurz op cit pp 3ndash24

McGuinness Brian ed 1982 Wittgenstein and HisTimes Oxford Blackwell

Mirrlees James A 1969 ldquoThe Evaluation of NationalIncome and an Imperfect Economyrdquo PakistanDevel Rev 91 pp 1ndash13

Monk Ray 1991 Ludwig Wittgenstein The Duty ofGenius London Vintage

Naldi Nerio 2000 ldquoPiero Sraffa and Antonio GramsciThe Friendship Between 1999 and 1927rdquo Europ JHist Econ Thought 71 pp 79ndash114

Pasinetti Luigi L 1966 ldquoChanges in the Rate of Profitand Switching of Techniquesrdquo Quart J Econ 804pp 503ndash17

mdashmdashmdash 1969 ldquoSwitches of Techniques and the lsquoRateof Returnrsquo in Capital Theoryrdquo Econ J 79 pp508ndash25

mdashmdashmdash 1974 Growth and Income DistributionCambridge Cambridge U Press

mdashmdashmdash 1977 Lectures on the Theory of ProductionLondon Macmillan

mdashmdashmdash 1979 ldquoSraffa Pierordquo Int EncyclopaediaSocial Sciences vol 18 NY Macmillan

mdashmdashmdash 1988 ldquoSraffa on Income DistributionrdquoCambridge J Econ 121 pp 135ndash38

Pollit Brian H 1990 ldquoClearing the Path forlsquoProduction of Commodities by Means ofCommoditiesrsquo Notes on the Collaboration ofMaurice Dobb in Piero Sraffarsquos edition of the Worksand Correspondence of David Ricardordquo inBharadwaj and Schefold op cit

Potier Jean-Pierre 1987 Piero SraffamdashUnorthodoxEconomist (1898ndash1983) A Biographical EssayLondon and NY Routledge

Ricardo David 1951ndash73 The Works andCorrespondence of David Ricardo 11 vols PieroSraffa ed with Maurice H Dobb CambridgeCambridge U Press

Robinson Joan 1933 The Economics of ImperfectCompetition London Macmillan

mdashmdashmdash 1953ndash54 ldquoThe Production Function and theTheory of Capitalrdquo Rev Econ Stud 212 pp81ndash106

mdashmdashmdash 1961 Prelude to a Critique of EconomicTheoryrdquo Oxford Econ Pap 131 pp 53ndash58

mdashmdashmdash 1964 Economic Philosophy Harmondsworth


PenguinRoncaglia Alessandro 1978 Sraffa and the Theory of

Prices NY Wiley 2nd ed 1981mdashmdashmdash 1999 Sraffa la biografia lrsquoopera le scoule

Bari LaterzaSalvadori Neri 2000 ldquoSraffa on Demand A Textual

Analysisrdquo in Kurz op cit pp 181ndash97Samuelson Paul A 1938 ldquoA Note on the Pure Theory

of Consumersrsquo Behaviourrdquo Economica 5 pp 61ndash71mdashmdashmdash 1962 ldquoParable and Realism in Capital Theory

The Surrogate Production Functionrdquo Rev EconStud 293 pp 193ndash206

mdashmdashmdash 1966 ldquoA Summing Uprdquo Quart J Econ 804568ndash83

mdashmdashmdash 1987 ldquoSraffian Economicsrdquo in EatwellMilgate and Newman op cit

mdashmdashmdash 2000a ldquoRevisionist Findings on Sraffardquo inKurz op cit pp 25ndash45

mdashmdashmdash 2000b ldquoSraffarsquos Hits and Missesrdquo in Kurz opcit pp 111ndash52

Schefold Bertram 1989 Mr Sraffa on Joint Productionand Other Essays London Unwin Hyman

mdashmdashmdash 1996 ldquoPiero Sraffa 1898ndash1983rdquo Econ J106438 pp 1314ndash25

Sen Amartya K 1974 ldquoOn Some Debates in CapitalTheoryrdquo Economica 41 pp 325ndash35

mdashmdashmdash 1978 ldquoOn the Labour Theory of Value SomeMethodological Issuesrdquo Cambridge J Econ 2 pp175ndash90

mdashmdashmdash 1979 ldquoThe Welfare Basis of Real IncomeComparisons A Surveyrdquo J Econ Lit 17 pp 1ndash45

mdashmdashmdash 1982 Choice Welfare and MeasurementOxford Blackwell Repub Cambridge MAHarvard U Press 1997

mdashmdashmdash 1984 Resources Values and DevelopmentCambridge MA Harvard U Press

mdashmdashmdash 2002 Rationality and Freedom CambridgeMA Harvard U Press

Smith Adam 1776 An Inquiry into the Nature andCauses of the Wealth of Nations Repub OxfordOxford U Press 1976

Solow Robert M 1955ndash56 ldquoThe Production Functionand the Theory of Capitalrdquo Rev Econ Stud 232pp 101ndash108

mdashmdashmdash 1963 Capital Theory and the Rate of ReturnAmsterdam North-Holland

Sraffa Piero 1925 ldquoSulle relazioni fra costo e quanti-ta prodottardquo Annali di Econ 2 pp 277ndash328English trans by John Eatwell and AlessandroRoncaglia in Luigi L Pasinetti ed Italian EconPapers vol 3 Bologna Il Mulino and OxfordOxford U Press 1998

mdashmdashmdash 1926 ldquoThe Laws of Return under CompetitiveConditionsrdquo Econ J 36144 pp 535ndash50

mdashmdashmdash 1951 ldquoIntroductionrdquo in Ricardo (1951ndash73) opcit vol I pp xiiindashlxii

mdashmdashmdash 1960 Production of Commodities by Means ofCommodities Prelude to a Critique of EconomicTheory Cambridge Cambridge U Press

Steedman Ian 1977 Marx After Sraffa London NewLeft Books Repub London Verso 1981

mdashmdashmdash 1988 Sraffian Economics 2 vols AldershotElgar

Sylos Labini Paolo 1990 ldquoSraffarsquos Critique of theMarshallian Theory of Pricesrdquo in Bharadwaj andSchefold op cit pp 3ndash19

Walsh Vivian and Harvey Gram 1980 Classical andNeoclassical Theories of General Equilibrium NYOxford U Press

Wittgenstein Ludwig 1921 Tractatus Logico-Philosophicus Trans David Pears and BrianMcGuinness NY Routledge 1961

mdashmdashmdash 1953 Philosophical Investigations OxfordBlackwell 2nd ed 1958

mdashmdashmdash 1958 The Blue and Brown Books OxfordBlackwell


6 See Samuelson (1987 2000ab) See also Frank Hahn(1982)

argued that Sraffa is partly profound andpartly just wrong6

The temptation to examine ldquothe econo-mist Sraffardquo separately has certainly beenstrong And yet there is something to begained from seeing Sraffarsquos different contri-butions together No less importantly for thehistory of philosophical thought it may beimportant to reexamine Sraffarsquos interactionswith Wittgenstein whom Sraffa stronglyinfluenced in the light of Sraffarsquos relation-ship with Antonio Gramsci the Marxist theo-rist who had a strong influence on SraffaIndeed these dual relations also provide anopportunity to explore a possible ldquoGramsciconnectionrdquo in the transformation of ldquoearlyWittgensteinrdquo into ldquolater Wittgensteinrdquo

2 Wittgenstein and Sraffa

Ludwig Wittgenstein returned to TrinityCollege Cambridge in January 1929 afterhaving left Cambridge in 1913 where hehad been a student of Bertrand RussellWittgensteinrsquos return was quite an eventgiven his already established reputation asa genius philosopher John MaynardKeynes wrote to his wife Lydia LopokovaldquoWell God has arrived I met him on the515 trainrdquo

Piero Sraffa who did not know Wittgen-stein earlier had moved to Cambridge fromItaly a little over a year before Wittgensteinrsquosreturn Even though Sraffa was only 29 yearsold at that time (he was born in Turin onAugust 5th 1898) he was already well-known in Britain and Italy as a highly origi-nal economist He had obtained a researchdegree (testi de Laurea) from the Universityof Turin in late 1920 with a thesis on mone-tary economics but it was an article on thefoundations of price theory which he pub-lished in 1925 in Annali di Economia (a jour-nal based in Milan) that made him a majorcelebrity in Italy and Britain In this essay

Sraffa demonstrated that the foundations ofongoing price theory developed by AlfredMarshall (the leader of the then-dominantldquoCambridge schoolrdquo) were incurably defec-tive A significant extension of this essay inEnglish appeared the next year in theEconomic Journal (Sraffa 1926) and wasextremely influential

Sraffa also had deep political interestsand commitments was active in theSocialist Studentsrsquo Group and joined theeditorial team of LrsquoOrdine Nuovo a leftistjournal founded and edited by AntonioGramsci in 1919 (it would later be bannedby the fascist government) Indeed by thetime Sraffa moved to Britain in 1927 he hadbecome a substantial figure among Italianleftist intellectuals and was close tomdashbutnot a member ofmdashthe Italian CommunistParty founded in 1921 and led by GramsciWhile Sraffa had obtained the position oflecturer at the University of Perugia in1923 and a professorship in Cagliari inSardinia in 1926 he considered a move toBritain as fascist persecution becamestronger in Italy

Already in 1922 Piero Sraffarsquos fatherAngelo who was the Rector of BucconiUniversity had received two telegrams fromMussolini demanding that Piero shouldretract a critical account of Italian financialpolicies he had published in the ManchesterGuardian (as it happens on John MaynardKeynesrsquos invitation) It was ldquospreading mis-trustrdquo and was ldquoan act of true and real sabo-tagerdquo Mussolini complained Angelo Sraffaa courageous and resolute academic repliedthat the article stated only ldquoknown factsrdquo andthere was nothing in particular to be retract-ed Piero Sraffa had several other alterca-tions with the Italian government in theyears following and warmed to an invitationconveyed in a letter from John MaynardKeynes in January 1927 to take up a lecture-ship in Cambridge He moved to Cambridgein September that year By the timeWittgenstein returned to Cambridge inJanuary 1929 Sraffa had already established



































































16 Robinson (1964) p 39




















































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16 Robinson (1964) p 39




















































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16 Robinson (1964) p 39




















































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16 Robinson (1964) p 39




















































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16 Robinson (1964) p 39




















































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16 Robinson (1964) p 39




















































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16 Robinson (1964) p 39




















































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16 Robinson (1964) p 39




















































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Amartya Sen-Sraffa, Wittgenstein, And Gramsci(2003)

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