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ECON 4050 Classical Economics: Contrast with Modern Microeco
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    Classical Economics:Contrast with Modern Microeconomics

    A one-sector model; corn is produced on land, with diminishing returns to labor when applied to the ‘extensive’ margin. Production cycle: one year. Capital solely takes the form of a fund to pay advanced wages.
    •A one-sector model; corn is produced on land, with diminishing returns to labor when applied to the ‘extensive’ margin.
    •Production cycle: one year.
    •Capital solely takes the form of a fund to pay advanced wages.

    •“[T]he treatment of the real wage, the social product and the technical conditions of production as independent variables in the ‘core’ in no way entailed denying the existence of influences of any single one of these three sets of variables over the remaining two” (p. 296).
    •“[T]hat those three sets of circumstances appeared as independent variables in the determination of the surplus did not prevent the classical economists from freely admitting influences of the surplus upon them” (p. 297).

    Section I heading: “The value of a commodity, or the quantity of any other commodity for which it will exchange, depends on the relative quantity of labour which is necessary for its production, and not on the greater or less compensation which is paid for that labour” ([1821] 1951, p. 11).
    Section II heading: “Labour of different qualities differently rewarded. This no cause of variation in the relative value of commodities” ([1821] 1951, p. 20).
    Section III heading: “Not only the labour applied immediately to commodities affect their value, but the labour also which is bestowed on the implements, tools, and buildings, with which such labour is assisted” ([1821] 1951, p. 22).
    ......

    •“[T]he assumption [of independence] becomes illegitimate, when a variation in the quantity produced by the industry under consideration sets up a force which acts directly, not merely upon its own costs, but also upon the costs of other industries; in such a case the conditions of the ‘particular equilibrium’ which it was intended to isolate are upset, and it is no longer possible, without contradiction, to neglect collateral effects” (p. 539).

    共39页ppt。

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