2.22 The categories of economic exchange are the same as the categories of commodities.

1. Three economic classifications are identical.

The nomenclature of commodities is the same as the nomenclature of commodity exchange and the nomenclature of prices, when the latter word designates the values of economic exchange.

2. One of the differences between capital (standing advance) and credit (temporary advance) is that only the former is essential financing for the creation and operation of an enterprise.

This is why a price theory that does not have in its elements a theory of the normal rate of return on placements in capital is defective. The provision of the financing essential to the creation and operation of an enterprise is part of the general scheme of economic exchange. This is particularly evident in the case of commercial companies which, by their articles of association, make it their rule: to you, the providers of my permanent financing, the remuneration of your service by a share of my earnings. The rule to which credit institutions adhere is just as logical and necessary: to you, my customers, the repayable advances that I provide you, to me the interest with which you remunerate my service.⁸¹

Notes

81. By this criterion, Sraffa’s price theory is open. Once the wage is added as a variable, his system has one more unknown than it has equations and moves with one degree of freedom (P. Sraffa, Production of Commodities by Means of Commodities, Cambridge University Press, 1960, §12). Sraffa closes it by taking the rate of profits as given from outside the system of production (§44) and offers no theory of its normal level. The Objective Political Economy supplies this element: a published national average rate of profit on capital, the NARP (Propositions 6.8 and 10.3), sufficient for full employment through the EPCE relation (chapter 7). See also Proposition 8.4. See the appendix Objective Political Economy and Sraffa. ↩