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118 Piero Sraffarelations are called ‘natural’ when they express the conditions of reproductionin the circular process of production and consumption, or inother words when producers recover what is needed to repeat activitiesin the following period, and when they find it advantageous to do so,the distribution of surplus complying with the condition of a uniformrate of profits in the various sectors and thus reflecting the essential elementof capitalist competition, namely the free flow of capital betweenthe various sectors of the economy. 9In this tradition the concept of market does not correspond to apoint in time and space upon which purchasers and sellers convergebut rather to a network of repetitive and sufficiently regular tradeflows, and thus to a network of interpersonal relations underlyingthese flows, essential for the reproduction of the economic system.This conception can be found in classical economists from WilliamPetty on. 10 Here prices indicate the conditions for reproduction recalledabove and not the relative scarcity of commodities vis-à-vis the wantsof consumers.Thus we find a sharp contrast between the approach of the classicaleconomists and an even older conception, where the concept of marketrefers to a place upon which purchasers and sellers converge and wheretrade relations are therefore determined by confrontation of demandand supply. The ideal reference point here is the Medieval fair, and thenthe Stock Exchange. It is from a development of this representation ofthe economic problem – as determination of the equilibrium arisingfrom the demand/supply confrontation – that the subjective conceptionof value derives. The ‘equilibrium’ price (a term that found itsplace in economics only after the ‘marginalist revolution’ of the 1870s,9The labour theory of value in this respect (disregarding its metaphysical aspect,connected to the idea of labour as cause or substance of value) is merely a simpleway of expressing the relative difficulty in the production of a commodity usinga mono-dimensional variable. However, the second condition for reproduction(uniformity of the rate of profits in the various sectors) calls for a multidimensionaldescription of the difficulty of production: for each sector, a vectorincluding as many elements as there are means of production (including labour)represents the physical costs of production. This relationship between labourand physical cost of production is quite clear, for instance in William Petty: cf.Roncaglia (1977, Chapter 8). In the Sraffa Papers there are a few, though oftenquoted, documents in which Sraffa shows negative appraisal of the transitionfrom Petty’s physical costs to the labour theory of value: cf. for instance SraffaPapers, D3/9.89 (quoted by Kurz and Salvadori 2000: 429): ‘It is a purely mysticalconception that attributes to labour a special gift of determining value’.10Cf. Roncaglia (1977: 73–6).Interpreting Production of Commodities 119alongside adoption of a methodological model inspired by physics,and in particular static mechanics) is that which ensures equality betweendemand and supply, or in other words allows for the balancing ofopposed forces deriving from the scarcity of commodities and the desirefor them. The problem remains essentially the same if it is the originalfactors of production that are scarce, equilibrium between demand forfinal consumption goods and the supply of original factors being mediatedby production. 11In the classical approach, the theory of value is based on technology,taken as given, and the principle for the distribution of the surplus –uniform wage rate and uniform rate of profits – while the marginalistapproach takes as given the endowment of resources and consumers’preferences (to which technology may be added). Here we come to thepoint of differentiation signalled by Sraffa: according to the classicalapproach the problem of value does not consist in determining theequilibrium values simultaneously for prices and quantities exchanged(and quantities produced, if the model includes production). Moresimply, it consists in determining the exchange ratios that satisfy theconditions for reproduction of the economic system. It is only whenthe marginalist conceptual framework of supply–demand equilibriumis superimposed on the classical problem that it appears necessary todetermine quantities and prices simultaneously.In the classical approach, of course, separating the problem of ‘reproductionprices’ from that of quantities produced and exchanged doesnot imply that the problem of determining production levels lies outsidethe economist’s field of work. An economist like Marx who startsfrom the classics makes a clear distinction between three logical stages:the firms’ decisions on the quantities to produce, the subsequent theoreticalanalysis of the link between prices and distribution and, finally,the problem of realising on the market through sales the value of thecommodities produced.11Actually, the very idea of original factors of production needs looking closelyinto. In fact, ‘land’ normally requires substantial investment before it can beused in the production process, but it cannot be considered scarce in absoluteterms. As regards ‘labour’, we must bear in mind both the importance of professionaltraining in contemporary economies and a whole range of elements (fromcustomary practices and legal norms to the existence of social services such askindergartens) determining both rates of activity (especially for women) andmigratory flows. We have already seen (in Chapter 6) the Sraffian critique of‘capital’ interpreted as a factor of production.