Surplus approach to value and distribution and structural economic dynamics: interpretation and uses of Sraffa's analysis

This essay presents and discusses the interpretation and uses of Sraffa's system which can be found in two major streams of analysis developed in the wake of Sraffa (1960): the Surplus Approach to Value and Distribution (SAVD) and the approach of Structural Economic Dynamics (SED). As to the former, we go through the separation of the analysis in two distinct logical stages, which leads to enucleate the 'core' of surplus theories: the relations between distribution and relative prices. As to the latter, the emphasis is on the analytical notion of growing subsystems, where the configuration of natural prices is logically implied by the conditions necessary for reproduction and growth. In both approaches, the relation between physical surplus product, profits and wages is explored, and the role played by the labour theory of value is touched upon. A further emphasis is put on the separate determination of relative prices and physical quantities common to both approaches.