ABSTRACT
During his first years in Cambridge, Piero Sraffa had initiated the research which led, much later, to the publication of his famous essay Production of Commodities by Means of Commodities: Prelude to a Critique of Economic Theory. In 1926, in ‘The Laws of Returns under Competitive Conditions’, he had already maintained that the classical economists’ theory of value, and the problems it raised, met with total ‘indifference’ among contemporary economists, most of whom were faithful to the marginal approach. But Sraffa, even though he himself had pioneered the idea of imperfect competition, had soon lost confidence in its prospects, and was showing increasing interest in the problems raised by the theory of value and distribution as defined by Smith, Ricardo and Marx; he was also interested in the approach of the physiocrat François Quesnay, who had been the first to consider production and consumption as a ‘circular process’. Sraffa attempted to rehabilitate and reformulate the theoretical approach based on the notion of ‘surplus’, as a potential starting point for a radical critique of the marginal approach to capital and distribution, based on the notion of ‘factors of production’.
