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RE: [ox-en] Re: Role of markets



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The measure is slightly more complex than that, but involves taking a bundle of commodity prices  for major industrial sectors : oil, steel, forestry .... to some 70 sectors of the economy and determining the correlation coefficient between the vector of labour values and the vector of market prices.
It means that some 95% of the variation of the recieved data ( prices ) can be explained by the variation of the signal ( value ). Basically it says you get an R^2 of over 0.95. One can use other measures such as angular separation, or mean absolute error, and you get similar results. For Mean Absolute Error, you find an error of about 10%. Depends on whether you like L1 or L2 metrics.

Paul Cockshott
Dept of Computing Science
University of Glasgow
[PHONE NUMBER REMOVED]
www.dcs.gla.ac.uk/~wpc/reports/



-----Original Message-----
From: owner-list-en oekonux.org on behalf of adam
Sent: Fri 8/15/2008 3:58 PM
To: list-en oekonux.org
Subject: Re: [ox-en] Re: Role of markets
 
Hi Paul,

( thanks for answering my question re: tables )

Paul Cockshott wrote:

The idea of labour being the measure of value has a long pedigree, going
back to classical political economy, and there is now a large body
of econometric literature which indicates that exchange value in
a capitalist economy does correlate very closely with labour values.
Studies typically get correlation coefficients of above 95% 
between labour content and exchange value of commodity types.

Do you mean by this, that in a survey of commodities, that one would 
expect over 95% of commodities surveyed, to have prices that appear to 
be mathematically related to the amount of time taken to produce a 
particular commodity ?

-- adam

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