Sraffa's system: Equal rate of profits and the notion of center of gravitation

This paper argues that the condition of uniform rate of profits in Sraffa's system is not based on his implicit assumption that the system is at the ‘equilibrium’ or the center of gravitation. It is rather a logical requirement of a reproducing system of basic goods as long as prices are not imposed from outside the system. This condition holds irrespective of supplies being equal to their respective effectual demands. It conjectures that Sraffa could have arrived at this conclusion through his analysis of the Standard system. On the basis of this result, a critique of the received interpretation, led by Garegnani, of Sraffa's prices is developed.     

RESPONSE OF STOCK PRICES TO MONEY SUPPLY ANNOUNCEMENTS: AUSTRALIAN EVIDENCE

This paper extends the literature on the money supply announcement effect by examining the response of stock prices to the monthly announcements of the money supply made in Australia. The unexpected component of the money supply change is identified using both a market based survey of expectations and rolling ARIMA time series models. The analysis is further extended to examine the impact of the money supply announcements during the period of monetary target-ting; the cross-sectional impact of the announcements across various stock price indices and the pre- and post-announcement responses of stock prices. The results documented show no evidence of a significant stock price response to the money supply announcements in Australia.