Freeing long‐period prices from the uniform profit rate hypothesis: A general model of long‐period positions

Modern long‐period literature defines long‐period prices as prices yielding a uniform profit rate. This definition relies on the assumption of free competition, which is not essential in defining long‐period prices, the reproducibility of the economic system being the essential condition. A definition of long‐period prices based only on reproducibility is then proposed and a model developed. The existence of long‐period price vectors is obtained in a variety of situations yielding differential or uniform profits rates. Our analysis shows that the long‐period approach is “robust” with respect to the elimination of the significant but problematic assumption of uniform profit rates. Our model provides also a formalization of Smith’s view of domestic and international division of labour.