The paper analyses the underlying 'philosophical underpinnings' of Sraffa's 'Production of Commodities by Means of Commodities', an aspect that has hitherto received very little intellectual discussion. The author argues that the rejection of the concept of 'mechanical causality' on which foundations of orthodox theory depend heavily, is the philosophical cornerstone of Sraffa' book. In other words, Sraffa sought to establish that a change in methods of production or techniques of production leaves economic theory with no standard of measurement with which economic variables could be compared. This makes very vulnerable theories like that proffered by the neoclassical school since it depends heavily on causal functional relationships between, for example, prices and choice of techniques.

*Ajit Sinha is associated with the Gokhale Institute of Economics and Politics at Pune, India.
 
August 19, 2002.