The law of value and laws of statistics: sectoral values and prices in the US economy, 1977-97

This study replicates findings that sectoral prices and values are highly correlated cross-sectionally, and that deviations between them are small. Yet after controlling for variations in industry size that produce 'spurious correlation', I find no reliable evidence that relative values have any influence upon relative prices. The smallness of price-value deviations thus does not result from such an influence; it is shown instead to result from a lack of dispersion in the data. Values turn out to be no better predictors of prices than any other random variable with the same probability distribution.