But, if we accept this, it just raises the question: how and under what conditions could commodity prices in a capitalist economy actually equal abstract socially-necessary labour time (SNLT) as Marx defines it?
The following conditions would be necessary:
(1) demonstrate how to reduce all heterogeneous human wage labour to a common, meaningful homogeneous unit of abstract labour time;But it is perfectly obvious that this is not how capitalism prices goods and even as a simplifying assumption it throws up all sorts of severe problems for Marx’s economic theories.
(2) calculate the SNLT required to produce all commodities and assign a consistent money unit to 1 unit of SNLT, e.g., 1 money unit would consistently equal one unit of homogeneous labour time;
(3) price all commodities and non-labour factor inputs in terms of socially necessary labour time required to produce them with the assigned money value of 1 unit of SNLT.
(4) under these conditions of course, we must assume also that workers are not paid the full and proper value of their labour in wage rates corresponding to SNLT, and that there is surplus labour value and money profit extracted by capitalists.
For one thing, the choice of what money unit you assign to 1 unit of SNLT is ultimately arbitrary, and at different money rates corresponding to one unit of SNLT (say, 1, 2, 3, 4, 5, 6, 7 etc.) you can potentially have any number of given price sets corresponding to SNLT, and any number of accidental instances where a real world commodity price might equal SNLT, under a given price set with a given money rate assigned to 1 unit of SNLT.
Under another standard interpretation, Marx in volume 3 of Capital sheds his simplifying assumption in volume 1 and assumes that most prices do not actually equal SNLT (and even average long-run Classical equilibrium prices do not directly do so), but only by accident do some occasional prices do so. But how on earth would you know when any individual real world market commodity price equals the SNLT required to produce it?
Marx does not explain how in real world markets a given commodity price would equal the SNLT needed to produce it, because it is never properly made clear how you determine such a price in the first place. Marx’s whole theory, even as a simplifying assumption and even in volume 1, is grossly under-determined and ambiguous.
Mandel, Ernest. 1990. “Introduction,” in Karl Marx, Capital. A Critique of Political Economy. Volume One (trans. Ben Fowkes). Penguin Books, London. 11–86.
Marx, Karl. 1990. Capital. A Critique of Political Economy. Volume One (trans. Ben Fowkes). Penguin Books, London.