Marx divides the chapter into four sections:
(1) The Degree of Exploitation of Labour-Power;A section by section summary follows.
(2) The Representation of the Value of the Product by Corresponding Proportional Parts of the Product;
(3) Senior’s “Last Hour”
(4) The Surplus Product.
(1) The Degree of Exploitation of Labour-Power
Surplus value is generated in production, and is value over and above the value of C (the capital advanced) (Marx 1990: 320).
But C is made up of the following:
(1) c = constant capital, andSo C = c + v (Marx 1990: 320).
(2) v = variable capital.
An output commodity is produced and value equals (c + v) + s, where s is surplus value. The “capital advanced” C is c + v.
The surplus value arises only from variable capital, or that part of the capital C converted into labour-power (Marx 1990: 322). So, for example, machines cannot create surplus value (Harvey 2010: 128).
The rate of surplus value is s/v (Marx 1990: 324; Brewer 1984: 43). It is important to note that s/C is the rate of profit and is distinct from the rate of surplus value (Brewer 1984: 43).
“Necessary labour-time” is the part of the working day that the worker needs to work to pay for his own reproduction (Marx 1990: 325).
But then there is the second part of the working day:
“During the second period of the labour-process, that in which his labour is no longer necessary labour, the workman, it is true, labours, expends labour-power; but his labour, being no longer necessary labour, he creates no value for himself. He creates surplus-value which, for the capitalist, has all the charms of a creation out of nothing. This portion of the working day, I name surplus labour-time, and to the labour expended during that time, I give the name of surplus-labour. It is every bit as important, for a correct understanding of surplus-value, to conceive it as a mere congelation of surplus-labour-time, as nothing but materialised surplus-labour, as it is, for a proper comprehension of value, to conceive it as a mere congelation of so many hours of labour, as nothing but materialised labour. The essential difference between the various economic forms of society, between, for instance, a society based on slave labour, and one based on wage labour, lies only in the mode in which this surplus-labour is in each case extracted from the actual producer, the labourer.” (Marx 1906: 240–241).The necessary part of the working day is determined by the value of variable capital bought by the capitalist (Marx 1990: 326).
And the crux of Marx’s view is that the worker is not paid for his “surplus labour-time” during which he creates surplus value for the capitalist. The actual labour-power expended during this “surplus labour-time” is the “surplus-labour.”
This passage is also very interesting because Marx thinks that a slave-based economy also has surplus labour. But do slaves produce surplus value? Marx’s theory seems to deny that a slave can sell labour-power that creates surplus value.
The rate of surplus value is also equal to the surplus labour divided by necessary labour (Marx 1990: 326; Brewer 1984: 43).
According to Marx,
“The rate of surplus-value is therefore an exact expression for the degree of exploitation of labour-power by capital, or of the labourer by the capitalist” (Marx 1906: 241).This, however, is not a measure of the absolute magnitude of exploitation (Marx 1990: 326, n. 7), but merely the degree of exploitation in relation to the ratio of surplus value to variable capital advanced (s/v).
In the remainder of this subsection Marx gives some examples of all these quantities and assumes that the prices of commodities are equal to the labour values (Marx 1990: 328). At the end of the examples there comes an obscure footnote:
“The calculations given in the text are intended merely as illustrations. We have in fact assumed that prices = values. We shall, however, see in Volume III., that even in the case of average prices the assumption cannot be made in this very simple manner.” (Marx 1906: 244, n. 1).First, it is quite obvious that this footnote is referring to the examples given in the chapter and not throughout the whole of volume 1 of Capital. This is not some statement by Marx that the whole law of value in volume 1 is merely an analytical tool, and not empirical in any way, as some Marxist apologists want to make it out to be.
Secondly, this is quite obviously one point where the inconsistent theory of prices of production that Marx had sketched in the draft of volume 3 of Capital (written prior to volume 1) has intruded into the text of volume 1.
It is quite extraordinary that Marx never further explained this point about prices of production. If he had done so, of course, his whole theory in volume 1 would have quickly fallen apart, and later critics pointed to the damning inconsistencies between volume 1 and volume 3 soon after volume 3 was published.
(2) The Representation of the Value of the Product by Corresponding Proportional Parts of the Product
In this section Marx applies his analysis to the production of yarn from cotton, and argues that the output product represents merely different parts of the labour going into its production, whether that labour value is in (1) constant capital, (2) variable capital and (3) the surplus-labour:
“To split up in this manner the product into different parts, of which one represents only the labour previously spent on the means of production, or the constant capital, another, only the necessary labour spent during the process of production, or the variable capital, and another and last part, only the surplus-labour expended during the same process, or the surplus-value;” (Marx 1906: 246–247).In essence, the total value of the output commodity is c + v + s (Harvey 2010: 130).
(3) Senior’s “Last Hour”
This subsection is a description of Nassau W. Senior’s defence of manufacturers against the Factory Act (1833) and agitation for a 10 hour working day, and his idea that a reduction of one hour in the working day would destroy the net profits of manufacturers.
However, this need not concern us, except to note that this is yet another section where Marx implies that his law of value is being applied to the 19th century capitalism, and not to some pre-modern world of commodity exchange (as he and Engels were later to state).
(4) The Surplus Product
Finally, the portion of the product that can be said to represent surplus value is called the “surplus product” (Marx 1990: 338).
Marx notes that
“The sum of the necessary labour and the surplus-labour, i.e., of the periods of time during which the workman replaces the value of his labour-power, and produces the surplus-value, this sum constitutes the actual time during which he works, i.e., the working day.” (Marx 1906: 254–255).BIBLIOGRAPHY
Brewer, Anthony. 1984. A Guide to Marx’s Capital. Cambridge University Press, Cambridge.
Harvey, David. 2010. A Companion to Marx’s Capital. Verso, London and New York.
Marx, Karl. 1906. Capital. A Critique of Political Economy (vol. 1; rev. trans. by Ernest Untermann from 4th German edn.). The Modern Library, New York.
Marx, Karl. 1990. Capital. A Critique of Political Economy. Volume One (trans. Ben Fowkes). Penguin Books, London.
Hey, LK. Hope you're well.
ReplyDeleteFirst, it is quite obvious that this footnote is referring to the examples given in the chapter and not throughout the whole of volume 1 of Capital.
I'm interested in how you sum this with your reading of the rest of the book. So, in this chapter, value = price is assumed, but in previous chapters, it is empirical? Then why would it not simply be empirical here, as well?
Secondly, this is quite obviously one point where the inconsistent theory of prices of production that Marx had sketched in the draft of volume 3 of Capital (written prior to volume 1) has intruded into the text of volume 1.
I'm interested also in this. You keep finding more and more places where "the theory of volume 3 intrudes" in volume 1. Why are you so adamantly, unshakably determined to read this as inconsistency when the more likely and textually supported explanation is simply that abstraction is being employed?
It is quite extraordinary that Marx never further explained this point about prices of production.
To do so would have required explication of the formation of the general rate of profit and the objective, historical conditions that gave rise to prices of production distinct from values. As he notes in the preface to the first edition, such would have been outside the scope of the first book, and would have required many more chapters if the structure of his explanation in vol 3 were to be preserved. Instead, he explicitly lays aside this question until later, multiple times throughout the text.
If you object to his presentation, that's quite apart from objecting to his content.
However, this need not concern us, except to note that this is yet another section where Marx implies that his law of value is being applied to the 19th century capitalism, and not to some pre-modern world of commodity exchange (as he and Engels were later to state).
A great deal of confusion arises over this point because Marx and Engels were realists, and therefore recognize a distinction between "real" and "empirical." In pre-capitalist commodity exchange, the law of value is both; under capitalism, it is merely the former, obscured by other factors they later explain.
I hope that clears up any confusion!
(1) his examples are given with the assumption that price = value, and he reminds his readers of this, because we know his view -- his law of value in vol. 1 -- is
Delete“The assumption that the commodities of the various spheres of production are sold at their value implies, of course, only that their value is the center of gravity around which prices fluctuate, and around which their rise and fall tends to an equilibrium.” (Marx 1909: 208–210).
There is no contradiction here.
(2) " You keep finding more and more places where "the theory of volume 3 intrudes" in volume 1. "
DeleteFalse. There are but 2 I know of and I have said this for months. Maybe there are more minor and obscure statements somewhere in vol. 1, but I've not seen them and more piffling and utterly obscure footnotes certainly would not refute my argument. That would just underline how (1) Marx was outrageously dishonest in not carefully stating that his law of value (as quoted above) does not apply to 19th century capitalism or (2) extremely incompetent.
Worse still, you seem still to be sticking to your totally discredited view that the law of value in vol. 1 is all abstraction and just totally abstract simplifying assumption.
That is false. Marx himself in vol. 3 says it at least applies empirically to pre-modern commodity exchange. So did Engels. There is no way it can be merely an "abstraction" or "simplifying assumption." You really are a shameful liar.
"To do so would have required explication of the formation of the general rate of profit and the objective, historical conditions that gave rise to prices of production distinct from values. "
Deletelol.. NO, IT WOULDN'T. All he needed to say was:
"This law of value in this volume -- the assumption that value is the center of gravity around which prices fluctuate, and around which their rise and fall tends to an equilibrium -- describes the pre-modern world of commodity exchange and not modern 19th century capitalism."
Or words to this effect.
(1) You may have made an error; the quote you selected refers to it as an assumption. I suggest you select a different one, because presently you are presenting *precisely* a contradiction.
Delete(2) Are footnotes not part of the text? I feel as if the rules keep changing. Were Keynes's footnotes also to be disregarded?
When Keynes treated money as endogenous in his Treatise, but then exogenous in his General Theory, was he being incompetent or inconsistent? Was he merely lying to us? Why?
Anyway, your framing of the law of value as "applying" to the 19th century still misstates the issue. It's not enough to say a law applies or does not apply; you need to specify how. In this case, the law of value is *ontologically* valid for commodity exchange in all eras, but *empirically* valid only prior to the rise of prices of production under capitalism. For more information on how this might be, please see this document.
As that will show, I'm not a liar at all; I merely subscribe to a different position re: ontology and the philosophy of science. I forgive you for your accusation, though.
All he needed to say was:
DeleteIn my opinion, saying that would have opened a huge can of worms. If he had just said what you say, his critics would have been all over him. "So your entire theory is inapplicable!" they'd shout, without any further explanation to show them that, no, they just haven't gotten to the next part, yet.
But we can agree to disagree about whether his presentation was optimal. The important thing is we agree on the content of the theory.
(1) "(1) You may have made an error; the quote you selected refers to it as an assumption. I suggest you select a different one"
DeleteYou are clearly a pathological liar and an utter buffoon.
You already admitted that you accept that Marx and Engels applied this law of value in vol. 1 to premodern commodity exchange as an empirical theory at least at the end of their lives. The word "assumption" as used by Marx does not have the sense you want to give to it.
I warn you will publish nothing more on this post unless you honestly admit what you have previously admitted: that Marx and Engels clearly did apply the law of value in vol. 1 (as stated above) to the real world at least at the end of their lives, and it cannot be a mere non-empirical or wholly abstract "assumption".
I warning you: show some basic honesty on this issue or fu*ck right off.
(2) Footnotes are part of a book, but that is not the issue here. The issue is how Marx does not mention the inconsistent theory he had sketched in the draft of vol. 3 explicitly and clearly in vol. 1 in the preface or chapter 1 and at the same time point out that his law of value in vol. 1 was to be confined to the pre-modern world.
Delete"When Keynes treated money as endogenous in his Treatise, but then exogenous in his General Theory, was he being incompetent or inconsistent? "
Keyes was wrong in the GT. But we do have good evidence why he did so: to make his case stronger by assuming assumptions his neoclassical opponents would accept.
But even he later admitted that endogenous money is the right theory, and no Post Keynesians waste their lives away defending the exogenous money theory -- unlike Marxists who defend the discredited LTV like the hardcode lunatic cultists they are.
Marx and Engels clearly did apply the law of value to the real world both at the ends of their lives and for decades before. They maintain that it is an empirical regularity only prior to capitalism, but has ontological significance through all commodity exchange through all eras.
DeleteThis is what I've always said, and you will not bully me into changing my position.
You are clearly a pathological liar and an utter buffoon.
It's not clear at all that you know what any of these words mean. I suppose the author of the SEP article I linked above is also a liar?
"In this case, the law of value is *ontologically* valid for commodity exchange in all eras, but *empirically* valid only prior to the rise of prices of production under capitalism"
DeleteThis all depends on a fallacy of equivocation.
The "law of value" is left deliberately vague. Presumably it means the feeble senses of the law in vol. 3.
No. The law of value even there is essentially B.S.
There are 2 senses as Marx defines it in which it is B.S., and then only trivially true in the other third sense (i.e., that labour costs influence prices). The 3rd sense does not vindicate the orthodox LTV at all.
"They maintain that it is an empirical regularity only prior to capitalism, but has ontological significance through all commodity exchange through all eras."
Delete.. which means -- if by "empirical regularity" you mean the law of value as quoted by me above in Marx's own words -- your attempt to say or imply that the word "assumption" as used by Marx only "refers to it as an assumption" as if it was totally abstract and non-empirical was a dishonest rhetorical trick.
You've done nothing but demonstrate your genuine dishonesty on this thread. The same B.S. we have seen time and again.
.. which means -- if by "empirical regularity" you mean the law of value as quoted by me above in Marx's own words -- your attempt to say or imply that the word "assumption" as used by Marx only "refers to it as an assumption" as if it was totally abstract and non-empirical was a dishonest rhetorical trick.
DeleteNope.
It is an assumption that prices of production either equal or tend to equal values. Empirically, they do not at the present time in history, though they did in the distant past. This has to do with a greater diversity of capital intensities now.
In order to treat the present like the distant past, therefore, we must abstract away from said diversity.
Literally no reader who approached Marx with an open mind has missed this; only those who have been determined from the outset to "disprove" him by reading errors into him.
I've shared with you the scientific realist tools you need to make sense of Marx. At this point, by ignoring them, your crusade against Marx has transformed into a crusade against realism. Yet you yourself have, in the past, professed to be a realist. That, my friend, is a contradiction.
Maybe solve that one before you go inventing others.
"Literally no reader who approached Marx with an open mind has missed this; "
DeleteThat is 100% bullsh*t, you Marxist a**hole. In your case, you know it is false.
You have been saying for months on my blog that
(1) the law of value NEVER meant that "value is the center of gravity around which prices fluctuate, and around which their rise and fall tends to an equilibrium" in any empirical sense and
(2) that when Marx said in vol. 1 that labour values can determine individual commodity prices this was only ever a pure abstract simplifying assumption, and not empirical in any way.
E.g.,
“>In vol. 1, goods have at least
>a tendency to exchange at pure
>labour values
We've been over this a hundred times. It's a simplification for pedagogical purposes that is explicitly unrealistic.”
http://socialdemocracy21stcentury.blogspot.com/2015/08/marxs-capital-volume-1-chapter-8.html?showComment=1438715789086#c514791626841157667
----------
I could easily find very many other quotations like this one. Perhaps you will actually go back and start deleting them. I wouldn't even be surprised given the level of lying we have seen here.
When I published this post here, which totally demolished your B.S., you quietly dropped claims (1) and (2) above, and now you dishonestly act as if this was your view all along.
You are truly an outrageous and pathological liar and a cultist, and at this stage your utterly shameless dishonesty suggests to me you must be deeply delusional if you think you can just throw these endless blatant lies out without being called out on them.
False. There are but 2 I know of and I have said this for months.
ReplyDeleteYes, and now you've just spotted a third. Hence "more and more." I thought that was obvious.
It is same footnote I referred to months ago. Further dishonesty.
DeleteNo, you were just unclear. Your previous post discusses chapters 5 and 8. This post claims to discuss chapter 9, but then apparently includes a quote from chapter 8 without ever specifying it as such.
DeleteYou didn't specify you were quoting chapter 8 in your post about chapter 9. But yeah, this is totally me being dishonest and not just being misled by your unclear writing.
DeleteIn the post here:
Deletehttp://socialdemocracy21stcentury.blogspot.com/2015/08/two-instances-where-marxs-theory-of.html
The words "Chapters 5 and 8 in volume 1 of Capital" are just a typo for "Chapters 5 and 9 in volume 1 of Capital."
So here the mistake lies with a typo and your own sloppy and hasty failure to notice it is the same quote as I used above.
I have not read this closely, but some of Hedlund's prevarications like "ontological significance" versus "empirical regularity" and so on remind me of the Catholic notions about the sacramental wine. Or MF and "incentive".
ReplyDelete"This passage is also very interesting because Marx thinks that a slave-based economy also has surplus labour. But do slaves produce surplus value? Marx’s theory seems to deny that a slave can sell labour-power that creates surplus value."
ReplyDeleteThe fact that the immediate producers create a surplus product is a fact for all modes of production. How that surplus product gets into the hands of the owning class is what differs -- alongside the mode of owning.
So under slavery, the workers do not sell their labour -- they themselves are sold. The product of their labour -- like the labour itself -- is held by their owners for as long as they own the slave.
The difference under capitalism is that it appears that the workers are paid for their labour. They sell their labour for a short period (rather than for all time) and get back what appears to be their "contribution" to production.
The question is how, if that is the case, why do workers not get the full value of their labour back as wages if all commodities -- including labour -- are sold at their (exchange) value.
Marx, like other socialists before him (Thompson, Proudhon), argued that was because the workers sell their labour and liberty to an employer who can then monopolise the product of that labour. Thus the "surplus of labour" they create by working ends up in the hands of their employer (using Proudhon's expression).
The different levels of investment (which Marx abstracts form in volume 1) does not change the situation that there is a surplus product produced which is then distributed via market exchange (which is what volume 3 takes into account via its "prices of production").
In short, surplus labour and surplus product exist in all modes of production. Surplus-value exists in market economies and its by means of wage-labour under capitalism that it is appropriated by the owning class.
Needless to say, Marx's claims at originality on discovering this are not true -- not least because its key features (e.g., the difference between labour and labour-power) were argued by Proudhon in the 1840s:
“Marx made some disparaging remarks about this passage [...] even though Proudhon here anticipated an idea that Marx was to develop as one of the key elements in the concept of labour power, viz. that as a commodity, labour produces nothing and it exists independently of and prior to the exercise of its potential to produce value as active labour.” (Oakley, Alan, "Marx’s Critique of Political Economy: intellectual sources and evolution, 1844 to 1860" Vol. 1 [Routledge & Kegan Paul, London, 1984], 118)
Also, I should note that some propertarians (i.e., right-wing "libertarians") follow Locke in arguing for voluntary slavery -- so workers can sell their labour for a lifetime rather than incrementally.
Iain
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