Philip Pilkington, “Marx, Hegel, the Labour Theory of Value and Human Desire,” Fixing the Economists, August 13, 2013.Also, very interesting are his arguments in debates with Marxists on the labour theory in the comments sections of these blog posts:
Philip Pilkington, “Was Marx Right?,” Fixing the Economists, March 31, 2014.
Philip Pilkington, “Joan Robinson and the Labor Theory of Value,” Fixing the Economists, August 7, 2013.
Philip Pilkington, “Why Sraffa’s Theory Does Not Contain a Labour Theory of Value,” Fixing the Economists, May 6, 2014.
Matias Vernengo, “Sraffa and Marxism or the Labor Theory of Value, what is it good for?,” Naked Keynesianism, August 14, 2012.One of his good examples of how subjective value and advertising have a major role in explaining price is as follows:
Vienneau, Robert. “Vocabulary For Marxism,” Thoughts on Economics, July 8, 2012.
“I recall pointing to advertising a number of times and saying that this added value to commodities without any additional human labour.Some Marxists might reply that the “use values” of the two shoes are different: the one worn by the famous sports star now has a different use value because it is a status symbol.
I had a long argument with two Marxist economists about this and came up with a great example:
Two pairs of runners are made in the same Chinese factory. The inputs are identical -- including labour time. However, one pair gets a little tick stitched onto it and are seen in magazines being worn by Michael Jordan. The other have a little star stitched onto them and are sold in WalMart.
The pair with the tick are sold for four times as much as the pair with the star.
The Marxist economists couldn’t really fault my logic. Without recourse to the idea of false consciousness, or some other moral/metaphysical concept, the labour theory of value can say nothing about any of this.”
Philip Pilkington, July 10, 2012
While one might defend that idea, subjective and intersubjective value are the major forces driving and underlying this difference in demand and price.
And even if a Marxist wants to defend the “use value” explanation, it simply will not work, because Marx says clearly that exchange value is not determined by use value. When Marx explains why two commodities have a given exchange value, he argues they are equal and have a common element but the exchange values are not caused by differing use values, but labour value:
“This common element cannot be a geometrical, physical, chemical or other natural property of commodities. Such properties come into consideration only to the extent that they make the commodities useful, i.e. turn them into use-values. But clearly, the exchange relation of commodities is characterized precisely by its abstraction from their use-values. Within the exchange relation one use-value is worth just as much as another, provided only that it is present in the appropriate quantity. Or, as old Barbon say: ‘One sort of wares are as good as another, if the value be equal. There is no difference or distinction in things of equal value … One hundred pounds worth of lead or iron, is of as great a value as one hundred pounds worth of silver and gold.’We can see the argument better in a translation from the German that is more idiomatic English:
As use-values, commodities differ above all in quality, while as exchange-values they can only differ in quantity, and therefore do not contain an atom of use-value.
If then we disregard the use-value of commodities, only one property remains, that of being products of labour.” (Marx 1982: 127–128).
“‘This common factor,’ … ‘cannot be a geometrical, physical, chemical or other natural property of the commodities. Their physical properties come into consideration for the most part only in so far as they make the commodities useful, and so make them values in use. But, on the other hand, the exchange relation of commodities is obviously determined without reference to their value in use. Within this relation one value in use is worth just as much as any other, if only it is present in proper proportion.’” (Böhm-Bawerk 1949: 10).For Marx exchange value is not determined by use-value, but by abstract labour time. If two different types of shoes as goods have the SNLT, then they ought to have the same exchange value. But that is clearly not the case.
The business can charge a larger mark-up on one pair of shoes worn by a celebrity and people will buy it because of subjective and intersubjective value and demand.
The SNLT is irrelevant here, and does not determine price. In commodity after commodity, you could demonstrate the same thing too.
Böhm-Bawerk, Eugen von. 1949. “Karl Marx and the Close of His System,” in Paul. M. Sweezy (ed.), Karl Marx and the Close of His System and Böhm-Bawerk’s Criticism of Marx. August M. Kelley, New York. 3–120.
Marx, Karl. 1982. Capital. Volume One. A Critique of Political Economy (trans. Ben Fowkes). Penguin Books, Harmondsworth, England.