tag:blogger.com,1999:blog-6245381193993153721.post6081409568095155103..comments2024-03-28T17:08:15.784-07:00Comments on Social Democracy for the 21st Century: A Realist Alternative to the Modern Left: Wicksteed on the Contradiction in Chapter 1 of Volume 1 of Capital on the Labour Theory of ValueLord Keyneshttp://www.blogger.com/profile/06556863604205200159noreply@blogger.comBlogger14125tag:blogger.com,1999:blog-6245381193993153721.post-86644956268142355542016-12-23T09:05:50.909-08:002016-12-23T09:05:50.909-08:00I think you make an interesting point on the disti...I think you make an interesting point on the distinction between value, which amounts to use-value for Marx, and exchange value - the exchange ratio or PRICE of a good, which Marx considers to be abstract labor value - but you're insight masks the irrelevance of Marx's whole endeavor. I think you and some of the above comments fail to recognize the main point of the above author that Marx's search for the COMMON quality or process to all goods is a foolish pursuit in and of itself. It is utterly unnecessary.<br /><br />Things do not need a common quality or process in order for things to arrive at a particular exchange ratio. Any ratio arises because at least TWO SEPARATE INDIVIDUALS HAVE TWO DIFFERENT ASSESSMENTS OF VALUE. Marx ignores the fact that there are two different perspectives within an exchange. Marx ignores the human actors involved in the exchange. If Marx wasn't searching for some ghostly metaphysical substance he would have realized that it is the difference between the goods' use-values that allows an exchange ratio to occur at all. Each person sees the good they are selling at that ratio as LESS valuable than the other person's goods. So it is the very fact that things are different that allows for an exchange ratio to exist. You don't need any other explanation to arrive at an exchange ratio. You don't need Marx's universal, common abstract substance to explain price. Marx creates the need to find a common substance universal to all goods out of whole cloth. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-13705505698929723282015-05-22T17:43:43.811-07:002015-05-22T17:43:43.811-07:00Surely you can see how this begs the question?
Bu...Surely you can see how this begs the question?<br /><br />But then again, maybe appearance is all there is to reality. Maybe exchange doesn't imply commensurability. <a href="http://img.pandawhale.com/post-25044-Neil-DeGrasse-Tyson-meme-There-3utl.jpeg" rel="nofollow">Maybe...</a>Hedlundnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-80259647896895899092015-05-22T17:14:47.756-07:002015-05-22T17:14:47.756-07:00Clearly there is both a production and a consumpti...<i>Clearly there is both a production and a consumption side to the creation of value.</i><br /><br />As Iain notes below, this is very much the case with Marx, as with others. <br /><br />I don't usually recommend the Grundrisse to people, since it's rambly and at times partially formed, probably apt to obscure more than it clarifies. However, the exception to this is the Introduction to it, which I usually recommend people read as a standalone essay, mainly because it states clearly a few things that rarely become explicit in much of the finished work — in particular, it includes a section on the relationship of consumption to production that makes it abundantly clear that he was keyed into exactly what you're saying, and that <i>this</i> is what the value/use-value distinction is expressing.<br /><br /><i>It was only during and after the war when the Labour Party adopted left Keynesianism that they became a force to be reckoned with.</i><br /><br />Until this recent SNP hullabaloo, at least...Hedlundnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-27286305394357917422015-05-22T17:04:19.776-07:002015-05-22T17:04:19.776-07:00in equilibrium (in which supply and demand are equ...<i>in equilibrium (in which supply and demand are equal) a hour of labour-time exchanges for an hour of labour-time, right? </i><br /><br />Well, first of all, labor is not the thing that is bought and sold directly. The thing that a capitalist buys is not labor but labor-power, the capacity to labor for a given period of time. They then seek to get the most labor out of that period as they can, and the difference between the two is the unpaid labor, or surplus value.<br /><br />Incidentally, Marx refers to labor under capitalism as "indirectly social" for this reason.<br /><br />In terms of commodity exchange (which is direct), then even if they're exchanged at "equilibrium prices," that is not the same thing as trading at value, because of the differences in capital to labor employed. (Ironically, for this exact reason, prices that realize more or less than the average rate of profit may nevertheless still realize their exact value! I.e., a higher-than-average OOC with a higher-than-average profitability may equalize s and p.)<br /><br />You are correct that exchange may yield different quantities of average labor trading for one another (a point I make somewhere under basically ever post), but as far as the <i>direct</i> objects of exchange go, you will never find a stable 1=2 relationship for identical commodities, whether they be shovels, couches, barrels, computer monitors, guitar picks, or hang gliders, for no reason more complicated than "we don't have magic Star Trek matter replicators."<br /><br />(Unless there's something you want to tell me!)Hedlundnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-30678956678999101742015-05-22T08:45:54.973-07:002015-05-22T08:45:54.973-07:00This is all very silly. The Labour Theory of Value...This is all very silly. The Labour Theory of Value is an attempt to explain the process by which products exchange. As such, it is a theory of exchange value -- exchange can only exist when a good has a use value, a utility for someone else. Without this then there would be no exchange.<br /><br />This explains why Ricardo, Proudhon, Marx, Smith, etc. all state very clearly that a commodity must have a use-value, a utility, in order to have a price, an exchange value. <br /><br />The labour theory of value then seeks to explain the dynamics of exchange value, of price. They do this by focusing on production, the price it takes to produce something. This is not the same as the market price although production price (or "natural" price in Smith) regulates the market price by, via higher/lower profits, decreasing/increasing the amount of goods on the market.<br /><br />As such, the labour theory of value is a theory of price dynamics -- it points of what Proudhon called "the law of value", namely that without production the market process cannot be understood.<br /><br />Neoclassical economics did precisely that -- ignore time and production. They took as given all goods at a snap shot and discovered their prices within that abstraction. They did so because socialists were using classical theory to critique capitalism as exploitative (neo-classical marginal productivity theory was developed by Clarke explicitly to defend capitalism against socialist criticism).<br /><br />So in terms of a commodity needing a use-value, this does not contradict the labour theory of value as its whole point is to understand exchange!<br /><br />In terms of Marx, he did indeed make a relatively simple notion much harder -- Ricardo's book is far better in giving the context Marx takes for granted.<br /><br />Iain<br />An Anarchist FAQ<br />http://www.anarchistfaq.orgAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-87649521422104808192015-05-21T21:37:50.828-07:002015-05-21T21:37:50.828-07:00I would add to Wicksteed's critique that in a ...I would add to Wicksteed's critique that in a capitalist system you decidedly do *not* need a 'common something' between differing commodities to make them exchangeable, be it utility or abstract labor or something else, because capitalism already has a 'common something' built into the act of exchange, and that is the price itself.<br /><br />Positing that there is some 'common element' in commodities beyond their ability to be expressed quantitatively in prices is not necessary, and whatever 'common element' you dream up is subject to Occam's razor. Prices themselves (and by extension the price system) are the universal quanta what allow for qualitatively different, heterogeneous commodities to enter into a homogenous quantitative relationship. No further unit is needed to explain the act of exchange.Von Minskynoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-24092908687965683962015-05-21T17:28:42.181-07:002015-05-21T17:28:42.181-07:00in equilibrium (in which supply and demand are equ...in equilibrium (in which supply and demand are equal) a hour of labour-time exchanges for an hour of labour-time, right? <br /><br />If, instead, demand is higher than supply, then an hour of labour-time must exchange for less than a hour of labour-time, due to the scarcity of the commodity demanded.Ahttps://www.blogger.com/profile/17386123430230365251noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-30427763658753151922015-05-21T14:41:50.180-07:002015-05-21T14:41:50.180-07:00Erfurt program. Excuse me. Erhard was the post-war...Erfurt program. Excuse me. Erhard was the post-war German neoliberal finance minister. Philnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-62980713567670237282015-05-21T14:40:47.615-07:002015-05-21T14:40:47.615-07:00Yes. It all comes down to focusing on one-side of ...Yes. It all comes down to focusing on one-side of the dialectic while ignoring the other. Labour creates value. But only assuming that the thing produced is desired ('useful' seems to me a term that is normatively loaded and veers toward utilitarianism). Clearly there is both a production and a consumption side to the creation of value.<br /><br />Regarding the British socialist movement freeing itself from Marx, I'm not sure that this was a good thing at the time. The Fabians in the early 20th century really had nothing of interest to say because of their lack of an economic framework. By contrast the German moderate Marxists were far more hard-headed in their approach -- the Erhard program in particular which Marx directly influenced via Kautsky.<br /><br />It was only during and after the war when the Labour Party adopted left Keynesianism that they became a force to be reckoned with. But in the early 20th century I would have taken the Marxist social democrats in Germany over the Fabians any day. While the former were trying to figure out how to restructure the economy, the latter were obsessed with eugenics and all sorts of rubbish.Philnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-59629449476424600462015-05-21T11:59:40.932-07:002015-05-21T11:59:40.932-07:00Philippe: No. Changes in supply and demand would ...Philippe: No. Changes in supply and demand would have no bearing on this, as it's a more fundamental aspect of market pricing.<br /><br />Consider my last example, which I never even specified as "equilibrium." But let's say it was. Now say there's a shortage of shovels, and thus shovels now trade for 2 barrels or 2 chairs each. If you trade a shovel for 2 barrels at that price, then trade them back for shovels, you'll only get 1. Similarly, if you trade them for 2 chairs, they also will get you 1 shovel. Just like that, the same phenomenon is witnessed out of equilibrium. And yet somehow, I doubt any of this comes as a surprise to you; it's pretty commonsense stuff, really.Hedlundnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-10346687073921786312015-05-21T09:48:40.024-07:002015-05-21T09:48:40.024-07:00"the double (subjective) inequality coincides..."the double (subjective) inequality coincides with an (objective) equality"<br /><br />Only in equilibrium though, right?Ahttps://www.blogger.com/profile/17386123430230365251noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-32198071365149883642015-05-21T07:49:55.668-07:002015-05-21T07:49:55.668-07:00I deny that there is "no further and obvious ...<i>I deny that there is "no further and obvious logical or empirical sense that the exchange is an equality of some third quantity." Note the word "equality": that there is a common element (subjective utility) is what I said, NOT that it is an equality of subjective utility (which I deny above).</i><br /><br />Wait, so now you deny the passage I quoted? Or did you mean to omit the "no"?<br /><br />Fair enough to say that subjective utility involves a double inequality, but the thing you're missing is that the double (subjective) inequality <i>coincides</i> with an (objective) equality. This can be shown, as I did in my example, without even making reference to value as such.<br /><br />(2) Yes, the two fit together contextually, that is precisely the point I sought to make. Your passage made it seem as though Marx only introduced corn and iron, and then said (apparently apropos of nothing) that there must be a Third Thing, which to an unfamiliar reader may appear to be a non sequitur. Yet the paragraph immediately before makes it clearer that he is referring to this occurring in the broader context of a set of market prices, where multiple commodities all come into relation and therefore stable, non-arbitrary exchange rates emerge. Hence, equality. Thus, equality can be established <i>prior</i> to any discussion of labor.Hedlundnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-38659050246369469522015-05-21T06:40:47.010-07:002015-05-21T06:40:47.010-07:00">There is no further and obvious logical ...<i>">There is no further and obvious logical or <br />>empirical sense that the exchange is an <br />><b>equality</b> of some third quantity, such<br /> > as abstract socially-necessary labour time.<br /><br />Interesting! So first you argue that the "third thing" is abstract utility, and then follow up by saying there is no third thing"</i><br /><br />False. <br /><br />I deny that there is "no further and obvious logical or empirical sense that the exchange is an <b>equality</b> of some third quantity." Note the word "equality": that there is a common element (subjective utility) is what I said, NOT that it is an equality of subjective utility (which I deny above).<br /><br />There is no contradiction here. You have merely failed to understand the argument.<br /><br />(2) Your Marx quote does not show anything has been taken out of context at all. It fits right in with the meaning of the passage after it: according to Marx, there is (supposedly) a third quantity called abstract labour which when equal explains the alleged "equality" of exchange values.<br /><br />In short, once again there is no contradiction.Lord Keyneshttps://www.blogger.com/profile/06556863604205200159noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-7078778442833616362015-05-21T06:28:23.108-07:002015-05-21T06:28:23.108-07:00If useful labor is labor that outputs a use-value,...If useful labor is labor that outputs a use-value, then socially necessary labor time, being a measure of value under capitalist (commodity) production, <i>is necessarily useful labor</i>.<br /><br />Wicksteed says we must still consider "abstract utility." Cool thought. Let's examine it, shall we?<br /><br />Let's start with the distinction between abstract and concrete labor. Concrete labor, as we know, is a particular qualitative sort of labor (carving, stitching, etc), and abstract labor is labor qua labor — a category to which all concrete labors belong, and which cannot exist independently of concrete labor.<br /><br />Now, let's do the same thing on the consumptive side as the productive side: an object of utility is a good that satisfies certain concrete desires (a toothbrush, a lawnmower, etc.). An abstraction that forms a suitable parallel would therefore have to refer to an overarching category that is only expressed through its members.<br /><br />As it happens, we already have just such a thing! "Use-value," we call this category. Just as one cannot aggregate baking and painting unless one abstracts from them as labor qua labor measured in time, one cannot aggregate toothbrushes and lawnmowers unless one abstracts from them as use-values qua use-values, measured in the number of goods.<br /><br />In other words, this is already addressed in this theory. <br /><br />I suspect Wicksteed missed this distinction; notice how he never uses the abstraction of "use-value," instead referring to a good's "value in use" as a <i>property</i> of said good, rather than as a unit.<br /><br /><i>Rather, when one person exchanges one good for another, it seems likely that in most cases he values the good he receives more highly than the good he gives up in the trade, and the same thing can be said of the other person in the trade. </i><br /><br />Of course. The whole phenomenon of trade is predicated on this truism, and thus it's implied in Marx's value theory.<br /><br /><i>There is no further and obvious logical or empirical sense that the exchange is an equality of some third quantity, such as abstract socially-necessary labour time.</i><br /><br />Interesting! So first you argue that the "third thing" is abstract utility, and then follow up by saying there is no third thing. Shotgun approach, I guess?<br /><br />Anyway, your "non sequitur" only works as such if quote Marx out of context. Check the paragraph immediately before the one you pulled:<br /><br />"A given commodity, e.g., a quarter of wheat is exchanged for x blacking, y silk, or z gold, &c. – in short, for other commodities in the most different proportions. Instead of one exchange value, the wheat has, therefore, a great many. But since x blacking, y silk, or z gold &c., each represents the exchange value of one quarter of wheat, x blacking, y silk, z gold, &c., must, as exchange values, be replaceable by each other, or equal to each other. Therefore, first: the valid exchange values of a given commodity express something equal; secondly, exchange value, generally, is only the mode of expression, the phenomenal form, of something contained in it, yet distinguishable from it."<br /><br />In other words, in a market with stable prices such that x amount of A trades for y amount of B, if I could trade a chair for either a shovel or a barrel, then these three things are "equal." It suggests that a shovel also trades for a barrel. <br /><br />Consider the alternative: a chair trades for a barrel or a shovel, but a shovel trades for two barrels. Market participants trade a shovel for two barrels, use these to trade for two chairs, and trade that for two shovels, and trade that for four chairs...<br /><br />Put another way, 1 shovel trades for 2 shovels.<br /><br />In order to argue that 1X = 2X is a stable ratio, we'd need to assume either that X=0 or that we've gotten something from nothing (1=2). If you're prepared to make the latter argument, I can definitely see how you might disagree with Marx that equality should be supposed in the case of market exchange.Hedlundnoreply@blogger.com