The law of value in the simplest terms...

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Chilli Sauce's picture
Chilli Sauce
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Feb 3 2016 14:36
The law of value in the simplest terms...

Go!

Khawaga's picture
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Feb 3 2016 14:51

Value of commodities is measured by the (socially necessary) labour-time that goes into them.

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Feb 3 2016 14:53

Ok, let's be simple then. The law of value is a law applied to value.

Do I get a prize?

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Feb 3 2016 16:22

Marx had a particular definition of value, namely that value is the units of socially necessary labour-time expanded on the production of commodities. What Khawaga described is what is commonly known as the 'labour theory of value' (somewhat of a misnomer). This is distinct from the law of value.

The Law of Value is Marx's theory of the allocation of labour time in capitalist society. It is the mechanism by which 'units of production/capital' are disciplined, that is, it is a theory of the operation of market forces. Private producers are compelled to sell their commodities at or around the average socially necessary labour time (the social value). If the individual value of the commodity produced by certain private producers is above the social value, the private producers in question will still have to sell the commodity at a price around the social value, and consequently will tend to not be profitable. They are compelled to lower the labour time they have expanded upon the production of the commodity, or else risk bankruptcy. This disciplining mechanism by which labour, dead and alive, is allocated is the law of value.

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Feb 3 2016 17:02

Dennis, what I wrote is the law of value in the simplest terms and is, in a nuthsell, what you described in much more complicated terms. The very term socially necessary labour-time refers to commodities having been exchanged, as individually spent labour time is reduced tot his social average at the moment of exchange. It is not an either/or when you refer to the labour theory of value and Marx's law of value, they are, for all intents and purposes basically the same. After all, when Marx speaks of labour-time, he immediately refer to SNLT. The bourgeois economists did not have a concept for SNLT because they did not have a concept of abstract labour.

Dave B
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Feb 3 2016 17:53

What is a private producer?

Is someone who engages in private labour?

What would be private labour?

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Feb 3 2016 18:05

From what I gather, a private producer is someone (or some entity) that is not producing directly for society. So any wage worker (and the business they work for) and most peasants (that produce directly for the family, but may sell their surplus on the market). Private production, in a nutshell, is basically not direct social production.

Marx doesn't really explain that term very well, though he may have in a text of his I have not read.

petey
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Feb 3 2016 19:15

how is social labor time different from labor time?

Dave B
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Feb 3 2016 19:40
Quote:
From what I gather, a private producer is someone (or some entity) that is not producing directly for society. So any wage worker (and the business they work for) and most peasants (that produce directly for the family, but may sell their surplus on the market). Private production, in a nutshell, is basically not direct social production.

Marx doesn't really explain that term very well, though he may have in a text of his I have not read.

It's not where the labourer is the private owner of his own means of labour set in action by himself, like an artisan then?

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Feb 3 2016 20:15

That would also be a case of private labour if I understand Marx correctly.

Dave B
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Feb 3 2016 20:29

not sure I really understood your definition properly.

Is wage labour also private labour?

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Feb 3 2016 20:38

Yes.

RC
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Feb 3 2016 21:06

What is value? First, its an economic category. What does it describe? Not the use value that satisfies a need, but the exchange value. What is said by how much exchange value does it have? Its the capacity of a good to get hold of other goods. If you take money as the expression of value, as exchange value itself, which is separate from the use value, what does it consist in? The capacity of money to command other goods, to get access to labor. If that’s what value is, that’s the economic substance. If the value of a good describes the capacity of a good to get hold of other goods, you are excluded from what you want. This relation of exclusion is what private property (a legal category) is. All goods exist under it. Value is the capacity to get hold of those goods. The economic category of value is a relation of political force. The state decrees that all goods are under exclusive ownership.

Dave B
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Feb 3 2016 21:36

Hi Khawaga

what does Karl mean by the following?

Quote:
....cardinal facts of capitalist production:

1) Concentration of means of production in few hands, whereby they cease to appear as the property of the immediate labourers and turn into social production capacities. Even if initially they are the private property of capitalists. These are the trustees of bourgeois society, but they pocket all the proceeds of this trusteeship.

2) Organisation of labour itself into social labour: through co-operation, division of labour, and the uniting of labour with the natural sciences.

In these two senses, the capitalist mode of production abolishes private property and private labour, even though in contradictory forms

https://www.marxists.org/archive/marx/works/1894-c3/ch15.htm

Is wage labour a contradictory form of private labour?

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Feb 3 2016 21:46

Or wage labour is a contradictory form of social labour that is done in private. As I said, I am not entirely sure what Marx means with the term private labour as he uses it in the first three chapters of Das Kapital. His use of private labour there is to show that an activity that is done in "isolation" and in private becomes social (or rather appears as such) when the commodity is exchanged. This in itself is a contradiction. But I am not sure if he uses it in the same way in Volume 3, which was an unfinished work. In any case, even if capital "socializes" production by bringing workers into co-operation under the same roof (or through technology today), it is still labour that is expended "privately" in the sense that the product is not merely given away.

I've tried several times to find a clear definition of what Marx means with private labour, but as of yet I have not been able to.

Dave B
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Feb 3 2016 22:49

What about this; just as start?

Quote:
In the very beginnings of bourgeois society, private labour emerged even in advance of the development of wage-labour and capital, with individual artisans producing goods for the market. In private labour, prior to the development of a proletariat and bourgeois class, all the essential relations of capitalism are found: people work to earn a living, dominated by a world populated by things (commodities) which appear to possess human powers.

https://www.marxists.org/glossary/terms/p/r.htm

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Feb 3 2016 22:51

Well, yes, it is a start. But by relying on this definition alone, you may be led to interpret the first three chapters of Capital as historically rather than logically.

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Khawaga's picture
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Feb 3 2016 23:08

Exactly. I think that was Chili's initial point: to see how convoluted it would get.

S. Artesian
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Feb 3 2016 23:46
RC wrote:
What is value? First, its an economic category. What does it describe? Not the use value that satisfies a need, but the exchange value. What is said by how much exchange value does it have? Its the capacity of a good to get hold of other goods. If you take money as the expression of value, as exchange value itself, which is separate from the use value, what does it consist in? The capacity of money to command other goods, to get access to labor. If that’s what value is, that’s the economic substance. If the value of a good describes the capacity of a good to get hold of other goods, you are excluded from what you want. This relation of exclusion is what private property (a legal category) is. All goods exist under it. Value is the capacity to get hold of those goods. The economic category of value is a relation of political force. The state decrees that all goods are under exclusive ownership.

This isn't accurate. Value is as it is described by S. Artesian, Khawaga, and myself in this thread.

Dave B wrote:
Hi Khawaga

what does Karl mean by the following?

Quote:
....cardinal facts of capitalist production:

1) Concentration of means of production in few hands, whereby they cease to appear as the property of the immediate labourers and turn into social production capacities. Even if initially they are the private property of capitalists. These are the trustees of bourgeois society, but they pocket all the proceeds of this trusteeship.

2) Organisation of labour itself into social labour: through co-operation, division of labour, and the uniting of labour with the natural sciences.

In these two senses, the capitalist mode of production abolishes private property and private labour, even though in contradictory forms

https://www.marxists.org/archive/marx/works/1894-c3/ch15.htm

Is wage labour a contradictory form of private labour?

Indeed, private labour is labour done in relative isolation, or more obscurely (dialectically expressed), in reciprocal independence. The labour done within 'units of production' is directly social, and these units of production exchange their products. The labour of these units of production is private labour, and this private labour becomes social only indirectly through the confrontation of commodities in the market. Private labour is labour executed in reciprocal independence.

Marx is describing how capitalism is undermining its own premises. In the era of proto-industrialisation, when capitalism was first emerging, production was small-scale, and scattered, still in a 'pygmy format'. The manufacturers of this era, the immediate producers, owned the tools with which they laboured. A smith owned his hammer and anvil. As the development of capitalism progresses, small-scale production is displaced by large-scale industrial production. The means of production become too large to be owned by the immediate producers themselves, and pass into the hands of a segment of the population that is privileged enough to afford them -- the capitalist class. Therefore, the individual private property of the manufacturing working class is replaced by a different type of private property, based on the separation of the producers from the means of production with which they produce.

In the first sense, capitalism abolishes private property and private labour because it destroys individual property. In the second sense, because it socially integrates labour -- it socialises the labour process. It is in a contradictory form because it undermines its own premises. This contradiction is resolved when the method of appropriation is harmonised with the method of production -- both becoming social (i.e. communism).

Here is a description of private labour to go with that definition:

Quote:
The first step made by an object of utility towards acquiring exchange-value is when it forms a non-use-value for its owner, and that happens when it forms a superfluous portion of some article required for his immediate wants. Objects in themselves are external to man, and consequently alienable by him. In order that this alienation may be reciprocal, it is only necessary for men, by a tacit understanding, to treat each other as private owners of those alienable objects, and by implication as independent individuals. But such a state of reciprocal independence has no existence in a primitive society based on property in common, whether such a society takes the form of a patriarchal family, an ancient Indian community, or a Peruvian Inca State. The exchange of commodities, therefore, first begins on the boundaries of such communities, at their points of contact with other similar communities, or with members of the latter. So soon, however, as products once become commodities in the external relations of a community, they also, by reaction, become so in its internal intercourse. The proportions in which they are exchangeable are at first quite a matter of chance. What makes them exchangeable is the mutual desire of their owners to alienate them. Meantime the need for foreign objects of utility gradually establishes itself. The constant repetition of exchange makes it a normal social act. In the course of time, therefore, some portion at least of the products of labour must be produced with a special view to exchange. From that moment the distinction becomes firmly established between the utility of an object for the purposes of consumption, and its utility for the purposes of exchange. Its use-value becomes distinguished from its exchange-value. On the other hand, the quantitative proportion in which the articles are exchangeable, becomes dependent on their production itself. Custom stamps them as values with definite magnitudes.

https://www.marxists.org/archive/marx/works/1867-c1/ch02.htm

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Feb 4 2016 03:59
Khawaga wrote:
Exactly. I think that was Chili's initial point: to see how convoluted it would get.

It wasn't, I promise!

To be honest, it came up because I was telling a liberally-lefty friend of mine about Paul Mason's argument regarding technology and I said that - according to Mason - the ability to reproduce information with the click of a button is effectively reducing the cost of many modern goods to zero, and, thus, undermining the law of value.

My friend asked me what I meant by this and I realized I couldn't give an adequate response.

So, would folks agree with my assessment of Mason's claim?

Just, for the record, I always understood the law of value to mean that commodities have within them a use-value and an exchange-value and that the exchange-value is a result of the socially necessary labor time contained within them. And, further, that ability of commodities to be exchanged for one another results from the fact the labor time within them can be measured proportionally between different goods. Thus, the law of value.

How's my understanding here? And can you think any way to put all that more simply?

RC
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Feb 4 2016 05:43

Value is the feature of private property that it has a claim on other private property.

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Feb 4 2016 07:21

It's all coming out now Chilli - you've been hobnobbing with left liberals! Shame on you! You're clearly listening to the wrong punk bands bro!

Seriously though, how do you even talk politics with those guys? I find politically engaged liberals to be the very worst people to knock ideas around with. Anything that even questions the idea of a state doing all the taking care of things seems to be like the conversational equivalent of a fart in a lift. Tell me your secret.

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Feb 4 2016 14:15

Eh, with most liberals, their heart's in the right place. I mean, literally everyone in my workplace - from the boss on down - supports Sanders. And, to speak to them, they do because they see him as being able to bring Scandinavian-style social democracy to America and they view that as a fairer, better society. And, shit, we live in New York, we all want some rent-controlled housing!

So, for a lot of them, it's not ideological in the sense that they're wedded to the state - more that they don't see any option beyond the liberal-conservative political discourse. Oh, and that communism is a nice idea on paper, but that it would never work. And, from there, there's something to work with. Committed Leftists on the other hand....

petey
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Feb 4 2016 14:33
Chilli Sauce wrote:
we live in New York, we all want some rent-controlled housing

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Feb 4 2016 17:08
petey wrote:
Chilli Sauce wrote:
we live in New York, we all want some rent-controlled housing

Hear, hear!

We all can't live a countryside mansion with Crass like certain libcom posters wink

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Feb 4 2016 18:21
petey wrote:
how is social labor time different from labor time?

as this seems to have got missed, basically socially necessary labour time, means the average necessary in a society at a given moment.

So if example Nike used machines to make trainers, which were so efficient it took half an hour of worker time to make a pair of trainers (and this technology had become the norm for the industry) the value would be proportionate to half an hour of labour time.

Whereas if Adidas made stuff all by hand and it took 6 of their worker hours to make one pair, that wouldn't mean the value of their product was greater than Nike, as value is determined by the socially necessary labour time, not the actual labour time. Do you see what I mean?

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Feb 4 2016 18:31
Quote:
We all can't live a countryside mansion with Crass like certain libcom posters

Hey but you know, like everyone can come live in my mansion with me anytime they like. Just don't forget to bring some organic mung beans with you.

Dave B
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Feb 4 2016 19:29

Perhaps because I am a scientist and a chemist in particular I tend to look at things more from that perspective and thus I seem to have interpreted the opening chapter of volume one in a more eccentric way.

I have been trained to think that if two or more things are say interchangeable or broader way are ‘equal’ then there must be something about them that is the same.

Thus if sugar side of a reaction is converted or changed into alcohol and carbon dioxide etc then the stuff on both sides of the equation is the same and we just need to count up the carbons, hydrogens and oxygens etc.

What is on one side of the equation or chemical reaction is the same as on the other; radically different in sense perception form but merely when totted up just different manifestations of the same stuff.

In fact we could say the content on both sides of the equation, ie carbons, hydrogens and oxygens the same.

It is the same in physics where they do heat being converted to movement being converted to light etc.

It is for them all the same thing, energy, thus;

In a paper Über die Natur der Wärme(German "On the Nature of Heat/Warmth"), published in the Zeitschrift für Physik in 1837, Karl Friedrich Mohr gave one of the earliest general statements of the doctrine of the conservation of energy in the words: "besides the 54 known chemical elements there is in the physical world one agent only, and this is called Kraft [energy or work]. It may appear, according to circumstances, as motion, chemical affinity, cohesion, electricity, light and magnetism; and from any one of these forms it can be transformed into any of the others."

https://en.wikipedia.org/wiki/Conservation_of_energy

Interestingly they don’t know what energy is yet or even all its forms eg dark energy.

But the logic is, that really goes back to the ‘Greeks’ (Democritus in particular perhaps- Karl did his pHd thesis on him) is that if one thing is ‘equivalent’ to another in anyway then it is just a matter of them in ‘reality’ being the same thing manifesting itself in different ways.

So for me Karl said if a coat is ‘equivalent’ to 10 yards of linen or whatever and for whatever reason that is initially of little interest.

Then there must be something about the coat and the linen that is the same.

And I think he goes onto to say maybe what is the same about them is that they are made by human effort (value) and that is what makes them ‘equivalent’ and runs with the idea to see where it leads to.

This remains fine as long as you have;

C(100) – M(100) –C(100)

As in each transformation or, - , you have a ‘conservation of value’ or (100).

But in capitalism we would seem to have;

M(100) – C(100) – M(150)

Which looks like a non conservation of value which was a premise or starting point of the investigation (or law of value if you like - which is analogous to the law of the conservation and conversion of energies?)

Or M(100) –M(150)

The physics people don’t believe you can get more energy out of a series of transformations any more than chemical engineers believe you can get more elements out of a series of chemical reactions than what you started with.

So what might be gong on in capitalism.

Is there something a bit funny about this C(100)?

Perhaps a special C(100) that wasn’t there before capitalism?

What was there C like in capitalism that wasn’t there before; or what could be bought in capitalism for money that couldn’t or wasn’t bought before capitalism?

It would nice to hope and assume that this special, * ,capitalist case of the special C(100)* that the

M(100) – C(100)

Or

M(100) – C(100)*

Still held fast to the law of the conservation of value.

What is C(100), generally.

Well it is something useful at the end of the day.

What if as that it is just somebody’s human effort that is bought?

You can’t really argue against the idea that other peoples effort can be useful for those of us who have Pilipino house maids or waitresses to serve you drinks in the Manhattan Crowne Plaza etc .

What if you can use that kind of thing to get for your paid for labour as a utility to produce ‘more effort embodied in something’?

I really have to go now; just now got a phone call.