What is "value"?

[anticap]

I'm starting this thread as per agreement that it might prove interesting.

To get the ball rolling, I'll take the lazy way out and quote the MIA encyclopedia:


Use-value is the qualitative aspect of value, i.e., the concrete way in which a thing meets human needs.

http://marxists.org/glossary/terms/u/s.htm#use-value



Exchange-value is the quantitative aspect of value, as opposed to “use-value” which is the qualitative aspect of value, and constitutes the substratum of the price of a commodity.

“Value” is often used as a synonym for exchange-value, though strictly speaking, “value” indicates the concept which incorporates both quantity and quality.

http://marxists.org/glossary/terms/e/x.htm#exchange-value


And now I'll step back and let others hash this one out.

[ckaihatsu]

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This is an excellent question and topic, one that I think isn't asked and addressed nearly enough -- especially for people who are relatively new to Marxist economics and may still be trying to wrap their heads around all of the elements within the totally different paradigm.

My understanding -- anyone should feel free to correct me -- is that 'socially necessary labor' is that which is required to sustain and reproduce (biologically, socially) the labor force, going forward into the future.

So right there we're not necessarily talking about hard numbers as finance and economics types may be used to doing -- it's a more *qualitative* bucket of what does it take to keep humanity and civilization more or less moving forward, in terms of labor power.

And, by the same regard, I think this might be the biggest "gray area" for us in our own, "internal" politics and possible societal planned production -- exactly what *should* the "baseline" standard of living be for the 'perpetuation of labor'? Obviously capitalism is incapable of even the basics, like full employment, so that part is a no-brainer, of course, but beyond capitalism, then what?

In the present day, in the context of capitalism, we might use rent payments, mortgage payments, or property values, along with family size, as a way of indexing people's varying strata of standards of living (just a thought), and go from there to calculate other basic personal expenses, thus arriving at some kind of 'socially necessary labor' calculation under capitalism. Any revenue that the employer takes in, based on labor time beyond that which covers the 'socially necessary labor' number, minus the wages paid out for that labor, would be the surplus labor value.

I made a simple 2-step chart based on a line from Jack London's _Iron Heel_ to illustrate this extraction of surplus labor value:


Labor & Capital, Wages & Dividends

http://i47.tinypic.com/dzbdzq.jpg


Here's a another diagram on the same topic:


A Business Perspective on the Declining Rate of Profit

http://i47.tinypic.com/28u781c.jpg


I've always found it curious that among Marxists / socialists / communists / whatever there is still the holdover thinking (for a communist-type economy) of a market-like surveying of demand, for the subsequent production of commodity-like products and services which may then possibly be consumed or may not be.

My point being that in a socialist society the "surplus" would have to be *intentionally planned for in advance*, and so, by definition, wouldn't really be a surplus since waste would be negligible.

[Jimmie Higgins]

I'm not sure what the debate here is, and this isn't my strongest area of knowledge, but I'll take a stab at an explanation:

Use value is simply the social usefulness of a commodity. A screen-door for submarines has no use-value.

To my understanding, exchange value is just the quantity of one commodity compared to another. So 1 bike may have the same exchange value as 100 loaves of bread.

But the question is why? Why is 1 bike worth that much bread, why not a different amount? What determines the value of one commodity to another is the average necessary labor-time put into it. So this means for complicated things, the labor-time of the parts goes into the value (so the value of producing the wheels of a bike is then transferred to the value of the bike) in addition to the new labor-time by workers who assemble the bikes. Labor as a commodity also has a value based on the labor-time needed to create labor - this means the basic costs of housing feeding and caring for the worker so they can return to work. This is also why skilled jobs or professional jobs have a higher value and are often better paying than unskilled because the value of the training and education increases the value of that labor as a commodity.

So the amount of the socially necessary labor-time determines the exchange value: a wheel is always going to have less value than a completed bike because the bike's value includes the value of the wheels.

People get thrown by this because it is an over-simplified model of how things work. Also because prices fluctuate, but as Marx and Ricardo noted, the fluxuation is and increase or decrease from the base value of the commodity, not independent. Another thing that throws people is the idea that profits can be made from speculation and buying low or selling high based on price. It's true that people make money all the time this way, but it is merely shifting wealth around between various capitalists, not creating new value or new wealth - ultimately it takes new labor somewhere along the process for new value to be created.

[Svoboda]

I'm starting this thread as per agreement that it might prove interesting.

To get the ball rolling, I'll take the lazy way out and quote the MIA encyclopedia:





And now I'll step back and let others hash this one out.
There seem to essentially be two types of value, a value in use and value in exchange and they in large seem to contradict each other, as Smith said there is nothing more useful than water yet it costs close to nothing due to its abundance therefore it has a low exchange value, while gold has hardly any use but is valubale in exchange purely for its scarcity.

But then it must be asked how a product gets its value and a product is simply a fusion of labor and capital, and that fusion of labor and capital gives a product its value. But really capital is unproductive, capital is wood or iron or something like that, it in a way is a product itself, but by itself it can give no real value, but with theapplication of labor onto capital value is created. But the value of everything is not purely the labor embodied into it, I mean you can work on making a pair of shoes for a hour for me but that dosen't mean that those shoes are more valubale than the person who made me a pair of shoes in half an hour.

[Zanthorus]

If a commodity has an exchange-value equal to the exchange-value of another commodity, the two commodities can take each other's place. "Despite their motely appearance [they] have a common demoninator." Value is this common demoninator. The "third-thing" which commodities on either side of an exchange relationship are reducible to.

[S.Artesian]

What is value? A social relation of production originating in the separation, dispossession of the direct producers from the instruments, and conditions, of production and consumption, thereby configuring labor as capable of satisfying the needs of the laborers only through exchange for, or for the equivalent of, the means of subsistence.

In this way, labor is reduced to the commonality, the abstraction of all human effort--time. Labor gives up its time, loses its time, exchanges its time, embeds its time, its ability to create a time beyond the satisfaction of necessity--its surplus labor time-- into the objects of production.

It is not the fusion of labor and capital that creates value, but the opposition of labor to the conditions of labor. It is the organization of labor as useless, for the laborers, save for its use in exchange.

"All economy is the economy of time." Marx