Capital Vol 1 Study Group

[Dean]

The study group subforum doesn't have much visibility so I'm posting here to let people know that we're trying to do a study group on Capital Vol 1.

I've written out notes for the first few chapters and posted Ch 1 here:

http://www.revleft.com/vb/capital-chapter-1-t142711/index.html

I'm new to some of the nuances of Marxian economics so I'm hoping some 'veterans' will join us to offer their insight.

[S.Artesian]

You might find Hans Ehrbar's annotations of Capital helpful. Hans is a professor at the University of Utah. The essays are available at:

http://www.econ.utah.edu/~ehrbar/akmc.htm (http://www.econ.utah.edu/%7Eehrbar/akmc.htm)

[PoliticalNightmare]

What I understand from the first chapter;

A commodity is an external body which can be utilised in one way or another that is benefitial to the person using it. It can be consumed or 'used' so to speak. E.g. a toy can be of satisfactory desire to a child as it pleases them to play with it. Thus the toy is a commodity.

'use-value' is the value that is beneficial to the consumer when purchasing a commodity. It is how useful the commodity is to the consumer. E.g. a bottle of wine tastes very nice to me, therefore it has high use-value.

'exchange-value' is the 'socially accepted' value that is used when exchanging goods on the market. For instance if the use value of 5 bananas equal the use value of 3 oranges then both these products in their quantites must also equal a third value. This third value is the 'socially accepted' exchange-value and in modern day capitalist society, this is money. Marx criticises this because there is no objective way of measuring the exchange-value. The exchange-value is priced in a way to maximise profit.

'Labour-value' is the amount of skills and total hours of labour that has gone into making a product. It is completely seperate to the other two values. According to Marx this is the true price for commodities.

I've probably got this all completely wrong so don't be too harsh on me please :D

P.s. I think a reading group is an excellent idea and that this thread should definitely be stickied.

[RedMaterialist]

What I understand from the first chapter;

[QUOTE]A commodity is an external body which can be utilised in one way or another that is benefitial to the person using it. It can be consumed or 'used' so to speak. E.g. a toy can be of satisfactory desire to a child as it pleases them to play with it. Thus the toy is a commodity.

That definition would apply as well to a rock. Marx made a distinction between useful (use-value) things produced by nature and useful things produced by human labor. A child can be happy playing with a rock.


'use-value' is the value that is beneficial to the consumer when purchasing a commodity. It is how useful the commodity is to the consumer. E.g. a bottle of wine tastes very nice to me, therefore it has high use-value.

Not only does it taste nice, it is nutritious. But then, so is a grape found wild in nature. A commodity must have a use-value; but a thing with a use-value is not necessarily a commodity.


'exchange-value' is the 'socially accepted' value that is used when exchanging goods on the market. For instance if the use value of 5 bananas equal the use value of 3 oranges then both these products in their quantites must also equal a third value.

Exchange value, for me, is an extremely difficult concept. In your example the bananas and oranges must be produced by qualitatively different kinds of labor: banana farming and orange farming. For Marx, this is analogous to producing coats and linen.


P.s. I think a reading group is an excellent idea and that this thread should definitely be stickied.

I agree.

[PoliticalNightmare]

[QUOTE=PoliticalNightmare;1897405]Exchange value, for me, is an extremely difficult concept. In your example the bananas and oranges must be produced by qualitatively different kinds of labor: banana farming and orange farming. For Marx, this is analogous to producing coats and linen.

Ermm...I'm a little confused by this.

Anyway vote for sticky!

[mikelepore]

What I understand from the first chapter;

A commodity is an external body which can be utilised in one way or another that is benefitial to the person using it. It can be consumed or 'used' so to speak. E.g. a toy can be of satisfactory desire to a child as it pleases them to play with it. Thus the toy is a commodity.

Commodities are also generic and in continuous production. The theory won't apply to land, startup prototypes, closeouts, rare collectibles, etc.


'use-value' is the value that is beneficial to the consumer when purchasing a commodity. It is how useful the commodity is to the consumer. E.g. a bottle of wine tastes very nice to me, therefore it has high use-value.

The wine has use value.I don't know about "high" use value. Did you see any place in the book where use value is spoken of as a relative magnitude, that is, more or less? I think it's something that objects either have or they don't have.


'exchange-value' is the 'socially accepted' value that is used when exchanging goods on the market. For instance if the use value of 5 bananas equal the use value of 3 oranges then both these products in their quantites must also equal a third value. This third value is the 'socially accepted' exchange-value and in modern day capitalist society,
this is money.

Sounds right to me.


Marx criticises this because there is no objective way of measuring the exchange-value.

I think the obective way of measuring it *IS* the 5 bananas to 3 oranges, after this ratio is converted into any money units. The practical problem is that we see a noisy signal, because supply and demand make the price wiggle all over the place. The price is the exchange value added to a lot of random noise.


The exchange-value is priced in a way to maximise product.

I don't understand that sentence.


'Labour-value' is the amount of skills and total hours of labour that has gone into making a product. It is completely seperate to the other two values. According to Marx this is the true price for commodities.

I don't remember seeing the phrase "labour-value." Is this verified?

[mikelepore]

Exchange value, for me, is an extremely difficult concept. In your example the bananas and oranges must be produced by qualitatively different kinds of labor: banana farming and orange farming. For Marx, this is analogous to producing coats and linen.

If different kinds of labor are used, why should that make the concept difficult? You're still going to get some ratio in the exchange of bananas and oranges based solely on how much human effort is needed to produce each of them. You might see it more clearly if the values are far apart, for example, a certain automobile exchanges for twenty thousand bananas. It's no different when the values are closer together, like the orange and the banana.

[ZeroNowhere]

A commodity is an external body which can be utilised in one way or another that is benefitial to the person using it. It can be consumed or 'used' so to speak. E.g. a toy can be of satisfactory desire to a child as it pleases them to play with it. Thus the toy is a commodity.
No, this definition is actually close to how Marx defined a use-value. A commodity is initially defined as a use-value, a useful thing, which has an exchange-value; that is, it may be exchanged in a definite proportion to another use-value. So, for example, if 20 yards of linen = 1 coat, the two are equivalated in the exchange, so that the exchange-value of 20 yards of linen is one coat. Exchange-value, in other words, is essentially the price of the commodity, and is therefore expressed in other commodities, such as money.


'use-value' is the value that is beneficial to the consumer when purchasing a commodity. It is how useful the commodity is to the consumer. E.g. a bottle of wine tastes very nice to me, therefore it has high use-value.Marx actually defines the term here: "The utility of a thing makes it a use value. But this utility is not a thing of air. Being limited by the physical properties of the commodity, it has no existence apart from that commodity. A commodity, such as iron, corn, or a diamond, is therefore, so far as it is a material thing, a use value, something useful." Essentially, a use-value is something useful. It is not a property, but rather describes the material body of the object. So, for example, a book is a use-value because it has utility. However, a use-value is not necessarily a commodity, but only becomes such if it also has an exchange-value. On the other hand, a commodity must be a use-value, as otherwise nobody would exchange anything for it.


'exchange-value' is the 'socially accepted' value that is used when exchanging goods on the market. For instance if the use value of 5 bananas equal the use value of 3 oranges then both these products in their quantites must also equal a third value. This third value is the 'socially accepted' exchange-value and in modern day capitalist society, this is money. Marx criticises this because there is no objective way of measuring the exchange-value. The exchange-value is priced in a way to maximise product.I think that your definition here is confused due to your interpretation of use-value as quantification of utility. Rather, exchange-value is simply the price of a given commodity; it is expressed in the material body of another commodity, and therefore in the use-value of another commodity.

For example, $5 is a specific quantity of money, which is a material thing; it expresses the price of, say, three doors. Now, $5 may also be the price of two cars, in which case one may sell three doors and buy two cars with the money. Now, one could express this as follows: 3 doors = 5 dollars = 2 cars. It would not be saying anything to say that one door can be exchanged with one door, but rather the price of a commodity must be expressed in other commodities (usually money).

'Labour-value' is the amount of skills and total hours of labour that has gone into making a product. It is completely seperate to the other two values. According to Marx this is the true price for commodities.It is not at all separate from exchange-value. In fact, let us return to exchange-value for a moment.

Above, we have seen that, through exchange-values, we get the equation: 3 doors = 5 dollars = 2 cars. However, through the medium of money, things are equal in price to many other things. Therefore, we may get:

3 doors = 5 dollars = 2 cars = 5 brooms = 100 iPods = 4 laptops. In that case, however, all of these things are equal; therefore, one may express it:

3 doors = 5 dollars = 2 cars = 5 brooms = 100 iPods = 4 laptops = x. Alternatively, 3d = 5m (for money) = 2c = 5b = 100i = 4l = x. Value may be defined as this 'x'. Now, this is a perfectly legitimate operation, as one is simply saying that different quantities of things which are equivalent to each other may be expressed as a certain quantity 'x'. It must be stressed again that this is a definition, rather than a proposition; one is defining value as the term 'x' which expresses the fact that all of these things are equal. Thus, x = 100 iPods, x = 5 dollars, etc. This may be seen, for example, if we were to look at 2x:

2x = 6 doors = 10 dollars = 4 cars, etc. This is indeed the case; for example, if one were to sell two iPods, one would receive twice the money, and with this could buy twice as many doors. Indeed, one could write that 2x = 4 cars, and then, by dividing by two, receive x = 2 cars, which is the same as saying that 2 cars may be exchanged with all other things which equal 'x', such as the 100 iPods, 5 brooms, etc. Therefore, we see that value is very much related to exchange-value. On the other hand, all of these commodities are very different in terms of their material bodies and uses, so that, in order that they be equalized through value, in order that they all be reduced to a common quantity, their actual material bodies must be abstracted from, that is, ignored, and as such one may write up thier relationship in more or less algebraic notation, independent of their actual uses.

It should be stressed that value is not a normative category, that is, not one which proscribes a 'true price' which things ought to have, but rather simply describes a capitalist economy when supply and demand are equal.

I don't wish to rewrite the chapter, but hopefully the above helps if you do re-read it.

[RedMaterialist]

You're still going to get some ratio in the exchange of bananas and oranges based solely on how much human effort is needed to produce each of them.[QUOTE]


Not only how much, but also what kind or quality of labor.

As Marx says, "As the coat and the linen are two qualitatively different use values, so also are the two forms of labour that produce them, tailoring and weaving. Were these two objects not qualitatively different, not produced respectively by labour of different quality, they could not stand to each other in the relation of commodities. Coats are not exchanged for coats, one use value is not exchanged for another of the same kind."

How does use-value (quality) become exchange-value (quantity)? If you pick one orange you have a use-value for yourself. If you employ 1,000 wage workers to do the picking you have an exchange value for the "market." How is this? Because oranges are not exchanged for oranges, but for bananas. They can be exchanged only because of their qualitative difference? But just because a use-value can be exchanged, that does not make it a commodity. Otherwise, things exchanged in barter would be commodities, but they are not.

[PoliticalNightmare]

Is the rest of the book as confusing and complicated as this?

[Zanthorus]

The first three chapters are generally considered to be the most difficult. I do think that it gets noticeably easier to read from chapter four onwards.

[RedMaterialist]

Is the rest of the book as confusing and complicated as this?

Yes it is. But it can be unraveled and understood.

[ZeroNowhere]

The first three chapters are generally considered to be the most difficult. I do think that it gets noticeably easier to read from chapter four onwards.
To be honest, I found the first two chapters to be relatively straightforward, certainly after re-reading them, although the third one is probably the hardest in the book. The first one can be somewhat hard to summarize, however, but I think that Marx, in the book itself, goes into enough explanation that one begins to think, "Alright, then, Marx, the point is taken by now..."

Of course, there is often additional depth to the point which one can only discover by coming back to it later, but nonetheless the essential point should be quite clear so long as one tries not to make presuppositions, and hasn't had them hammered into one by exegeses. For example, the point about indirectly social labour is one which may not seem as important as it is until Marx goes further into his analysis, but nonetheless the point is fairly easy to grasp.

[mikelepore]

What exactly do you still think is confusing? The connection between labor time and exchange value?

Try this example:

Suppose the nature of the production process (the methods, the kinds of machines, the plant growth speed, etc., etc.) was such that a given amount of hired labor could be used by employers EITHER to produce 3 oranges OR to produce 10 bananas.

Suppose that was common knowledge. Every investor in the fruit business recognizes it. Some given amount of labor cost will get you either 3 oranges or 10 bananas.

After the market settles down and sets prices for the two kinds of fruit, what else would you expect those prices to be, if not in a 10 to 3 ratio?

If the prices were to deviate from that, and become anything else besides a 10 to 3 ratio, then investors would find it to be a wise decision to move their operations from one fruit to the other. If capital were to move from one to the other, that would change the market supplies of each, reducing the supply of the fruit that more investors had abandoned, and increasing the supply of the fruit that more investors had selected. That change to the supplies of each would cause the prices to move back toward the 10 to 3 ratio that they had earlier departed from.

Therefore the prices may keep swinging like pendulums, but prices typically gravitate back to the same ratio as the the labor time required to produce each commodity.