How is the value of labour estimated?

[UltraWright]

I have been reading on the labour theory of value and do understand how commodities get their value but do not get how the value of labour itself is estimated/calculated. Can somebody help me with it?

[Rooster]

Do you mean how is the cost of reproducing the worker is measured?

[UltraWright]

Do you mean how is the cost of reproducing the worker is measured?

Yes!

[Rooster]

Yes!

I'm not that much of an expert on this but someone will no doubt correct me. Basically, as I understand it, the minimum amount that a worker needs in a given society for his general reproduction (food, clothes, housing, fuel, maintaining children, etc) is what constitutes the minimum wage. This is why it's different from country to country where the cost of living is different. This also fluctuates due to the strength of unions and how much the worker is taxed to provide health care and education (depending on country). So a variety of other relations have to be taken into account and this is where most labour struggles come into play. The costs of production in one industry can change the costs of production in another, so it can also change the minimum wage. So the cost of reproduction is what a worker creates when they do the socially necessary amount of labour during a given day.

[Zanthorus]

the value of labour

Technically, in the terms of Marx's critique of political economy, there is no such thing as the value of labour. If what capitalists bought was in fact the workers' labour then it would make surplus-value inexplainable. If the value of the product which the capitalist sells is equal to the value of the means of production and raw materials plus the value produced by the worker and renumerates the latter for the entire value produced during his labour-time then the only way of explaining profit is on the basis of an unequal exchange. Marx got around this apparent problem which classical political economists stumbled over by theorising that it was not the 'value of labour' which the capitalist bought but their capacity to labour which was bought for a certain amount of time, and the difference between the value of this capacity and the value created by the expenditure during the time which the worker is employed and the value of what Marx calls their 'labour-power' is what, for Marx, explains the origins of surplus-value. The value of labour-power is usually said to be equal to the means of subsistence necessary to maintain the worker in a state where they are capable of performing their job and providing for their family plus the cost of the technical training they needed to learn how to do their job in the first place. In Capital Volume I Marx added that into the determination of the value of labour-power their enters a 'historical and moral element', emphasising that the amount of means of subsistence necessary to maintain the worker which counts here is not a strictly physically determined quantity but also something regulated by social convention and morals. It is also worth emphasising that for Marx what he called the 'minimum' wage or the value necessary to reproduce the labourer would only be the average, he also noted that in practice many workers' were paid under the amount they needed to properly reproduce their physical capacity to labour and provide for their families, and on the other hand a certain section of workers may be paid over that amount, but on average the value of labour-power will tend to gravitate around the minimum.

[UltraWright]

I see! Now, how is the value of the work which the worker puts into the commodity determined?

[Zanthorus]

Now, how is the value of the work which the worker puts into the commodity determined?

Well, again, the work itself doesn't have value, it creates value by being objectified in the form of a use-value. And the value it creates is equal to the socially necessary labour-time needed to produce the commodity.

[Book O'Dead]

I have been reading on the labour theory of value and do understand how commodities get their value but do not get how the value of labour itself is estimated/calculated. Can somebody help me with it?

Under capitalism labor power is a commodity. So it must follow that the socially necessary ammount of labor time required for its production is what determines its value.

[ZeroNowhere]

The value of labour-power is implicit (although not yet existent as such) in the simple form of commodity production, C-M-C, which contains the opposite form, M-C-M, implicitly within it as something carried out by the rest of society as a whole (ie. society buys, M-C, and then produces another commodity C to sell, C-M), and further by the producer themselves from the viewpoint of the rest of society (M-C...P...C-M, in that they first buy from society and hence reproduce their labour capacity (society sells them a commodity), then produce another commodity for society). This is a simple result of the fact that a part of society's total labour-time, the 'necessary' labour-time, serves as a necessity for the reproduction of labour itself at all, which forms a necessary basis before labour may be done with free self-development as its end.

Of course, this is as yet only present as a potentiality, and the dominant form of production is still ultimately only C-M-C, so that this form has not taken on autonomy as such yet. There is no common thread between the first M-C and the next C-M in practice, except an incidental one, which is to say that while society is already something divorced from the individual, it has not yet taken on the form of an independent subject (in the same way that Hegel identified a metaphysical view of the infinite as essentially seeing it as simply a static and constant commonality between various finites, just as money would appear in in C-M-C-M-C-M, etc., rather than seeing the infinite as unfolding itself through the finite, in which case the infinite appears prior and develops itself for itself through the finite. One could refer to this as infinite-finite-infinite'. By this, the infinite was supposed to become subjective rather than merely objective, actively realizing itself in the finite for its own teleological ends, whereas previously such would have been a pointless act of becoming finite and staying the same and hence accomplishing nothing). Here, value also appears as limited, insofar as it has no autonomy as such, but rather the end of production appears as simply a use-value for the particular producer (which is why C-M-C is the dominant form of production)

The development of this into the value of labour-power as such is further developed by collective labour, labour featuring co-operation on a fairly notable scale as an integral productive power, by which the individual producer no longer has an individual product to preside over, as the simple commodity producer did, and hence produces a product which can no longer undergo the process C-M-C in the same direct way in which it did for the individual commodity producer. The individual commodity producer produces their product, and then sold it and reaped the dividends, but now the individual, atomized producer produces a collective product, which does not belong to any of the individuals involved in any direct manner (if ten people work together to produce something, then this is evidently a collective product, not an individual one). Private production in its traditional form becomes impossible. The significance of this is that the collective product is sold as collective product, and hence its sale is not directly the C-M of the individual producer, because it is not their product.

Therefore, their gaining of money through C-M, part of C-M-C, can no longer feature the commodity itself as the original C. Their M appears rather as a reward for having laboured, as the price of their labour, rather than the price of their product because, again, it's not 'their' product. Here, money comes to take on the role not of simply means of circulation, but of means of payment, and hence of money as such (for example, in Marx's development of money in chapter 3 of capital, money is said to function as money in the functions of firstly the hoard, and then money as means of payment, in both of which money appears as an end in itself rather than simply a means towards use-values). These are the two basic moments of capital, and mean that the subsumption of commodity production to capital only becomes real, inherent in the production process itself, with the development of collective labour, prior to which capital did exist, but with independent producers where it featured as essentially arbitrary rather than as a productive force in itself.

It's probably important to view capital as essentially society in alien form as subject (in the same way as the idealistic God). It is society in a concentrated form, as it were. The total social product now appears as the property of the total social capital. However, in the first place, capital and labour are not identical as such, and hence capital is forced to divide itself into on the one hand surplus-value, and on the other hand the labour necessary for the reproduction of its necessary basis, namely labour itself (to put things in an idealistic (ie. in the philosophical sense) manner). Through this it manifests the fact that it is in fact reliant upon labour, rather than something absolute and autonomous.

However, through this it in fact incorporates labour into itself, in other words through buying labour-power it makes the labour-power into its own labour-power in the fairly literal sense that it is now its own power. The labourer's power is now the power of capital. As such, likewise, the labourer's labour is now its own (in slavery, it is the slave and not their labour-power which is bought, so this does not apply in full; this simply reveals slavery to be a lower form of alienated society). In dividing itself it unifies itself with labour, which hence appears as simply a moment of its own process and realization; it repulses itself to form labour-power, then attracts itself once more as a necessary moment of the former already implicit in it. The individual is unified with society through being absorbed into it, just as in the state, but this does not ultimately abolish their abstract form or their opposition.

As we said, society must perform a basic amount of labour simply to reproduce labour on a given level (or even a higher one, as the workforce grows). This forms the labour by which labour-capacity is reproduced, so that it may be hired once more. In total, this forms society's necessary labour-time. Society's labour-hours may thus be divided between necessary and surplus labour-time here. For example, out of 800, 400 hours may be of necessary labour, and 400 of surplus-labour. This division, however, takes place within each individual workplace as well (where labour counts as abstract labour, of course). Of course, insofar as it applies to the total amount of abstract labour-hours, it must also apply to a given amount of them. Hence, if these 800 hours are divided between 80 firms which each employ 10 hours of labour, then 5 hours of labour for each firm function as necessary labour-time (of course, not all of these firms will produce products which, as use-values, compose the necessary labour-time, but nonetheless the labour is performed as abstract labour and hence this is irrelevant. This is manifested in the tendency towards equality of wages, albeit a tendency abetted by other factors such as skilled labour, as well as the everyday disequilibrium of the market, and hence remaining tendential.)

In that case, we here have the wage-system in embryo, that is, capital's self-division. This is because capital is not only manifested in a single process M-C-M', but rather attains its true existence through the continual repetition of the process M-C-M' on the part of the total social capital; this forms a necessary prerequisite of capitalism, for after all capital is capital only in process, and hence remains capital only through this continual self-expansion of value (which hence features as truly the infinite in the process, continually realizing itself in the finite; the alternative if M-C-M' where the M' is then expended upon use-values, where money still does not appear as an end in and for itself). The division of the total social labour-time into necessary and surplus is mirrored in the division of capital into profits and wages, and at base into the value of labour-power (necessary labour-time) and surplus-value (the proportion of these is, of course, the rate of surplus-value). A certain amount of the social labour is required to produce labour, as it were.

Through this, labour-power comes to attain a value and have this asserted as a necessity in the capitalist process, rather than simply a result of the labourer's stubbornness (I hear that those labourers in China are asking for higher wages; goddamnit, why can't these workers stop being stubborn mules and just do what they're told? It helps the world economy!) Value, after all, has its basis in the social distribution of labour in an economy of estranged actors.

(Arjun Rampal, by the way, is quite emphatically not (http://www.bollywoodworld.com/bollywood-news/an-actor-should-never-live-in-isolation-arjun-rampal-111144.html) an estranged actor.)