Debunking "Human Capital"

[Rafiq]

I have discovered this, deeply Idealist and reactionary notion of "Human Capital".

Basically the premises is as follows: That Human capital is skills, knowledge, creativity, (Investing in yourself or some rubbish like that).

Now I know it's horse shit, though I need some text, or recources I can link a pal of mine regarding the subject, as I don't want to explain it to him.


Anything would be fine, honestly.

Yours truly,

Rafiq

[Rafiq]

Bump? I need resources guys

[Rowan Duffy]

I don't think it's horseshit. It takes a long time to become, say, a civil engineer, and requires study. It also requires information resources and knowledgeable people to assist in the knowledge transfer. This civil engineering is a necessary precondition for the design of, say, bridges. Without it, you'd be in trouble trying to produce bridges. The labour involved in the transfer of this knowledge, which goes into the information infrastrcture (such as libraries), teaching, materials and equipment involved in models and prototypes during the learning process etc. is a fair bit of invested capital. Where does it go?

Clearly human capital is different from machines etc, but I don't think there is anything deeply reactionary about attempting to track the labour input required to assist people in becoming competent engineers.

It should be noted that this isn't at all an argument for intellectual property rights.

[Die Neue Zeit]

The labour involved in the transfer of this knowledge, which goes into the information infrastrcture (such as libraries), teaching, materials and equipment involved in models and prototypes during the learning process etc. is a fair bit of invested capital. Where does it go?

Clearly human capital is different from machines etc, but I don't think there is anything deeply reactionary about attempting to track the labour input required to assist people in becoming competent engineers.

Can't that just fit into the bigger umbrella of variable capital, the cost of labour power?

[Hit The North]

Human capital theory is the summation of a process of regarding labour as a commodity and, what's more, comes from the bourgeois point-of-view of the labour-capital relation, in that the "equality" of both transactors is assumed. In UK universities at the moment, degree courses are being shaped by 'employability' criteria - a set of transferable skills designed to instil the notion of flexibility that is desired by our exploiters. The theoretical underpinnings of this lie in human capital theory.

Rafiq, I reckon this is what you're looking for: Social Solidarity versus Social Capital (http://ethicalpolitics.org/reviews/social-solidarity.htm)

[ColonelCossack]

So does it require labour time to create a person with a skilled job... like teachers... so teachers are proletarians?

'Cos labour time is the source of surplus value... so any profit created by the skilled worker is created by the labour time needed to train them?

So there's two levels of exploitation going on?

Right or wrong? :confused:

[Desperado]

So does it require labour time to create a person with a skilled job... like teachers... so teachers are proletarians?

'Cos labour time is the source of surplus value... so any profit created by the skilled worker is created by the labour time needed to train them?

So there's two levels of exploitation going on?

Right or wrong? :confused:

Assuming private sector teachers, the teachers is exploited the same as any other prole. The service they provide also increases the potentials of other future workers labour. But it also increases the price of that workers labour-power, because the worker has to pay back the cost of her education (just as needing to eat increases the price of a worker's labour).

There's no two-levels of exploitation, just that workers need basic commodities by other exploited workers in order to be exploited themselves (food, housing, education).

[Matija]

http://en.wikipedia.org/wiki/Human_capital#Marxist_analysis

[Die Neue Zeit]

Human capital theory is the summation of a process of regarding labour as a commodity and, what's more, comes from the bourgeois point-of-view of the labour-capital relation, in that the "equality" of both transactors is assumed. In UK universities at the moment, degree courses are being shaped by 'employability' criteria - a set of transferable skills designed to instil the notion of flexibility that is desired by our exploiters. The theoretical underpinnings of this lie in human capital theory.

Rafiq, I reckon this is what you're looking for: Social Solidarity versus Social Capital (http://ethicalpolitics.org/reviews/social-solidarity.htm)

Look, I know you're trying to criticize "human capital," "knowledge capital," etc. on the basis of "reification" and such, but LTV posits exploitation under the explicit assumption of equality of both transactors.

Until I learned more about variable capital, I too bought into the "reification" critique hook-line-and-sinker. Then I realized the problem of that critique, because by its own assumptions a term like "variable capital" (the cost of labour power) would itself be a "reification."

I think now that there should be discussions on the evolution of variable capital ("knowledge economy") as well as of fixed capital (such as mechanization) using the classical frameworks underpinning both.

[Vladimir Innit Lenin]

The idea of Human Capital as a stand-alone entity actually makes sense. People can invest non-monetary, non-exchange variables (such as time, energy, initiative etc.) into improving various non-monetary, non-exchange parameters (education, health/fitness, cultural awareness, social understanding/abilities).

The problem comes in the application of Human Capital Theory, which often defends privatised education, healthcare etc., by saying that they are an investment (much like an angel investor investing in themselves...) which will be reaped by either a better job or a longer life (and thus more output) later on.

The idea of measuring a persons' value, or potential future output, is a key problem in economics and the ideas of Human Capital, or the Value of Statistical Life, are intrepid concepts (not without flaws). But, like most things, such an idea can of course be hijacked and used for 'capital' purposes, which is not what we want.

[Hit The North]

Look, I know you're trying to criticize "human capital," "knowledge capital," etc. on the basis of "reification" and such, but LTV posits exploitation under the explicit assumption of equality of both transactors.


If Marx's LTV was posited on the assumption of a real equality between transactors, then social class would lose its power to explain exploitation. If the day-to-day, constant transactions between labour and capital were based on a real equality, then exploitation would only be possible on the agreement of those who's labour power is being exploited and workers would have control over their own conditions of labour.


Until I learned more about variable capital, I too bought into the "reification" critique hook-line-and-sinker. Then I realized the problem of that critique, because by its own assumptions a term like "variable capital" (the cost of labour power) would itself be a "reification."
I'd suggest that "variable capital" is a necessary abstraction based on a scientific approach to understanding capitalism; whereas, the concept of "human capital" is an abstraction based on a reified understanding of the human being. Not all abstractions are equal or carry the same degree of sin.


I think now that there should be discussions on the evolution of variable capital ("knowledge economy") as well as of fixed capital (such as mechanization) using the classical frameworks underpinning both.
But from which point of view of the class struggle should this discussion be had?

This is the crux: Before we can talk about "social capital", the social must have been first colonised by capital. Before we can talk about "cultural capital", the culture must have first been colonised by capital. Before we can talk about "human capital", the human must have been first colonised by capital.

Or, as Andy Blunden puts it, human capital theory is based on the idea that "human life is a form of capital".


Originally posted by Stammer and Tickle
The idea of Human Capital as a stand-alone entity actually makes sense... The problem comes in the application of Human Capital Theory... But, like most things, such an idea can of course be hijacked and used for 'capital' purposes, which is not what we want. Before we can talk of human beings having "capital", their attributes must already be transformed into commodities that can be exchanged and put into circulation. In other words, the idea of human capital only makes sense within the capitalist mode of production. It isn't that it is a viable theory, abused by unscrupulous capitalists. The truth is that it is a theory of capital and was designed explicitly to serve the interests of capital.

Now, given that our historic mission is to overcome the capitalsit mode of production and create a world where workers are not commodities, we will not be able to utilise the theoretical excretia and ideological apologia for the bourgeoisie relation of production, in our free association of producers.

[Vladimir Innit Lenin]

I agree if we are talking specifically about Human Capital Theory, I was more talking about attempts within Economics to define the potential output of humans of the course of the rest of their life. I would have thought that to be something that is essential in a post-monetary economy, which is what we strive for.

Even in a world where workers aren't commodities, they will still always have an inherent value in relation to the production function, as long as scarcity exists (which it surely always will!).

[Die Neue Zeit]

If Marx's LTV was posited on the assumption of a real equality between transactors, then social class would lose its power to explain exploitation.

The point behind Marx assuming the best-case scenario was to avoid Ricardian or populist problems with LTV, which tended to focus on information and power asymmetries, like exploitation at the point of distribution.


If the day-to-day, constant transactions between labour and capital were based on a real equality, then exploitation would only be possible on the agreement of those who's labour power is being exploited and workers would have control over their own conditions of labour.

If I were to use neoclassical terminology to describe the "generous" scenario Marx was writing about, it would be a "perfectly competitive free market":

http://en.wikipedia.org/wiki/Perfect_competition



Infinite buyers and sellers – Infinite consumers with the willingness and ability to buy the product at a certain price, and infinite producers with the willingness and ability to supply the product at a certain price.
Zero entry and exit barriers – It is relatively easy for a business to enter or exit in a perfectly competitive market.
Perfect factor mobility - In the long run factors of production are perfectly mobile allowing free long term adjustments to changing market conditions.
Perfect information - Prices and quality of products are assumed to be known to all consumers and producers.
Zero transaction costs - Buyers and sellers incur no costs in making an exchange (perfect mobility).
Profit maximization - Firms aim to sell where marginal costs meet marginal revenue, where they generate the most profit.
Homogeneous products – The characteristics of any given market good or service do not vary across suppliers.
Non-increasing returns to scale - Non-increasing returns to scale ensure that there are sufficient firms in the industry.


[...]

In contrast to a monopoly or oligopoly, it is impossible for a firm in perfect competition to earn economic profit in the long run, which is to say that a firm cannot make any more money than is necessary to cover its economic costs. In order not to misinterpret this zero-long-run-profits thesis, it must be remembered that the term 'profit' is also used in other ways. Neoclassical theory defines profit as what is left of revenue after all costs have been subtracted, including normal interest on capital plus the normal excess over it required to cover risk, and normal salary for managerial activity. Classical economists on the contrary defined profit as what is left after subtracting costs except interest and risk coverage; thus, if one leaves aside risk coverage for simplicity, the neoclassical zero-long-run-profit thesis would be re-expressed in classical parlance as profits coinciding with interest in the long period, i.e. the rate of profit tending to coincide with the rate of interest.

In other words, exploitation was posited as occurring under the scenario of profits = interest on capital + risk coverage.

Now:


I'd suggest that "variable capital" is a necessary abstraction based on a scientific approach to understanding capitalism; whereas, the concept of "human capital" is an abstraction based on a reified understanding of the human being. Not all abstractions are equal or carry the same degree of sin.

We'll agree to disagree there, I suppose.

[Hit The North]

The point behind Marx assuming the best-case scenario was to avoid Ricardian or populist problems with LTV, which tended to focus on information and power asymmetries, like exploitation at the point of distribution.

If I were to use neoclassical terminology to describe the "generous" scenario Marx was writing about, it would be a "perfectly competitive free market":

http://en.wikipedia.org/wiki/Perfect_competition

In other words, exploitation was posited as occurring under the scenario of profits = interest on capital + risk coverage.



None of the above remotely addresses my points.


We'll agree to disagree there, I suppose.


And the basis of your disagreement is what?

[Hoipolloi Cassidy]

Funny, I was just about to go pick up Marcel Mauss' "The Gift." I've already got enough Bourdieu under my belt not to need to read more at this point.

Look, there's a whole huge side to "economic exchanges" that doesn't fit into the capitalist (or Leninist) definition of productive labor, call that side "symbolic capital" "Human capital," whatever. Marx never said LTV was the exclusive definition of labor. So cappie's just figured out that his narrow little system has a couple "externalities" (as they're politely called)? Duhhhhhh.

[Die Neue Zeit]

^^^ Again, comrade, didn't Marx sorta cover it with "variable capital," with the latter only needing a contemporary expansion?


None of the above remotely addresses my points.

I'm afraid you're the one who lost me this time.


And the basis of your disagreement is what?

Again, I don't agree with the "reification" critiques of "human capital," but I do think a popularization of "variable capital" that encompasses the details in "human capital," "knowledge capital," etc. is in order.

[Hit The North]

I'm afraid you're the one who lost me this time.


Nothing that you quoted in your post relates to the labour-capital relation.


Again, I don't agree with the "reification" critiques of "human capital," but I do think a popularization of "variable capital" that encompasses the details in "human capital," "knowledge capital," etc. is in order.

To what end?

[RHIZOMES]

This is more a suggestion of where to look rather than what to think, but there is a substantial Marxian sociological literature of the bourgeois concept of 'employability'. Just input 'sociology employability' into Google Books or Scholar and you'll find a wealth of analysis on the subject.

[Hoipolloi Cassidy]

WOID XX-11. Demand-Side Economics


Teaching without students
writing without fame
is hard.

It's nice to go out mornings
With the freshly written sheets
To the waiting printer, through the buzzing market-
place where they sell meat and appliances
You sell phrases.
- Bertolt Brecht.
No society can for any length of time remain master of its own production and continue to control the social effects of its process of production, unless it abolishes exchange between individuals.
- Friedrich Engels. I meet a woman at a demonstration - she's involved with a program that sends books to prison inmates, so I show her one of my books and her first reaction is, "What kind of book is this?" Then I tell her about my pricing system (http://theorangepress.com/accounts/); that I adjust my prices according to the buyer's ability to pay: for books, $5.00 if you're unemployed, $20.00 for Institutions, $40.00 if you're rich; free for prison inmates, on demand. And $200.00 for rich assholes, which is going to put me in a bind with Bernie Madoff since he's rich, an inmate, and an asshole to boot.

And the woman grabs my book and says, "I'll pass it on;" And I grab it back. If she doesn't like my book why pass it on to others? Why send the inmates something they may not want to begin with? When I say "free on demand" I mean just that: not just that I don't price my books or lectures based on the reader or the student's ability to pay; I base them on their interest, and how much paying means to them. The jails are full of folks who've learned the price of walking off with something just because it happens to be there; and the best are those who are still trying to figure out what's worth having; trying to break loose from Freedom and Democracy, the Freedom to choose whatever you want so long as whatever you want is chosen for you, but you know, Democratically. Instead, why not help inmates and the others break loose from the fantasy that folks are naturally, spontaneously drawn to goodies like flies to shit? For it is a fundamental law of Capital that folks are spontaneously attracted to getting stuff that someone else says they want. (Eat shit. Fifty billion flies couldn't be wrong.) And it's a fundamental law of capitalist Culture that folks spontaneously like art and books and music, the one exception being poor people and inmates who are poor and inmates because they don't buy stuff and therefore don't go to museums or read or go to concerts. There has to be a better way.

...continued at:

http://theorangepress.com/woid/woid20/woidxx11.html

WOID: a journal of visual language (http://theorangepress.com/woid)

[Hit The North]

^^^ What does this have to do with the OP?

[Hoipolloi Cassidy]

^^^ What does this have to do with the OP?
I'm going to assume you're actually expecting an answer rather than taunting me, though the first answer I have is so obvious I expect it doesn't address your question.

The original topic was "Human Capital," and as I pointed out, "Human Capital" is only one way of conceptualizing an area of economic praxis, and perhaps the most reactionary. There are also conceptions like "Symbolic capital," "The Gift Exchange," etc., as developed by folks like Mauss and Bourdieu. Incidentally, I previously mentioned that I didn't think I had anything to learn from Bourdieu. I was wrong. I just started reading "Les Structures sociales de l'économie, the Introduction has a brilliant analysis of the various concepts and their limits.

So, as promised, I posted the first two paragraphs of the first or a series of articles I'm writing on the topic - in fact it looks as though the project might reach book-length at some point.

I suspect what you really want to know, is how I would dare to write about my actual, real-life political engagement with the economy (otherwise known as "work") on a site that's 2/3rds devoted to what Lassalle used to call "The Revolutionary Idea," meaning a lot of wannabes telling others to do and think what they themselves are neither capable or willing to do for themselves. I'm planning to address that issue somewhere in the third or fourth part of the article, because the praxis of economics is an important part of Bourdieu's argument; but of course you actually might have to read the article - assuming of course that you wanted an answer to begin with.

[Hit The North]

I'm going to assume you're actually expecting an answer rather than taunting me, though the first answer I have is so obvious I expect it doesn't address your question.

The original topic was "Human Capital," and as I pointed out, "Human Capital" is only one way of conceptualizing an area of economic praxis, and perhaps the most reactionary. There are also conceptions like "Symbolic capital," "The Gift Exchange," etc., as developed by folks like Mauss and Bourdieu. Incidentally, I previously mentioned that I didn't think I had anything to learn from Bourdieu. I was wrong. I just started reading "Les Structures sociales de l'économie, the Introduction has a brilliant analysis of the various concepts and their limits.

So, as promised, I posted the first two paragraphs of the first or a series of articles I'm writing on the topic - in fact it looks as though the project might reach book-length at some point.



Well, that told me :rolleyes:.

But it is not my fault that you decided to post the most irrelevant paragraphs of your article. Sorry that it turned out to be your valuable experience and all, but your personal pricing system and haggling with that woman sheds precious light on the theory of human capital which is, after all, the subject of this thread. Thanks for answering nonetheless. I've read the rest of your article and see where you're coming from.

So no need to get snippy:


I suspect what you really want to know, is how I would dare to write about my actual, real-life political engagement with the economy (otherwise known as "work") on a site that's 2/3rds devoted to what Lassalle used to call "The Revolutionary Idea," meaning a lot of wannabes telling others to do and think what they themselves are neither capable or willing to do for themselves. I'm planning to address that issue somewhere in the third or fourth part of the article, because the praxis of economics is an important part of Bourdieu's argument; but of course you actually might have to read the article - assuming of course that you wanted an answer to begin with.
Yes, how DARING of you to talk about your *drum roll* "real-life political engagement." You are obviously some kind of big shot and we are not worthy.

[Hoipolloi Cassidy]

So no need to get snippy:
Okay, so I take back the snippy part. An occupational hazard, I guess.

Do consider that what I said (apart from how I said it) is an important issue later on in the article: economic praxis vs. economic theory, and whether there is one kind of theory (even "revolutionary") that in any way encompasses the actual practice within a specific segment of society - in this case the cultural sector.

Solidarity,