How is Surplus Value Possible?

[Nicoth]

Hi,

I'm reading Capital and I'm having trouble understanding how surplus value is derived from the labour process.
An example used by Marx is that of producing yarn over the process of 5 days. When the cotton is bought, it advances its 4 days of labour time into the process. the last day is spent between necessary and surplus labour. If the average work day is 12 hours, and the spinning on the 5th day takes 8 hours, this leaves 4 hours of the 5th day to advance as surplus value.
Is it correct to say that the surplus value is based on a labour time of 60 hours, rather than 56 hours? If so, why is the capital averaging labour time by the day rather than the hour?

Much thanks to anyone who can clarify this for me,
Nick

[tuwix]

The Surplus Value is that what the worker is exploited of by capitalist. It is the value that isn't given to worker but earned by capitalist and done by a worker.

Regarding it, your considerations about time doesn't make much sense unfortunately.

[robbo203]

Hi Nick

I think the example from Capital you cite should not be interpreted too literally. The working week is not literally divided into one period of time devoted to the production and reproduction of necessary labour and the other, surplus labour. This is only by way of illustration and in fact, more closely resembles what goes on under feudalism e.g. the corvee system, than under capitalism.

For Marx, necessary and surplus labour run together simultaneously and it was for this reason that he criticised certain bourgeois economists who argued against a reduction in the working day on the grounds that it would eliminate the portion of time alloted to surplus labour and thus mean the capitalist would not get any profit.

This point is developed in Marx's discussion on the difference between relative surplus value and absolute surplus value

[Comrade Jacob]

The most basic way of putting it: What ever the capitalist earns that their workers do not get is surplus value.
No, it doesn't need to be 60 hours, 60 hrs is just the average work done in a week at that time. 5 days a week for 12 hours.

[Dave B]

The cotton that has 4 days [or 48 hours] labour in it is spun into yarn in a day [or 12 hours.]

Of the 12 hours of [a days] work [value] that is added to the cotton in the production of yarn, the [additional] worker will [eventually] get paid 8 for it and the capitalist will get 4.

48 + {8 + 4} = 60


Guessing what Nick wants an answer to?

Actually all the simple workers ‘should’ be interested in or focus on from their perspective is the {8 + 4} and whether or not it is say; {6 + 6} or {10 + 2}; or in other words the proportion of the work that they do (in a day, or week as a nominal time frame) that they get paid for.

Or the rate of exploitation.

The price of cotton, 48, is of no immediate concern to the workers, yet.

The [daily] rate of exploitation, at the way Karl chooses to describe it, is;

4hours /8hours

And the 5 day weekly rate of exploitation is the same at;

20 hours/ 40hours.

You could have an hourly or minute rate of exploitation eg;

20 minutes/40 minutes

proportion of the work that they do in an hour that they don't get paid for.

Or

20 seconds/ 40 seconds.

proportion of the work that they do in an minute that they get don't paid for.

Generally Karl "arbitrarily" picks the model of a weekly time frame mostly because that was the conventional norm; to purchase labour power (or employ someone) for a week.

However the exploitation continues minute by minute in real time if you like over the whole time period of the week.


Returning to the more orthodox yarn spinning capitalist himself; he looks at things a bit differently.

As far as they are concerned they shell out or put up front [invest];


48 cotton + 8 wages*= 56 to produce something worth 60


; the difference being “a” profit.

Actually capitalists out of jealously for each other are not even just interested in profits, they are preoccupied by rates of profits or in this case the [daily] rate of profit for the capitalist yarn spinner is ;

4/ (48 + 8)

or 4/56.

His 5 day weekly rate of profit would be the same at;

20/280

We have to be conscious of the capitalist classes perspective as well because they do chase after rate of profit first and the rate of exploitation can seem to follow along afterwards as almost a consequence.

As robbo points out it is only in the feudal and corvee type systems that the necessary labour time [say Monday to Wednesday] and surplus labour time [Thursday to Saturday] are neatly and transparently divided up into days.

And if that wasn’t helpful enough to uncover the nature of exploitation etc.

Necessary labour time and surplus labour time are performed in different places; and perhaps much of the surplus product as destined for the consumption fund of the lord of the manor or to be exchanged for the luxury products of guild producers etc would be of a different type or quality.

So much so that even Karl couldn’t mange to stretch an analysis of that out into more than a very long paragraph;




So much is evident with respect to labour rent, the simplest and most primitive form of rent: Rent is here the primeval form of surplus-labour and coincides with it. But this identity of surplus-value with unpaid labour of others need not be analysed here because it still exists in its visible, palpable form, since the labour of the direct producer for himself is still separated in space and time from his labour for the landlord and the latter appears directly in the brutal form of enforced labour for a third person.



In the same way the "attribute" possessed by the soil to produce rent is here reduced to a tangibly open secret, for the disposition to furnish rent here also includes human labour-power bound to the soil, and the property relation which compels the owner of labour-power to drive it on and activate it beyond such measure as is required to satisfy his own indispensable needs. Rent consists directly in the appropriation of this surplus expenditure of labour-power by the landlord; for the direct producer pays him no additional rent.

Here, where surplus-value and rent are not only identical but where surplus-value has the tangible form of surplus-labour, the natural conditions or limits of rent, being those of surplus-value in general, are plainly clear. The direct producer must 1) possess enough labour-power, and 2) the natural conditions of his labour, above all the soil cultivated by him, must be productive enough, in a word, the natural productivity of his labour must be big enough to give him the possibility of retaining some surplus-labour over and above that required for the satisfaction of his own indispensable needs. It is not this possibility which creates the rent, but rather compulsion which turns this possibility into reality.

But the possibility itself is conditioned by subjective and objective natural circumstances. And here too lies nothing at all mysterious. Should labour-power be minute, and the natural conditions of labour scanty, then the surplus-labour is small, but in such a case so are the wants of the producers on the one hand and the relative number of exploiters of surplus-labour on the other, and finally so is the surplus-product, whereby this barely productive surplus-labour is realised for those few exploiting landowners.

http://www.marxists.org/archive/marx/works/1894-c3/ch47.htm



All this is obscured in capitalism hence the need for the book.



*The idea the capitalist having to put up front or have as ready cash available in the safe for the workers wages etc etc is another idealised ‘working model’.

Based on the need to pay the wages of the workers before the sale of the final product.

Which is obviously different for a ship builder to a restaurant owner.

The necessary labour time (wages) generated by a cook might immediately go into the pocket of the restaurateur capitalist as a sale which he will not hand over to the cook until the end of the week.

So ‘v’ ,only as regards rate of profit, is possibly less than 0.

That is the problem with ‘v’ it has two ‘meanings’; money invested or locked up in the business to pay wages before sale.

And the ‘proportion’ of the workers labour time that will be paid for.

But again it would probably be a spurious kind of analysis to think in terms of the cook being, eventually. fully paid to boil the potatoes and frying up the steak for nothing; or the other way round.

[Turinbaar]

Important categories you should be thinking about are the rights of appropriation that are practiced by the owners of private property. Not only do they own the instroments that allow labor to produce exponentially greater value than the unaided hand, it is the right of the capitalist under this system to determine what rate of pay is the absolute minimum necessary to keep the worker alive and working. What wealth is not expended in wages and the upkeep of capital, is kept as surplus value.

Another area you may look into after you have finished capital is Rosa Luxemburg's Accumulation of Capital, in order to see how expanded production and the absolute increase of surplus value is possible.

[Red Shaker]

To better understand the meaning of surplus value you first have to understand the difference between labor time and labor power. The value of a commodity is the socially necessary labor time that is needed to produce it. Labor power is the commodity that a worker sells to a capitalist. The value of the commodity labor power is determined by the amount of labor time that is required to produce it. The average wage of a worker is usually the value of his labor power. Thus a capitalist pays a worker two hours of labor time which represents the time it took to produce the labor power the capitalist bought from the worker, but the worker is required to work eight hours labor time. The difference between the value of the eight hours the worker spent on the job and the value of the two hours that the capitalist paid the worker is the surplus value that the capitalist gets to keep as his profit. Marx's booklet Wages, Prices and Profits explains this pretty well. It is a good introduction to Capital.

[reb]

To put simply, part of the working day goes towards the payment of labor and what is left is effectively unpaid labor and it's this where surplus value comes from. This division of paid and unpaid labor is hidden in the wages-system. It appears that a wage goes towards a whole days work by the laborer. Compare this to serfdom where one part of your time was to work on your own land to reproduce yourself and the other you work for free on your landlord's land. Under the wages system this is all tied up together so that it is not obvious anymore. This is why there is a constant drive towards the lowering of wages, the lengthening of the working day and increasing productivity and the intensity of labor. These things allow for more surplus value to be extracted.

[cyu]

From http://www.revleft.com/vb/your-favorite-political-t171310/index24.html
http://i.imgur.com/OnLTxi7.png

When capitalists are allowed to legally bribe politicians, the amount of flesh and blood they are able to extract out of their employees increases ever more.

[ckaihatsu]

[23] A Business Perspective on the Declining Rate of Profit

http://s6.postimage.org/c0b0m6i25/23_A_Business_Perspective_on_the_Declining_Rat.jpg (http://postimage.org/image/c0b0m6i25/)

[Comrade #138672]

Surplus-value is derived from surplus-labor, i.e. the labor that is in excess of the labor needed for a worker to sustain and reproduce itself. The necessary labor for a worker, to sustain and reproduce itself as a worker, constitutes the absolute minimum of the variable capital. The surplus-labor constitutes the absolute maximum of the surplus-value. In practice, however, wages can be fought over, so the variable capital per worker is usually higher than the absolute minimum, especially in First World countries with a rich history of labor movements.

This does not mean that capitalism can be reformed to serve the workers, though. But this is an entirely different issue.

[Vilhelmo]

All this talk of Surplus Value & not one mention of "Economic Rent"?:confused:

[Comrade #138672]

All this talk of Surplus Value & not one mention of "Economic Rent"?:confused:Economic rent does not produce surplus-value.

[Vilhelmo]

Economic rent does not produce surplus-value.
What? I don't think you know what "Economic Rent" is. The difference between price & value is Economic Rent It is that element of price with no corresponding cost of production, that is not attributable to labour. Economic Rent is surplus-value.

[reb]

What? I don't think you know what "Economic Rent" is. The difference between price & value is Economic Rent It is that element of price with no corresponding cost of production, that is not attributable to labour. Economic Rent is surplus-value.

Surplus-value comes from unpaid labor. Value is created by labor, no value is created through exchange.

[Vilhelmo]

Surplus-value comes from unpaid labor. Value is created by labor, no value is created through exchange. Are you saying that Economic Rent comes from unpaid labour?

[reb]

Are you saying that Economic Rent comes from unpaid labour?

No, I'm telling you where surplus-value comes from and how value in general is created. Look, I get what you are saying, that price can sometimes not equal value. But, when a marxist talks about capitalims, we talk about it in tendencies and generalities so that overall, value = price. Value and price are two different things.

[Vilhelmo]

No, I'm telling you where surplus-value comes from and how value in general is created. You assert that "Surplus-value comes from unpaid labor." Economic Rent is defined as surplus-value. Economic Rent is not unpaid labour. Either Economic Rent is not surplus-value, which it undoubtedly is, or Surplus-value doesn't entirely stem from unpaid labor.
I get what you are saying, that price can sometimes not equal value. Not sometimes but frequently.
Value and price are two different things. Yes, value means cost-value & price means market price.
But, when a marxist talks about capitalims, we talk about it in tendencies and generalities so that overall, value = price. Marxists might but Marx certainly did not!

[The Jay]

You assert that "Surplus-value comes from unpaid labor." Economic Rent is defined as surplus-value. Economic Rent is not unpaid labour. Either Economic Rent is not surplus-value, which it undoubtedly is, or Surplus-value doesn't entirely stem from unpaid labor. Not sometimes but frequently. Yes, value means cost-value & price means market price. Marxists might but Marx certainly did not!

Could you cite your sources for all this please?

[Jimmie Higgins]

You assert that "Surplus-value comes from unpaid labor." Economic Rent is defined as surplus-value. Economic Rent is not unpaid labour. Either Economic Rent is not surplus-value, which it undoubtedly is, or Surplus-value doesn't entirely stem from unpaid labor. Not sometimes but frequently. Yes, value means cost-value & price means market price. Marxists might but Marx certainly did not!You are conflating price and value. In the market, it's possible to get "extra returns" without actually creating extra value. If you have land and suddenly there is a drought and you have the only access to nearby water, you are not creating more water, you are just able to charge more momentarily for the same amount of water. But in terms of value, that water can only be useable water when labor is applied, creating ways to divert or pump that water to wherever you need it to be.

Buying low and selling high does not create value, it's just taking advantage of market fluxuations. If this was how value was created, then it would be a zero-sum game where no new value is created, instead capitalists would move the same amount of value around amongst themselves like chips in a poker game. You (an individual investor or firm) can win big, but no new poker chips are actually created.

[Vilhelmo]

You are conflating price and value. I am NOT. I explicitly stated they were different
Yes, value means cost-value price means market price.

[argeiphontes]

Vilhelmo, rents are a case of what Marx called superprofits (https://en.wikipedia.org/wiki/Superprofit).

[Vilhelmo]

Are superprofits held to be the result of unpaid labour?
Economic Rents sure aren't.

[argeiphontes]

Are superprofits held to be the result of unpaid labour?
Economic Rents sure aren't.

No, superprofits are like a bubble. The classic example is when a firm has a temporary technical advantage over its competitors, and takes less than the socially necessary labor time to produce something. Until the patents run out, or the competitors catch up, that firm will receive superprofits. It's not that labor is "unpaid" it's that the rent (patent, gound rent, etc) allows more than the value to be charged. I think. :) So I think it's a special case that Marx developed.

That pretty much bottoms out my knowledge. Apparently the article said that Marx likened it to ground rent, which I don't know much about.

[Jimmie Higgins]

I am NOT. I explicitly stated they were different
Yes, value means cost-value price means market price.Well forgive me, but that sentance made no sense to me both grammatically and conceptually.

Value means cost minus value? Or Value means the value of the cost?

it's sort of like saying: the value of X is X minus something.

[Vilhelmo]

Well forgive me, but that sentance made no sense to me both grammatically and conceptually.

Value means cost minus value? Or Value means the value of the cost?

it's sort of like saying: the value of X is X minus something.

My apologies.

The intended definitions are as follows:

Value = Cost Value = the technologically necessary costs of production
Price = Market Price

[Vilhelmo]

No, superprofits are like a bubble. The classic example is when a firm has a temporary technical advantage over its competitors, and takes less than the socially necessary labor time to produce something. Until the patents run out, or the competitors catch up, that firm will receive superprofits. It's not that labor is "unpaid" it's that the rent (patent, gound rent, etc) allows more than the value to be charged. I think. :) So I think it's a special case that Marx developed.

As I thought.
It seems to be almost synonymous with Economic Rent &/or Unearned Income.

Why do some claim that Surplus-value comes from unpaid labour?

[Blake's Baby]

...
Value = Cost Value = the technologically necessary costs of production
Price = Market Price


OK; if price = 'market price', or 'whatever it sells for in the market (because of disequilibrium between supply and demand, etc)' then we can for the moment ignore that as producing 'value', yes?

So 'value' = the "technologically necessary costs of production" is what we're after here. What are those "technologically necessary costs of production"? Machines, power, raw materials... labour? Does labour come into it at all?



...

Why do some claim that Surplus-value comes from unpaid labour?

Is this a typo? Do you mean, "Why do some deny that Surplus-value comes from unpaid labour?"

[Blake's Baby]

Sorry, double post.

[Vilhelmo]

So 'value' = the "technologically necessary costs of production" is what we're after here. What are those "technologically necessary costs of production"? Machines, power, raw materials... labour? Does labour come into it at all?

They are ultimately reducible to labour time.


Is this a typo? Do you mean, "Why do some deny that Surplus-value comes from unpaid labour?"

No.
I meant what I wrote.

[Blake's Baby]

They are ultimately reducible to labour time...

Right, all overheads are reducible to labour. So value is derived from labour.




No.
I meant what I wrote.

If you know that labour is the source of value, why are you asking why people claim that labour is the source of value? I'm afraid you've lost me.

[Five Year Plan]

Vilhelmo, I am not sure what the purpose of your intervention in this thread is. Rent is taken from a portion of surplus value and is paid to the owners of some monopolized resource like agricultural land. It has nothing to do with where surplus value comes from, which is human labor. It has only to do with how it is divided up between property/land owners once it has been created.

To the OP: surplus value comes from the fact that workers are able to produce, through their work, more than it takes for them to reproduce themselves at some socially acceptable level of subsistence. That surplus goes to the exploiter who contributes nothing to the labor process except his ownership of the tools and equipment, but none of the actual labor.

[Vilhelmo]

If you know that labour is the source of value, why are you asking why people claim that labour is the source of value? I'm afraid you've lost me.
I'm not. I'm asking why people claim all Surplus-value comes from unpaid labour. If Economic Rent is Surplus-Value, which, unless I'm mistaken, it undoubtedly is, then, as Economic Rent does NOT stem from unpaid labour, it follows that not all Surplus-Value can be derived from unpaid labour. The purpose of all my comments is to learn.

[cyu]

The purpose of all my comments is to learn.

Perhaps we should move all your comments to http://www.revleft.com/vb/learning-f43/index.html and clear up this forum for honest leftist discussion =]

[Vilhelmo]

Vilhelmo, I am not sure what the purpose of your intervention in this thread is. To learn & understand, particularly the views held by others & the reasons they are held.
surplus value comes from the fact that workers are able to produce, through their work, more than it takes for them to reproduce themselves at some socially acceptable level of subsistence. This is not the source of Economic Rents. They are instead the result of natural or contrived exclusivity. One cause is the differential productivity of factors. Land is a good example of this.

[Kill all the fetuses!]

I'm not. I'm asking why people claim all Surplus-value comes from unpaid labour. If Economic Rent is Surplus-Value, which, unless I'm mistaken, it undoubtedly is, then, as Economic Rent does NOT stem from unpaid labour, it follows that not all Surplus-Value can be derived from unpaid labour. The purpose of all my comments is to learn.

I think you are just mistaken about your own assumption. For instance, when you say "Economic rent is defined as surplus value", well, that's just... not true.

Marx clearly states in Volume 1 of Das Kapital that there are some goods that have no value, but can be sold for money in the market nevertheless, hence, earning "economic rent", which you defined as "price minus value", which in this case is "price minus zero", because a good doesn't have value in it. But it's not surplus value, that's not how Marx defines surplus value.

I mean, you can't simply jump in a conversation about Marx's usage of surplus value in Das Kapital, re-define it in your own way and run around shouting something about economic rent. At very least that's simply not cool.

[Five Year Plan]

This is not the source of Economic Rents. They are instead the result of natural or contrived exclusivity. One cause is the differential productivity of factors. Land is a good example of this.

The OP asked a question about the source of surplus value, which is a Marxist term. Your response is a marginalist/neo-classical definition of rent that does not answer the question, and moreover, by implying that things produce value rather than people, departs from the assumed economic school from which the question is asked. Maybe your interest in pursuing this debate is better left to Opposing Ideologies, rather than derailing this thread for multiple pages. That subforum, after all, is designed for people who wish to learn things, while espousing anti-leftist views.

[Vilhelmo]

Perhaps we should move all your comments to http://www.revleft.com/vb/learning-f43/index.html and clear up this forum for honest leftist discussion =]

I do not know why you keep claiming that my comments or myself are not "leftist". I could just as easily call your comments fascist. But I'm not that kind of guy.

[Vilhelmo]

by implying that things produce value rather than people, departs from the assumed economic school from which the question is asked. It was not my intent to imply that things produce value.
That subforum, after all, is designed for people who wish to learn things, while espousing anti-leftist views. Which of my views are "anti-leftist"? I would really like to know.

[Vilhelmo]

I mean, you can't simply jump in a conversation about Marx's usage of surplus value in Das Kapital, re-define it in your own way and run around shouting something about economic rent. At very least that's simply not cool. Marx does indeed define Economic Rent as Surplus-Value. Have you ever read Marx?

[Kill all the fetuses!]

Marx does indeed define Economic Rent as Surplus-Value. Have you ever read Marx?

Not that much, but I think I grasp the basic concepts quite well.

"[Marx theory of rent] does not imply any emergence of ‘supplementary’ value (surplus value, profits) in the market, in the process of circulation of commodities, which is anathema to Marx and to all consistent upholders of the labour theory of value. Nor does it in any way suggest that land or mineral deposits ‘create’ value. It simply means that in agriculture and mining less productive labour (as in the general case analysed above) determines the market value of food or minerals, and that therefore more efficient farms and mines enjoy surplus profits which Marx calls differential (land and mining) rent." Ernest Mandel "Karl Marx", Chapter 5.

I am not sure if this is what you are up to, but it seems like a very good explanation as to why you are wrong.

[Five Year Plan]

Marx does indeed define Economic Rent as Surplus-Value. Have you ever read Marx?

But the issue you seem unable to comprehend was that the original poster asked about the source of surplus value, what made it possible. The poster did not want a laundry list of the various forms that surplus could take, by virtue of being distributed to various parties for various reasons, once it was created by the direct producers.

[cyu]

I do not know why you keep claiming that my comments or myself are not "leftist".

So how opposed to capitalism are you? What kinds of actions against capitalists would you say is justified? If someone was about to die of starvation or lack of health care due to property claims, what actions would be justified in preventing his or her death?

[Vilhelmo]

"economic rent", which you defined as "price minus value", which in this case is "price minus zero", because a good doesn't have value in it..
I did not. Economic Rent is the excess of market price over intrinsic cost-value.

[Vilhelmo]

our response is a marginalist/neo-classical definition of rent. Defining Economic Rent as the excess of market price over intrinsic cost-value is a marginalist/neo-classical definition? Really?

[Five Year Plan]

Defining Economic Rent as the excess of market price over intrinsic cost-value is a marginalist/neo-classical definition? Really?

In a context where, asked about the source of surplus value, you define surplus value as rent, then proceed to define rent as the product of market price differentials, without any mention of labor, yes--you are clearly spouting neo-classical crap. This might come as a surprise to you, but Marxists here are a lot more familiar with right-wing economics than right-wingers tend to be with Marxism. We can spot from a mile away people advocating right-wing nonsense under the guise of being earnest "learners."

[Vilhelmo]

In a context where, asked about the source of surplus value, you define surplus value as rent, then proceed to define rent as the product of market price differentials, without any mention of labor,

I did NOT define Surplus-Value as Economic Rent.
I said Economic Rent was a form of Surplus-Value.

I defined Economic Rent as the excess of market price over intrinsic cost-value.
I stated explicitly that cost-value is ultimately reducible to labour time.
This is how Classical Economists defined Economic Rent which they isolated using the LTV.

Please stop falsely attributing to me views that I do NOT hold.
If you are unclear, I would be happy to elaborate.


yes--you are clearly spouting neo-classical crap. This might come as a surprise to you, but Marxists here are a lot more familiar with right-wing economics than right-wingers tend to be with Marxism. We can spot from a mile away people advocating right-wing nonsense under the guise of being earnest "learners."

You are clueless.
Neo-Classicalal Economics rejects the LTV.
They have abandoned the concept of Economic Rent & Unearned Income.

What exactly is this right-wing nonsense I'm apparently advocating?

[Vilhelmo]

But the issue you seem unable to comprehend was that the original poster asked about the source of surplus value, what made it possible. The poster did not want a laundry list of the various forms that surplus could take, by virtue of being distributed to various parties for various reasons, once it was created by the direct producers. I apologize if my comments were inappropriate. I was merely attempting to further discussion of the topic at hand. I leave it to moderators to take appropriate action. I mean no disrespect. It just seemed odd to have a discussion of Surplus-Value without mentioning Economic Rent.

[Vilhelmo]

I am not sure if this is what you are up to, but it seems like a very good explanation as to why you are wrong.

As these are not my views I fail to see how it could explain why they are wrong.

[Five Year Plan]

Economic Rent is surplus-value.


I did NOT define Surplus-Value as Economic Rent. I said Economic Rent was a form of Surplus-Value.

Oh, okay. :rolleyes:

Edit: Now having looked at your post history, I think it's fairly obvious you are some confused Ron Paulite pretending to be a leftist. Is dishonesty one of the treasured principles of right-wing politics?

[Blake's Baby]

I'm not. I'm asking why people claim all Surplus-value comes from unpaid labour...

Because it does. That's what surplus value is.

'Surplus value' is the portion of the value (not price) of a good that is not recompensed, when a worker is paid for his or her time but instea of that time being paid the amount that they have added to the goods of the capitalist, they are paid for the replacement time of their own labour (in other words, labour has become a commodity that trades at its own socially-necessary labour-time).




If Economic Rent is Surplus-Value, which, unless I'm mistaken, it undoubtedly is, then, as Economic Rent does NOT stem from unpaid labour, it follows that not all Surplus-Value can be derived from unpaid labour. The purpose of all my comments is to learn.

I'm not sure where you get the notion that economic rent is surplus value. Can you quote something that you're refering to?

[Vilhelmo]

Edit: Now having looked at your post history, I think it's fairly obvious you are some confused Ron Paulite pretending to be a leftist. Is dishonesty one of the treasured principles of right-wing politics?

I think Ron Paul is a nut as are the Libertarians & Austrians.
I have next to NOTHING in common with these crazies.

I'm honestly shocked to be called a right-wing Ron Paulite.
It's just something I've never head before.
Usually I'm called a left-wing, socialist nut.
I consider Marx's Theories of Surplus Value (Terence McCarthy translation) to be one of the best histories of economic thought that should be mandatory reading for all economists.

What comments or views specifically do you think are Ron Paulite?
I'm honestly interested.

[A Revolutionary Tool]

I'd be interested in what you think surplus-value means because it certainly is not equatable with "economic rent." Looking it up, the concept of economic rent looks like it could even take away from surplus value as its seen as inputs in production. Paying unionized workers higher wages doesn't create surplus value, paying for a patent doesn't create surplus value, they're both costs that would take away from what would have been more surplus.

And even if you're going to make the argument that having a patent can lead to more surplus value, to the aforementioned concept of super profits, the value is still coming from labor. If someone gets a new technical way of producing something more efficiently and patents it the extra surplus value(super profits) come from the fact that they're operating under what the socially necessary labor time is, therefore they can sell at the normal price others are selling at but because they're more efficient, because the competition hasn't caught up, their labor creates more value.

[ckaihatsu]

OK; if price = 'market price', or 'whatever it sells for in the market (because of disequilibrium between supply and demand, etc)' then we can for the moment ignore that as producing 'value', yes?




So 'value' = the "technologically necessary costs of production" is what we're after here. What are those "technologically necessary costs of production"? Machines, power, raw materials... labour? Does labour come into it at all?


F.y.i.... (duh)


[11] Labor & Capital, Wages & Dividends

http://s6.postimage.org/f4h3589gt/11_Labor_Capital_Wages_Dividends.jpg (http://postimage.org/image/f4h3589gt/)

[Blake's Baby]

Were you under the impression I was asking for anything other than as a heuristic device? I'm trying to work out where Vilhelmo thinks they are coming from.

[reb]

F.y.i.... (duh)


[11] Labor & Capital, Wages & Dividends

http://s6.postimage.org/f4h3589gt/11_Labor_Capital_Wages_Dividends.jpg (http://postimage.org/image/f4h3589gt/)

I've been staring at this for about ten minutes and I have no idea what you are trying to say with it.

[Blake's Baby]

Wages and dividends come from money, that's made from combining wages with capital to prouce goods and services.

I don't think it's particularly helpful, as what Vilhelmo seems to be getting at is 'how?'.

[cyu]

some confused Ron Paulite pretending to be a leftist. Is dishonesty one of the treasured principles of right-wing politics?

Looks like this isn't the first time - from October: http://www.revleft.com/vb/time-new-theory-t144224/index.html?p=2673549

Why is it that whenever I see a new account, with a handful of posts, in the Economics forum, I automatically think it's a pro-capitalist "libertarian" who thinks his political ideology actually makes him some kind of "expert" on economics? I guess their brainwashing makes them automatically assume all leftists are clueless about economics so they head straight for the Economics section to impart some of their "infinite wisdom" on the "uninformed" masses.

[cyu]

I'm honestly shocked to be called a right-wing Ron Paulite.


Again, what actions do you believe are justified against capitalists? If someone is starving or will die from lack of health care due to "property" claims, what actions do you believe are justified in saving his or her life?

[Vilhelmo]

Looks like this isn't the first time - from October: http://www.revleft.com/vb/time-new-theory-t144224/index.html?p=2673549

What can I say, I'm a drug addict with a fuzzy memory! :)
The second time...?

I despise Libertarian, Austrian & Neo-classical junk economics.
They espouse the morality of a sociopath.

I engage in such debate & discussion so that I may learn from others.

[cyu]

I engage in such debate & discussion so that I may learn from others.

If you honestly want to learn, keep it in the Learning section. If you are here to present a crypto-capitalist point of view, keep it in the Opposing Ideologies section.

[Vilhelmo]

If you honestly want to learn, keep it in the Learning section. If you are here to present a crypto-capitalist point of view, keep it in the Opposing Ideologies section.

If you could be more specific as to what you mean by "crypto-capitalist"?
Maybe you could refer to a specific view or comment & the reasons why you think it presents a crypto-capitalist point of view.

[cyu]

Your refusal to answer the following questions implies volumes:

what actions do you believe are justified against capitalists? If someone is starving or will die from lack of health care due to "property" claims, what actions do you believe are justified in saving his or her life?

[Vilhelmo]

Your refusal to answer the following questions implies volumes:

what actions do you believe are justified against capitalists? If someone is starving or will die from lack of health care due to "property" claims, what actions do you believe are justified in saving his or her life?

I believe that any action, except murder, that saves a human life is justified. I can imagine limited circumstances where even murder could be justified.

I just think that economic policy can save far move lives & prevent far more suffering than any individual action.

[Five Year Plan]

What can I say, I'm a drug addict with a fuzzy memory! :)
The second time...?

I despise Libertarian, Austrian & Neo-classical junk economics.
They espouse the morality of a sociopath.

I engage in such debate & discussion so that I may learn from others.

No, actually, you're a troll who propounds libertarian ideas, and evinces a fixation on issues related to the monetary system (with all the earmarks of a Paulite who, in unguarded moments, would rail about how "The Federal Reserve is enslaving us because we were taken off the Gold Standard!"). Yet you carefully formulate your statements in a way that doesn't overtly reveal yourself to be a right-winger. How clever :rolleyes:

If it walks like a duck and quacks like a duck, does the duck's protestations about not being a duck really matter? Nope. And neither do your superficial disavowals of libertarianism. As I said, troll, a lot of people here are too well versed on these issues to confuse an earnest novice asking questions with a passive-aggressive debating style replete with leading right-wing-slanted questions.

[Vilhelmo]

No, actually, you're a troll who propounds libertarian ideas, and evinces a fixation on issues related to the monetary system (with all the earmarks of a Paulite who, in unguarded moments, would rail about how "The Federal Reserve is enslaving us because we were taken off the Gold Standard!").

I do NOT advocate these views!
I do NOT believe that "The Federal Reserve is enslaving us because we were taken off the Gold Standard!"
I do NOT advocate a Gold Standard!

Please stop falsely attributing to me views that I do NOT hold & to which I stand in direct opposition.

I advocate State & Credit Theories of Money, known as Chartalism or Modern Monetary Theory.

Libertarians, Austrians, Neo-Classicals, Ron Paulites, etc, do NOT share this view.
They hold the opposite view for which there exists no supporting evidence. In fact, there is overwhelming evidence to the contrary.

Most Right-wingers hold the view that money is a commodity.
I do NOT.
Instead, I assert that money is debt.

It is not me who is spouting such right-wing junk economics on this board.

[Vilhelmo]

No, actually, you're a troll who propounds libertarian ideas, and evinces a fixation on issues related to the monetary system (with all the earmarks of a Paulite who, in unguarded moments, would rail about how "The Federal Reserve is enslaving us because we were taken off the Gold Standard!"). Yet you carefully formulate your statements in a way that doesn't overtly reveal yourself to be a right-winger. How clever :rolleyes:

Are you saying that the following policies have been formulated so as not to reveal my true identity as a right-winger?


The policies I advocate are the same regardless.


Permanent Job Guarantee Program (living wage & benefits)
Free Public Education
PharmaCare - free prescription drugs
Public Housing
Tax Reform - Abolish Income & sales taxes, Institute an Economic Rent Tax
Drug Legalization
Massive Infrastructure Spending
Banking & Monetary Reform
Anti-Shit Law
Debt Cancellation
etc

Are any of these policies advocated by even a single right-winger/Libertarian/Austrian/Neo-classical?
With the exception of Drug Legalization I can think of none.

Is the ultimate aim of achieving a Participatory Society (Economics/Polity) as envisioned by Albert & Hahnel, one shared by myself, a right-wing vision for society?

[Blake's Baby]

This is a thread about surplus value, in the economics board, not a thread about whether-or-not someone is a supporter of Ron Paul.

So to Vilhelmo, could you take a stab at responding to these points please:


I'm not. I'm asking why people claim all Surplus-value comes from unpaid labour...

Because it does. That's what surplus value is.

'Surplus value' is the portion of the value (not price) of a good that is not recompensed, when a worker is paid for his or her time but instead of that time being paid at the amount that they have added to the goods of the capitalist, they are paid for the replacement time of their own labour (in other words, labour has become a commodity that trades at its own socially-necessary labour-time).


If Economic Rent is Surplus-Value, which, unless I'm mistaken, it undoubtedly is, then, as Economic Rent does NOT stem from unpaid labour, it follows that not all Surplus-Value can be derived from unpaid labour. The purpose of all my comments is to learn.

I'm not sure where you get the notion that economic rent is surplus value. Can you quote something that you're refering to?

[Jimmie Higgins]

General Warning: I don't think the troll-speculation is helpful, please keep on topic folks.

If someone has formulations which lead to right-wing conclusions, argue it out - show how these conceptions lead to a misunderstanding of how capitalism works and therefore how to fight it. Leftists are certainly capable of unknowingly taking some bourgeois ideas about the world for granted, and Trolls generally out themselves eventually anyway.

[ckaihatsu]

I've been staring at this for about ten minutes and I have no idea what you are trying to say with it.


Give it another ten minutes -- !


x D

[Blake's Baby]

So is this sorted then? Everyone understand how surplus value is the result of the exploitation of labour?

[Vilhelmo]

I'm not sure where you get the notion that economic rent is surplus value. Can you quote something that you're refering to?


In the wiki article "Differential and absolute ground rent (https://en.wikipedia.org/wiki/Differential_and_absolute_ground_rent), part of their series on Marxism, it states:

Differential ground rent and absolute ground rent are concepts used by Karl Marx in the third volume of Das Kapital to explain how the capitalist mode of production would operate in agricultural production, under the condition where most agricultural land was owned by a social class of land-owners who obtained rent income from those who farmed the land. Rent as an economic category is regarded as one form of surplus value just like interest, production taxes and industrial profits.

In the Wiki article "Resource Rent" (https://en.wikipedia.org/wiki/Resource_rent) it states:

In economics, rent is a surplus value after all costs and normal returns have been accounted for

From a Marxist Blog "A Critique of Crisis Theory - Bichler, Nitzan and Hudson versus Marx (http://critiqueofcrisistheory.wordpress.com/responses-to-readers-austrian-economics-versus-marxism/bichler-nitzan-and-hudson-versus-marx/)"

The most important thing to understand about Marx’s theory of rent is that rent is simply a fraction of the total surplus value that is appropriated by the owners of land at the expense of the industrial capitalists who directly appropriate the surplus value.


So while it is possible that the conception of Economic Rent as Surplus Value is not shared by Marx, the notion is not mine alone.

[Blake's Baby]

Right. Two people on wiki (who could have any political views imaginable) and one blogger.

The first two quotes are using 'surplus value' in a non-Marxist sense. You can discount them. This is not what Marxists mean by 'surplus value' so using this term for that in a discussion with Marxists won't get you very far.

The last quote makes clear that rent is an overhead that the capitalist pays out of surplus value extracted from the workers. So, 'rent' itself is not surplus value but the money the capitalist uses to pay it comes from exploitation of the worker, yes.

Do you think 'rent' is the same as 'surplus value'? The way you expressed it in the first instance you seem to imply that the rent itself (charge levied by one owner of capital - in this case land - on another owner of capital - in this case plant) is in itself an extraction of surplus value by the first capitalist from the second. Which it isn't, it's just paid out of extracted surplus value, in exactly the same way as all other overheads.

[Vilhelmo]

Right. Two people on wiki (who could have any political views imaginable) and one blogger.

My intent was to show that the idea is not unique to me.


The first two quotes are using 'surplus value' in a non-Marxist sense. You can discount them. This is not what Marxists mean by 'surplus value'

The first quote was used in an article on Marx's concept of "Differential and absolute ground rent".
It may not accurately represent what Marxists mean by 'surplus value' but it was certainly intended to.


The last quote makes clear that rent is an overhead that the capitalist pays out of surplus value extracted from the workers. So, 'rent' itself is not surplus value but the money the capitalist uses to pay it comes from exploitation of the worker, yes.

That may be true.
But a plain reading of the text would seem to indicate that Economic Rent is a form of Marxian Surplus Value.


so using this term for that in a discussion with Marxists won't get you very far.

I was asked where I got the notion that economic rent is surplus value.
My confusion stems from the fact that other notions of surplus value exist.
But the confusion is not mine alone as the wiki article on Marx's concept of "Differential and absolute ground rent (https://en.wikipedia.org/wiki/Differential_and_absolute_ground_rent), demonstrates.


Do you think 'rent' is the same as 'surplus value'?

I do not.
Economic Rent is the non-labour element of price, that, having no counterpartin the technologically necessary costs of production, cannot be resolved into labour effort.

[Blake's Baby]

Who pays rent?

Is it 1 - the worker;
2 - the capitalist?

Not, 'who generates the wealth?' because that's always the worker; who actually pays it?

[Vilhelmo]

Who pays rent?

Is it 1 - the worker;
2 - the capitalist?

Not, 'who generates the wealth?' because that's always the worker; who actually pays it?

It is paid by buyers.
Economic Rent is an element of price.
An entity that extracts Economic Rent is a Rentier not a Capitalist.

[cyu]

An entity that extracts Economic Rent is a Rentier not a Capitalist.

In the economic system you advocate, would some people be wealthier than others? If so, do you believe wealth disparity results in misallocation of economic resources?

[Blake's Baby]

It is paid by buyers...

What buyers?

Workers buying bread, or workers 'buying' (renting) housing, or capitalists 'buying' (renting) space in which to keep their machines?


...
Economic Rent is an element of price...

Price of what?


...
An entity that extracts Economic Rent is a Rentier not a Capitalist.

What is the relevance of this?

[Jimmie Higgins]

It is paid by buyers.
Economic Rent is an element of price.
An entity that extracts Economic Rent is a Rentier not a Capitalist.

But then what is the price based on? If it's based on desirability, then why isn't milk priced higher than a TV since one is essential and other other is not? Why is a desirable piece of farm-land priced less than an equally desired piece of commercial or residential land?

I'm actually not that familiar with Marx's specific arguments about rent. The quote you linked seemed to be more about an argument attempting to explain how non-wage labor arrangements still fit into generalized capitalism even if on the surface they look more like older forms of exploitation. So I don't think these arguments are as relevent in a practical way as they may have been over 100 years ago - now agricultural production in most of Europe and large parts of the Americas much more resembles industrial production - agricultural tenancy (like the near-slave conditions in the South after the civil war) really died out in the US by about WWII.

At any rate, as I understand it, land price is based on what the most profitable potential use of the land is. So if you want to grow turnips on urban land, the price is still determined by the value of that land as urban industrial or residential land not the value of the land in producing turnips. So it's still valued based on a generalized socially necessary labor time. Urban industrial land is more valued because of existing infrastructure and nearness to transportation and sources of labor - so it's value and then it's specific price are still based out of A) the pre-labor gone into it in creating utilities and roads and so on and B) the potential value of the most efficient (in terms of profit) use of that land. So the value is still determined by labor.