Debunking the Labour Theory of Value [Archive]

redstar2000

11th April 2004, 16:34

Since the entire theory of communism rests on a single theory - the Labour Theory of Value, it had better be a 'correct' theory! Well it isn't, it is full of flaws, and now I will disprove this stupid theory.

No, that's wrong. What actually "rests" on the labor theory of value is "the tendency of the rate of profit to fall over time", prompting the collapse of capitalism from "internal" causes.

There really are problems with the labor theory of value; we've had threads about them in the Theory forum.

But this is not one of them.

The Austrian economist, Eugen von Böhm-Bawerk argued against Marx's theory of exploitation, pointing out that workers traded in their share of the end price for the more certain and soon wages paid by the entrepreneur. In other words, he claimed that the employer "earns" their profit by exposing themselves to risks that the workers can avoid.

:lol: Consult the job ads in your daily newspaper. Count the openings that say "work for no pay but receive a full and equal share of the profits" or words to that effect.

Couldn't find any?

Then, as others have already noted, count the number of workers who could actually afford to work for nothing until profits were made and distributed.

Couldn't find many of those either, right?

The idea that profit is the "legitimate reward" of risk is so stupid it practically drools.

Consider the "high roller" in a casino. He sits down at the blackjack table and buys 100 $10,000 chips. Three hours later, he leaves the table with 150 $10,000 chips. Did he just "earn" $500,000 for three hours of "work"...or did he just get lucky this time?

To be honest, I never heard of Herr Professor Böhm-Bawerk. If this is a representative sample of his thought, it's knowledge I could have done without.

:redstar2000:

The Redstar2000 Papers (http://www.redstar2000papers.vze.com)
A site about communist ideas

Hoppe

11th April 2004, 21:46

To be honest, I never heard of Herr Professor Böhm-Bawerk. If this is a representative sample of his thought, it's knowledge I could have done without.

What a shame Redstar. The Vienna school was quite famous before WWII after which most economists fled Austria leaving most of their work behind. Another famous one was Carl Menger, and of course von Mises.

But Nyder, it's easier to start on another assumption if you want to debunk it, that value is created by labour. This is nonsense. However, it's still peculiar to continue to think that if value is not created by labour alone, workers are exploited.

antieverything

11th April 2004, 23:58

What a shame Redstar. The Vienna school was quite famous before WWII after which most economists fled Austria leaving most of their work behind. Another famous one was Carl Menger, and of course von Mises.
Yeah, an interesting example of what can be achieved through abandoning any presumption of economics being a science and basing a theory solely on "logical" assumptions!

Face it, the Austrians are now widely considered to be the joke that they are.

redstar2000

12th April 2004, 00:14

The Vienna school was quite famous before WWII after which most economists fled Austria leaving most of their work behind. Another famous one was Carl Menger, and of course von Mises.

Well, I lost interest in the Vienna school when I took Economics 101 more than 40 years ago and was introduced to the theory of marginal utility in price determination.

Understand, I knew nothing of Marxist economics at that point (and am far from competent on that subject even now). "Marginal utility" just "didn't feel right".

After several sessions on the subject, the fault finally occurred to me. The theory of marginal utility can explain prices only in economies where consumers have practically unlimited wealth.

For an ordinary person who must choose between groceries and rent, or utilities and health care, the "marginal utility" of their next meal or next bottle of medicine may be "infinite"...it's a moot point as they don't have the resources to afford even the most basic necessities.

Marginal utility might well be useful in explaining the prices of luxury goods...but for the necessities required by the great bulk of the population, it's worthless.

Not being an economist myself or having any aspirations in that direction, I saw no further point in looking into the Vienna school.

:redstar2000:

The Redstar2000 Papers (http://www.redstar2000papers.vze.com)
A site about communist ideas

Hoppe

12th April 2004, 10:25

Originally posted by [email protected] 11 2004, 11:58 PM
Yeah, an interesting example of what can be achieved through abandoning any presumption of economics being a science and basing a theory solely on "logical" assumptions!

Face it, the Austrians are now widely considered to be the joke that they are.
Thanks for your illuminating contribution to the Methodenstreit.

Actually, since the '70 Austrian economics is returning as school of thought. Obviously, you only read Marx and followers so you wouldn't know.

Well, I lost interest in the Vienna school when I took Economics 101 more than 40 years ago and was introduced to the theory of marginal utility in price determination.

Do you know Alfred Marshall? He went one step further and combined marginal utility with labour, land etc to come up with a solution.

Nyder

12th April 2004, 12:23

Originally posted by [email protected] 11 2004, 04:34 PM

No, that's wrong. What actually "rests" on the labor theory of value is "the tendency of the rate of profit to fall over time", prompting the collapse of capitalism from "internal" causes.

Can you justify this statement?

:lol: Consult the job ads in your daily newspaper. Count the openings that say "work for no pay but receive a full and equal share of the profits" or words to that effect.

Couldn't find any?

Then, as others have already noted, count the number of workers who could actually afford to work for nothing until profits were made and distributed.

Couldn't find many of those either, right?

Exactly my point.

The idea that profit is the "legitimate reward" of risk is so stupid it practically drools.

Just think of investment. People invest money to gain a financial return. Generally the greater the risk, the higher the return. Or you could invest in low risk areas and get lower, but more steady returns.

Consider the "high roller" in a casino. He sits down at the blackjack table and buys 100 $10,000 chips. Three hours later, he leaves the table with 150 $10,000 chips. Did he just "earn" $500,000 for three hours of "work"...or did he just get lucky this time?

Nyder

12th April 2004, 12:26

Nonsense. If the business goes bankrupt, it is the owner who has to pay the debts, not the employees.

But the employees get laid off. They share the debts of the owner, albeit indirectly.

When the workers lose their job they can get another job. They are not the ones that have to pay off outstanding loans to finance companies. The owner is much worse off.

Nyder

12th April 2004, 12:41

Originally posted by [email protected] 11 2004, 04:15 AM

The problem with that is you're assuming that the owner doesn't hold any other capital and that they don't pay themselves a salary as, say, president of the company. If this was true, than they would be working for long periods for little or no money, and that obviously doesn't happen. Also, the owner would be getting a far larger percentage of the profit than the workers, so he could save a portion of that money in case of a recession, or fall in profits, the workers could not.

Firstly, the real world is often more complex then that. The CEO or President does not necessarily 'own' the company. The ownership of the company could be spread across several dozen shareholders. And the large stockholders may get more of the benefits from profits, but they are also at greater risk of losses as well. So in a recession, it is the stockholders who stand to lose the most. Employees may keep their wage even in a recession, usually against neoclassical theory which predicts that wages should adjust, but because of other factors.

Nonsense. If the business goes bankrupt, it is the owner who has to pay the debts, not the employees.

I'm not really sure how this adressed my point. I'm saying that someone with a lot of money can afford to take risks. If a venture fails, so be it, they have something to fall back on. Say, their other ventures. Workers, however, do not have this. If they don't get paid for a month, they have nothing.

People who have more money stand to lose more by taking risks. If they diversify their risk with multiple ventures, then you may be correct that they have 'something to fall back on', but if it is just in one venture, then they are royally screwed. Still, they stand to lose much more.

Workers, depending on their employability and/or the state of the economy, can find another job and not have to worry about debts (from the employer's business). That is definitely a perk of being a worker.

Nyder

12th April 2004, 12:45

Originally posted by [email protected] 11 2004, 04:19 PM

This doesn't disprove the fact that it's the workers who create the value of the commodity.

Then how do you explain the fact that a factory worker may receive $300 per week, yet a nightclub dancer earns over $1000? How is value determined in these scenarios?

Nyder

12th April 2004, 12:51

This is Ricardo's varying capital intensity theory (from Wikipedia):

Suppose the proportion of unpaid to paid labor time is the same for all workers. Further suppose that workers are paid when the product is sold.
Technology will result in different proportions of labour and capital goods being consumed within different industries. If products were traded based on labor values, prices would result in different industries earning different rates of profits on the capital invested. But competition among industries should be modeled as tending to remove differences in profitability. Thus, either the labor theory of value cannot be true, or a mysterious mechanism must exist for the transfer of profits from one industry to another.

For example:

Suppose I employ twenty men at an expense of 1000 pounds for a year in the production of a commodity, and at the end of the year I employ twenty men again for another year, at a further expense of 1000 pounds in finishing or perfecting the same commodity, and that I bring it to market at the end of two years, if profits be 10 per cent., my commodity must sell for 2,310 pounds.; for I have employed 1000 pounds capital for one year, and 2,100 pounds capital for one year more. Another man employs precisely the same quantity of labour, but he employs it all in the first year; he employs forty men at an expense of 2000 pounds, and at the end of the first year he sells it with 10 per cent. profit, or for 2,200 pounds. Here then are two commodities having precisely the same quantity of labour bestowed on them, one of which sells for 2,310 pounds--the other for 2,200 pounds.

Misodoctakleidist

12th April 2004, 13:10

Originally posted by [email protected] 12 2004, 12:45 PM
Then how do you explain the fact that a factory worker may receive $300 per week, yet a nightclub dancer earns over $1000? How is value determined in these scenarios?
Have you not figued it out yet, they're underpaid.

No wonder you can't understand why we talk about exploitation, i'll run throught it just so you're clear; the workers produce a commodity, the owner sells it then pays the worker less (because, shock, horrror, they pay as little as they can get away with not what they think the worker is worth) than the value which they produced.

Misodoctakleidist

12th April 2004, 13:17

Originally posted by [email protected] 12 2004, 12:51 PM

Suppose I employ twenty men at an expense of 1000 pounds for a year in the production of a commodity, and at the end of the year I employ twenty men again for another year, at a further expense of 1000 pounds in finishing or perfecting the same commodity, and that I bring it to market at the end of two years, if profits be 10 per cent., my commodity must sell for 2,310 pounds.; for I have employed 1000 pounds capital for one year, and 2,100 pounds capital for one year more. Another man employs precisely the same quantity of labour, but he employs it all in the first year; he employs forty men at an expense of 2000 pounds, and at the end of the first year he sells it with 10 per cent. profit, or for 2,200 pounds. Here then are two commodities having precisely the same quantity of labour bestowed on them, one of which sells for 2,310 pounds--the other for 2,200 pounds.
I'm probably missing something really obvious here but why does the first person sell for a price of £2,310?

Hoppe

12th April 2004, 13:57

Originally posted by [email protected] 12 2004, 01:10 PM
Have you not figued it out yet, they're underpaid.

No wonder you can't understand why we talk about exploitation, i'll run throught it just so you're clear; the workers produce a commodity, the owner sells it then pays the worker less (because, shock, horrror, they pay as little as they can get away with not what they think the worker is worth) than the value which they produced.
But how can labour theory put value on a nightclub dancer? She doesn't produce anything. Or is "a night out with your best friends" a commodity?

Misodoctakleidist

12th April 2004, 14:04

I suppose the obvious answer is that she isn't producing a value, just becuase somebody pays for something that doesn't mean that they're paying the correct value or even that they're paying for a value at all.

Hoppe

12th April 2004, 14:23

Originally posted by [email protected] 12 2004, 02:04 PM
I suppose the obvious answer is that she isn't producing a value, just becuase somebody pays for something that doesn't mean that they're paying the correct value or even that they're paying for a value at all.
Clearly she is otherwise people wouldn't pay to see her. So how do you want to determine the correct value?

The same goes for a pianist, a scientist, a writer, Britney Spears, politicians, a nice view etc.

perception

12th April 2004, 15:08

Value = benefits received from that product by a consumer of it = price they are willing to pay.

Value = price

The value of labor is the proportion of the end price contributed by that worker. The value of all labor is the proportion contributed by labor vis a vis capital inputs. If workers are paid according the the value they contribute (which they pretty much are) they still get fucked, becuase prices are inevitably driven into the ground and employers will increase the ratio of capital to labor to reduce the contribution of the worker and thus his/her wage.

Competition eliminates 'economic' profits, meaning that the only way employers get rich in most industries is by skimming a few cents out of tens of thousands of workers' pockets. That's why inequality is on the rise.

perception

12th April 2004, 15:13

Originally posted by [email protected] 12 2004, 09:04 AM
I suppose the obvious answer is that she isn't producing a value, just becuase somebody pays for something that doesn't mean that they're paying the correct value or even that they're paying for a value at all.
They are paying the value to them, otherwise they wouldn't be paying for it. That's all that matters. Everybody values products differently based on their preferences. I'm a vegetarian, I value a lb. of lentils more than a lb. of ground beef, even though the lentils are 1/5th the price. If lentils shot up in price, I'd still buy them, but even if ground beef was $.01/lb I'd pass, while you might stock your freezer.

Value might not be entirrly reflected by price, but the only way to measure value is the price we are willing to pay for something (especially at the margin).

redstar2000

12th April 2004, 15:15

First, let's begin with an empirical observation that I hope is indisputable.

No employer will knowingly hire you unless he sincerely believes that the value of the good or service you produce will be greater than the wage that he pays you.

He (the boss) can be mistaken, of course. But his motivation is transparent. He acts as if the labor theory of value was valid.

Marx's discussion of this theory includes a great number of simplifications for the purpose of discussion. The problem appears to be that he over-simplified; when you try to plug real numbers into the equations he suggests, they yield contradictory results.

In Marx's view, human labor power is the only commodity that can be used to produce a value greater than its exchange value. I suggested once that what was really producing value was energy: the exchange value of a commodity was equal to the socially necessary energy to produce it...be that human labor power or inanimate energy.

My guess is that some form of the labor theory of value will ultimately turn out to be approximately true -- but it will be more complicated than Marx's original formulation, perhaps involving mathematical tools not hitherto thought to be useful in economics.

As to our lovely dancer, she is, of course, producing a commodity (entertainment) that sells on the market like any other -- the socially necessary labor time to survive and produce the next generation of dancers. Clubs hire her because they expect to make even more money from her labor than they pay her.

What is a bit misleading about the entertainment industry is that a small number of people earn enormous paychecks while most earn nothing or next to nothing...nevertheless, the average compensation would probably be in accord with the labor theory of value.

There are a small number of commodities that do exchange at values far above the socially necessary labor power to produce them; these are items that are produced and purchased by the bourgeoisie to display status.

Lucid's purchase of an expensive mutt falls into this category -- the "value" of the dog is not in itself but rather as a "statement" about Lucid and what a "splendid" human being he "is".

Yeah, pretty stupid, I agree. But that's capitalists for you.

:redstar2000:

The Redstar2000 Papers (http://www.redstar2000papers.vze.com)
A site about communist ideas

BuyOurEverything

12th April 2004, 19:56

Firstly, the real world is often more complex then that. The CEO or President does not necessarily 'own' the company. The ownership of the company could be spread across several dozen shareholders. And the large stockholders may get more of the benefits from profits, but they are also at greater risk of losses as well. So in a recession, it is the stockholders who stand to lose the most. Employees may keep their wage even in a recession, usually against neoclassical theory which predicts that wages should adjust, but because of other factors.

People who have more money stand to lose more by taking risks. If they diversify their risk with multiple ventures, then you may be correct that they have 'something to fall back on', but if it is just in one venture, then they are royally screwed. Still, they stand to lose much more.

Workers, depending on their employability and/or the state of the economy, can find another job and not have to worry about debts (from the employer's business). That is definitely a perk of being a worker.

You didn't adress my point. Yes, if one invests more, they're taking a larger rick, however they can afford to. How many capitalists have all their capital invested in one high, or even moderate, risk venture and don't have any other sources of income? I'll bet not a lot. As you said, if one diversifies their investments, they lessen the risk.

A person with alot of money can afford to take risks and to not get payed for a short period of time. A poor person cannot.

lucid

12th April 2004, 20:12

Originally posted by [email protected] 12 2004, 07:56 PM
A person with alot of money can afford to take risks and to not get payed for a short period of time. A poor person cannot.
Not true. Anyone that is in the US and tries with everything they have and never gives up will become successfull. It's a shame that you don't see this.

BuyOurEverything

12th April 2004, 20:14

Not true. Anyone that is in the US and tries with everything they have and never gives up will become successfull. It's a shame that you don't see this.

Well I suppose that's what it comes down to. Capitalists subscribe to faith-based economics, socialists do not.

lucid

12th April 2004, 20:21

Originally posted by [email protected] 12 2004, 08:14 PM

Not true. Anyone that is in the US and tries with everything they have and never gives up will become successfull. It's a shame that you don't see this.

Well I suppose that's what it comes down to. Capitalists subscribe to faith-based economics, socialists do not.
It's not what we subscribe to. It's just the way this world is. Blaming someone for being successfull is as stupid as blaming someone for being poor.

Professor Moneybags

14th April 2004, 18:47

Well I suppose that's what it comes down to. Capitalists subscribe to faith-based economics, socialists do not.

Speak for yourself, yea of the Karl Marx school of economic collapse.

While we're on that subject, does anyone want to take a free online course (http://www.mindspring.com/~cunningr/pp/H0.html) in (workable) economics ?

Misodoctakleidist

15th April 2004, 09:35

In two pages of this thread, at the start of which nyder gleefully declared
Since the entire theory of communism rests on a single theory - the Labour Theory of Value, it had better be a 'correct' theory! Well it isn't, it is full of flaws, and now I will disprove this stupid theory. we've seen a quote from Eugen von Böhm-Bawerk who made a weak excuse for the owners recieving profits but crucialy failed to provide any argument suggesting that they created the value and a quote from david ricardo which nyder is still to explain.

p.s. Nyder, do you get all your knowledge of economics from an encyclopedia?

革命者

16th April 2004, 14:48

Originally posted by Nyder+Apr 11 2004, 05:43 AM--> (Nyder @ Apr 11 2004, 05:43 AM)
[email protected] 11 2004, 03:27 AM
When you have that much money, you can afford risk. When you're living paycheck to paycheck, you can't.
Nonsense. If the business goes bankrupt, it is the owner who has to pay the debts, not the employees.

Furthermore, this is an interesting dichotomy. Let's suppose that an employer decided to pay his/her workers by the labour theory of value. This may actually be beneficial to the employer since he/she could spread their risks to the employees. This happens with shareholders, instead of one person holding all of the financial capital, many people do so the risk isn't shouldered by just one shareholder.

Also, what if the business ran at a loss for a long period of time for whatever reason (for example the business may not be up to producing to equal it's average total cost, or it may be going through a recession, or maybe it is having trouble adjusting to the marketplace)? This means that the employees may be paid little or nothing for quite long periods. Do you really think that people are going to show up to work if they are not being paid? Talk about exploitation!! [/b]
Nyder statements are clearly false 'cause:

1 - The bank loans the money, then the stockholders loan their money to the bank and the entrepeneur nor the bank is at risk.

2 - Even when the enterprise has no stockholders the owner is not personal responsible: if the company can't pasy they go bankrupt and the bank loses.

There are some exceptions where the owner is personally responsible for any debts.

:unsure:

Osman Ghazi

16th April 2004, 20:11

2 - Even when the enterprise has no stockholders the owner is not personal responsible: if the company can't pasy they go bankrupt and the bank loses.

This is only true of corporations. If you own a business all on your oddy-knocky, you are liable for all the money that must be paid and you can lose your house or car.

STI

16th April 2004, 21:02

Originally posted by Hoppe+Apr 12 2004, 01:57 PM--> (Hoppe @ Apr 12 2004, 01:57 PM)
[email protected] 12 2004, 01:10 PM
Have you not figued it out yet, they're underpaid.

No wonder you can't understand why we talk about exploitation, i'll run throught it just so you're clear; the workers produce a commodity, the owner sells it then pays the worker less (because, shock, horrror, they pay as little as they can get away with not what they think the worker is worth) than the value which they produced.
But how can labour theory put value on a nightclub dancer? She doesn't produce anything. Or is "a night out with your best friends" a commodity? [/b]
The 'night out with your best friends' would be a mixture between commodities and non- commodities. The beer you drink would be a commodity, the gas you use to get to the bar would be a commodity, the peanuts you eat would be a commodity, and the entertainment produced by the dancer would be a commodity. The conversations you have with your friends wouldn't be a commodity. The fun you have watching your friend throw up wouldn't be a commodity, and the fuzzy memory of the previous night which you posses the next mornign wouldn't be a commodity.

Commodities, as I understand, are:
-The products of human labour
-Used for exchange
-If there's anything I'm missing, somebody, please, correct me.

but it will be more complicated than Marx's original formulation, perhaps involving mathematical tools not hitherto thought to be useful in economics.

From what I understood, it was going to be explained more deeply in volumes 5 and 6 of Capital. I could be wrong, though.

Nyder

18th April 2004, 05:58

COMMIES, read carefully:

Labour is a service that is offered to another person/entity. The price for the service is determined by how much the employer is willing to pay for it, not by the labour theory of value (in the vast majority of cases).

A stripper in a night club is in very high demand by employers and they are willing to pay a lot of money for them (plus apparently they get a commission on other services 'performed'). An employer won't pay so much for a factory worker because they are very easy to find (because of the plethora of non-skilled workers out there) and the value they actually provide is very minimal (then again they are paid according to minimum wage laws, not actual market prices).

So really it is supply and demand that would determine wages in a free market (not with most countries with minimum wage restrictions).

You keep saying pay people according to the l.t.o.v but how do you determine it?

Nyder

18th April 2004, 06:01

Originally posted by æ@Apr 16 2004, 02:48 PM

Nyder statements are clearly false 'cause:

1 - The bank loans the money, then the stockholders loan their money to the bank and the entrepeneur nor the bank is at risk.

then the stockholders loan their money to the bank - that statement proves you have no idea what you talking about.

2 - Even when the enterprise has no stockholders the owner is not personal responsible: if the company can't pasy they go bankrupt and the bank loses.

Then what happens do the owner's credit rating?

DaCuBaN

18th April 2004, 07:58

Have you not figued it out yet, they're underpaid.

No wonder you can't understand why we talk about exploitation, i'll run throught it just so you're clear; the workers produce a commodity, the owner sells it then pays the worker less (because, shock, horrror, they pay as little as they can get away with not what they think the worker is worth) than the value which they produced.

Rather than sharing, he decides to keep as much as possible for himself. Whoever taught that kind of greed will be first against MY wall.

A stripper in a night club is in very high demand by employers and they are willing to pay a lot of money for them... An employer won't pay so much for a factory worker because they are very easy to find... the value they actually provide is very minimal

Without the worker, the entrepeneur(sp) would have nothing, yet he considers the worker near worthless? The stripper doesn't actually do anything worthwhile and gets more money.... and this make sense to you? These people are paid peanuts, and have to fight with each other like dogs to get the scraps from the bastard who got 'lucky' with an idea. Capitalist wage schemes are abhorrent... the main argument is that it's reward due for effort and sure it is - all that effort exploiting your fellow man. Well played folks.

Misodoctakleidist

18th April 2004, 09:40

Originally posted by [email protected] 18 2004, 05:58 AM
COMMIES, read carefully:

Labour is a service that is offered to another person/entity. The price for the service is determined by how much the employer is willing to pay for it, not by the labour theory of value (in the vast majority of cases).

A stripper in a night club is in very high demand by employers and they are willing to pay a lot of money for them (plus apparently they get a commission on other services 'performed'). An employer won't pay so much for a factory worker because they are very easy to find (because of the plethora of non-skilled workers out there) and the value they actually provide is very minimal (then again they are paid according to minimum wage laws, not actual market prices).

So really it is supply and demand that would determine wages in a free market (not with most countries with minimum wage restrictions).

You keep saying pay people according to the l.t.o.v but how do you determine it?
No, You fucking moron! How fucking stupid are you? If the employers paid the workers what they deserved do you think we'd be complaining about exploitation?

We are talking about the value of a commodity being determined by the amount of labour expended in it's creation, why do you assume that the employers will pay the workers what they deserve?

Why don't you try reading Das Kapital?

DaCuBaN

18th April 2004, 12:24

No, You fucking moron! How fucking stupid are you? If the employers paid the workers what they deserved do you think we'd be complaining about exploitation?
:lol: :lol: :lol: Chill :) Do we really need the insults?

Labour is a service that is offered to another person/entity. The price for the service is determined by how much the employer is willing to pay for it, not by the labour theory of value

Hence why it is an alternative ideology - and the flaw you mention only happens when the venture is about capital gain.

perception

18th April 2004, 16:26

this thread is hilarious. A bunch of capitalists with no working knowledge of economics arguing with a bunch of communists with no working knowledge of economics about economics. :blink:

Osman Ghazi

18th April 2004, 18:07

QUOTE
2 - Even when the enterprise has no stockholders the owner is not personal responsible: if the company can't pasy they go bankrupt and the bank loses.

Then what happens do the owner's credit rating?

Oh dear god no! What were we thinking? How could we have missed the fact that the owner may recieve a bad credit rating? I take it all back. The owner deserves the profits because he has to risk his fucking credit rating. What do you think happens to the worker's credit rating when he's out of a fucking job?

Don't Change Your Name

18th April 2004, 20:29

Originally posted by [email protected] 18 2004, 05:58 AM
You keep saying pay people according to the l.t.o.v but how do you determine it?
Forget the wages system. We need an alternative.

Just because such an alternative wasn't invented yet it doesn't mean it won't be invented.

Bradyman

18th April 2004, 21:41

I've been reading the posts and it seems as if no one has actually "debunked" the labor theory of value. The main idea behind the labor theory is that it is actual "labor" that creates value. This board hasn't even addressed that issue.

Sure the Strip club owner takes some sort of risk by paying the stripper. But, without a stripper, he has nothing, it is the stripper that actually creates the commodity, the stripper has produced value.

What you are really arguing is if earning the profit is justifiable because you took the risk. Should the entreprenuer recieve some of the value that was created by the worker because he had the capital in the beginning, aka risk-taking?

All us communists propose is that neither the entreprenuer has to make such a risk nor that the worker has to give away a portion of the value that he created.

That solves both sides of the problem.

Hoppe

19th April 2004, 07:40

No one needs to debunk it Bradyman, it has been done a long time ago. Even if you don't believe in marginal utility, then still labour defines only a part of value.

Nyder

19th April 2004, 10:13

'Value' is not some sort of mythical given quantity. 'Value' is basically determined by willingness to pay. Of course it is not value in the sense you might think. Oxygen is what keeps us alive, yet no one is willing to pay for it. This is because there is such a huge supply. So supply has a factor in value. There is also intrinsic value - I might pay my entire earnings to save my life because my life is valuable to me, not to someone else though. Or why is bottled water more expensive then tap water? - because people prefer buying bottled water (or at least a lot of people do).

Then there is production costs - the adding up of value that goes into the final value of the product. The value added to sell a cappucino, for example, could include the price for growing the beans, manufacturing the coffee, distributing, the making of the cappucino and finally the retail price with mark-up. So you see, there is a value chain that pays off a lot of different people's labour with the price of one particular commodity.

In the case of the mark-up, the owner of the capital (the entity who purchased it - unless you don't believe in exchange), would like to make that price as high as they can, but this is not possible in a competitive market (and also high prices tend to stop people from buying this product).

Now I could just pay according to production costs, but at the end of the day I'm not exactly going anywhere am I? How can I grow the business if I spend exactly what I earn? And growth in the business creates more jobs, which in turn creates more prosperity in the economy.

So back to the point - the l.t.o.v. is but one wage system. Under communism, it would have to be forced. But under a free market, you could have some employers using this way to pay workers (I even heard on the news that one employer actually divided up the profits from his business and paid it in bonuses to his workers). Or you could have the simple wage system, commissions, contracts, incentive wages, pay per manufactured item, salaries, share bonus schemes, etc. The free market offers variety.

Again, it always comes down to people's willingness to pay. And I have already explained much of the decision that goes behind determining this.

Nyder

19th April 2004, 10:16

Originally posted by El Infiltr(A)do+Apr 18 2004, 08:29 PM--> (El Infiltr(A)do @ Apr 18 2004, 08:29 PM)
[email protected] 18 2004, 05:58 AM
You keep saying pay people according to the l.t.o.v but how do you determine it?
Forget the wages system. We need an alternative.

Just because such an alternative wasn't invented yet it doesn't mean it won't be invented. [/b]
The majority of wages exist because of Government enforcement. However, people aren't only paid according to an hourly rate, as I have explained in the post above.

perception

19th April 2004, 15:05

Originally posted by [email protected] 19 2004, 05:13 AM
'Value' is not some sort of mythical given quantity. 'Value' is basically determined by willingness to pay. Of course it is not value in the sense you might think. Oxygen is what keeps us alive, yet no one is willing to pay for it. This is because there is such a huge supply. So supply has a factor in value. There is also intrinsic value - I might pay my entire earnings to save my life because my life is valuable to me, not to someone else though. Or why is bottled water more expensive then tap water? - because people prefer buying bottled water (or at least a lot of people do).

this is a decent summary of value. I explained 3 pages ago but I'm quoting it so some of these assholes might read it this time.

In the case of the mark-up, the owner of the capital (the entity who purchased it - unless you don't believe in exchange), would like to make that price as high as they can, but this is not possible in a competitive market (and also high prices tend to stop people from buying this product).

The owner will always choose the profit maximizing price, whether the market is competitive or not. In a competitive market it would be where the supply(MPC) curve and the Demand(MPB) curve intersect, in a monopoly it would be where the Marginal revenue curve intersects the demand curve.

That determines price, which, as a reflection of WTP, reflects value. But determining whether workers see their fair share of this end value/price is a distributional issue.

Misodoctakleidist

19th April 2004, 16:49

Of course it is not value in the sense you might think. Oxygen is what keeps us alive, yet no one is willing to pay for it. This is because there is such a huge supply.
The purpose of this thread is discuss whether that is why no one is willing to pay for it, what makes you so sure it's not becuase oxygen embodies to human labour. If you think about it, drivers pay for oxygen, the difference is that it embodies human labour (putting it in a cylinder). If we assumed your statement to be true them compressed air would be worthless.

I know your point was that value isn't just made up of labour but you picked a poor example, especially in a therad where you are trying to disprove labour value theory.

So supply has a factor in value.
I'm not satisfied with your reasoning.

There is also intrinsic value - I might pay my entire earnings to save my life because my life is valuable to me
Then again, your life is valuable becuase you have the potential to create value.

not to someone else though.
It is if they're making money out of you.

Or why is bottled water more expensive then tap water?
Becuase there is more human labour embodied in bottled water than in tap water.

because people prefer buying bottled water (or at least a lot of people do).
I don't think that is why it has a higher value, i can think of a lot of things which people "prefer" but are cheaper.

Then there is production costs - the adding up of value that goes into the final value of the product.
You mean like paying workers (not enough) and buying other commodities who's value is determined by labour?

The value added to sell a cappucino, for example, could include the price for growing the beans, manufacturing the coffee, distributing, the making of the cappucino and finally the retail price with mark-up.
It takes human labour to grow and harvest (is that the right term?) beans, it takes human labour to manufacture the coffee, it takes human labour to distribute, it takes human labour to make the cappucino (even with a machine, the machine is created by human labour), it's not marked up, the workers wages are marked down.

So you see, there is a value chain that pays off a lot of different people's labour with the price of one particular commodity.
And since all that labour went into creating the commodity, it is all embodied in the value of that commodity.

In the case of the mark-up, the owner of the capital (the entity who purchased it - unless you don't believe in exchange), would like to make that price as high as they can, but this is not possible in a competitive market (and also high prices tend to stop people from buying this product).
You mean if the price is higher than the value?

Now I could just pay according to production costs, but at the end of the day I'm not exactly going anywhere am I? How can I grow the business if I spend exactly what I earn? And growth in the business creates more jobs, which in turn creates more prosperity in the economy.
What's your point, we don't suggest paying workers according to labour value theory, we suggest the complete absence of a market.

So back to the point - the l.t.o.v. is but one wage system.
It's not a wage system, it's an explanation of value.

Under communism, it would have to be forced.
No it wouldn't, under communism there wouldn't be wages. How can you force a theory of value to be correct, it either is or it isn't.

But under a free market, you could have some employers using this way to pay workers (I even heard on the news that one employer actually divided up the profits from his business and paid it in bonuses to his workers). Or you could have the simple wage system, commissions, contracts, incentive wages, pay per manufactured item, salaries, share bonus schemes, etc. The free market offers variety.
It also offers exploitation but hey, if no one was exploited life would be dull so let's all support the free market for it's 'variety.'

Again, it always comes down to people's willingness to pay. And I have already explained much of the decision that goes behind determining this. People generally pay as little as they think they can, what's your point?

Edit: My post count is the number of the beast! :o

peaccenicked

19th April 2004, 17:12

The theory of communism is multisplendid. Its source is contentious. Then we may assume Marx, or Thomas Moore, or Bakunin, but I think for morden purposes we are assuming a Stateless society. Marx claims in opposition to modern anthropologists that there was a phase called 'primitive communism'. This is pre- the "Labour theory of value".
Stateless in the future, I have pressumed has put an end to 'exchange' Value meaning that the use value of any item is not measured in money. It is simply appreciated for what it is and used for its intended purpose. The way water is (in general) now.

Nyder

24th April 2004, 09:33

Originally posted by [email protected] 19 2004, 04:49 PM

The purpose of this thread is discuss whether that is why no one is willing to pay for it, what makes you so sure it's not becuase oxygen embodies to human labour. If you think about it, drivers pay for oxygen, the difference is that it embodies human labour (putting it in a cylinder). If we assumed your statement to be true them compressed air would be worthless.

Wrong! The only reason compressed air is valuable is because are willing to pay for it. A diver would very much like to have compressed air and is willing to give up some of his income so he can pursue his passion of diving.

Stacking up heavy rocks on top of the other requires great labour costs but the resulting product is worthless. Why? Because who but a weird art freak will pay money for a bunch of big rocks stacked on top of the other?

Then again, your life is valuable becuase you have the potential to create value.

I wouldn't measure value by potential. A lifeless rock has the potential to be carved into a sculptural masterpiece, but this in itself does not give the rock value.

Becuase there is more human labour embodied in bottled water than in tap water.

Only machines could efficiently produce that amount of produce. Then again I might have to pay people to distribute it, and various factory workers. Does this add value? No, it adds production cost. At the end of the day it is the marketability that gives it value.

It takes human labour to grow and harvest (is that the right term?) beans, it takes human labour to manufacture the coffee, it takes human labour to distribute, it takes human labour to make the cappucino (even with a machine, the machine is created by human labour), it's not marked up, the workers wages are marked down.

Marked down from what? The labour value? You seem to think that the value of labour is some magical number floating above their heads. It is not. Value is subjectively determined. The employee offers a service to the employer and usually the employer sets the cost of this service. Sometimes it is the employee. The employee does not have to accept this price, but if his skill is limited and he/she is not very marketable then they may accept. People are usually the masterminds of what kind of value they can realistically earn based on their own marketable criteria.

And since all that labour went into creating the commodity, it is all embodied in the value of that commodity.

Rubbish. Value ultimately lies with the consumer, you should know that by now. A product/service not wanted, no matter how much labour is put into it, is worthless.

In the case of the mark-up, the owner of the capital (the entity who purchased it - unless you don't believe in exchange), would like to make that price as high as they can, but this is not possible in a competitive market (and also high prices tend to stop people from buying this product).
You mean if the price is higher than the value?

As I said, value is determined subjectively. You may value 'Das Kapital' more then me, for example.

What's your point, we don't suggest paying workers according to labour value theory, we suggest the complete absence of a market.

That's a shame because without markets people would have to produce everything themselves which would be very difficult and would mean a life of very basic means.

So back to the point - the l.t.o.v. is but one wage system.
It's not a wage system, it's an explanation of value.

Technically, I thought it could be attributed to paying employees, based on their subjective input, a share in the ownership of the company and therefore entitled to whatever profit or loss they make. That is the only way I could practically envision the labour theory of value, but I could be wrong.

Under communism, it would have to be forced.
No it wouldn't, under communism there wouldn't be wages. How can you force a theory of value to be correct, it either is or it isn't.

Well in order to abolish wages, you would need to enforce it. Otherwise how could it happen? If you abolish wages you have an incentive problem, too.

It also offers exploitation but hey, if no one was exploited life would be dull so let's all support the free market for it's 'variety.'

It seems your definition of exploitation is different from mine.

Again, it always comes down to people's willingness to pay. And I have already explained much of the decision that goes behind determining this. People generally pay as little as they think they can, what's your point?

Well, would you rather pay $1 for a luxurious mansion, or $1000000, if you had the choice?

Misodoctakleidist

24th April 2004, 13:55

Wrong! The only reason compressed air is valuable is because are willing to pay for it. A diver would very much like to have compressed air and is willing to give up some of his income so he can pursue his passion of diving. Why am i wrong? What makes you sure that the plausable explanation that i gave you is incorrect.

Stacking up heavy rocks on top of the other requires great labour costs but the resulting product is worthless. Why? Because who but a weird art freak will pay money for a bunch of big rocks stacked on top of the other?
Well as Marx said, a commodity must have a use value otherwise it isn't a commodity and therfore has no value.

I wouldn't measure value by potential. A lifeless rock has the potential to be carved into a sculptural masterpiece, but this in itself does not give the rock value.
That's a falty analogy, i said that you have the potential to perform labour, a rock has the potential to have labour performed on it.

Only machines could efficiently produce that amount of produce.
And who designs, builds, operates and maintains machines?

Then again I might have to pay people to distribute it, and various factory workers. Does this add value?
Yes, each of these things requires human labour.

No, it adds production cost. At the end of the day it is the marketability that gives it value.
Again, why are you so sure that it's the marketability rather than the labour embodied in the commodity which gives it value?

Value is subjectively determined. The employee offers a service to the employer and usually the employer sets the cost of this service.
And the amount the employer pays is usualy less than the amount of value which the emplyee produces for the employer.

The employee does not have to accept this price, but if his skill is limited and he/she is not very marketable then they may accept.
The employee does have to accept the price, at least if they want a job, becuase no employer would pay their staff what they are actualy otherwise the company would not make a profit. The employer has the capital and holds all the cards.

Rubbish. Value ultimately lies with the consumer, you should know that by now. A product/service not wanted, no matter how much labour is put into it, is worthless.
As i've already said, Marx makes this clear in Das Kapital.

As I said, value is determined subjectively. You may value 'Das Kapital' more then me, for example.
And so if you went into a bookshop you would get it cheaper? I don't think so.

That's a shame because without markets people would have to produce everything themselves which would be very difficult and would mean a life of very basic means. No, they just wouldn't be able to place commodities into exchange relationships, this doesn't mean they have to produce everything themselves.

Technically, I thought it could be attributed to paying employees, based on their subjective input, a share in the ownership of the company and therefore entitled to whatever profit or loss they make. That is the only way I could practically envision the labour theory of value, but I could be wrong. The main point of the theory to explain why a commodity has a value, the reason it has such significance is becuase it leads to the conclusion that workers are being exploited.

Well in order to abolish wages, you would need to enforce it. Otherwise how could it happen? If you abolish wages you have an incentive problem, too.
You wouldn't need to enforece it. There would be no currency so it wouldn't be possible to pay people in money. You're probably thinking they could be paid in commodities, say bread, but why would they work for bread when they can get it for free from the bakery?

How do wages offer an incentive? You get paid the same amount per week wether you work hard or not.

It seems your definition of exploitation is different from mine. If i pay you £5 to bake me a cake then sell it for £6 am i not exploiting you?

Well, would you rather pay $1 for a luxurious mansion, or $1000000, if you had the choice? I was refering to wages.

Shredder

24th April 2004, 22:03

Posted by Nyder on Apr 19 2004, 10:13 AM

'Value' is not some sort of mythical given quantity. 'Value' is basically determined by willingness to pay. Of course it is not value in the sense you might think.

Nyder,

Marx's 'value' is not to be confused with the price. His value is what prices approach through the mechanisms of the capitalist market (consistent with the philosophy side of Marx, which emphasises taking moving systems instead of abstractions frozen in time). The 'value' is the socially necessary labor to create a commodity. Far from refuting supply/demand, Marx takes these as the aforementioned mechanisms of the capitalist market. And not just supply versus demand, but competition between suppliers versus competition between demanders.

For example, if the demand for a commodity is high, a capitalist can sell for a high price. We agree here. But we must, as Marx, analyze this scenario by imagining it in the context of a real capitalist market. The capitalist doesn't just go about selling vital commodities at absurd prices. Instead, more capitalists come in and compete with him and the prices lower. You can't just say 'supply vs demand' and be done with it. You must understand that capitalists abhor a vacuum, and so meet demand with supply. The capitalists increase supplies to meet demands to raise profits, with other capitalists pushing prices down through competition between suppliers.

For Marx, what prices are pulled toward through the capitalists trying to meet demand with supply is the 'value', and the value is the socially necessary labor for the production of that commodity. Socially necessary labor is 'social' because it means it combines all the labor needed to produce that commodity--that is, a machine is not a laborer, but it required labor to produce the machine. Furthermore, it takes labor to produce food to feed the laborer who operates the machine. The 'necessary' part, I'm not sure I remember. I'm fairly certain that that is to show that if you spend 15 years of hard labor creating a chair which normally takes an average of 10 hours to make, you're just an idiot.

The stripper in your example isn't inconsistent with the LTV. In this case, it already takes 2x as much socially necessary labor to create a stripper as soon as you add the requisite that she is female. Next you must consider the necessary labor time to feed her and her children and to create and insert her breast implants and for her to work out at the gym, etc.

This 'marginal utility' business finally begins to break down the LTV, but not disprove it. For example, an original van gogh painting cannot be reproduced with any amount of social labor. Thus the laws of the market never get a chance to act on it to bring its price in line with its 'value.' I guess it would still have 'value' in a marxian sense, just no mechanism by which the price approaches it.

The 'surplus value' stuff that we talk about, that is, the theory of exploitation, doesn't really lean on the LTV. A monkey could see that a capitalist does not add anything to property simply by owning it. You can certainly argue with me forever that the capitalist earned his profit, but you will still have to admit that the the demand and supply of a commodity, which determine the price, would have changed regardless of who or what owned it.

Using this conception of value, analyses get really ugly once you start considering the labor side--The supply v demand of labor power, the uncontrolled reproduction of laborers regardless of the demand, etc. So you'll find it ironic that after this entire post, I admit that I don't necessarily subscribe to the LTV. It seems to me that the marxist conception of value has certain applications in analysing capitalism, but I always take it with a grain of salt. The point of me posting was not to defend the LTV, but simply to say that you're failing to effectively attack it.

perception

24th April 2004, 23:37

Originally posted by [email protected] 24 2004, 08:55 AM

As I said, value is determined subjectively. You may value 'Das Kapital' more then me, for example.

And so if you went into a bookshop you would get it cheaper? I don't think so.

Noi, if price exceeds marginal value you don't buy something. If marginal value exceeds price you do. You measure marginal value by whether someone chooses to purchase something at a given price. Do you have a better way?

If i pay you £5 to bake me a cake then sell it for £6 am i not exploiting you?

If I'm a baker and you're a salesman that sounds like a fair exchange. Otherwise I have to go through the trouble of finding a buyer for my cake when I would rather focus on baking. Ther are other economic functions besides laborers. Retail is a value-added activity, chulo.

elijahcraig

25th April 2004, 02:39

Rubbish. Value ultimately lies with the consumer, you should know that by now. A product/service not wanted, no matter how much labour is put into it, is worthless.

And who determines who wants something? Answer: the Capitalist system. Who “wants” a pet rock? No one, if they thought about it. Why did people buy it? Herd mentality.

The capitalist system creates “wants” and “needs” idiotic products.

People need basic necessities which are never shaken and are determined by the amount of labor put into them providing them. Example, food.

Wrong! The only reason compressed air is valuable is because are willing to pay for it. A diver would very much like to have compressed air and is willing to give up some of his income so he can pursue his passion of diving.

You didn’t prove the point wrong, you simply asserted some other random thought on the “passion” of diving.

I wouldn't measure value by potential. A lifeless rock has the potential to be carved into a sculptural masterpiece, but this in itself does not give the rock value.

And? You DON”T measure something on “potential,” you measure it on the act provided to create value, done on the rock by someone.

A person’s life is valued as potential because a human can act on other things to create value. A rock cannot act.

Though art, in Marxist economy, is called a “rarity” and is worked on in Das Kapital in the Appendix mostly (if I remember correctly).

Hoppe

25th April 2004, 08:44

People need basic necessities which are never shaken and are determined by the amount of labor put into them providing them. Example, food.

So much for individual preferences. Another example of the road to serfdom.

You didn’t prove the point wrong, you simply asserted some other random thought on the “passion” of diving.

Take to similar houses. One has a view on a chemical plant, the other is situated near a beach. The last will be more expensive to buy than the first. How come?

According to your other statement, housing is a basic need and people shouldn't complain.

Though art, in Marxist economy, is called a “rarity” and is worked on in Das Kapital in the Appendix mostly (if I remember correctly).

Yes, let's compare the Mona Lisa with your homemade aquarel.

We can conclude that no one in your society will be jobless. Those who are will be digging holes and fill them up afterwards when they're done. Labour creates value.

Misodoctakleidist

25th April 2004, 09:06

Originally posted by [email protected] 24 2004, 11:37 PM
If I'm a baker and you're a salesman that sounds like a fair exchange. Otherwise I have to go through the trouble of finding a buyer for my cake when I would rather focus on baking. Ther are other economic functions besides laborers. Retail is a value-added activity, chulo.

Well i was ignoring factors such my labour expended in finding a buyer.

So much for individual preferences. Another example of the road to serfdom.
What has having food got to do with surfdom?

We can conclude that no one in your society will be jobless. Those who are will be digging holes and fill them up afterwards when they're done. Labour creates value.

Hoppe, try reading the fucking thread. I've already pointed out to Nyder that something must have a utility to be a commodity and therefor have value.

Take to similar houses. One has a view on a chemical plant, the other is situated near a beach. The last will be more expensive to buy than the first. How come?
That's because they're different commodities; one is a house, the other is a house with a nice view.

Ask yourself; how much labour would it take to build a house with a nice view next a chemical plant? Would it be the same for a house on the beach?

Here's a good little example for you to explain; I have a diamond and a very good fake, only an expert can tell the difference. The utility of both is the same; to look pretty but the diamond is worth much more than the fake. Let's assume that this is before Diamonds were used in industry, how do you explain the difference in value? I would say it is because there is more labour embodied in the diamond.

Rasta Sapian

25th April 2004, 09:14

to try and argue against marx? this guy was the man who took economics to a new level, to look at economics and society from 360 degrees, where economics could be used to liberate the masses to an equal labour for $ value, and yes of course the labour theory defines exploitation! :blink:

what is your point? my point is that the exploitaion has gotton much greater, especially in the US where the economy has been eccellerated toward individualistic independance and greed!

das kapital es a tresbien direction por le future ou economicas por le monde :)

peace yall

Professor Moneybags

25th April 2004, 17:46

What has having food got to do with surfdom?

Having to give up the pursuit of non-necessities for the sake of providing necessities for others is serfdom.

Professor Moneybags

25th April 2004, 17:47

No, You fucking moron! How fucking stupid are you? If the employers paid the workers what they deserved do you think we'd be complaining about exploitation?

Probably. There's no such thing as 'enough'. It's a subjective word.

Misodoctakleidist

25th April 2004, 18:03

Originally posted by Professor [email protected] 25 2004, 05:46 PM
Having to give up the pursuit of non-necessities for the sake of providing necessities for others is serfdom.
[/B]Nobody said anything like that, elijacraig said people need necessities not that people should only have necessities.

[b]Probably. There's no such thing as 'enough'. It's a subjective word.
I love the way you just invent your on quotation and imply that i said it. I didn't use the word 'enough,' i said 'what they deserve.'

NYC4Ever

25th April 2004, 18:06

I agree that workers do deserve higher pay, but you cant have higher wages and free medical aid, free schooling and welfare. I mean do you want your cake and eat it too?

Misodoctakleidist

25th April 2004, 18:51

That's why you get rid of the owners.

Nyder

26th April 2004, 01:37

Originally posted by [email protected] 24 2004, 10:03 PM

Marx's 'value' is not to be confused with the price. His value is what prices approach through the mechanisms of the capitalist market (consistent with the philosophy side of Marx, which emphasises taking moving systems instead of abstractions frozen in time). The 'value' is the socially necessary labor to create a commodity. Far from refuting supply/demand, Marx takes these as the aforementioned mechanisms of the capitalist market. And not just supply versus demand, but competition between suppliers versus competition between demanders.

My point is that it is not the value of the labour that defines the value of the product. A businessman would like to cover his production costs, but that is not always the case and mark-ups can differ depending on the situation. Sometimes mark-ups can be over 200% but it really depends on demand, supply and competition in the marketplace.

Far from being seperate to markets, labour is its own market and also complies with supply, demand and competition.

For example, if the demand for a commodity is high, a capitalist can sell for a high price. We agree here. But we must, as Marx, analyze this scenario by imagining it in the context of a real capitalist market. The capitalist doesn't just go about selling vital commodities at absurd prices. Instead, more capitalists come in and compete with him and the prices lower. You can't just say 'supply vs demand' and be done with it. You must understand that capitalists abhor a vacuum, and so meet demand with supply. The capitalists increase supplies to meet demands to raise profits, with other capitalists pushing prices down through competition between suppliers.

I agree with you. However, in a monopoly situation supply can actually be cut to raise the price and therefore revenue.

For Marx, what prices are pulled toward through the capitalists trying to meet demand with supply is the 'value', and the value is the socially necessary labor for the production of that commodity. Socially necessary labor is 'social' because it means it combines all the labor needed to produce that commodity--that is, a machine is not a laborer, but it required labor to produce the machine.

That is true to an extent (even today where machines can produce machines). But what it is saying is that the original labours that built the machine have a stake in the profit/loss that the machine makes. This is absurd because it was the original buyer/s of the machine who put their money at risk.

Furthermore, it takes labor to produce food to feed the laborer who operates the machine.

That is correct but isn't it normal for workers to paid above their own production costs?

The 'necessary' part, I'm not sure I remember. I'm fairly certain that that is to show that if you spend 15 years of hard labor creating a chair which normally takes an average of 10 hours to make, you're just an idiot.

So only 'necessary' labour creates value? How does Marx explain the shift in labour values caused by the automation of automobile factories?

The stripper in your example isn't inconsistent with the LTV. In this case, it already takes 2x as much socially necessary labor to create a stripper as soon as you add the requisite that she is female. Next you must consider the necessary labor time to feed her and her children and to create and insert her breast implants and for her to work out at the gym, etc.

Are you saying that the 'production costs' of the stripper are somehow greater which justifies her wage? And how is her feeding her children a part of the production cost of being a stripper?

This 'marginal utility' business finally begins to break down the LTV, but not disprove it. For example, an original van gogh painting cannot be reproduced with any amount of social labor. Thus the laws of the market never get a chance to act on it to bring its price in line with its 'value.' I guess it would still have 'value' in a marxian sense, just no mechanism by which the price approaches it.

Good point. If labour creates value, then how do you explain a painting of Van Gogh? It is almost priceless in its value yet the labour performed to create it was minimal (in sense). Does the ltv also take into account intellectual labour?

The 'surplus value' stuff that we talk about, that is, the theory of exploitation, doesn't really lean on the LTV. A monkey could see that a capitalist does not add anything to property simply by owning it. You can certainly argue with me forever that the capitalist earned his profit, but you will still have to admit that the the demand and supply of a commodity, which determine the price, would have changed regardless of who or what owned it.

The fact that the capitalist invested his/her money into the inventory and/or capital of the business should give indication that they actually own it. And it is their risk which is why they are able to appreciate the full profit or loss of their venture. However, if they want to spread their risk and give employees shares in the ownership of the business, that is up to them.

Using this conception of value, analyses get really ugly once you start considering the labor side--The supply v demand of labor power, the uncontrolled reproduction of laborers regardless of the demand, etc. So you'll find it ironic that after this entire post, I admit that I don't necessarily subscribe to the LTV. It seems to me that the marxist conception of value has certain applications in analysing capitalism, but I always take it with a grain of salt. The point of me posting was not to defend the LTV, but simply to say that you're failing to effectively attack it.

I think I've raised some good points against it.

And whatever do you mean by 'reproduction of labourers'? Generally labour markets for particular jobs shrink and grow according to the demand for them. If not then there is always an incentive to enter the industry because they will offer higher wages to attract people. For example, the trades industry such as carpenters, plumbers and electricians are in high demand and attract a high wage because there is not enough people entering the industry.

Nyder

26th April 2004, 01:38

Originally posted by [email protected] 25 2004, 06:51 PM
That's why you get rid of the owners.
Then you have a tradegy of the commons problem.

STI

26th April 2004, 02:14

Originally posted by Nyder+Apr 26 2004, 01:38 AM--> (Nyder @ Apr 26 2004, 01:38 AM)
[email protected] 25 2004, 06:51 PM
That's why you get rid of the owners.
Then you have a tradegy of the commons problem. [/b]
Nyder, you brought this up in a thread and you got owned. Don't fall back on it again, because it won't work.

That is correct but isn't it normal for workers to paid above their own production costs?

No. There wouldn't be any profit if such were the case.

So only 'necessary' labour creates value? How does Marx explain the shift in labour values caused by the automation of automobile factories?

Yes, only necessary labours create value. If you owned a shoe-producing factory, and you made 100 shoes in a month, but only sold 50, the other 50 shoes would not have had any value to you. The labour which produced the shoes is hence socially unnecessary.

Are you saying that the 'production costs' of the stripper are somehow greater which justifies her wage? And how is her feeding her children a part of the production cost of being a stripper?

Yes, they are. I don't know about the "kids" part, but the breast implants, the time at the gym, etc. are all part of the labour necessary to create a commodity of the quality that said stripper would be create.

Good point. If labour creates value, then how do you explain a painting of Van Gogh? It is almost priceless in its value yet the labour performed to create it was minimal (in sense). Does the ltv also take into account intellectual labour?

Several years (however long ago Van Gough was alive) of labour have been used in preserving, protecting, and holding on to Van Gough's paintings. They didn't have much value when they were painted (explaining why most artists are usually quite poor).

Shredder

26th April 2004, 06:34

The reason the stripper's value includes her kids is, er, complicated. Remember that the 'socially necessay labor' to produce a commodity applies to the commodity of 'labor power' itself. But though labor can invent value where there was none before, value cannot create laborers ex nihilo. So the value of labor power includes the socially necessary labor to create the next generation of laborers, i.e. the stripper's children.

Guest1

26th April 2004, 07:39

Originally posted by [email protected] 25 2004, 01:06 PM
I agree that workers do deserve higher pay, but you cant have higher wages and free medical aid, free schooling and welfare. I mean do you want your cake and eat it too?
I always hated that saying. <_< Why have a cake if you're not gonna eat it? There's no reason not to, in fact, it would be stupid not to.

The idea is, we're not looking for higher wages, we're looking for the abolition of wages.

At the very least, workers should no longer be paid a salary, they should share profits. At the very least, bosses should be paid no more than the worker, though we would prefer they be fired all together.

The money saved from the exhorbitant profits that bosees give themselves, economically referred to as rent (profits made without producing anything, leeching), would allow you to eat your cake instead of just staring at it.

perception

26th April 2004, 14:08

Originally posted by Che y [email protected] 26 2004, 02:39 AM
The idea is, we're not looking for higher wages, we're looking for the abolition of wages.

At the very least, workers should no longer be paid a salary, they should share profits. At the very least, bosses should be paid no more than the worker, though we would prefer they be fired all together.

Stick to that, and cut that LTV shit out. Workers should share in the profits. That's all you need to say. The LTV is useless.

The money saved from the exhorbitant profits that bosees give themselves, economically referred to as rent (profits made without producing anything, leeching), would allow you to eat your cake instead of just staring at it.

that's not what 'rent' is. Rent is when profit is made above what normal market conditions would dictate; for example, if a company lobbies for legislation which gives it market power that increases profits, that is considered rent-generating activity. What you're referring to is either accounting profits or economic profits, thought capitalist economists would tell you that in a competitive market there are no economic profits, just accounting profits.

Misodoctakleidist

26th April 2004, 15:41

Nyder, i see you failed to respond to my last refutation of your argument so I'll assume that you accepted my points, I think a lot criticism stems from a misunderstanding. Let's keep this debate about value and not wages, wages aren't an indicator to the amount of value added by the labourer.

One of the most important things you don't understand is that the value of a commodity applies all identical commodities and not just that individual commodity; the value of a commodity is Representative of the amount of human labour socially expended in it's creation. Without this fact you may thinks that a slow inefficiant worker produces greated value however the value is that of the amount of labour expended socially in the creation of a commodity with the average amount of skill and technology prevailent at the time. This also means that if labour is expended which is not usefull in the creation of a commodity then it does not add value to it.

I was hoping you'd have responded to my question about diamonds at the bottom of the previous page, I'd be interested to hear your explanation.

DaCuBaN

26th April 2004, 22:27

Having to give up the pursuit of non-necessities for the sake of providing necessities for others is serfdom

The whole point is it's selfish to persue your own self gratification whilst there are others who have to worry about where the next meal is coming from and where they'll sleep tonight. I wouldn't consider that serfdom...

Why have a cake if you're not gonna eat it? There's no reason not to, in fact, it would be stupid not to

:lol: I think you've been misunderstanding this one comrade.... 'Having your cake and eating it' is impossible. How can you still be in possession of the cake once you have eaten it? It's an analogy :)

Guest1

27th April 2004, 04:19

I'd rather have it in my stomach :P

pandora

27th April 2004, 04:30

What a load of crap, to hear such nonsense when productivity is high inflation is high, profits are high, and unemployment is also high, wages are frozen, and despite high productivity corporations are moving to third world markets which basically have slavery, and workers sleep under their machines is absolute idioiticy.

I refer to the comment of one Mexican woman who received a job in a factory after NAFTA which was prior a union position. She worked for only as much in Mexico to be able to afford chicken once a week. The factory moved to India to "cut costs" she asked, "Is it so much that I ask for chicken once a week?"

In India the woman who received her job who basically lived at the factory with her children under the machines had THE SAME QUESTION! "If they paid me just a little bit more I might afford chicken once a week, are they so greedy?"

I refer to this as the "GREAT CHICKEN SCANDAL" or the corporate FUCK YOU clause.

Nyder

28th April 2004, 08:37

socialist_tiger,

Then you have a tradegy of the commons problem.
Nyder, you brought this up in a thread and you got owned. Don't fall back on it again, because it won't work.

You didn't 'own' me. You can't just simply dismiss the tragedy of the commons problem. All you commies could think of was either people will magically share or that there will be a massive bureaucracy doing checks upon checks without any sort of corruption and with great efficiency. It just showed that you guys didn't have a fucking clue.

That is correct but isn't it normal for workers to paid above their own production costs?

No. There wouldn't be any profit if such were the case.

Production costs for the worker (such as food, clothing, housing, etc) are subjective and differ from each individual person. An employer just pays the employee the agreed upon wage, which the employee accepts based on what he or she can earn based on their marketablity in the labour market.

So only 'necessary' labour creates value? How does Marx explain the shift in labour values caused by the automation of automobile factories?

Yes, only necessary labours create value. If you owned a shoe-producing factory, and you made 100 shoes in a month, but only sold 50, the other 50 shoes would not have had any value to you. The labour which produced the shoes is hence socially unnecessary.

So are you saying that the labourers who made those shoes therefore don't get paid?

And in a capitalist market the shoes would have their price lowered to sell them off, they wouldn't just be thrown away.

Are you saying that the 'production costs' of the stripper are somehow greater which justifies her wage? And how is her feeding her children a part of the production cost of being a stripper?

Yes, they are. I don't know about the "kids" part, but the breast implants, the time at the gym, etc. are all part of the labour necessary to create a commodity of the quality that said stripper would be create.

So you are saying an employer should have to pay all that? Then you must agree that the employee should pay for all the equipment, uniforms and training that the employer provides, otherwise you have a double standard.

Good point. If labour creates value, then how do you explain a painting of Van Gogh? It is almost priceless in its value yet the labour performed to create it was minimal (in sense). Does the ltv also take into account intellectual labour?

Several years (however long ago Van Gough was alive) of labour have been used in preserving, protecting, and holding on to Van Gough's paintings. They didn't have much value when they were painted (explaining why most artists are usually quite poor).

But that's not what gives it its value. The labour was performed because of its value, not the other way around. The value was there before the labour was put into it. And art lovers will pay a mint for it, not because of the labour gone into to it, but because of its rarity and other subjective reasons.

Guest1

28th April 2004, 09:08

Its value is exaggerated by the system we live in, based upon the rich having a jerking circle over anything that raises their social standing. The more they jerk, the more valuable it is, the more social standing they have, the more they jerk.

In a socialist economy, it would be appreciated for its art value, period.

That's the other side of the LTV, some things are just over-valued. It actually explains some things like that.

Internet bubble anyone?

Hoppe

28th April 2004, 09:23

Guys, you're argumenting in circles. If value is concieved to be dependent on labour, how can you determine the value of that labour? How can you characterize socially useful labour other than that it produces socially useful things?

Hoppe

28th April 2004, 09:30

Originally posted by Che y [email protected] 28 2004, 09:08 AM
In a socialist economy, it would be appreciated for its art value, period.

But who decides whether it has any "art" value?

It would be very funny if in your socialist economy your acquarel has more value than a Van Gogh because your lack of painting skills recquired you longer time to paint it.

Guest1

28th April 2004, 13:48

Well that's exactly the point.

When it comes to art, different things have different value to different people.

So what better way than to recognize that and allow the appreciation of art, rather than circle jerk around the price tag.

What you're forgetting is that LTV only applies to Capitalism, it's a method to prove the exploitation of workers. Beyond that, there's nothing.

You can't use the LTV to judge Communist society, because "value" in communist society is what it's meant to be, and abstract and distinctly subjective concept. So each person may place more value in one thing or another, apprecation of art as an example, but the economy is not based on these personal preferences or on any other abstract idea. The economy is based upon mutual cooperation. Period.

STI

28th April 2004, 13:54

You didn't 'own' me. You can't just simply dismiss the tragedy of the commons problem. All you commies could think of was either people will magically share or that there will be a massive bureaucracy doing checks upon checks without any sort of corruption and with great efficiency. It just showed that you guys didn't have a fucking clue

The tradgedy of the commons occurred before capitalism existed. Capitalism must first exist in order for communism to exist. It's an irrelivant example. I could bring up several examples from the ancient world of how communalism was effectively put into practice.

Production costs for the worker (such as food, clothing, housing, etc) are subjective and differ from each individual person. An employer just pays the employee the agreed upon wage, which the employee accepts based on what he or she can earn based on their marketablity in the labour market.

You didn't address my point. I said that, if workers were paid more than the value of their labour, there wouldn't be any profit for the boss.

So are you saying that the labourers who made those shoes therefore don't get paid?

And in a capitalist market the shoes would have their price lowered to sell them off, they wouldn't just be thrown away.

I'm not saying they wouldn't be paid, I'm saying that it would make their labout 'socially unnecessary'. If the shoes were sold for, say, 75% of their value, only 75% of the labour required to make said shoes would have been socially necessary. And yes, goods are thrown away quite often.

So you are saying an employer should have to pay all that? Then you must agree that the employee should pay for all the equipment, uniforms and training that the employer provides, otherwise you have a double standard

No. In the grand scheme of things, I'm saying that there should be no employer in the first place. And yes, I do believe that, even in capitalism, uniforms, equiptment, and training should be paid for by the employers (including university and colledge, in the form of taxes).

But that's not what gives it its value. The labour was performed because of its value, not the other way around. The value was there before the labour was put into it. And art lovers will pay a mint for it, not because of the labour gone into to it, but because of its rarity and other subjective reasons.

But 'rarity', 'artistic value' and the like are use-values, not exchange-values. The LTV deals with exchange-values.

Guys, you're argumenting in circles. If value is concieved to be dependent on labour, how can you determine the value of that labour? How can you characterize socially useful labour other than that it produces socially useful things?

I agree. In order for labour to be 'socially necessary', it must produce exchange-value. Nothing can have exchange-value without having a use-value.

But who decides whether it has any "art" value?

It would be very funny if in your socialist economy your acquarel has more value than a Van Gogh because your lack of painting skills recquired you longer time to paint it.

Exchange wouldn't exist in socialism, so neither would exchange-value. And slow and lazy workers do not produce goods of greater value simply because it took them longer to produce. Their labour is worth less of the sociall-necessary amount of labour than a speedy worker.

Basically all the points I've addressed in this post were addressed in the first chapter of Das Kapital. Neither of you knows enough about the LTV to honestly criticize it.

Hoppe

28th April 2004, 14:10

Originally posted by Che y [email protected] 28 2004, 01:48 PM
What you're forgetting is that LTV only applies to Capitalism, it's a method to prove the exploitation of workers. Beyond that, there's nothing.

You can't use the LTV to judge Communist society, because "value" in communist society is what it's meant to be, and abstract and distinctly subjective concept. So each person may place more value in one thing or another, apprecation of art as an example, but the economy is not based on these personal preferences or on any other abstract idea. The economy is based upon mutual cooperation. Period.
Pfff come on. Marx tried to come up with an objective measure of value (he was a classical economist, remember). Unfortunately for you he failed. Subjectivity is by the way a different school and is much in use to explain value nowadays.

Of course, in your view the laws of economics won't apply anymore in your society as everything will just "happen", but that is not very realistic now, is it? And what is so abstract about individuals preferences, do you just want to dismiss them and give people only basic necessities?

Hoppe

28th April 2004, 14:19

Basically all the points I've addressed in this post were addressed in the first chapter of Das Kapital. Neither of you knows enough about the LTV to honestly criticize it.

Hahaha. :lol:

The circular reasoning is one of the main objections of the LTV and Marx's couldn't resolve this. Socially necessary labour is just a meaningless empty phrase. Furthermore the methodology he has used is complety unsound

If the LTV is such a good theory then why is there no economist in this world who still believes in it? They're either following Menger or Walras.

Guest1

28th April 2004, 14:28

Originally posted by Hoppe+Apr 28 2004, 09:10 AM--> (Hoppe @ Apr 28 2004, 09:10 AM)
Che y [email protected] 28 2004, 01:48 PM
What you're forgetting is that LTV only applies to Capitalism, it's a method to prove the exploitation of workers. Beyond that, there's nothing.

You can't use the LTV to judge Communist society, because "value" in communist society is what it's meant to be, and abstract and distinctly subjective concept. So each person may place more value in one thing or another, apprecation of art as an example, but the economy is not based on these personal preferences or on any other abstract idea. The economy is based upon mutual cooperation. Period.
Pfff come on. Marx tried to come up with an objective measure of value (he was a classical economist, remember). Unfortunately for you he failed. Subjectivity is by the way a different school and is much in use to explain value nowadays.

Of course, in your view the laws of economics won't apply anymore in your society as everything will just "happen", but that is not very realistic now, is it? And what is so abstract about individuals preferences, do you just want to dismiss them and give people only basic necessities? [/b]
What I'm saying is that value in communist society would be entirely objective and up to the individual, because the economy wouldn't rely on it.

Believe it or not, many of the economic laws of Capitalism wouldn't apply without Capitalism.

Hoppe

28th April 2004, 15:13

Originally posted by Che y [email protected] 28 2004, 02:28 PM
What I'm saying is that value in communist society would be entirely objective and up to the individual, because the economy wouldn't rely on it.

Believe it or not, many of the economic laws of Capitalism wouldn't apply without Capitalism.
You were just saying that value is subjective in paradise, what is it now?

Believe it or not, economics isn't interested in socialism or capitalism or whatever ism. It will only tell you what happen when you abolish a market, or nationalize private property etc etc. You can of course change everything the way you see fit and say "these are the conditions in my utopia", but that is just scientific spielerei and unrealistic.

STI

28th April 2004, 15:14

Originally posted by Hoppe+Apr 28 2004, 02:10 PM--> (Hoppe @ Apr 28 2004, 02:10 PM)
Che y [email protected] 28 2004, 01:48 PM
What you're forgetting is that LTV only applies to Capitalism, it's a method to prove the exploitation of workers. Beyond that, there's nothing.

You can't use the LTV to judge Communist society, because "value" in communist society is what it's meant to be, and abstract and distinctly subjective concept. So each person may place more value in one thing or another, apprecation of art as an example, but the economy is not based on these personal preferences or on any other abstract idea. The economy is based upon mutual cooperation. Period.
Pfff come on. Marx tried to come up with an objective measure of value (he was a classical economist, remember). Unfortunately for you he failed. Subjectivity is by the way a different school and is much in use to explain value nowadays.

Of course, in your view the laws of economics won't apply anymore in your society as everything will just "happen", but that is not very realistic now, is it? And what is so abstract about individuals preferences, do you just want to dismiss them and give people only basic necessities? [/b]
Well, if this debate has been any indication, he hasn't. When all has been said and done, the only thing you've managed to come up with that we havn't successfully shot down is "He was wrong". I applaud your incredible capacity to debate. :rolleyes:

Hahaha.

The circular reasoning is one of the main objections of the LTV and Marx's couldn't resolve this. Socially necessary labour is just a meaningless empty phrase. Furthermore the methodology he has used is complety unsound

If the LTV is such a good theory then why is there no economist in this world who still believes in it? They're either following Menger or Walras.

1) My point wasn't addressed
2) What circular reasoning? I managed to argue against all the claims that we were using circular reasoning (none of my points have actually been addressed yet, but that's understandable, as I posted them only a few hours ago. We'll have to wait and see what develops).
3) 'Socially necessary labour' is NOT a meaningless and empty phrase. It refers to all of society's labour which creates exchange-value.
4) I highly doubt that no economists support the LTV. Even if they didn't, you and the rest of the capitalists here have failed to 'debunk' the LTV.
4.1) Argument of authority, logical fallacy
Silly conservative :lol:

Guest1

28th April 2004, 16:06

Sorry, I meant subjective.

If you'd read the rest of the post: "up to the individual", you would have known that.

No need to argue over typos.

Misodoctakleidist

28th April 2004, 16:45

Nyder, why have you ignored my last two posts even thought they were both specifically addressed to you?

Hoppe, why have you ignored everything that's been written in this entire and thread and continued to fall back on argument which have been refuted already.

You should both find out what Marx actually said before you start criticising it.

Hoppe

28th April 2004, 19:33

2) What circular reasoning? I managed to argue against all the claims that we were using circular reasoning (none of my points have actually been addressed yet, but that's understandable, as I posted them only a few hours ago. We'll have to wait and see what develops).

You are still stuck in a circle, explaining the value of goods by the labor that went into them and the value of that labor by the goods it produces.

This circular reasoning can be attributed to Aristotle who said that goods themselves must possess some property that makes a certain amount of x equal to a certain amount of y. If correct, you just have to find the missing factor, which Marx thought was labour.

3) 'Socially necessary labour' is NOT a meaningless and empty phrase. It refers to all of society's labour which creates exchange-value.

see above. Exchange value is not so interesting. In the center should be (subjective) use value since you need a theory of utility to explain the actions of consumers.

This was the crappy part of his methodology since he didn't look at the demandside, only the supply side. Nowhere in Das Kapital is there any positive proof of his theory, only this:

1) hypothesis: there is a factor which produces value to a good.
2) hypothesis: only goods in which humans have invested labor have value (???)
3) methodology: list all factors that produce a good. Don't count the factors which didn't produce equal value in an equal amount and eliminate all till there is one left
4) conclusion: labour is the source of value

Marx never came up with any positive proof of his theory, only this. He even went so far to say that there were two sorts of capital in production that and only one could add value. So he himself stated that labour is not the only source of value.

4) I highly doubt that no economists support the LTV. Even if they didn't, you and the rest of the capitalists here have failed to 'debunk' the LTV.

Name one. I even read people here who have problems with it.

Now, Marx was just influenced by the economic thoughts of his time, and after that more people got involved and knowledge grew. It is as simple as that. So he was wrong, big deal. Ricardo was wrong as well, as was Smith.

STI

29th April 2004, 02:18

You are still stuck in a circle, explaining the value of goods by the labor that went into them and the value of that labor by the goods it produces

You're really just oversimplifying. I'm saying that labour has no use to anybody but the labourer if it does not produce anything (and therefore no exchange value). The value of a commodity is connected to the amount of labour embodied in it. There's nothing circular about it. You just don't seem to understand (or care, whichever the case is) that, if something has no use-value, it has not exchange-value.

Marx never came up with any positive proof of his theory, only this. He even went so far to say that there were two sorts of capital in production that and only one could add value. So he himself stated that labour is not the only source of value.

I disagree. Example: No matter how little bread there is, a spaceship will always have a higher exchange-value than a loaf of bread, because there is more socially necessary labour embodied in the spaceship.

Name one. I even read people here who have problems with it.

Ernest Mandel.

Now, Marx was just influenced by the economic thoughts of his time, and after that more people got involved and knowledge grew. It is as simple as that. So he was wrong, big deal. Ricardo was wrong as well, as was Smith.

I don't have any emotional ties to the rightness or wrongness of Marx, I just believe that his LTV (among other things) was correct. I don't agree with everything Marx said, but I do agree with this.

And, if you guys are so knowledgeable about economics, tell me, what does create exchange-value if not human labour?

Nyder

29th April 2004, 05:46

Ok, Misodoctakleidist, I will respond to your last two posts. I wasn't ignoring you was just trying to address the points which I felt were more pressing.

Wrong! The only reason compressed air is valuable is because are willing to pay for it. A diver would very much like to have compressed air and is willing to give up some of his income so he can pursue his passion of diving. Why am i wrong? What makes you sure that the plausable explanation that i gave you is incorrect.

I gave you a plausible explanation that you didn't answer. The diver requires compressed air, and that is why it has value. Compressed air by itself is nothing, without the need for it.

Stacking up heavy rocks on top of the other requires great labour costs but the resulting product is worthless. Why? Because who but a weird art freak will pay money for a bunch of big rocks stacked on top of the other?
Well as Marx said, a commodity must have a use value otherwise it isn't a commodity and therfore has no value.

Marx also said: "This property of a commodity is independent of the amount of labour required to appropriate its useful qualities." So if a commodity has no use value, then it must have no value at all, despite the labour put into it. This makes common sense, because how can a commodity have value if it is not an item that is needed or wanted? However, I'm not too sure how Marx would define 'use value' and who determines 'use value'.

I wouldn't measure value by potential. A lifeless rock has the potential to be carved into a sculptural masterpiece, but this in itself does not give the rock value.
That's a falty analogy, i said that you have the potential to perform labour, a rock has the potential to have labour performed on it.

You are just trashing my example. Potential is not value. I may have the potential to be a billionaire, but that does not mean I am worth a billion dollars. Every sperm has the potential to become a human being, etc. Potential is not a useful measure of value at all.

Only machines could efficiently produce that amount of produce.
And who designs, builds, operates and maintains machines?

Are you saying that more value is inherent in the machines that were built 100 years ago by a lot more hands-on labour then today? Most machines are built by machines, with very few human operators in modern times. They are able to build structures much faster, more efficiently, cheaper and with much less use of human labour. Yet according to your ltv, the resulting commodity must be less valuable. Seems there is a kink in this theory.

No, it adds production cost. At the end of the day it is the marketability that gives it value.
Again, why are you so sure that it's the marketability rather than the labour embodied in the commodity which gives it value?

Like Hoppe said, you are only looking at the supply side. Without demand, the commodity is worthless, despite the production costs of the labourer.

When businesses cut production costs it does not mean that they lose value in the form of human labour. In fact, this often makes the business more valuable, if the cost cutting was because of innovation (ie. if they use a tractor instead of 20 human workers or they find a better way of producing things).

Value is subjectively determined. The employee offers a service to the employer and usually the employer sets the cost of this service.
And the amount the employer pays is usualy less than the amount of value which the emplyee produces for the employer.

But employees don't actually produce value that is somehow magically embodied in a product/service. The value of an employee is the service they give to the employer, which is valuable enough to him/her that they are willing to pay for it. The actual value of the material costs of the good or service is what the employer already paid for, with his/her investment into the inventory for the business.

Say, if the worker simply pours milkshakes that does not give the product extra value. The production value or price comes from the ice cream, milk, cup, straw, flavouring, etc that the owner paid for already. The only value that the employee provides is the service, which is paid for by mutual agreement between the employee and employer.

The employee does not have to accept this price, but if his skill is limited and he/she is not very marketable then they may accept.
The employee does have to accept the price, at least if they want a job, becuase no employer would pay their staff what they are actualy otherwise the company would not make a profit. The employer has the capital and holds all the cards.

And who is decide what they are 'actually worth'? I have already addressed this.

As I said, value is determined subjectively. You may value 'Das Kapital' more then me, for example.
And so if you went into a bookshop you would get it cheaper? I don't think so.

I simply would not buy it. So my price for Das Kapital is $0.00. Luckily for the sellers of Das Kapital, the total market price of the sum of individual willingness to pay curves does not average $0.00, otherwise there would be no incentive to sell Das Kapital. Then again an old copy of Das Kapital may be worth more then a recent copy, which is because of product differentiation which I won't go into now.

That's a shame because without markets people would have to produce everything themselves which would be very difficult and would mean a life of very basic means. No, they just wouldn't be able to place commodities into exchange relationships, this doesn't mean they have to produce everything themselves.

Exchange is based on human want and need. How do you fulfill human want and need without exchange? The only other way is through a Government monopoly on force stopping exchange and allocating production.

Well in order to abolish wages, you would need to enforce it. Otherwise how could it happen? If you abolish wages you have an incentive problem, too.
You wouldn't need to enforece it. There would be no currency so it wouldn't be possible to pay people in money. You're probably thinking they could be paid in commodities, say bread, but why would they work for bread when they can get it for free from the bakery?

Why would the baker give you free bread if their is a cost in producing the bread, and that cost is uncompensated. It is the same thing as working for nothing, like slavery. Or do you propose some kind of exchange relationship to compensate the baker?

How do wages offer an incentive? You get paid the same amount per week wether you work hard or not.

Wages may not offer an incentive to work harder, but most people will only work if they are paid for doing so.

It seems your definition of exploitation is different from mine. If i pay you £5 to bake me a cake then sell it for £6 am i not exploiting you?

Well if an employee earns 5 pounds per cake whilst the owner (who paid for all of the ingredients of the cake) only earns 1 pound then I would say it is the other way around.

Nyder

29th April 2004, 05:51

The tradgedy of the commons occurred before capitalism existed. Capitalism must first exist in order for communism to exist. It's an irrelivant example. I could bring up several examples from the ancient world of how communalism was effectively put into practice.

The tragedy of the commons has always existed, even with capitalism. It is an economic problem that is far more prevalent under communism because there is no private property.

Nyder

29th April 2004, 06:01

And, if you guys are so knowledgeable about economics, tell me, what does create exchange-value if not human labour?

Exchange value is based on markets. First there must be demand for a good, otherwise it will not be produced. Production costs add value which is passed on to the consumer, to compensate the producers. Mark-up is added at varying percentages depending on the product/service and competition. Mark-up is merely a way of getting a return on investment. But value always rests on the consumer. Competitors know this which is why they lower prices, and is why businesses prefer monopolies, so that they can receive more profit.

Labour is a service performed for a business, just like how a business performs a service for its customer. The value always consists of the demand side.

For production costs, value actually increases when productivity increases. This is due to innovation, not an increase in human labour. A business with high production costs will be much less value in favour of innovative competition. Technological innovation pretty much destroys your ltv.

STI

29th April 2004, 15:11

Originally posted by [email protected] 29 2004, 05:51 AM

The tradgedy of the commons occurred before capitalism existed. Capitalism must first exist in order for communism to exist. It's an irrelivant example. I could bring up several examples from the ancient world of how communalism was effectively put into practice.

The tragedy of the commons has always existed, even with capitalism. It is an economic problem that is far more prevalent under communism because there is no private property.
Cum Hoc Ergo Propter Hoc. You're assuming that, just because the tradgedy of the commons happened in a communal system, such a problem is necessarily linked to communal systems (a logical fallacy.)

It's funny how, when you cut through the nonsense, conservatives really don't use logic, as they claim to.

Exchange value is based on markets. First there must be demand for a good, otherwise it will not be produced. Production costs add value which is passed on to the consumer, to compensate the producers. Mark-up is added at varying percentages depending on the product/service and competition. Mark-up is merely a way of getting a return on investment. But value always rests on the consumer. Competitors know this which is why they lower prices, and is why businesses prefer monopolies, so that they can receive more profit.

There's a difference between price and value. Some commodities are simply sold for more or less than their exchange value (the point of this whole thing is that labour is sold for less than its value).

You're right in saying that there must be a demand for a commodity. Demand implies that the commodity satisfies a need, and hence has a use-value. Nothing can have an exchange-value without having a use-value.

What are "production costs"? They are:
a)Labour
b)Raw materials, which are the result of labour
c)Electricity, etc, also the result of labour
and
d)Taxes

Labour is a service performed for a business, just like how a business performs a service for its customer. The value always consists of the demand side.

While labour is a commodity (I'm referring to both goods and services as 'commodities'), you're not differentiating between use-value and exchange-value. As explained above, demand implies the existence of a use-value. If the commodity had no use-value, it would have no exchange-value (for example, the car that was smashed up). If there was no demand for labour at a given time, it would be because labour would not satisfy a use-value at said time. Nobody would pay for anything which doesn't have a use-value to them, ergo the labour would not have any exchange-value.

For production costs, value actually increases when productivity increases. This is due to innovation, not an increase in human labour. A business with high production costs will be much less value in favour of innovative competition. Technological innovation pretty much destroys your ltv.

The value of the commodities produced by the company does not increase. The value of the company may increase, because more commodities are being produced and sold, but the commodities themselves do not increase in value.

I gave you a plausible explanation that you didn't answer. The diver requires compressed air, and that is why it has value. Compressed air by itself is nothing, without the need for it.

'Compressed' air is the result of human labour (human labour is required for the compression). 'Regular' air (the stuff you're breathing right now) has no exchange-value, as it occurs naturally and without human labour.

Marx also said: "This property of a commodity is independent of the amount of labour required to appropriate its useful qualities." So if a commodity has no use value, then it must have no value at all, despite the labour put into it. This makes common sense, because how can a commodity have value if it is not an item that is needed or wanted? However, I'm not too sure how Marx would define 'use value' and who determines 'use value'.

A commodity has a use-value if it "satisfies a need" which springs up "either from the stomach or from the fancy". Basically, if somebody wants it, they want it because it is of some use to them. If it is of some use to them, the commodity has a use-value. Exchane-value implies use-value, but use-value does not imply exchange-value.

You are just trashing my example. Potential is not value. I may have the potential to be a billionaire, but that does not mean I am worth a billion dollars. Every sperm has the potential to become a human being, etc. Potential is not a useful measure of value at all.

The potential is in itself a use-value. As I said above, use-value does not imply exchange-value. A rock wouldn't have exchange-value if you found it in the forest. There wouldn't be any human labour embodied in it.

Are you saying that more value is inherent in the machines that were built 100 years ago by a lot more hands-on labour then today? Most machines are built by machines, with very few human operators in modern times. They are able to build structures much faster, more efficiently, cheaper and with much less use of human labour. Yet according to your ltv, the resulting commodity must be less valuable. Seems there is a kink in this theory.

Yes, more exchange-value. That's why fewer people had cars before, say, 1950 than today. More labour was required to create the car before 1950, and therefore, there was a higher exchange-value.

The machines of today have a higher use-value, but a high use-value does not imply a high exchange-value (or any at all, for that matter).

Like Hoppe said, you are only looking at the supply side. Without demand, the commodity is worthless, despite the production costs of the labourer

You're right. A commodity is valueless without a demand because it has no use-value. This is all part of Marx's theory. You'd do well to actualyl read it.

When businesses cut production costs it does not mean that they lose value in the form of human labour. In fact, this often makes the business more valuable, if the cost cutting was because of innovation (ie. if they use a tractor instead of 20 human workers or they find a better way of producing things).

The business is more valueable, but not the commodities. You're not attacking the actual LTV, just your incomplete knowledge of it.

Say, if the worker simply pours milkshakes that does not give the product extra value. The production value or price comes from the ice cream, milk, cup, straw, flavouring, etc that the owner paid for already. The only value that the employee provides is the service, which is paid for by mutual agreement between the employee and employer.

An unpoured milkshake has a higher exchange-value than an unpoured milkshake. Even you could figure this out.

And who is decide what they are 'actually worth'? I have already addressed this.

Well, by 'worth', do you mean 'use-value' or 'exchange-value'?

simply would not buy it. So my price for Das Kapital is $0.00. Luckily for the sellers of Das Kapital, the total market price of the sum of individual willingness to pay curves does not average $0.00, otherwise there would be no incentive to sell Das Kapital. Then again an old copy of Das Kapital may be worth more then a recent copy, which is because of product differentiation which I won't go into now.

It has no exchane-value to you because it has not use-value to you. No use-value implies no exchange-value. Maybe you should consider picking up a copy of the book (and paying for it...or not. That's none of my business) and actually reading the LTV. About 90% of your points wouldn't even have to be brought up if you actually knew the LTV.

Exchange is based on human want and need. How do you fulfill human want and need without exchange? The only other way is through a Government monopoly on force stopping exchange and allocating production.

You're right , exchange is based on want and need. If something is wanted or needed, it has a use-value. The exchange-value is a totally seperate measure (a concept you seem to have trouble understanding).

Why would the baker give you free bread if their is a cost in producing the bread, and that cost is uncompensated. It is the same thing as working for nothing, like slavery. Or do you propose some kind of exchange relationship to compensate the baker?

The baker would also have access to the butcher shop, who would have access to the food 'store', and on, and on, and on.

Wages may not offer an incentive to work harder, but most people will only work if they are paid for doing so.

Under capitalism, yes, people will only work for wages (barring volunteer work). Under communism, though, economic organizaton would be fundamentally changed (but you never seem to want to listen to how it would work, so I won't even bother explaining how it might be organized).

Well if an employee earns 5 pounds per cake whilst the owner (who paid for all of the ingredients of the cake) only earns 1 pound then I would say it is the other way around.

That whole thing was a bad analogy. If the owner paid for the raw materials, which added up to $1 (i don't have the 'pound' key, sorry), paid the worker $5 for making the cake, then sold it for $7, he's exploiting the worker. This is on a screwy scale compared to actual exploitation, but the idea is the same.

Misodoctakleidist

29th April 2004, 16:36

Originally posted by [email protected] 29 2004, 05:46 AM
Ok, Misodoctakleidist, I will respond to your last two posts. I wasn't ignoring you was just trying to address the points which I felt were more pressing.

Actually you only responded to one of them.

I gave you a plausible explanation that you didn't answer. The diver requires compressed air, and that is why it has value. Compressed air by itself is nothing, without the need for it.
You are trying to 'debunk' labour value theory, you offered the air example as something which couldn't be explained by lvt, i proved otherwise.

I've already explained to you that things without a use value have no exchange value, why do keep ignoring that?

Marx also said: "This property of a commodity is independent of the amount of labour required to appropriate its useful qualities." So if a commodity has no use value, then it must have no value at all, despite the labour put into it. This makes common sense, because how can a commodity have value if it is not an item that is needed or wanted? However, I'm not too sure how Marx would define 'use value' and who determines 'use value'.

Use-value is a value a commodity has if it is of utility, so you agree?

You are just trashing my example. Potential is not value. I may have the potential to be a billionaire, but that does not mean I am worth a billion dollars. Every sperm has the potential to become a human being, etc. Potential is not a useful measure of value at all.
Because your example is trash, your life isn't a commodity.

Are you saying that more value is inherent in the machines that were built 100 years ago by a lot more hands-on labour then today? Most machines are built by machines, with very few human operators in modern times. They are able to build structures much faster, more efficiently, cheaper and with much less use of human labour. Yet according to your ltv, the resulting commodity must be less valuable. Seems there is a kink in this theory.
So you did ignore my second post. Value is determined by the human labour expended socialy with the average amount of skill and technology prevailent at the time (this very second, not the time of production).

Like Hoppe said, you are only looking at the supply side. Without demand, the commodity is worthless, despite the production costs of the labourer.
I think you should be able to guess my response to this by now.

When businesses cut production costs it does not mean that they lose value in the form of human labour. In fact, this often makes the business more valuable, if the cost cutting was because of innovation (ie. if they use a tractor instead of 20 human workers or they find a better way of producing things).
This gives them a great advantage is the short term if they are the only company with such efficient production methods because they are producing commodies with less human labor than is expended socially. Consequently the value of the business will increase but inevitably the value of the commodities it, and all it's competitors, produces will decrease.

But employees don't actually produce value that is somehow magically embodied in a product/service.
That is what we're debating, you can't use it as an argument. That's like saying "god doesn't exist becuase he doesn't"

The value of an employee is the service they give to the employer, which is valuable enough to him/her that they are willing to pay for it. The actual value of the material costs of the good or service is what the employer already paid for, with his/her investment into the inventory for the business.
You mean other commodities, which are produced by human labour? Are you saying that commodities are capable of coming into existence without the expenditure of human labour?

Say, if the worker simply pours milkshakes that does not give the product extra value. Yes it does, why do you think it's cheaper to buy milkshake from a shop and pour it yourself?

The production value or price comes from the ice cream, milk, cup, straw, flavouring, etc that the owner paid for already.
And do ice cream, milk, cups, straws and flavouring just appear without the expenditure of human labour?

The only value that the employee provides is the service, which is paid for by mutual agreement between the employee and employer.
How it's paid for is irrelivent, were discussing what value it adds to the commodity.

And who is decide what they are 'actually worth'? I have already addressed this.
That's why were having this discussion, it is possible for an employer to pay an employee less than they are worth so saying talking about wages is irrelivent.

I simply would not buy it. So my price for Das Kapital is $0.00. Luckily for the sellers of Das Kapital, the total market price of the sum of individual willingness to pay curves does not average $0.00, otherwise there would be no incentive to sell Das Kapital.
So how does this disprove that it is the human labour expended in creating a copy of Das Kapital which gives it it's value.

Exchange is based on human want and need. How do you fulfill human want and need without exchange?
It's possible to satisfy a want or a need without exchange, i could give you a bowl of ice cream without having to exchange anything.

Why would the baker give you free bread if their is a cost in producing the bread, and that cost is uncompensated.
There isn't, you seem to be forgetting that there are no exchange relationships

It is the same thing as working for nothing, like slavery.
No it isn't, slavery is forced labour, do you think volunteers are slaves?

Or do you propose some kind of exchange relationship to compensate the baker?
No, he is compensated by the fact that he is allowed to participate in society.

Wages may not offer an incentive to work harder, but most people will only work if they are paid for doing so.
I can think of plety of people who work without being payed; volunteers, slaves, business owners. People work is they see a reason to, monatary reward is only one possible reason.

Well if an employee earns 5 pounds per cake whilst the owner (who paid for all of the ingredients of the cake) only earns 1 pound then I would say it is the other way around.
I was presuming that you made the ingredients too

Nyder, you said you were going to disprove labour theory of value but so far you're argument has been; "it's not true because X is true" or "It's not true becuase it's wrong." Please start "Debunking the Labour Theory of Value."

And please don't continue in this fashion, what you have said so far is akin to "Jahova isn't god becuase Allah is."

Osman Ghazi

29th April 2004, 19:25

QUOTE
For production costs, value actually increases when productivity increases. This is due to innovation, not an increase in human labour. A business with high production costs will be much less value in favour of innovative competition. Technological innovation pretty much destroys your ltv.

The value of the commodities produced by the company does not increase. The value of the company may increase, because more commodities are being produced and sold, but the commodities themselves do not increase in value.

A question. If a machine is created that can increase the productivity of a worker, does the extra productivity count as extra labour?

Nyder

1st May 2004, 06:06

Originally posted by [email protected] 29 2004, 03:11 PM

Cum Hoc Ergo Propter Hoc. You're assuming that, just because the tradgedy of the commons happened in a communal system, such a problem is necessarily linked to communal systems (a logical fallacy.)

Obviously you don't yet understand what the tragedy of the commons is. As I explained, it relates to the use of collectively owned resources. Coupled with the Prisoner's Dilemma, it creates a situation of constant diminishing returns.

For example, if everyone collectively owns a rice paddock, they have two options; they can either share it or use up the land as much as they can for their own benefit. The Prisoner's Dilemma says that because there is always the risk of someone else taking more then the others, everyone will try and maximise the output by overusing the resource, since the cost of doing so is less then the benefit derived from using it up (since the costs are shared collectively).

Of course if everyone shares they will each get an equal amount, but an individual will only maximise his/her returns by defecting from the group.

With private property there is no tragedy of the commons, as the cost of using the resource is directly impacted on the owner, thus the owner maximises returns by efficient use of the resource.

There's a difference between price and value. Some commodities are simply sold for more or less than their exchange value (the point of this whole thing is that labour is sold for less than its value).

So how does Marx derive exchange value? And how can I talk about the ltv without prices, because ultimately you want the ltv to translate into a price that must be paid to the worker (according to your theory).

You're right in saying that there must be a demand for a commodity. Demand implies that the commodity satisfies a need, and hence has a use-value. Nothing can have an exchange-value without having a use-value.

You can't change 'use value' into prices. That's why it's better to measure it with 'demand' (consumer's willingness to pay at price and quantity level). Ultimately, everything is measured in prices and quantities, not values.

What are "production costs"? They are:
a)Labour
b)Raw materials, which are the result of labour
c)Electricity, etc, also the result of labour
and
d)Taxes

Labour - in various quantities. Of course depending on the type of labour, you can't always reach a definitive value. For example, a security guard may perform patrol duties at $20 per hour, but the value he provides of deterring thieves may be incalculable as it just eliminates a percentage of risk. Though that may save the company X amount of dollars each year, are you assuming that according to ltv, this money then must be transferred to the security guard's pay? Or are you assuming that the ltv is only attributable to profits and not other factors like loss recovery or savings of the business?

Raw materials - the result of a quantity of human labour, perhaps with varying capital intensity and the use of physical capital (like machines). Now, are you attributing labour ownership over this commodity because of the labour value added, thus a share of the profits that this incurs? Again, what are you going to do to determine this? Who is to say the exact value (in price) that the labourer adds to the final product? How do you measure this mathematically? And are you implying that the labourer of the raw materials must forego his/her wage in order to see if the capitalist makes a profit on the product that the raw materials went into?

Electricity - ha ha. So if the labour was performed 50 years ago to install the electrical wiring, the capitalist has to keep paying for it?

Taxes - very good, but I can add more: rent, interest payments, loan repayments, government overheads, insurance, marketing...

While labour is a commodity (I'm referring to both goods and services as 'commodities'), you're not differentiating between use-value and exchange-value. As explained above, demand implies the existence of a use-value. If the commodity had no use-value, it would have no exchange-value (for example, the car that was smashed up). If there was no demand for labour at a given time, it would be because labour would not satisfy a use-value at said time. Nobody would pay for anything which doesn't have a use-value to them, ergo the labour would not have any exchange-value.

So you are saying that use value is the equivalent of demand. That is incorrect, because technically demand is the willingness to pay curve at each given price and quantity. Also, you seem to be suggesting that if a capitalist mis-calculates demand, he does not have to pay his workers because it has no 'exchange value'. That is definitely exploitation, and the reason why people don't operate according to the ltv is because they would rather not invest their labour in a risky venture that carries uncertain returns.

The value of the commodities produced by the company does not increase. The value of the company may increase, because more commodities are being produced and sold, but the commodities themselves do not increase in value.

In a competitive market, the value of commodities would decrease because the cost would be too high for consumers in the face of alternatives. No one would buy the product, hence the capitalist goes into bankruptcy. Considering this, in a competitive market the price of the commodity would most likely decrease, which of course is to sell more and hence gain more revenue. Thus the returns and therefore profit would increase.

Exchane-value implies use-value, but use-value does not imply exchange-value.

That is because this definition ignores the reality of how markets operate.

Yes, more exchange-value. That's why fewer people had cars before, say, 1950 than today. More labour was required to create the car before 1950, and therefore, there was a higher exchange-value.

Again you are ignoring what happens in markets. What if there was only one firm producing cars?

An unpoured milkshake has a higher exchange-value than an unpoured milkshake. Even you could figure this out.

Ok, but how would I determine what the price is of the value added to the milkshake by this service?

The baker would also have access to the butcher shop, who would have access to the food 'store', and on, and on, and on.

So it just a free for all (ie. everything is free for the taking)?

That whole thing was a bad analogy. If the owner paid for the raw materials, which added up to $1 (i don't have the 'pound' key, sorry), paid the worker $5 for making the cake, then sold it for $7, he's exploiting the worker. This is on a screwy scale compared to actual exploitation, but the idea is the same.

So the net profit for the owner is $1....

Try again..

Nyder

1st May 2004, 06:09

Originally posted by Osman [email protected] 29 2004, 07:25 PM
A question. If a machine is created that can increase the productivity of a worker, does the extra productivity count as extra labour?
Obviously not.

Ha! You just hammered another nail in the coffin of the ltv. Thank you very much!

Shredder

1st May 2004, 06:45

I don't know why I'm doing this because I'd be perfectly content to see this thread die and take the LTV with it. But here goes:

A question. If a machine is created that can increase the productivity of a worker, does the extra productivity count as extra labour?

Maybe I'm misunderstanding something, but the wording on the question makes it bogus. Let me explain:

If two competing capitalists buy from a 3rd capitalist this labor-saving machine, then neither capitalist can exploit the machine. The two capitalists will drive eachother's profits down.

I don't know what this 'extra labor' stuff in the quote is about. Obviously, the machine saves labor by definition. If demand is high enough, the capitalists will cut eachother's prices and produce more. If demand is already being met, they will need to cut labor because they now need less of it to produce the same amount.

Maynard

1st May 2004, 07:37

If the LTV is such a good theory then why is there no economist in this world who still believes in it? They're either following Menger or Walras
Paul Sweezy is another, in fact there are many Marxian economists out there. Not all subscribe to the theory who unfortunatly died two months ago did "It was a long hard struggle to overcome the traditions and inhibitions of a neoclassical training.... It took me a long, long time before I could accept the Marxist labor value theory because I was totally accustomed to the type of thinking of marginal utility price theory, and so on. And ... for a long time, I couldn’t see how there could be another kind of value theory with totally different purposes.”

I'll just offer this study for viewing
http://www.reality.gn.apc.org/econ/DZ_article1.pdf
which provides more evidence than I could.
http://www.wfu.edu/%7Ecottrell/wpc_ac/wpc_ac.html
http://www.reality.gn.apc.org/econ/vectorspaces.pdf
http://www.dcs.gla.ac.uk/~wpc/reports/profit.pdf

STI

1st May 2004, 18:27

Obviously you don't yet understand what the tragedy of the commons is. As I explained, it relates to the use of collectively owned resources. Coupled with the Prisoner's Dilemma, it creates a situation of constant diminishing returns.

In an eat-or-be-eaten world, you're right. People will likely fuck each other over for personal gain. That's what must happen in class society. Capitalists do it to each other all the time. I understand what the tragedy of the commons is, btw.

For example, if everyone collectively owns a rice paddock, they have two options; they can either share it or use up the land as much as they can for their own benefit. The Prisoner's Dilemma says that because there is always the risk of someone else taking more then the others, everyone will try and maximise the output by overusing the resource, since the cost of doing so is less then the benefit derived from using it up (since the costs are shared collectively).

If resources are too scarce, they'll overexploit the land. If not (and resources wouldn't be too scarce in communism), they wouldn't. People, now especially, have more foresight into environmental issues than they did in the middle ages. Will the one prisoner fuck the other over because of nature, or material conditions?

With private property there is no tragedy of the commons, as the cost of using the resource is directly impacted on the owner, thus the owner maximises returns by efficient use of the resource

I think history will prove that true communist societies are better with the environment and resources than the wasteful capitalists. After all, how often do you see communists dumping grain into the ocean to keep prices up?

So how does Marx derive exchange value? And how can I talk about the ltv without prices, because ultimately you want the ltv to translate into a price that must be paid to the worker (according to your theory).

Exchange value comes from human labour. Prices and value are seperate. Commodities are often sold for either less or more than their exchange value. On average, though, it's about even.

Also, the LTV isn't a microeconomic theory. It doesn't seek to explain why the price of cotton went up $0.01/pound yesterday.

You can't change 'use value' into prices. That's why it's better to measure it with 'demand' (consumer's willingness to pay at price and quantity level). Ultimately, everything is measured in prices and quantities, not values.

You're absolutely right, use value does not equal price. Demand goes up and down, and effects price, not value. The point is that sometimes commodities are sold for more than their value, sometimes less. The point of the LTV is to show how human labour creates value. You're just bringing up irrelivant nonsense because you don't know enough about it.

Honestly, though. You should read the LTV, not just about the LTV. It may increase your understanding, and hell, maybe even your ability to argue it.

Electricity - ha ha. So if the labour was performed 50 years ago to install the electrical wiring, the capitalist has to keep paying for it?

He has to keep paying for electricity. Duh.

Taxes - very good, but I can add more: rent, interest payments, loan repayments, government overheads, insurance, marketing...

Those are all essentially production costs.

So you are saying that use value is the equivalent of demand. That is incorrect, because technically demand is the willingness to pay curve at each given price and quantity. Also, you seem to be suggesting that if a capitalist mis-calculates demand, he does not have to pay his workers because it has no 'exchange value'. That is definitely exploitation, and the reason why people don't operate according to the ltv is because they would rather not invest their labour in a risky venture that carries uncertain returns.

No, I'm not saying that. I'm saying that no demand for a commodity means that it has no use-value at the given moment. I'm not saying that, as the demand goes up, so does the use value.

Again you are ignoring what happens in markets. What if there was only one firm producing cars?

Then that one firm would end up selling cars for more than their value. What's your point?

Ok, but how would I determine what the price is of the value added to the milkshake by this service?

Again, you're not differentiating between 'price' and 'value'. The price will be whatever the seller and the buyer agree on. The value will be determined by the amount of labour embodied in the poured milkshake.

So it just a free for all (ie. everything is free for the taking)?

Essentially, yes. But the mentality of people would be different. There wouldn't be any exchange, so there wouldn't be any point in stockpiling a warehouse full of steaks. The steaks would go bad and be of no use to anybody. Of course, common sense would come into effect. If people started to notice that, say, I was taking WAY more steak than I could POSSIBLY eat, they'd say, "Hey, buddy. Take it easy".

So the net profit for the owner is $1....

Try again..

Well, I suppose I can't expect you to read my post. Oh well. I said, right in the fucking post that, 'the proportions are screwy'. This was because I was very rushed and didn't have the time to put it into any reasonable proportion. Here's Engles' explaination of it:

Let us assume that our worker - a machinist - has to make a part of a machine which he can complete in one day. The raw material - iron and brass in the necessary previously prepared form - costs, twenty marks. The consumption of coal by the steam-engine, the wear and tear of this same engine, of the lathe and other tools which our worker uses, represent for one day, and reckoned by his share of their use, a value of one mark. [my insert: We're at 21 marks now]. The wage for one day, according to our assumption, is three marks. [24 marks]. This makes twenty-four marks in all for our machine part. But the capitalist calculates that he will obtain, on an average, twenty-seven marks from his customers in return, or three marks more than his outlay.

Whence came the three marks pocketted by the capitalist? According to the assertion of classical economics, commodities are, on the average, sold at their values, that is, at prices corresponding to the amount of necessary labour contained in them [my edit: on average, the commodities are. Minor fluctuations are not the issue here]. The average price of our machine part - twenty-seven marks - would thus be equal to its value, that is the labour embodied in it. But of these twenty-seven marks, twenty-one marks were values already present before our machinist began work. Twenty marks were contained in the raw materials, one mark in the coal consumed during the work, or in the machines or tools which were used in the process and which were diminished in their efficiency to the value of this sum. There remain six marks which have been added to the value of the raw material. But according to the assumpion of our economists themselves, these six marks can only arise from the labour added to the raw material by our worker. His twelve hours' labour has thus created a new value of six marks. The value ofhis twelve hours' labour would, therefore, be equal to six marks. And thereby we would at last have discovered what the "value of labour" is.

-Engles, Wage-Labour and Capital.

Honestly, I'll say it again. Read the fucking LTV for yourselves. Don't just read about it. Read the fuggen thing and learn what it actually says.

Osman Ghazi

1st May 2004, 18:57

Nyder, the tragedy of the commons doesn't even make sense in a communist society because, altough the land was communally owned, the sheep were privately owned. In communism, your incentive wouldn't be to increase your herd at the expense of everyone elses because that would be to your detriment rather than benefit. It actually doesn't relate to communism at all, just some mixed economies.

Nyder

2nd May 2004, 07:35

Socialist Tiger,

If you think you are such an expert on the ltv then how come you've never mentioned the transformation problem?

In other words; how do you translate 'value' into 'price'? You can't simply say that labour adds X amount of dollars into the product's final price. How is this determined? Especially considering the intensity of labour can be different even for the same product - because of how the capital is managed, different production processes and technology.

'Value' is an abstract and subjective term. It has no real measure outside of prices so cannot be considered as a scientific concept.

Also you forget one critical thing: if the capitalist can make a profit on the sale of a good, he can also make a loss. Should the employee bear the burden of that loss, as is stipulated in the ltv? Rather, the employee would rather have a 'guaranteed wage' then bargain on the profitability of the good.

And as for exploitation - if the worker is not happy with his/her wage, is it not possible for him/her to seek another job? In a capitalist society with free markets(therefore no barriers to entry caused by Government), there would be more competition among employers (hence driving up the wage). And if you cannot claim that the capitalist 'steals' the employee's surplus value (which, if it exists, arised from the arrangement of capital to production by the capitalist), then how do you justify your claims of exploitation?

At the end of the day it is negotiated prices which tend to work better then some meaningless discussion of values.

Nyder

2nd May 2004, 07:48

Originally posted by Osman [email protected] 1 2004, 06:57 PM
Nyder, the tragedy of the commons doesn't even make sense in a communist society because, altough the land was communally owned, the sheep were privately owned. In communism, your incentive wouldn't be to increase your herd at the expense of everyone elses because that would be to your detriment rather than benefit. It actually doesn't relate to communism at all, just some mixed economies.
I didn't say the sheep would be privately owned. But someone's going to have graze the sheep.

And isn't it funny how you make sweeping statements like "increasing the herd would be to your detriment". How is that so, and what will stop it from happening? It's like saying that if you gave a bunch of kids a bowl of smarties that they would all share it equally, because they would.

Face it, over 50% of the 'credibility' of communism comes from gross assumptions about human behaviour. Statements like: "They will share" or "no one will be self-interested" - YEAH RIGHT!!!

Misodoctakleidist

2nd May 2004, 07:56

Socialist Tiger,

If you think you are such an expert on the ltv then how come you've never mentioned the transformation problem?

So you've give up your previous line of argument?

In other words; how do you translate 'value' into 'price'? You can't simply say that labour adds X amount of dollars into the product's final price. How is this determined? Especially considering the intensity of labour can be different even for the same product - because of how the capital is managed, different production processes and technology.

Value is roughly the same as price although there can be variance for instance; if one business has more efficient production methods those generally prevalent then they can afford to sell for less than the value.

'Value' is an abstract and subjective term. It has no real measure outside of prices so cannot be considered as a scientific concept.

It's not subjective, you're the one whose been trying to argue that it's subjective; "value is whatever people think it's worth blah blah blah"

Also you forget one critical thing: if the capitalist can make a profit on the sale of a good, he can also make a loss. Should the employee bear the burden of that loss, as is stipulated in the ltv? Rather, the employee would rather have a 'guaranteed wage' then bargain on the profitability of the good.

That doesn't change what created the value.

If he shared all the proceeds amongst the employees involved in the creation of the commodity, how could they possibly make a loss?

And as for exploitation - if the worker is not happy with his/her wage, is it not possible for him/her to seek another job?

Nyder, let me explain something to you. If you're a coal miner in an area where there a three coal mines and you aren't happy with your wages then all you can do is go and work for one of the other mines for the same wage. None of the mines would be able to offer higher wages because they would have to rise their prices and would be destroyed by the competition. The mines wouldn't "compete for labour," if their employee don't want their wages then the mine would employ one of the unemployed people desperate for a job and willing to take whatever they can get.

In a capitalist society with free markets(therefore no barriers to entry caused by Government), there would be more competition among employers (hence driving up the wage).

Are you delusional? There'd be competition amongst employees. With no welfare sate the unemployed would be starving to death and willing to take any wage high enough to prolong their lives with, if other people don't accept such a wage then there are no shortage of people who will.

And if you cannot claim that the capitalist 'steals' the employee's surplus value (which, if it exists, arised from the arrangement of capital to production by the capitalist), then how do you justify your claims of exploitation?

Just because an employee accepts a wage that doesn't mean it's fair or even that they think it's fair.

At the end of the day it is negotiated prices which tend to work better then some meaningless discussion of values.

How many times do i have to explain to you, just because a worker is paid £X that doesn't mean they contributed £X to the value of the commodity, we're discussion wage policies, we're discussing value.

Misodoctakleidist

2nd May 2004, 08:00

Originally posted by [email protected] 2 2004, 07:48 AM
I didn't say the sheep would be privately owned. But someone's going to have graze the sheep.

And isn't it funny how you make sweeping statements like "increasing the herd would be to your detriment". How is that so, and what will stop it from happening? It's like saying that if you gave a bunch of kids a bowl of smarties that they would all share it equally, because they would.

Face it, over 50% of the 'credibility' of communism comes from gross assumptions about human behaviour. Statements like: "They will share" or "no one will be self-interested" - YEAH RIGHT!!!
So imagine you're a shepherd in a communist society, you look after the sheep when their alive, you take then to the slaughter house when they need to be killed. You graze your sheep on the common, why the hell would you want to overgraze? You would get absolutely nothing out of it, you may even cause a shortage of lamb so you wouldn't be able to eat it.

Osman Ghazi

2nd May 2004, 12:49

And isn't it funny how you make sweeping statements like "increasing the herd would be to your detriment". How is that so, and what will stop it from happening? It's like saying that if you gave a bunch of kids a bowl of smarties that they would all share it equally, because they would.

You know what I think is funny Nyder? How you quoted something I never even said. What I said was "your incentive wouldn't be to increase your herd at the expense of everyone elses because that would be to your detriment". The thing is that they would gain absolutley no advantage from having more sheep than the other sheppards because they wouldn't get any material benefit from it. So why would you overgraze for no reason? It actually isn't at all like the smarties example because the sheppard cannot simply eat his entire herd.

STI

3rd May 2004, 20:18

Socialist Tiger,

If you think you are such an expert on the ltv then how come you've never mentioned the transformation problem?

I've never claimed to be an expert on the LTV. In fact, if you look back through the thread, I believe you'll find me saying that I don't know all that much about it.

In other words; how do you translate 'value' into 'price'? You can't simply say that labour adds X amount of dollars into the product's final price. How is this determined? Especially considering the intensity of labour can be different even for the same product - because of how the capital is managed, different production processes and technology

Value does not always transfer directly into price. Price is essentially the result of four factors:
1)The value the commodity in relation to the value of the given curency.
2)The competition between sellers and sellers. The more sellers there are, the more they will cut prices in order to sell their commodities
3)The competition between buyers and buyers. The more buyers, the higher they'll pay to get a given commodity as opposed to the other buyer
4)The competition between buyer and seller. The buyer wants to pay less, while the seller wants the price to be higher (for obvious reasons).

Marx talked about all these things. You're not proving him wrong in any way, especially by attacking me.

Also you forget one critical thing: if the capitalist can make a profit on the sale of a good, he can also make a loss. Should the employee bear the burden of that loss, as is stipulated in the ltv? Rather, the employee would rather have a 'guaranteed wage' then bargain on the profitability of the good.

If a commodity is sold for a loss, then a part of the labour embodied in it is socially unnecessary.

And as for exploitation - if the worker is not happy with his/her wage, is it not possible for him/her to seek another job? In a capitalist society with free markets(therefore no barriers to entry caused by Government), there would be more competition among employers (hence driving up the wage). And if you cannot claim that the capitalist 'steals' the employee's surplus value (which, if it exists, arised from the arrangement of capital to production by the capitalist), then how do you justify your claims of exploitation?

This is a debate for some other thread. This has nothing to do with the LTV and you know it.

Face it, over 50% of the 'credibility' of communism comes from gross assumptions about human behaviour. Statements like: "They will share" or "no one will be self-interested" - YEAH RIGHT!!!

Face it, 100% of the arguments against communism come from gross assumptions about human behavion. Statements like: "They will never share" or "People will only be self-interested". - YEAH RIGHT!!!

didn't say the sheep would be privately owned. But someone's going to have graze the sheep

In "The Tragedy of the Commons", the sheep were privately-owned.

Hoppe

3rd May 2004, 20:47

This is a debate for some other thread. This has nothing to do with the LTV and you know it

Of course it has. If the LTV isn't true how can you talk about exploitation? Or are you just going to change the terms like Marx did, that you have to see subsistence in a historical context?

Misodoctakleidist

4th May 2004, 15:58

Originally posted by [email protected] 3 2004, 08:47 PM
Of course it has. If the LTV isn't true how can you talk about exploitation? Or are you just going to change the terms like Marx did, that you have to see subsistence in a historical context?
No, it hasn't.

We're discussing whether they're exploited, not what they can do about it.

STI

4th May 2004, 22:41

Originally posted by [email protected] 3 2004, 08:47 PM

This is a debate for some other thread. This has nothing to do with the LTV and you know it

Of course it has. If the LTV isn't true how can you talk about exploitation? Or are you just going to change the terms like Marx did, that you have to see subsistence in a historical context?
It doesn't at all. X (the LTV) implies Y (Exploitation). You're trying to prove that X isn't true, and therefore Y is not (at least, that would be the purpose of debunking the LTV). You're trying to attack Y because you're unable to prove X untrue.

Vinny Rafarino

5th May 2004, 00:15

It's easy to attack the LTV when no one can say will all certaintly whether or not it will indeed work as it pertains to how value will be assessed to goods and services once the "market" is not available to assess value.

As Stalin found quite early in the game, the LTV cannot possible be applied to any economy that still must trade with countries that use the international market to assess value to thier products. He divised a simple plan (they call it market socialism today) to use the free market to set value on goods and services that will be traded internationally and domestically, the only question was "how do we divide the surplus value for these goods and services"?

His policies worked brilliantly and propelled the USSR into a stage of economic growth that has yet to be equalled.

The only works when applied to a completely communist society and can't actually be tested until that time. As comrade RS ponted out, more than likely the majority of the theory will be applicable while additions and possible corrections will need to be applied using modern more modern techniques.

What several capitalist economists like to say is that since the LTV cannot be applied in conjunction with capitalist economic policies, it simply cannot be true.

This is an obvious attack (not even a well thought out attack) on communism as a whole. What they will never admit is that the LTV was never designed to be used in conjunction with capitalism, and therefore their "predictions" are nothing more than hot air cooked up by those that truly benefit from capitalist policy.

Will it all work out in the end? I cannot be sure however I do know this, when the time actually comes to implement these policies, the choice to "try something new" will have already been made.

Hoppe

5th May 2004, 09:51

Originally posted by [email protected] 4 2004, 10:41 PM
It doesn't at all. X (the LTV) implies Y (Exploitation). You're trying to prove that X isn't true, and therefore Y is not (at least, that would be the purpose of debunking the LTV). You're trying to attack Y because you're unable to prove X untrue.
Let's go a different path.

Let's assume the LTV is correct. All goods exchange at the value of the required labour. Labour obtains as wages what is required to produce the labourer and so earns a subsistence wage. So if the value exceeds the subsistence cost of labour you have a surplus i.e. profit which is the rate of exploitation.

Yet how come that in a capitalist society wages rise (far above) the level of subsistence?
Marx himself admitted that the conditions for his view were "special", and that only under these conditons the price of labour is determined by the cost of subsistence. If the wage earner is chattel and he is under the delusion that he plays no other role in society, and if he has no other desires than feeding and proliferation. When do these conditions exist?

STI

5th May 2004, 13:16

Yet how come that in a capitalist society wages rise (far above) the level of subsistence?
Marx himself admitted that the conditions for his view were "special", and that only under these conditons the price of labour is determined by the cost of subsistence. If the wage earner is chattel and he is under the delusion that he plays no other role in society, and if he has no other desires than feeding and proliferation. When do these conditions exist?

These conditions are rarer today than in Marx's time, because of mass labour organization and mobilization. Capitalism has made some superficial concessions in an attempt to keep the working class happy.

And, even in the above statement, you're not arguing the LTV, which was the purpose of this thread. It has yet to be 'debunked' on this board (or anywhere, to my knowledge).

It's all basically a big red herring.

Hoppe

5th May 2004, 13:33

Originally posted by [email protected] 5 2004, 01:16 PM
These conditions are rarer today than in Marx's time, because of mass labour organization and mobilization. Capitalism has made some superficial concessions in an attempt to keep the working class happy.

And, even in the above statement, you're not arguing the LTV, which was the purpose of this thread. It has yet to be 'debunked' on this board (or anywhere, to my knowledge).

It's all basically a big red herring.
I wasn't the one starting this thread so complain to someone else.

But I thought you would come up with such a meaningless statement as "in Marx' time......". That's bs, because as you might know, critique on the LTV didn't come suddenly 100 years after his death. Of course the conditions weren't different. And how can "capitalism" make superficial concessions, is there a global conspiracy dictating markets and human behaviour?

I present you with another incosistency when Marx' reasoning is applied and you choose to ignore it, though it has everything to do with the LTV. Have you ever bothered to study the critiques or do you just "believe" it? You almost sound like a religious man whose life will be over if someone explains to him that logically a God cannot exist.

STI

5th May 2004, 13:48

I wasn't the one starting this thread so complain to someone else

I wasn't 'complaining'. I was pointing out that your statements don't serve to 'debunk' the LTV, which was the point of this thread.

But I thought you would come up with such a meaningless statement as "in Marx' time......". That's bs, because as you might know, critique on the LTV didn't come suddenly 100 years after his death. Of course the conditions weren't different. And how can "capitalism" make superficial concessions, is there a global conspiracy dictating markets and human behaviour?

Let's see some concessions which capitalism has made across the world:
1)Welfare
2)Public Universal Healthcare
3)Public Schools
4)Environmental restrictions
5)Labour and safety standards
6)Minimum Wage
...Need I go on?

I realize that the LTV has been criticized for quite some time, but that doesn't make anything any of the capitalists here have said any more valid.

I present you with another incosistency when Marx' reasoning is applied and you choose to ignore it, though it has everything to do with the LTV. Have you ever bothered to study the critiques or do you just "believe" it? You almost sound like a religious man whose life will be over if someone explains to him that logically a God cannot exist.

I am willing to accept criticism of the LTV and even abandon it if the criticism is valid enough. None of the criticisms here have 'debunked' the LTV and withstood the attacks of the LTVers here.

Hoppe

5th May 2004, 14:20

I wasn't 'complaining'. I was pointing out that your statements don't serve to 'debunk' the LTV, which was the point of this thread.

The fact that a lot of these inconsistencies are easy to point out, or the gross errors Marx has made (methodology for instance) must arouse some suspicion, doesn't it?

...Need I go on?

So because we have invented welfare, people now have other desires than during Marx life? Certainly you must see the absurdity of this statement yourself?

I realize that the LTV has been criticized for quite some time, but that doesn't make anything any of the capitalists here have said any more valid.

As far as I have read Nyder's comments, most are valid critiques of the LTV. What I don't understand is that some of you guys cannot accept that economic thinking didn't end after Marx his death.

STI

5th May 2004, 14:25

The fact that a lot of these inconsistencies are easy to point out, or the gross errors Marx has made (methodology for instance) must arouse some suspicion, doesn't it?

No. Any 'inconsitencies' in the LTV that any of you have 'pointed out' are due entirely to things about the LTV that either of you don't know.

So because we have invented welfare, people now have other desires than during Marx life? Certainly you must see the absurdity of this statement yourself?

I never said anybody had new desires. Welfare wasn't created by capitalism, either. You clearly get confused sometimes, methinks.

As far as I have read Nyder's comments, most are valid critiques of the LTV. What I don't understand is that some of you guys cannot accept that economic thinking didn't end after Marx his death

We never said Marx's death was the death of economic thinking. The final two volumes of Capital were printed after Marx's death. We just think the LTV is correct, you're just trying to misrepresent what we believe.

Hoppe

5th May 2004, 20:31

No. Any 'inconsitencies' in the LTV that any of you have 'pointed out' are due entirely to things about the LTV that either of you don't know.

Excuse me, have you ever taken the time to actually read the critiques on the LTV? Have you actually read what Menger, Jevons, Walras or Marshall had to say on this subject?

I never said anybody had new desires. Welfare wasn't created by capitalism, either. You clearly get confused sometimes, methinks.

Ehm, who was talking about concessions of capitalism? The "iron law" of wages is only applicable under the conditions I described. Then you come with some crazy ideas that these conditions were viable in Marx' time even if Marx himself admitted that they didn't exist. Who is confused now?

The final two volumes of Capital were printed after Marx's death. We just think the LTV is correct, you're just trying to misrepresent what we believe.

No I don't. I assume you have read the third part of Das Kapital, and if you've read carefully you would know that in this part Marx debunked the LTV himself.

STI

5th May 2004, 20:54

Excuse me, have you ever taken the time to actually read the critiques on the LTV? Have you actually read what Menger, Jevons, Walras or Marshall had to say on this subject?

No, i'm still reading Capital. Sometime later, maybe. In this thread, though, nobody has 'debunked' the LTV, which was its purpose.

No I don't. I assume you have read the third part of Das Kapital, and if you've read carefully you would know that in this part Marx debunked the LTV himself.

I assume you're talking about Volume 3. No, I havn't. Would you mind pointing out the place in which he debunked it?

Hoppe

5th May 2004, 21:38

No, i'm still reading Capital. Sometime later, maybe. In this thread, though, nobody has 'debunked' the LTV, which was its purpose

Funny. You haven't even finished das Kapital, and read no other theories. Yet with this extremely little amount of knowledge you assume that it is right. With all respect, but you look more like a sheep following the other sheep.

I assume you're talking about Volume 3. No, I havn't. Would you mind pointing out the place in which he debunked it?

Well, that would be a bit easy, not? But it has to do with Marx proposing to give a "positive" evidence of the LTV (remember his crappy methodology), but he doesn't. The rest you have to find out yourself.

STI

5th May 2004, 22:20

Funny. You haven't even finished das Kapital, and read no other theories. Yet with this extremely little amount of knowledge you assume that it is right. With all respect, but you look more like a sheep following the other sheep

Argumentum ad Hominem. You're attacking me now, not the LTV. If we were able to successfully defend the LTV, you really shouldn't be attacking me.

Well, that would be a bit easy, not? But it has to do with Marx proposing to give a "positive" evidence of the LTV (remember his crappy methodology), but he doesn't. The rest you have to find out yourself.

What am I supposed to draw from the statement "Marx debunked the LTV himself"?

Misodoctakleidist

6th May 2004, 15:35

Hoppe, if there are such "massive inconsistencies" then why don't you tell us one of them instead of insulting socialist_tiger?

You keep going on and on about how Marx was so "obviously" wrong but as of yet you haven't offered a single explanation as to why, even me and socialist_tiger have been able to refute your weak arguments with our very limited knowledge of economics. This must be rather embarrassing for someone who prides himself on his knowledge of economics.

Have you even read Das Kapital or do you just believe what text books tell you?

Hoppe

6th May 2004, 20:23

Originally posted by [email protected] 6 2004, 03:35 PM
Hoppe, if there are such "massive inconsistencies" then why don't you tell us one of them instead of insulting socialist_tiger?

You keep going on and on about how Marx was so "obviously" wrong but as of yet you haven't offered a single explanation as to why, even me and socialist_tiger have been able to refute your weak arguments with our very limited knowledge of economics. This must be rather embarrassing for someone who prides himself on his knowledge of economics.

Have you even read Das Kapital or do you just believe what text books tell you?
I don't degrade myself to insulting, I was merely expressing my amazement that someone who hasn't read anything can judge whether Nyder in this case hasn't debunked the LTV. How can you claim that other economists were wrong if you don't have any knowledge of their theories?

This goes for you as well since you claim to have limited knowledge of economics. I have read Das Kapital, did you by any chance read the critiques or know how neoclassical economics evolved after Marx? That's what I call "believing".

So, to conclude, this weekend I'll read back your comments and Nyder's, then we can have another go.

Misodoctakleidist

6th May 2004, 20:43

You're amazed that he is capable of refuting you, what does that say about you're arguments?

Nobody is claiming any other economists are wrong, this thread is about whether marx was wrong, why don't you post something of substance?

Instead of saying "everyone know marx was wrong, you havn't even read he critiques" why don't you tell us how marx was wrong, if we're really as ignorant as you make out then we'll be incapable of refuting you.

Nyder

7th May 2004, 06:20

As far as the ltv goes, I'm not really trying to prove that the ltv is false because of some theory that makes it false. For example, the theory that the sun revolves around the earth was falsified by a competing theory.

Since a lot of economics is based on human behaviour, it tends to be the applicability of the theory rather then its base underlying assumptions that needs to be considered. Most of the attacks on the ltv concentrate on its applicability to the real world.

Some of the assumptions of the ltv may be valid. Labour adding value to a commodity, the creation of surplus value above what the worker is paid, the employer paying below the total input value of the labourer in order to gain profit.

So if you are going to argue that because labour surplus value is not paid to the the worker, thus causing exploitation, then the ltv must be strong enough to support such a hypothesis.

Unfortunately there are a lot of shortcomings to the applicability of the ltv. I have already pointed it out in this thread, and in response all I have seen is a lot of ad hoc attempts at refuting many of the criticisms of the ltv.

For example, you have not really addressed:

*If labour adds value, then how much value and under what conditions? How do you transform this value into price?

*How do you determine the value that labour adds to the commodity? For example, there is a stripper, a security guard, an abbatoir worker and a movie star - what explains the price difference in these very different occupations?

*How do you explain that the price can differ for a commodity A and B despite the fact that exactly the same labour was utilised to produce commodity A and B?

*The ltv only deals with surplus value, yet it doesn't deal with deficit value.

*Workers aren't normally paid at subsistence level in capitalist economies (ie. equalling their production cost in order for them to work efficiently)

This is just the beginning, I will see if there are any further criticisms of the ltv.

Nyder

7th May 2004, 06:26

And I also have a reply to one of the posts made a few days ago (I forget who posted it).

So you've give up your previous line of argument?

No, I just addressed several of your points.

In other words; how do you translate 'value' into 'price'? You can't simply say that labour adds X amount of dollars into the product's final price. How is this determined? Especially considering the intensity of labour can be different even for the same product - because of how the capital is managed, different production processes and technology.

Value is roughly the same as price although there can be variance for instance; if one business has more efficient production methods those generally prevalent then they can afford to sell for less than the value.

Price is a way to measure value, but value does not mean price. Price can measure value, but value can't measure price. For example, the value of education does not equal the price of education.

'Value' is an abstract and subjective term. It has no real measure outside of prices so cannot be considered as a scientific concept.

It's not subjective, you're the one whose been trying to argue that it's subjective; "value is whatever people think it's worth blah blah blah"

Yes but that value or utility becomes a willingness to pay which it can then be measured.

Also you forget one critical thing: if the capitalist can make a profit on the sale of a good, he can also make a loss. Should the employee bear the burden of that loss, as is stipulated in the ltv? Rather, the employee would rather have a 'guaranteed wage' then bargain on the profitability of the good.

That doesn't change what created the value.

If he shared all the proceeds amongst the employees involved in the creation of the commodity, how could they possibly make a loss?

Quite easily. Sometimes producers have to produce at a loss for some time until they their revenue gets to the point where it covers fixed and variable costs. It happens all the time, not every business starts making profits as soon as they start producing.

And what about in a recession?

And as for exploitation - if the worker is not happy with his/her wage, is it not possible for him/her to seek another job?

Nyder, let me explain something to you. If you're a coal miner in an area where there a three coal mines and you aren't happy with your wages then all you can do is go and work for one of the other mines for the same wage. None of the mines would be able to offer higher wages because they would have to rise their prices and would be destroyed by the competition. The mines wouldn't "compete for labour," if their employee don't want their wages then the mine would employ one of the unemployed people desperate for a job and willing to take whatever they can get.

This is an irrevelant example. If there are no jobs or the wages are not attractive enough in the coal mine industry, then people will simply look to work at other industries.

In a capitalist society with free markets(therefore no barriers to entry caused by Government), there would be more competition among employers (hence driving up the wage).

Are you delusional? There'd be competition amongst employees. With no welfare sate the unemployed would be starving to death and willing to take any wage high enough to prolong their lives with, if other people don't accept such a wage then there are no shortage of people who will.

You forget that welfare comes from taxes. If people kept those taxes, then the economy would grow a lot more (as the disincentive to earn wealth has gone). In fact welfare embellishes poverty by subsidising it. And your example of competition amongst employees does not apply in a free market. A monopoly is very rare in a free market, because everytime there are profits to be made in an industry, suppliers will fill that industry until there are no longer profits to be made because of competition.

And if you cannot claim that the capitalist 'steals' the employee's surplus value (which, if it exists, arised from the arrangement of capital to production by the capitalist), then how do you justify your claims of exploitation?

Just because an employee accepts a wage that doesn't mean it's fair or even that they think it's fair.

If they don't like their wage they can look for another job (and if they're smart they'll do it while they still have their current job). No one is forcing him/her to work there and accept that wage.

At the end of the day it is negotiated prices which tend to work better then some meaningless discussion of values.

How many times do i have to explain to you, just because a worker is paid £X that doesn't mean they contributed £X to the value of the commodity, we're discussion wage policies, we're discussing value.

Again, you can't simply say: "the worker added X amount of value". You can't objectively measure something like that. And the product was not the sole creation of the labourer, but also from the adding of inputs of production from the owner and management of capital.

STI

7th May 2004, 21:15

If labour adds value, then how much value and under what conditions? How do you transform this value into price?

Well, this would depend on circumstances. Of course, the labour added would have to maintain or add to the use-value of the commodity (for example, the 'smashing the car' example given by Professor Moneybags wouldn't be relevant). Also, there aren't units through which value is measured. 20 hours of labour does not create 20 units of value (whatever that is). The value of a coat which takes 20 hours of socially necessary labour to create would have the same value of a blanket which took 20 hours of socially necessary labour to create. A commodity's value must be measured in other commodities, otherwise, you end up saying that 1 coat has a value equal to 1 coat. That's not really saying anything.

How do you determine the value that labour adds to the commodity? For example, there is a stripper, a security guard, an abbatoir worker and a movie star - what explains the price difference in these very different occupations?

The stripper was already explained. The same principle can be used to explain the security gaurd. The movie star takes a bit more explaination.

I explained before that 'price' and 'value' are seperate things, and that commodities are not always sold for their value (be it above or below, as each case dictates). The value that a 'movie star' 'produces' is really produced by bunch of different people (filmers, audio guys, etc.). The movie star is simply paid more for their labour (nobody is saying that a movie star is underpaid. Heavens). The audio guy, however, is paid less than the value of his labour.

How do you explain that the price can differ for a commodity A and B despite the fact that exactly the same labour was utilised to produce commodity A and B?

As explained before, some commodities are sold for more than their value, some for less. Prices are determined by 4 factors:
1)The value the commodity in relation to the value of the given curency.
2)The competition between sellers and sellers. The more sellers there are, the more they will cut prices in order to sell their commodities
3)The competition between buyers and buyers. The more buyers, the higher they'll pay to get a given commodity as opposed to the other buyer
4)The competition between buyer and seller. The buyer wants to pay less, while the seller wants the price to be higher (for obvious reasons).

I already covered all that, though.

The ltv only deals with surplus value, yet it doesn't deal with deficit value

You'll have to elaborate a bit, here. I'm not quite sure what you mean.

Workers aren't normally paid at subsistence level in capitalist economies (ie. equalling their production cost in order for them to work efficiently)

I assume you mean "They're paid more than a living wage"? I'll respond when I figure out what you mean.

Price is a way to measure value, but value does not mean price. Price can measure value, but value can't measure price. For example, the value of education does not equal the price of education

Exactly. We're saying that price and value are seperate (I think i've been doing that for the last 3 pages). Price is one, very elastic way, through which value is measured. Price is subject to several different forces, while value is not.

Yes but that value or utility becomes a willingness to pay which it can then be measured.

You're still talking about price, not value.

Quite easily. Sometimes producers have to produce at a loss for some time until they their revenue gets to the point where it covers fixed and variable costs. It happens all the time, not every business starts making profits as soon as they start producing.

And what about in a recession?

Those things have to do with PRICE, again, not VALUE. You keep failing to see the difference.

You forget that welfare comes from taxes. If people kept those taxes, then the economy would grow a lot more (as the disincentive to earn wealth has gone). In fact welfare embellishes poverty by subsidising it. And your example of competition amongst employees does not apply in a free market. A monopoly is very rare in a free market, because everytime there are profits to be made in an industry, suppliers will fill that industry until there are no longer profits to be made because of competition.

What about, say, Microsoft? Or Apple in the 80s? The auto industry is moving steadily toward a monopoly.

If they don't like their wage they can look for another job (and if they're smart they'll do it while they still have their current job). No one is forcing him/her to work there and accept that wage.

This has nothing to do with the ltv.

Again, you can't simply say: "the worker added X amount of value". You can't objectively measure something like that. And the product was not the sole creation of the labourer, but also from the adding of inputs of production from the owner and management of capital.

Inputs how? The raw materials? They're all the result of human labour. Micromanagement? Right, that REALLY helps the worker add value :rolleyes:

Hoppe

8th May 2004, 20:30

Nobody is claiming any other economists are wrong, this thread is about whether marx was wrong, why don't you post something of substance?

Yes you do, since other economists have pointed out the shortcomings of the LTV (and many have been brought forward here).

Instead of saying "everyone know marx was wrong, you havn't even read he critiques" why don't you tell us how marx was wrong, if we're really as ignorant as you make out then we'll be incapable of refuting you

:rolleyes: , do you want me to post them again?

The auto industry is moving steadily toward a monopoly

It's more like the other way around.

DaCuBaN

8th May 2004, 20:34

Originally posted by [email protected] 8 2004, 08:30 PM

Instead of saying "everyone know marx was wrong, you havn't even read he critiques" why don't you tell us how marx was wrong, if we're really as ignorant as you make out then we'll be incapable of refuting you

:rolleyes: , do you want me to post them again?

The auto industry is moving steadily toward a monopoly

It's more like the other way around.
1) Yes please

2) Explain please... monopoly moving toward the auto industry?

Morpheus

8th May 2004, 22:11

Originally posted by [email protected] 11 2004, 03:23 AM
Since the entire theory of communism rests on a single theory - the Labour Theory of Value,
No it doesn't. Marxist economics does, but not all Communists are Marxists.

The Austrian economist, Eugen von Böhm-Bawerk argued against Marx's theory of exploitation, pointing out that workers traded in their share of the end price for the more certain and soon wages paid by the entrepreneur. In other words, he claimed that the employer "earns" their profit by exposing themselves to risks that the workers can avoid.

Muggers & mafia bosses take risks, too. If I stand on the edge of a cliff I'm taking a risk - should I be paid for it?

This isn't an attack on the labor theory of value, anyway. It's an attempt to justify the extraction of surplus value from workers. They are not identical. The Marxist case for exploitation under capitalism rests on the LTV, but the LTV isn't necessary to show that exploitation exists. Just because the LTV is wrong doesn't mean capitalism is just.

http://question-everything.mahost.org/images/work_faster.jpg

Misodoctakleidist

8th May 2004, 22:18

Yes you do, since other economists have pointed out the shortcomings of the LTV (and many have been brought forward here).

The only one who has been "brought forward here" in the very first post and it wasn't even a criticism of LVT.

:rolleyes: , do you want me to post them again?

Yes, unless they're the really stupid ones that i refuted four pages back.

STI

9th May 2004, 04:13

It's more like the other way around.

Really? There were over 100 auto Manufacturers in the United States during Henry Ford's time. Now, there are two and a half.

Professor Moneybags

9th May 2004, 09:55

Will you people stop posting that silly cartoon ? It begs more questions than it claims to answer.

Hoppe

9th May 2004, 17:24

Originally posted by [email protected] 9 2004, 04:13 AM
Really? There were over 100 auto Manufacturers in the United States during Henry Ford's time. Now, there are two and a half.
Various research has been done on this subject. Economists from Harvard have looked at various industries where entry barriers are very high because of sunk costs, like automobile industry, oil refinery or aluminium. Over a period of 50 yrs they found that market concentration decreased over this period. It's not online btw unless you are willing to pay for it.

The only one who has been "brought forward here" in the very first post and it wasn't even a criticism of LVT

Also Jevons, Walras and Marshall who brought forward similar critiques on the methodology.

Yes, unless they're the really stupid ones that i refuted four pages back.

1) Methodology
2) Time-preference of consumers (or workers)
3) Importance of time and position (20 yr old whiskey vs 1 yr old whiskey)
4) value is intrinsic
5) The contradiction of the LTV with the law of equal profit
6) The transformation problem

Misodoctakleidist

9th May 2004, 17:58

Originally posted by [email protected] 9 2004, 05:24 PM
1) Methodology
You said "his methodology was bad," you didn't actualy explain why.

2) Time-preference of consumers (or workers)

Elaborate...

3) Importance of time and position (20 yr old whiskey vs 1 yr old whiskey)

That's becuase the value of a commodity is the amount of labour socialy expended in it's production at the time of valuation. It would take a more labour to make a 20 yr old bottle of whiskey than a 1 yr old bottle of whiskey.

4) value is intrinsic

Prove it.

5) The contradiction of the LTV with the law of equal profit

Elaborate...

6) The transformation problem

You didn't even bring that up, Nyder did.

Hoppe

9th May 2004, 18:30

You said "his methodology was bad," you didn't actualy explain why.

Yes I have.

Elaborate...

The strong preference of goods and services now, as opposed to later. Present consumption is more valuable than future.

That's becuase the value of a commodity is the amount of labour socialy expended in it's production at the time of valuation. It would take a more labour to make a 20 yr old bottle of whiskey than a 1 yr old bottle of whiskey.

No. Unless you mean waiting is also socially necessary labor.

Prove it.

Ehm, you have to prove this, as I don't believe in objective value.

Elaborate...

Classical economists agreed that there was only one rate of profit in the economy. If one industry gains a higher profit than another, capital will flow to the higher profitable one, whereby prices and profits decrease, and an increase in the former less profitable one untill the rates of profits were equal. Aka the law of equalizating of the rate of profits. This is one of the main reasons why economics has moved away from the LTV path since this is irreconcilable with the LTV, and few disagree with this law in competitive markets.

You didn't even bring that up, Nyder did.

So? If you solve that problem you could opt for a Nobelprize.

Nyder

10th May 2004, 04:14

That's becuase the value of a commodity is the amount of labour socialy expended in it's production at the time of valuation. It would take a more labour to make a 20 yr old bottle of whiskey than a 1 yr old bottle of whiskey.

If you can't see the ridiculousness of that statement then you truly are blinded by your own ignorance.

Nyder

10th May 2004, 04:48

Originally posted by [email protected] 7 2004, 09:15 PM

Well, this would depend on circumstances. Of course, the labour added would have to maintain or add to the use-value of the commodity (for example, the 'smashing the car' example given by Professor Moneybags wouldn't be relevant). Also, there aren't units through which value is measured. 20 hours of labour does not create 20 units of value (whatever that is). The value of a coat which takes 20 hours of socially necessary labour to create would have the same value of a blanket which took 20 hours of socially necessary labour to create. A commodity's value must be measured in other commodities, otherwise, you end up saying that 1 coat has a value equal to 1 coat. That's not really saying anything.

But the coat is not the same price value as the blanket. Therefore your hypothesis is wrong, and the ltv cannot be applied in this case.

The stripper was already explained. The same principle can be used to explain the security gaurd. The movie star takes a bit more explaination.

You did not explain the security guard. As for the stripper, the only explanation given was that she expended more cost on things like silicon and working out at the gym. As we both know, this is a ridiculous assumption and does not explain the difference in labour prices.

I explained before that 'price' and 'value' are seperate things, and that commodities are not always sold for their value (be it above or below, as each case dictates). The value that a 'movie star' 'produces' is really produced by bunch of different people (filmers, audio guys, etc.). The movie star is simply paid more for their labour (nobody is saying that a movie star is underpaid. Heavens). The audio guy, however, is paid less than the value of his labour.

How exactly is a movie star's labour distinct from, say, a metal sheet worker? The ltv does not explain this.

As explained before, some commodities are sold for more than their value, some for less. Prices are determined by 4 factors:
1)The value the commodity in relation to the value of the given curency.
2)The competition between sellers and sellers. The more sellers there are, the more they will cut prices in order to sell their commodities
3)The competition between buyers and buyers. The more buyers, the higher they'll pay to get a given commodity as opposed to the other buyer
4)The competition between buyer and seller. The buyer wants to pay less, while the seller wants the price to be higher (for obvious reasons).

There are also external factors which affect supply and demand. And currency does not effect the value of the commodity.

The ltv only deals with surplus value, yet it doesn't deal with deficit value

You'll have to elaborate a bit, here. I'm not quite sure what you mean.

If exactly the same amount of labour was used to produce commodity A and commodity B, but commodity A makes a profit while commodity B makes a loss. According to the ltv the loss is passed on to the labourer.

Workers aren't normally paid at subsistence level in capitalist economies (ie. equalling their production cost in order for them to work efficiently)

I assume you mean "They're paid more than a living wage"? I'll respond when I figure out what you mean.

If you regard labour as a business in itself (which it is - a service being offered to another), rarely is the payment equal to production costs (the base survival of the worker to perform required duties). This may be the case in some third world countries, but that is because of the lack of competition.

Exactly. We're saying that price and value are seperate (I think i've been doing that for the last 3 pages). Price is one, very elastic way, through which value is measured. Price is subject to several different forces, while value is not.

You can't measure value. Value is meta-physical. Price-value is different from the concept of value discussed in the ltv. Therefore, the hypothetical 'surplus value' doesn't really exist.

What about, say, Microsoft? Or Apple in the 80s? The auto industry is moving steadily toward a monopoly.

I said a monopoly is rare in free markets. Hoppe has already addressed the auto industry. Microsoft used clever marketing for its products but there are better operating systems available. Apple is no longer a monopoly.

If they don't like their wage they can look for another job (and if they're smart they'll do it while they still have their current job). No one is forcing him/her to work there and accept that wage.

This has nothing to do with the ltv.

It undercuts the idea of exploitation - which is the central point of the ltv.

Inputs how? The raw materials? They're all the result of human labour. Micromanagement? Right, that REALLY helps the worker add value :rolleyes:

Labour is not the sole part of production. The production function consists of labour, capital and technology. Yes - human labour in various quantities created capital and technology, but how does this validate the ltv? If a machine was built 10 years ago and an entrepreneur buys it for production, how does he fulfill his duties to the labourers who built it 10 years ago? That argument is ridiculous.

Professor Moneybags

10th May 2004, 07:25

Originally posted by [email protected] 10 2004, 04:48 AM
You can't measure value. Value is meta-physical.
You mean value is abstract. That, I think is the reason so many of the fail to "get it"; they're only used to dealing with the "tangibles".

Osman Ghazi

10th May 2004, 13:24

How exactly is a movie star's labour distinct from, say, a metal sheet worker? The ltv does not explain this.

I think (and I could be wrong) that a certain labourers labour is worth more than others because of the amount of labour that went into 'creating' or training that labourer. Also, You have to take into consideration that the movie star is providing a service to 20 million people who are going to watch his movie whereas the metal sheet worker is providing a service to only one person and thus recieves payment only from that one person.

Hoppe

10th May 2004, 15:28

Originally posted by Osman [email protected] 10 2004, 01:24 PM
I think (and I could be wrong) that a certain labourers labour is worth more than others because of the amount of labour that went into 'creating' or training that labourer. Also, You have to take into consideration that the movie star is providing a service to 20 million people who are going to watch his movie whereas the metal sheet worker is providing a service to only one person and thus recieves payment only from that one person.
The actor produces no commodity, he is therefor unproductive. How can the LTV explain that some movies fail and some don't? 20 million people may watch the latest Harry Potter but noone saw Gigli. Or does the LTV only applies when a movie is a succes?

Misodoctakleidist

10th May 2004, 16:23

Originally posted by [email protected] 10 2004, 03:28 PM
The actor produces no commodity, he is therefor unproductive. How can the LTV explain that some movies fail and some don't? 20 million people may watch the latest Harry Potter but noone saw Gigli. Or does the LTV only applies when a movie is a succes?
The work done in the actual production of the movie contributes very little to the value of the commodities which it is used to sell. The movie isn't the commoditiy, people don't buy a movie, people buy DVDs or Cinama Tickets. I don't see what the problem is? There is little variation in price of DVDs or cinema tickets regardless of how popular the movie is.

Let's assume that the same amount of labour was put into both harry potter and gigli, if harry potter sells 20 million cinema tickets then that's 20 million different commodities not one. The cinema tickets for gigli will cost the same price but maybe only 1 million will be sold, 20 times more labour is expended in the creation of the first lot of commodities (cinema tickets) so their value is 20 times more.

Misodoctakleidist

10th May 2004, 16:38

If exactly the same amount of labour was used to produce commodity A and commodity B, but commodity A makes a profit while commodity B makes a loss. According to the ltv the loss is passed on to the labourer.

Are you really so short-sighted?

A commodity can't "make a loss" becuase the production costs of all commodities are human labour. A commodity may make a loss for a particular business but that is not the only business implicated in it's creation.

To take a simple example, i grow flowers pick them and sell them (presume that im that i'm doing so by the most efficient means prevailent at the time), i can't possibly make a loss. If i let another business pay me to let them pick the flowers and sell them, they could make a loss but all the people involved in the creation of the commodity as a whole can never make a loss.

You can't measure value. Value is meta-physical. Price-value is different from the concept of value discussed in the ltv. Therefore, the hypothetical 'surplus value' doesn't really exist.

Just becuase you can't comprehend it that doesn't mean it doesn't exist. If you continue that line of thought then you would have to conclude that the law doesn't exist.

It undercuts the idea of exploitation - which is the central point of the ltv.

It's irrelivent so stop talking about it.

Labour is not the sole part of production. The production function consists of labour, capital and technology. Yes - human labour in various quantities created capital and technology, but how does this validate the ltv? If a machine was built 10 years ago and an entrepreneur buys it for production, how does he fulfill his duties to the labourers who built it 10 years ago? That argument is ridiculous.

He doesn't "fulfill his duties to the labourers who built it 10 years ago," that doesn't change the fact that the labourers who produced it 10 years ago made a contribution to the value of his commodities.

Osman Ghazi

10th May 2004, 19:16

The actor produces no commodity, he is therefor unproductive.

Well I've never tried to make a movie without actors in it so you could be right. However, I think that movies generally need actors to advance the plot etc. etc.

How can the LTV explain that some movies fail and some don't? 20 million people may watch the latest Harry Potter but noone saw Gigli. Or does the LTV only applies when a movie is a succes?

How can it explain that a car that took hours to smash up has no value? Because something that people don't want (i.e. a bad movie or a smashed-up car) has no use-value.

Edit: Another question: Is the 'exchange value' the price?

Hoppe

10th May 2004, 20:15

Let's assume that the same amount of labour was put into both harry potter and gigli, if harry potter sells 20 million cinema tickets then that's 20 million different commodities not one. The cinema tickets for gigli will cost the same price but maybe only 1 million will be sold, 20 times more labour is expended in the creation of the first lot of commodities (cinema tickets) so their value is 20 times more.

Haha, what labor? Printing tickets?

How can it explain that a car that took hours to smash up has no value? Because something that people don't want (i.e. a bad movie or a smashed-up car) has no use-value.

Or why have diamonds a higher price per unit than water while the latter is obviously more useful and valuable.

Another question: Is the 'exchange value' the price?

Yes

Misodoctakleidist

10th May 2004, 20:39

Originally posted by [email protected] 10 2004, 08:15 PM
Haha, what labor? Printing tickets?
errr...building, maintaining and running a cinema.

Or why have diamonds a higher price per unit than water while the latter is obviously more useful and valuable.

Becuase usefulness is irrelivent so long as a commodity has a utility, value is created by labour.

Hoppe

10th May 2004, 21:06

What does a cinema have to do with the labor needed to make a movie? A cinema produces nothing, they only profit from the work of the actors.

Becuase usefulness is irrelivent so long as a commodity has a utility, value is created by labour.

Ow yes, you have to open your mouth to catch the pouring rain.....

So funny how you can dismiss this while the great Marx himself couldn't find the answer. What is usefulnes what use-value and utility is not?

When do I get an answer on time-preference and the other things?

Misodoctakleidist

10th May 2004, 21:14

Originally posted by [email protected] 10 2004, 09:06 PM
What does a cinema have to do with the labor needed to make a movie? A cinema produces nothing, they only profit from the work of the actors.
The cinema sell the commodity, as i have already pointed out; actors contribute a minscule amount to the value.

Ow yes, you have to open your mouth to catch the pouring rain.....

So funny how you can dismiss this while the great Marx himself couldn't find the answer. What is usefulnes what use-value and utility is not?

When i said usefulness i was refering to use-vlaue.

When do I get an answer on time-preference and the other things?

When you make an actual argument, and no, "marx was wrong becuase i read it in a book" doesn't count.

Osman Ghazi

10th May 2004, 23:25

Or why have diamonds a higher price per unit than water while the latter is obviously more useful and valuable.

Well I was under the impression that diamonds were somewhat rarer than water, no? Diamonds do have a use though. Conspicuous consumption. People buy them because it lets other people know that they are rich. And in a society where you can get water from the tap for a buck per cubic meter, water doesn't mean that much.

Edit: Apparently it is your B-day misodoctakleidist. Have a good one.

STI

11th May 2004, 03:05

Originally posted by [email protected] 10 2004, 04:48 AM

Well, this would depend on circumstances. Of course, the labour added would have to maintain or add to the use-value of the commodity (for example, the 'smashing the car' example given by Professor Moneybags wouldn't be relevant). Also, there aren't units through which value is measured. 20 hours of labour does not create 20 units of value (whatever that is). The value of a coat which takes 20 hours of socially necessary labour to create would have the same value of a blanket which took 20 hours of socially necessary labour to create. A commodity's value must be measured in other commodities, otherwise, you end up saying that 1 coat has a value equal to 1 coat. That's not really saying anything.

But the coat is not the same price value as the blanket. Therefore your hypothesis is wrong, and the ltv cannot be applied in this case.

That's because price is subject to several other factors. Value is not. I've said this about 8 times.

The stripper was already explained. The same principle can be used to explain the security gaurd. The movie star takes a bit more explaination.

You did not explain the security guard. As for the stripper, the only explanation given was that she expended more cost on things like silicon and working out at the gym. As we both know, this is a ridiculous assumption and does not explain the difference in labour prices.

The commodity which a security guard provides would be 'security'. You're making stuff up about that being 'all that was said about the stripper' because I know for a fact that Redstar2000 alone dedicated a half a post about it.

I explained before that 'price' and 'value' are seperate things, and that commodities are not always sold for their value (be it above or below, as each case dictates). The value that a 'movie star' 'produces' is really produced by bunch of different people (filmers, audio guys, etc.). The movie star is simply paid more for their labour (nobody is saying that a movie star is underpaid. Heavens). The audio guy, however, is paid less than the value of his labour.

How exactly is a movie star's labour distinct from, say, a metal sheet worker? The ltv does not explain this.

The movie star is paid more than the value of his labour. You should be able to figure that out. Besides, you're dealing with price, not value.

As explained before, some commodities are sold for more than their value, some for less. Prices are determined by 4 factors:
1)The value the commodity in relation to the value of the given curency.
2)The competition between sellers and sellers. The more sellers there are, the more they will cut prices in order to sell their commodities
3)The competition between buyers and buyers. The more buyers, the higher they'll pay to get a given commodity as opposed to the other buyer
4)The competition between buyer and seller. The buyer wants to pay less, while the seller wants the price to be higher (for obvious reasons).

There are also external factors which affect supply and demand. And currency does not effect the value of the commodity.

I never said it did. I said it affected price. 'Supply and Demand' can basically be fit into numbers 2 and 3 in the post you responded to.

The ltv only deals with surplus value, yet it doesn't deal with deficit value

You'll have to elaborate a bit, here. I'm not quite sure what you mean.

If exactly the same amount of labour was used to produce commodity A and commodity B, but commodity A makes a profit while commodity B makes a loss. According to the ltv the loss is passed on to the labourer.

I have no idea what you're talking about.

Workers aren't normally paid at subsistence level in capitalist economies (ie. equalling their production cost in order for them to work efficiently)

I assume you mean "They're paid more than a living wage"? I'll respond when I figure out what you mean.

If you regard labour as a business in itself (which it is - a service being offered to another), rarely is the payment equal to production costs (the base survival of the worker to perform required duties). This may be the case in some third world countries, but that is because of the lack of competition.[/QUOTE]

That's because the labour adds value on top of the production costs.

If they don't like their wage they can look for another job (and if they're smart they'll do it while they still have their current job). No one is forcing him/her to work there and accept that wage.

This has nothing to do with the ltv.

It undercuts the idea of exploitation - which is the central point of the ltv.
[/QUOTE]

No, the ltv is central to exploitation. Not vice-versa. You have it mixed up in your head.

Inputs how? The raw materials? They're all the result of human labour. Micromanagement? Right, that REALLY helps the worker add value :rolleyes:

Labour is not the sole part of production. The production function consists of labour, capital and technology. Yes - human labour in various quantities created capital and technology, but how does this validate the ltv? If a machine was built 10 years ago and an entrepreneur buys it for production, how does he fulfill his duties to the labourers who built it 10 years ago? That argument is ridiculous.[/QUOTE]

Capital and technology are both the result of human laobur. Geez. The entreprenur doesn't 'fulfil his duty' either way. My oh my, you're great at mixing up ideas and putting words in our mouths.

Exactly. We're saying that price and value are seperate (I think i've been doing that for the last 3 pages). Price is one, very elastic way, through which value is measured. Price is subject to several different forces, while value is not.

You can't measure value. Value is meta-physical. Price-value is different from the concept of value discussed in the ltv. Therefore, the hypothetical 'surplus value' doesn't really exist.[/QUOTE]

Surplus-value is the value which the worker produces after he has produced an amount of value equal to his wage. And, as I've explained umteen times, price is subject to multiple other factors. Value is not.

What about, say, Microsoft? Or Apple in the 80s? The auto industry is moving steadily toward a monopoly.

I said a monopoly is rare in free markets. Hoppe has already addressed the auto industry. Microsoft used clever marketing for its products but there are better operating systems available. Apple is no longer a monopoly.
[/QUOTE]

Apple used to be a monopoly. That's all I said. If they were really all that rare, I shouldn't be able to name 3 cases off the top of my head.

Hoppe

11th May 2004, 16:36

The cinema sell the commodity, as i have already pointed out; actors contribute a minscule amount to the value.

Then you're Ben&Jen fiasco has the same value as Harry Potter. Great. It's a bit absurd to claim that the actor doesn't make a huge contribution to the success of a movie.

When you make an actual argument, and no, "marx was wrong becuase i read it in a book" doesn't count.

Well, what books have you read? These are all valid claims against the LTV which you must have come about during your study of marxist economics.

Well I was under the impression that diamonds were somewhat rarer than water, no? Diamonds do have a use though. Conspicuous consumption. People buy them because it lets other people know that they are rich. And in a society where you can get water from the tap for a buck per cubic meter, water doesn't mean that much.

Well, you make it quite easy here. Now you're introducing subjective value concepts in your argument. People in western societies may place low value on tap water, yet in Africa a high value on water. Probably are purified water systems cost a lot more to operate as opposed to the wells in an African village. How to solve this riddle with the LTV?

If people buy diamonds out of selfish reasons and place a high value on them, LTV doesn't have an answer since it only looks at the supplyside, not the demand.

Misodoctakleidist

11th May 2004, 17:07

Then you're Ben&Jen fiasco has the same value as Harry Potter. Great. It's a bit absurd to claim that the actor doesn't make a huge contribution to the success of a movie.

The actors may make the movie more successful but they make a minescule contribution to the value of the commodity. Why do you find this so hard to grasp, do more successful movies cost more to buy on DVD? No!

Well, what books have you read? These are all valid claims against the LTV which you must have come about during your study of marxist economics.

As I've already said, i know very little about economics; perhaps you could explain some of these arguments to me. They may be valid but im not going to just take it as a matter of trust.

Well, you make it quite easy here. Now you're introducing subjective value concepts in your argument. People in western societies may place low value on tap water, yet in Africa a high value on water. Probably are purified water systems cost a lot more to operate as opposed to the wells in an African village. How to solve this riddle with the LTV?

The reason diamonds are so expensive is because their production costs, in terms of human labour, are astronomical. It's irrelivent "how much" people people want something, provided that they want it, it's value is the manifestation of human labour expended in it's production.

I'd be interested to hear what you think gives diamons their value.

If people buy diamonds out of selfish reasons and place a high value on them, LTV doesn't have an answer since it only looks at the supplyside, not the demand.

I doubt you have, as you claim, read Das Kapital since their is a whole page dealing specifically with diamonds in the first chapter of volume I.

P.S. thanks Osman

Hoppe

11th May 2004, 19:59

The actors may make the movie more successful but they make a minescule contribution to the value of the commodity. Why do you find this so hard to grasp, do more successful movies cost more to buy on DVD? No!

How come that the labor that went into the HP film is more succesful than the labor into the Gigli movie? Was HP more socially necessary?

I doubt you have, as you claim, read Das Kapital since their is a whole page dealing specifically with diamonds in the first chapter of volume I.

I know Marx wrote about it, but I also know that classical economists couldn't solve the dilemma I described some posts ago.

The reason diamonds are so expensive is because their production costs, in terms of human labour, are astronomical. It's irrelivent "how much" people people want something, provided that they want it, it's value is the manifestation of human labour expended in it's production.

Yet people also place value on "natural" phenomena. Gold is more valuable than silver and arguably the amount of labor necessary to extract it won't differ substantially.

Ok, these were some things which were pointed out. Some of them were already argued on in other posts but I haven't reread them all.

1) Methodology of Marx
2) Time-preference of consumers (or workers), or present consumption over future consumption
3) Importance of time and position (20 yr old whiskey vs 1 yr old whiskey)
4) value is intrinsic or subjective, the first will end in circular reasoning
5) The contradiction of the LTV with the law of equal profit, I have explained the latter. If you want I can give an example.
6) The transformation problem, this has been explained by Nyder.

Which one is not clear?

Misodoctakleidist

11th May 2004, 20:32

I'm currently drunk but I'll try by best to answer:

How come that the labour that went into the HP film is more successful than the labour into the Gigli movie? Was HP more socially necessary?

It wasn't, the commodities sold for the same price. The harry potter movie sold more commodities because it provided a use-value to more people.

I know Marx wrote about it, but I also know that classical economists couldn't solve the dilemma I described some posts ago.

What was wrong with my explanation?

Yet people also place value on "natural" phenomena. Gold is more valuable than silver and arguably the amount of labour necessary to extract it won't differ substantially.

Gold is harder to find than silver, it takes more labour to locate it and it is more likely that labour will be wasted on unproductive mines, gold mines are also less efficient than silver mines.

1) Methodology of Marx
You still haven't said why, you've just said that it was "bad."

2) Time-preference of consumers (or workers), or present consumption over future consumption
You still haven't explained what this is or how it disproves LTV.

3) Importance of time and position (20 yr old whiskey vs 1 yr old whiskey)
I believe that I've already addressed this.

4) value is intrinsic or subjective, the first will end in circular reasoning
How so?

5) The contradiction of the LTV with the law of equal profit, I have explained the latter. If you want I can give an example.
Yes, that would clear it up.

6) The transformation problem, this has been explained by Nyder.
This is irrelivent, it doesn't disprove LTV, it just presents problems in "utilising" it in determining wages, a task it was never intended for.

Which one is not clear?
2 and 4.

Hoppe

11th May 2004, 21:34

It wasn't, the commodities sold for the same price. The harry potter movie sold more commodities because it provided a use-value to more people.

No, the use-value is the same, just as the use-value of a porsche is equal to the use-value of a ford.

You can insert consumerpreferences in the equation but then you're on marginal utility territory and you probably don't want that.

What was wrong with my explanation?

Did you provide one?

Gold is harder to find than silver, it takes more labour to locate it and it is more likely that labour will be wasted on unproductive mines, gold mines are also less efficient than silver mines

That's guessing. Where's your proof for this statement? Many people have just stumbled on some gold while bading in a river.

You still haven't said why, you've just said that it was "bad.

I have said more.

You still haven't explained what this is or how it disproves LTV

Well, in case of workers, most prefer to be paid when their job is done then wait for the product to be sold. If workers are to be paid now, someone must advance their wages, and this service clearly has a value. You want to have it both ways, or get the full amount of the future value now.

I believe that I've already addressed this.

No, you just repeated your argument for everything, that more labor is needed to produce a 20yr old whisky. I find it difficult to discover what labor is necessary to keep whisky in a barrel for 20 yrs opposed to one year.

How so?

If you want to objectively establish value by looking at the labor, how are you going to value that labor etc etc etc etc.

Yes, that would clear it up

Suppose we have 2 industries, butter and jeans. Let's assume the rate of exploitation is 100% and that half the labor is appropriated by the employer (s/v=1). Now, butter has an organic composition of capital of 1/2 (wage bill is half as large as non-labor costs). This means for butter the rate of profit is 1/3=33%. For jeans the organic composition is 1/10 so the rate of profit is 9%.

Capital will now flow out of jeans into butter. The price of jeans will rise and the price of butter will fall. The price of jeans will now be above its labor value and butter below. This is the contradiction.

This is irrelivent, it doesn't disprove LTV, it just presents problems in "utilising" it in determining wages, a task it was never intended for.

Of course it is important. Marx used the rate of exploitation as a primary (then to the rate of profit and then to the exchange values.

Misodoctakleidist

12th May 2004, 16:05

No, the use-value is the same, just as the use-value of a porsche is equal to the use-value of a ford.

You can insert consumerpreferences in the equation but then you're on marginal utility territory and you probably don't want that.

I know the use-value is the same, i never stated otherwise, what i said was; "it provided a use-value to more people."

I don't insert consumer preferences, i gave them as a reason the harry potter selling more but also stated that they don't make the blind bit of difference to the value of the commodities sold provided, of course, that there is a demand at all.

Did you provide one?
Yes, i also refered to Das Kapital.

This was my explantion; "The reason diamonds are so expensive is because their production costs, in terms of human labour, are astronomical."

That's guessing. Where's your proof for this statement? Many people have just stumbled on some gold while bading in a river.

Oh please, it's no secret, go googling for it.

If someone find Gold in a river it's still worth as much as all other gold becuase the value is determined by the amount of human labour socialy expendable in it's production, in other words; the value of all gold is determined by the average amount of human labour nessecary for it's extraction with the average amount of skill and efficiency prevailent at the time.

I have said more.
I don't see it, perhaps you could repeat it.

Well, in case of workers, most prefer to be paid when their job is done then wait for the product to be sold. If workers are to be paid now, someone must advance their wages, and this service clearly has a value. You want to have it both ways, or get the full amount of the future value now.

This has nothing to do with what creates the value of the commodity.

If LTV is correct then this 'service' doesn't have a value since it doedn't produce a commodity, it is exploitation. LTV isn't dispoven by this, it may be that LTV is wrong and this is correct but it alone doesn't disprove LTV.

No, you just repeated your argument for everything, that more labor is needed to produce a 20yr old whisky. I find it difficult to discover what labor is necessary to keep whisky in a barrel for 20 yrs opposed to one year.
I'm afraid you misinterpreted my argument, Nyder understood it and refered to it as ridiculous which is a fair comment. I was making the point that you can't make a bottle of 20 year old whisky, you have to make a bottle of whisky and leave it for 20 years to mature. LTV states that the value of a commodity is determine by the amount of labour expended in the creation of the commodity at the time of valuation, in other words; the amount of labour it would require to make a 20 year old bottle of whisky right now. It's a very complex example since you can't just make a 20 year old bottle of whisky but by no means is it inconsistent with LTV.

If you want to objectively establish value by looking at the labor, how are you going to value that labor etc etc etc etc.
You don't, it's very difficult, if not impossible, to accuratly measure labour not least socialy nessecary labour.

Suppose we have 2 industries, butter and jeans. Let's assume the rate of exploitation is 100% and that half the labor is appropriated by the employer (s/v=1). Now, butter has an organic composition of capital of 1/2 (wage bill is half as large as non-labor costs). This means for butter the rate of profit is 1/3=33%. For jeans the organic composition is 1/10 so the rate of profit is 9%.

Capital will now flow out of jeans into butter. The price of jeans will rise and the price of butter will fall. The price of jeans will now be above its labor value and butter below. This is the contradiction.
And that's why jeans cost the same as butter?

Sorry, im probably just ignorant but this sounds ridiculous to me.

Of course it is important. Marx used the rate of exploitation as a primary (then to the rate of profit and then to the exchange values.

You don't need to know what the workers contributed to establish that they are being exploited, the fact that as a whole they produced all the value but don't recieve all the profit is enought to know that.

Osman Ghazi

12th May 2004, 21:21

Suppose we have 2 industries, butter and jeans. Let's assume the rate of exploitation is 100% and that half the labor is appropriated by the employer (s/v=1). Now, butter has an organic composition of capital of 1/2 (wage bill is half as large as non-labor costs). This means for butter the rate of profit is 1/3=33%. For jeans the organic composition is 1/10 so the rate of profit is 9%.

Capital will now flow out of jeans into butter. The price of jeans will rise and the price of butter will fall. The price of jeans will now be above its labor value and butter below. This is the contradiction.

This has more to do with competition then with production, does it not? It simply reflects that there is a greater supply for the same demand, and that the prices will fall in a market situation. What element is it that causes the decrease or increase in price? It has to be more complicated then just 'Capital will now flow out of jeans into butter'. Does it reflect better technology?

And also, if that is true, doesn't that mean that there is a set 'profit percentage' and that every company, no matter what they make will take say, for example, a 9% profit?

And wouldn't that also mean that every industry makes the same amount of money? Relative to investment anyway.

Hoppe

14th May 2004, 21:52

I'll reply once I have time, sorry. Currently I have voluntarily chosen to be exploited by a bank. ;)

STI

15th May 2004, 15:19

Originally posted by [email protected] 14 2004, 09:52 PM
I'll reply once I have time, sorry. Currently I have voluntarily chosen to be exploited by a bank. ;)
Wow, your intense wit and little winkey compell me to abandon my political beliefs and become a capitalist :rolleyes:

Nyder

17th May 2004, 03:07

One question for the commies:

How do you determine value?

Guest1

17th May 2004, 03:48

You don't. Everything that's needed is valuable, so long as you do reasonable work, no one will vote to stop giving you all you need.

Screw value, it's arbitrary.

The LTV is not really meant to determine value, it's meant to show how exploitation occurs in Capitalism. It's not some sort of formula for value. At least that's how I understand the LTV, could be wrong. I'll step aside and let the members who've read more about it chip in :lol:

Misodoctakleidist

18th May 2004, 16:04

Originally posted by [email protected] 17 2004, 03:07 AM
One question for the commies:

How do you determine value?
What, value as a concept? Are you suggesting that value doesn't actualy exist?

Nyder

19th May 2004, 05:32

Value is the result of the human mind. It is subjective. Value is determined by individuals - there is no 'pre-requisite' value.

The LTV is false, because you cannot determine what 'surplus value' is. As Hoppe said, who puts the value on labour?

Nyder

23rd May 2004, 12:06

Abandoned this thread, commies?

I'm not surprised that they can't answer the criticisms of the ltv, despite that the whole scientific argument that capitalism is inherently exploitative rests on its laurels.

Osman Ghazi

23rd May 2004, 13:24

I have a question for you Nyder. Where does value come from if not from human labour?

Professor Moneybags

23rd May 2004, 13:50

Originally posted by Osman [email protected] 23 2004, 01:24 PM
I have a question for you Nyder. Where does value come from if not from human labour?
People's desires and needs.

Misodoctakleidist

23rd May 2004, 16:59

Originally posted by [email protected] 23 2004, 12:06 PM
Abandoned this thread, commies?

I'm not surprised that they can't answer the criticisms of the ltv, despite that the whole scientific argument that capitalism is inherently exploitative rests on its laurels.
No, you just havn't put forward any new arguments since i refuted your last set.

Misodoctakleidist

23rd May 2004, 17:00

Originally posted by Professor Moneybags+May 23 2004, 01:50 PM--> (Professor Moneybags @ May 23 2004, 01:50 PM)
Osman [email protected] 23 2004, 01:24 PM
I have a question for you Nyder. Where does value come from if not from human labour?
People's desires and needs. [/b]
So that's why oxygen is so expensive.

Professor Moneybags

23rd May 2004, 17:24

Originally posted by [email protected] 23 2004, 05:00 PM
So that's why oxygen is so expensive.
Supply far outstrips demand. Just like your posts.

Misodoctakleidist

23rd May 2004, 17:26

Originally posted by Professor Moneybags+May 23 2004, 05:24 PM--> (Professor Moneybags @ May 23 2004, 05:24 PM)
[email protected] 23 2004, 05:00 PM
So that's why oxygen is so expensive.
Supply far outstrips demand. Just like your posts. [/b]
So how do you explain the difference in the value between a diamond ring and an fake so convincing that only an expert could tell the difference?

STI

23rd May 2004, 20:57

Nyder

24th May 2004, 01:32

It goes without saying that labour is not the only thing that creates value. As I've already argued, the fact that something has more 'man hours' put into it does not make it more valuable (price-wise).

And the Marxist diatribe that it only counts if it has 'use value' is just faulty deductive reasoning.

Furthermore, the statement that 'labour creates all value' is meaningless, because what values labour?

The usual example given; labour is paid X while commodity is sold for Y, is because labour's price was valued at X. This is not just made up out of thin air but is based on reason (such as value of labour to company, competition in wages, wage employee willing to accept, demand in labour, etc).

The faulty line of logic used by proponents of the ltv is usually that labour adds X amount of value to a commodity, while the capitalist/boss/owner sells the commodity for X + Y (Y being the surplus value). Thus the argument is that labour 'creates' surplus value which is then taken by the capitalist as profit. This is all based on faulty logic as there is no scientific explanation as to how labour 'creates' that surplus value. And you can only deal with value in terms of price, so labour does not add say $5 to a commodity that is ridiculous and illogical.

perceptÂ¡on

24th May 2004, 15:14

Price = exchange value.

Nobody said that labor determined exchange value.

But labor is the only way of measuring something's inherent value.

Adam Smith said the exact same thing in Wealth of Nations.

Value = power to command labor.

Value of a commodity to an individual = amount of labor he/she would have to sacrifice to produce the commodity

"Labour, therefore, it appears evidently, is the only universal, as well as the only accurate measure of value, or the only standard by which we can compare the values of different commodities at all times and all places." Adam Smith, Wealth of Nations

"The value of any commodity, therefore, to the person who possesses it, and who means not to use or consume it himself, but to exchange it for other commodities, is equal to the quantity of labour which it enables him to purchase or command. Labour, therefore, is the real measure of the exchangeable value of all commodities." Adam Smith, Wealth of Nations

Adam Smith's intelligence >>>>>>>>>> Nyder's intelligence

perceptÂ¡on

24th May 2004, 15:20

Originally posted by [email protected] 24 2004, 01:32 AM

The faulty line of logic used by proponents of the ltv is usually that labour adds X amount of value to a commodity, while the capitalist/boss/owner sells the commodity for X + Y (Y being the surplus value). Thus the argument is that labour 'creates' surplus value which is then taken by the capitalist as profit. This is all based on faulty logic as there is no scientific explanation as to how labour 'creates' that surplus value. And you can only deal with value in terms of price, so labour does not add say $5 to a commodity that is ridiculous and illogical.
That's not true. The way Marx outlined it in Capital is that labour is the only commodity which can be bought at less than it's value. You only have to pay the worker the value of his maintenance (food, clothes and shelter) and enough to reproduce and raise the next generation of workers. While this definition is a little extreme, it is still relevant because even today workers' wages are determined not by the value they contribute but according to the conditions of the labor market. Any capitalist business owner will tell you that labor is the most variable cost a business incurs, the most profits are garnered by those owners who can pay their workers the least and keep their staff as thin as possible.

Misodoctakleidist

24th May 2004, 16:30

Originally posted by [email protected] 24 2004, 01:32 AM
It goes without saying that labour is not the only thing that creates value.
Well obviously it doesn't or we wouldn't be having this discussion.

As I've already argued, the fact that something has more 'man hours' put into it does not make it more valuable (price-wise).

The thing is that all of those arguments were refuted, then you resorted to "what about..."s and all of which were satisfactorily explained.

And the Marxist diatribe that it only counts if it has 'use value' is just faulty deductive reasoning.

Wouldn't you care to back this up with anything?

Furthermore, the statement that 'labour creates all value' is meaningless, because what values labour?

The value of labout is the value of the commodity it creates, labour gives a commodity value, the value of the commodity is the the value of the labour expended in it's creation.

The usual example given; labour is paid X while commodity is sold for Y, is because labour's price was valued at X. This is not just made up out of thin air but is based on reason (such as value of labour to company, competition in wages, wage employee willing to accept, demand in labour, etc).

I would replace the part in brackets with; "The least amount the labourer is willing to accept."

The faulty line of logic used by proponents of the ltv is usually that labour adds X amount of value to a commodity, while the capitalist/boss/owner sells the commodity for X + Y (Y being the surplus value). Thus the argument is that labour 'creates' surplus value which is then taken by the capitalist as profit. This is all based on faulty logic as there is no scientific explanation as to how labour 'creates' that surplus value. And you can only deal with value in terms of price, so labour does not add say $5 to a commodity that is ridiculous and illogical.

I think you have a major gap of understanding, the argument is; labour creates a commodity worth X, the owner sell the commodity for X and gives the workers X-Y (Y being the surplus value).

lucid

24th May 2004, 17:47

Originally posted by Che y [email protected] 17 2004, 03:48 AM
You don't. Everything that's needed is valuable, so long as you do reasonable work, no one will vote to stop giving you all you need.

Screw value, it's arbitrary.

The LTV is not really meant to determine value, it's meant to show how exploitation occurs in Capitalism. It's not some sort of formula for value. At least that's how I understand the LTV, could be wrong. I'll step aside and let the members who've read more about it chip in :lol:
Are you planning on being a Marijuana farmer?

Nyder

25th May 2004, 01:58

Originally posted by percept¡[email protected] 24 2004, 03:14 PM
But labor is the only way of measuring something's inherent value.

Ignoring the demand side (again).

Adam Smith said the exact same thing in Wealth of Nations.

Value = power to command labor.

If you mean 'price value' (or exchange value for the commies), then that statement may have some truth in it. It does not really explain a lot though.

Value of a commodity to an individual = amount of labor he/she would have to sacrifice to produce the commodity

That's a stupid statement and lacks common sense. An individual's perception of value is not dependant on labour.

"Labour, therefore, it appears evidently, is the only universal, as well as the only accurate measure of value, or the only standard by which we can compare the values of different commodities at all times and all places." Adam Smith, Wealth of Nations

"The value of any commodity, therefore, to the person who possesses it, and who means not to use or consume it himself, but to exchange it for other commodities, is equal to the quantity of labour which it enables him to purchase or command. Labour, therefore, is the real measure of the exchangeable value of all commodities." Adam Smith, Wealth of Nations

Adam Smith's intelligence >>>>>>>>>> Nyder's intelligence

Fallacy: Appeal to Authority.

Copying some select quotes of Adam Smith from some leftist website does not prove anything and takes it out of context of what he was trying to convey to the reader.

Nyder

25th May 2004, 02:07

Originally posted by percept¡on+May 24 2004, 03:20 PM--> (percept¡on @ May 24 2004, 03:20 PM)
[email protected] 24 2004, 01:32 AM

The faulty line of logic used by proponents of the ltv is usually that labour adds X amount of value to a commodity, while the capitalist/boss/owner sells the commodity for X + Y (Y being the surplus value). Thus the argument is that labour 'creates' surplus value which is then taken by the capitalist as profit. This is all based on faulty logic as there is no scientific explanation as to how labour 'creates' that surplus value. And you can only deal with value in terms of price, so labour does not add say $5 to a commodity that is ridiculous and illogical.
That's not true. The way Marx outlined it in Capital is that labour is the only commodity which can be bought at less than it's value. You only have to pay the worker the value of his maintenance (food, clothes and shelter) and enough to reproduce and raise the next generation of workers. While this definition is a little extreme, it is still relevant because even today workers' wages are determined not by the value they contribute but according to the conditions of the labor market. Any capitalist business owner will tell you that labor is the most variable cost a business incurs, the most profits are garnered by those owners who can pay their workers the least and keep their staff as thin as possible. [/b]
In Marx's time people could have lived on a lot less then what they worked for in the factories. But they chose to work there because the money they earned gave them a higher standard of living.

Since Marx's time, average wages have risen in real terms.

Labour is valued by the market. Practically, there is no other way to value labour, except for central administration.

And most wages are bound by minimum wage laws at the moment. This creates a price floor which distorts the normal market process and creates unemployment.

Business owners would like to pay their workers as little as possible, but in a competitive market that is not possible.

DaCuBaN

25th May 2004, 02:15

Ignoring the demand side (again)

I'm no economist, so I'm loathe to join in this debate as I have very little I can add to this conversation. Surely the whole point is that the LTV ignores the idea of demand because life is not about what you, as an individual, want - It's about what you can do within society.

"Ask not what your country can do for you, but what you can do for your country" - remove the word country and replace it with people, and you've got yourself a damn dirty commie :P :lol:

Or was that why he was murdered...

Value of a commodity to an individual = amount of labor he/she would have to sacrifice to produce the commodity

That's a stupid statement and lacks common sense. An individual's perception of value is not dependant on labour.

So you've never said to yourself "I'm not buying that cheaply made piece of crap" ?

"Labour, therefore, it appears evidently, is the only universal, as well as the only accurate measure of value, or the only standard by which we can compare the values of different commodities at all times and all places." Adam Smith, Wealth of Nations

"The value of any commodity, therefore, to the person who possesses it, and who means not to use or consume it himself, but to exchange it for other commodities, is equal to the quantity of labour which it enables him to purchase or command. Labour, therefore, is the real measure of the exchangeable value of all commodities." Adam Smith, Wealth of Nations

Adam Smith's intelligence >>>>>>>>>> Nyder's intelligence

Fallacy: Appeal to Authority.

Copying some select quotes of Adam Smith from some leftist website does not prove anything and takes it out of context of what he was trying to convey to the reader.

I would be interested to hear your interpretation of what Smith was trying to say...

Labour is the only common standard all over the world - exchange rates change by their nature, and demand causes prices to constantly fluctate. However, if you base an economy on the LTV - on a global scale, you would begin to see eqaulisation of prices.

perceptÂ¡on

25th May 2004, 05:05

Originally posted by nyder+--> (nyder) Ignoring the demand side (again). [/b]

Demand side isn't value, it's utility. In a capitalist economy, you buy something when your utility or use-value exceeds the price or exchange value; or when you value something more than the next best thing you can spend your money on. That has nothing to do with the inherent value of the commodity. Which is what LTV deals with.

Originally posted by nyder+--> (nyder)

[email protected]
Value of a commodity to an individual = amount of labor he/she would have to sacrifice to produce the commodity

That's a stupid statement and lacks common sense. An individual's perception of value is not dependant on labour. [/b] That was from Smith, not from me. Think of it like this: The value of someone mowing your lawn for you is equal to the value of the labor you'd have to sacrifice to do it yourself.

nyder
Fallacy: Appeal to Authority.

Copying some select quotes of Adam Smith from some leftist website does not prove anything and takes it out of context of what he was trying to convey to the reader.

WTF? You're supposedly arguing the classical economists' POV on this aren't you? If someone is arguing physics from Einstein's point of view and is contradicting or misrepresenting what Einstein himself said, I would say appealing to Einstein's authority would be helpful.

Put it in context, betch: http://www.adamsmith.org/smith/won-b1-c5.htm
They weren't out of context, they were self-evident.

Furthermore, Smith says that price is determined by three things: value of labor, profits from stock (capital), and rent (in the sense of the economists' definition, i.e. profits from unproductive labor aka economic profits, in Smith's time mostly the rent charged by landowners). Only two of these contribute value: labor and capital (rent by definition is non-value-adding). Smith says that profits of stock are the right of the owner of stock, Marx says that this is ripping off the workers. This is essentially the point of divergence.

perceptÂ¡on

25th May 2004, 12:40

Originally posted by Nyder+May 25 2004, 02:07 AM--> (Nyder @ May 25 2004, 02:07 AM) In Marx's time people could have lived on a lot less then what they worked for in the factories. But they chose to work there because the money they earned gave them a higher standard of living.
[/b]

That is ahistorical garbage. So 19th century factory workers in Great Britain had a high standard of living? Higher than what, street beggars?

Originally posted by [email protected]

Labour is valued by the market. Practically, there is no other way to value labour, except for central administration.

Of course there is. That's ridiculous. Labor is a component of production, it can be valued relative to the output/commodity produced with it.

Nyder

And most wages are bound by minimum wage laws at the moment. This creates a price floor which distorts the normal market process and creates unemployment.

If you can prove that, contact the economics department at your local university, because every study on the effects of minimum wage on the unemployment rate has shown that it is INSIGNIFICANT. Demand for minimum wage workers is quite inelastic.

Misodoctakleidist

25th May 2004, 16:03

Originally posted by [email protected] 25 2004, 02:07 AM
In Marx's time people could have lived on a lot less then what they worked for in the factories. But they chose to work there because the money they earned gave them a higher standard of living.

:lol: Do you know anything about the society Das Kapital is based on (19th century England, the place of the most advanced capitalism at the time)?

No working class person owned their own house, they all rented a room, two rooms for the upper working class, from a member of the bourgeoisie, usually their boss who would throw them onto the street if they were no longer needed without any money to acquire alternative accommodation. It wasn't uncommon for 3 or 4 families to share one room, sometimes even a cellar which would flood if a near by river overflowed. Of course they had no furniture, some of them would have a bed in the room which would be shared by several people piled up on top of each other, if they needed they toilet they went in the corner or perhaps in the one toilet shared by the entire street if it wasn't overflowing. They couldn't afford decent food, most bought meat from the market which was past it's best and couldn't be sold in shops, often it was so old that it wasn't legal to sell. The "flour" that they bought was mostly chalk mixed in with the flour but having eaten it all their lives they couldn't tell the difference, hardly any working class person could afford shoes. Understandably they got quite ill but there was no way they could afford to go to a doctor so most people bough remedies which claimed to cure just about anything, most contained opium. As a result children were regularly given opium before they went to sleep at night. In the early 19th century the average life span was 30 years, for a working class person it was 15!!! Of course whats even more shocking is the working conditions which they had to endure for anything up to 20 hours a day, 6 days a week to eek out this meagre existence.

Since Marx's time, average wages have risen in real terms.

True, in industrialised countries. I would suggest that it is because the work force of their primary and secondry industries is based abroad but that's a completely different topic.

Labour is valued by the market. Practically, there is no other way to value labour, except for central administration.

As I've already said; you know the value of labour becuase it's the same as the value of the commodity it produces.

Business owners would like to pay their workers as little as possible, but in a competitive market that is not possible.

Oh, please! Do you really think competition drives up wages? Why would companies compete for labour when there is a surplus of unemployment?

Professor Moneybags

26th May 2004, 07:52

Originally posted by [email protected] 25 2004, 04:03 PM
No working class person owned their own house, they all rented a room, two rooms for the upper working class, from a member of the bourgeoisie, usually their boss who would throw them onto the street if they were no longer needed without any money to acquire alternative accommodation. It wasn't uncommon for 3 or 4 families to share one room, sometimes even a cellar which would flood if a near by river overflowed. Of course they had no furniture, some of them would have a bed in the room which would be shared by several people piled up on top of each other, if they needed they toilet they went in the corner or perhaps in the one toilet shared by the entire street if it wasn't overflowing. They couldn't afford decent food, most bought meat from the market which was past it's best and couldn't be sold in shops, often it was so old that it wasn't legal to sell. The "flour" that they bought was mostly chalk mixed in with the flour but having eaten it all their lives they couldn't tell the difference, hardly any working class person could afford shoes. Understandably they got quite ill but there was no way they could afford to go to a doctor so most people bough remedies which claimed to cure just about anything, most contained opium. As a result children were regularly given opium before they went to sleep at night. In the early 19th century the average life span was 30 years, for a working class person it was 15!!! Of course whats even more shocking is the working conditions which they had to endure for anything up to 20 hours a day, 6 days a week to eek out this meagre existence.
Put the violin away. It was like that everywhere at the time and it improved thanks to capitalism, not socialism.

Osman Ghazi

26th May 2004, 12:57

Actually moneybags, it was actually better to be a peasant at the time than an industrial worker. Besides, we all know where the wealth came from, i.e. the entire third world.

STI

26th May 2004, 13:59

Put the violin away. It was like that everywhere at the time and it improved thanks to capitalism, not socialism

Actually, large-scale union mobilization is responsible for most of the real change. Guess who was there on the front lines, organizing, agitating, and mobilizing?

Misodoctakleidist

26th May 2004, 15:52

Originally posted by Professor [email protected] 26 2004, 07:52 AM
Put the violin away. It was like that everywhere at the time and it improved thanks to capitalism, not socialism.
Capitalism was entirely responsible for this situation, guess why it improved? Did the bougeoirsie become benevolent? No, did the market "drive up wages"? :lol: No, the workers demanded it, they damanded lower working hours, they demanded health and safety reglations, they damanded rights over how and how quickly they could be sacked, they damnded unemployment benifits, they damnded socialist laws be introduced, they damnded the restriction of capitalsim. The chartists campaigned for "the charter," their supporters burned down factories and shut down the production of entire cities at a time.

Professor Moneybags

26th May 2004, 19:30

Capitalism was entirely responsible for this situation, guess why it improved? Did the bougeoirsie become benevolent?

Some were, some weren't.

No, did the market "drive up wages"?

Yes, it did, actually.

:lol: No, the workers demanded it, they damanded lower working hours, they demanded health and safety reglations, they damanded rights over how and how quickly they could be sacked,

Working terms and conditions are part of the contractual agreement.

they damnded unemployment benifits, they damnded socialist laws be introduced, they damnded the restriction of capitalsim.

I was waiting for that. Everything did not become wonderful because some socialist politician, by fiat, decided that child labour and long hours were no longer needed; it's productivity, caused by technology, that was responsible for the reduction in working hours. They wouldn't have demanded all that two hundred years eariler; they'd have all starved.

An interesting collorary is the third world today. Those who are trying to prevent child labour are harming these people because they do not have a sufficient level of productivity to meet their own needs (you lot trying to prevent their "exploitation" from Nike etc isn't helping either). That's why these people resist such laws. They need their own "industrial revolution", which Nike etc are (knowingly or not) kick-starting.

Misodoctakleidist

26th May 2004, 19:45

I was waiting for that. Everything did not become wonderful because some socialist politician, by fiat, decided that child labour and long hours were no longer needed

Things improved because the workers forced the right-wing politicians to make concessions.

caused by technology, that was responsible for the reduction in working hours.
So how do you explain the fact that we have laws governing working hours?

They wouldn't have demanded all that two hundred years eariler; they'd have all starved.

I doubt the bougeoursie would let their work force starve, then they might actualy have to do some work. Laws reduced working hours so the workers had to be paid more so they could actualy afford to live, if they were payed less they wouldn't bother working.

Those who are trying to prevent child labour are harming these people because they do not have a sufficient level of productivity to meet their own needs What a load of crap! If child labour was stopped then families would have less income so the adult member woulnd't bother working unless they received higher wages, Nike would be forced to comply or lose their work force (the source of their profits).

Professor Moneybags

27th May 2004, 15:46

Originally posted by [email protected] 26 2004, 07:45 PM
Things improved because the workers forced the right-wing politicians to make concessions.

Only because the conditions were met for them to be allowed.

So how do you explain the fact that we have laws governing working hours?

What's that got to do with anything ?

I doubt the bougeoursie would let their work force starve, then they might actualy have to do some work. Laws reduced working hours so the workers had to be paid more so they could actualy afford to live, if they were payed less they wouldn't bother working.

Apart from the non-sequitur, you seem to have this idea that you can simply legislate people out of poverty and into prosperity. You don't ask where the means to do this comes from.

What a load of crap! If child labour was stopped then families would have less income so the adult member woulnd't bother working unless they received higher wages, Nike would be forced to comply or lose their work force (the source of their profits).

Erm...that's what I just said, wasn't it ?

perceptÂ¡on

27th May 2004, 16:37

Originally posted by Professor [email protected] 26 2004, 07:30 PM
I was waiting for that. Everything did not become wonderful because some socialist politician, by fiat, decided that child labour and long hours were no longer needed; it's productivity, caused by technology, that was responsible for the reduction in working hours. They wouldn't have demanded all that two hundred years eariler; they'd have all starved.

An interesting collorary is the third world today. Those who are trying to prevent child labour are harming these people because they do not have a sufficient level of productivity to meet their own needs (you lot trying to prevent their "exploitation" from Nike etc isn't helping either). That's why these people resist such laws. They need their own "industrial revolution", which Nike etc are (knowingly or not) kick-starting.
This is a load of crap. I'd respond but you seem comfortable with self-delusion.

Non-Sectarian Bastard!

27th May 2004, 18:03

Originally posted by [email protected] 26 2004, 07:45 PM
Things improved because the workers forced the right-wing politicians to make concessions.

Only because the conditions were met for them to be allowed.

What conditions?

So how do you explain the fact that we have laws governing working hours?

What's that got to do with anything ?

Apparantly the Gov't fears that Companies would demand the workers to work long hours, to work at inconvienent times. It seems as that fear is justified, in countries where the labour controlling device of the Gov't is very weak or the Gov't simply doesn't feel like putting restrictions of Capitalists, you see that workers have to work up to 14 or even 16 hours a day.

I doubt the bougeoursie would let their work force starve, then they might actualy have to do some work. Laws reduced working hours so the workers had to be paid more so they could actualy afford to live, if they were payed less they wouldn't bother working.

Apart from the non-sequitur, you seem to have this idea that you can simply legislate people out of poverty and into prosperity. You don't ask where the means to do this comes from.

The means are there, but in the wrong hands and in the wrong quantities. Bill Gates doesn't need his billions of dollars, billions of people do need those dollars.

Professor Moneybags

28th May 2004, 11:25

Originally posted by percept¡[email protected] 27 2004, 04:37 PM
This is a load of crap. I'd respond but you seem comfortable with self-delusion.
Same old commie cop-out.

DaCuBaN

28th May 2004, 13:02

Moneybags, study the industrial revolution in the UK. The US workers got it easy as far as industrialisation was concerned. There were other hardships, but those were not linked to technology - the UK's technology drive crippled the working population.

I can't speak for any other nations, but certainly almost every british historian, left and right, agrees that conditions throughout the revolution were appalling, and it was in fact the technology that caused the problem. The mills are a famous example if you'd care to read up on it. Somehow I doubt you will.

Professor Moneybags

28th May 2004, 13:54

Apparantly the Gov't fears that Companies would demand the workers to work long hours, to work at inconvienent times. It seems as that fear is justified, in countries where the labour controlling device of the Gov't is very weak or the Gov't simply doesn't feel like putting restrictions of Capitalists, you see that workers have to work up to 14 or even 16 hours a day.

Haven't I just said that technology has increased the productivity of labour to the extent that people do not have to work 14-16 hours a day ? What system do you think was responsible for that ?

The means are there, but in the wrong hands and in the wrong quantities. Bill Gates doesn't need his billions of dollars, billions of people do need those dollars.

Need is not a legitimate claim to someone else's money.

Professor Moneybags

28th May 2004, 13:56

Originally posted by [email protected] 28 2004, 01:02 PM
I can't speak for any other nations, but certainly almost every british historian, left and right, agrees that conditions throughout the revolution were appalling, and it was in fact the technology that caused the problem. The mills are a famous example if you'd care to read up on it. Somehow I doubt you will.
What, technology caused appaling conditions ? What do you think it was like before ?

DaCuBaN

28th May 2004, 14:11

Read over what you quoted there PM, then research it. I'm not your history teacher. If you can't be bothered to read, I can't be bothered to discuss.

I await your argument.

*HINT*
I mentioned one technology....

Misodoctakleidist

28th May 2004, 16:14

PM, people didn't have to work that long before but it increased output and therefor profits. When technology improved allowing the same output in less time the factory owners didn't think "oh, our worker don't have to work as long now," they thought "now i can make even more money with the same amount of labour." Technology didn't reduce working hours laws reduced working hours.

Technology did create those conditions, one of the most influential inventions was the spinning jenny invented by james hargreaves, it allowed weaving to be done without any skill, merely by operating a machine. The spinning jenny and other such machines were bought by those who could afford them and had the forsight and were operated by paid labour, several of them in one factory. The competition of the spinning jenny and other weaving machines forced the hand weavers out of business and they then had to seek employment in the weaving factories, they couldn't afford their own machines. This pattern was reflected in many other industries, drawing poor people from the country (the ones who's been made poor by the competition of technology) into the factories where they earned just enough to survive and as a result were forced to live in the conditions i have already described.

I'm certainly not supporting feudalism but a feudal surf had far better living conditions than a 19th century worker, the massive decline in such was a direct result of the technology which made mass production possible.

DaCuBaN

28th May 2004, 16:43

:angry:
Why spoonfeed him? He's not going to believe it if someone from Che-Lives tells him.

Good post though Misodoctakleidist :)

Misodoctakleidist

28th May 2004, 18:56

Originally posted by [email protected] 28 2004, 04:43 PM
:angry:
Why spoonfeed him? He's not going to believe it if someone from Che-Lives tells him.
He's not going to find out on his own, he's in denail. At least now he'll have to confront facts in his own mind.

Good post though Misodoctakleidist :)

Thanks.

Professor Moneybags

28th May 2004, 22:02

Originally posted by [email protected] 28 2004, 02:11 PM
Read over what you quoted there PM, then research it. I'm not your history teacher. If you can't be bothered to read, I can't be bothered to discuss.

I await your argument.

*HINT*
I mentioned one technology....
A technology that made conditions harder would be a pointless technology, wouldn't it ?

Professor Moneybags

28th May 2004, 22:15

[/QUOTE]PM, people didn't have to work that long before but it increased output and therefor profits.

They had to scratch a living on farms. Not exactly the good life. Not exactly easy without machinery.

[QUOTE]I'm certainly not supporting feudalism

You could have fooled me. Someone once said that under the skin of every communist is a medievalist and you are certainly beginning to fit the bill.

but a feudal surf had far better living conditions than a 19th century worker, the massive decline in such was a direct result of the technology which made mass production possible.

Yeah, sure. If it wasn't for the minor problem that he could be executed at the whim of some lord or king at any time, the 50% infant mortality rate and the 30 year lifespans (which had doubled by the end of the industrial revolution) of the era.

He's not going to find out on his own, he's in denail. At least now he'll have to confront facts in his own mind.

Denial of what ?

pandora

28th May 2004, 23:05

I think Marx's labour theory is correct, the only change I would suggest is a new understanding of how it applies to third world countries attacked by outside forces.

It's very sad when all the conditions are ripe, most of the country is on strike and an outside nation intervenes. ie. Dominican Republic, coca-cola shooting strikers, etc.

This is something Marx was not aware would happen.

I would like to see how Marx would have corresponded to this. I think if he were alive today he would address this issue, keeping key concepts the same, but working on approach and applications.

What do others think

redstar2000

29th May 2004, 03:28

How the LTV works in semi-developed countries is much in dispute among Marxist economists.

For example, there is a view that suggests that workers in semi-developed countries are actually paid less than the socially necessary wage to reproduce themselves; they actually die childless and the "super-profit" is repatriated to the imperialist countries. The imperial capitalists can "get away" with this strategy because (1) the "reserve army of the unemployed" is enormous in semi-developed countries...so replacement workers are always available; and (2) as you mentioned, the imperialists can bring brute force to bear on any organized resistance to this "super-exploitation".

The opposing view, which seems more likely to me personally, is that once a country begins developing (even on a limited scale), the LTV "kicks in" and workers in semi-developed countries are (sooner or later) paid the socially-necessary wage to reproduce themselves. The benefit of imperialism to the imperial capitalists is that they are permitted to take advantage of the enormous discrepancy in the value of labor in a semi-developed country and the price of the commodity which that labor produced when it is sold in the market of an advanced capitalist country.

The shoes that cost $3.00 in semi-developed wages to produce can sell for $150 in an imperialist country because the value of labor power in an imperialist country is so high that workers can (for the moment) afford to pay $150 for a pair of shoes...even if they have to buy them on credit.

This is obviously a temporary situation; when imperial capitalists begin to develop a country, there is an increase in the value of labor power in that country...brute force can be used to delay the corresponding rise in wages, but cannot stop it from happening.

If capitalism lasted long enough, wages would be more or less equal throughout the world...equally low, to be precise.

One of the drawbacks of this board is that we don't have even one really expert Marxist economist; otherwise a lot of these questions could be dealt with in a much more competent fashion.

:redstar2000:

The Redstar2000 Papers (http://www.redstar2000papers.fightcapitalism.net)
A site about communist ideas

DaCuBaN

29th May 2004, 07:19

Yeah, sure. If it wasn't for the minor problem that he could be executed at the whim of some lord or king at any time, the 50% infant mortality rate and the 30 year lifespans (which had doubled by the end of the industrial revolution) of the era

You see this is what you appear to be in denial about. If you had studied the industrial revolution in the UK (the first place for it to happen and hence worthwhile reading up on) you wouldn't be making this mistake.

The economy of the UK was almost entirely rural just prior to the industrial revolution. The invention of the technologies used in the mills caused them to spawn up and down the country, pulling workers away from the fields and into the factories. This is also generally accepted as the driving force behind industrialisation of the agriculture industry - the fear of losing the workforce forced through technology to replace the mainly manual labour involved, and as a result ended up causing thousands to involuntarily move to the cities to seek work.

As for the mills, they were often built on the edges of cities and had 'custom made' accommodation provided - Tenement buildings were constructed and families were cramped into them with no sanitation whatsoever - often two or three families per room and were paid a subsistence wage alone. So these people had gone from an adequate standard of living in the country to appalling conditions as factory workers, some by choice but most by default. It was in this time that we really started to see the 'health' of the nation suffer - infant mortality rates skyrocketed, diseases such as cholera were rampant.

So to say technology improves the standards of living is a half-truth: It hurts far more than it helps. But then the owner of the factories made his buck, and that's what counts. Right?

Misodoctakleidist

29th May 2004, 10:44

Originally posted by Professor [email protected] 28 2004, 10:15 PM
Yeah, sure. If it wasn't for the minor problem that he could be executed at the whim of some lord or king at any time, the 50% infant mortality rate and the 30 year lifespans (which had doubled by the end of the industrial revolution) of the era.
Your ignorance astounds me, I can't believe you would actualy risk looking like a complete fool by debating a topic you know absolutely nothing about. If you'd even read my earlier post you'd know that the average life span for a member of the english working class in the early 19th century was 15 years, that's half that of the surf you mentioned, although i get the feeling you just made that up. I don't know about feudal infant mortality rates but i do know that in Egland in the early 19th century over half of all children died before the age of five (EDIT: that's not during an out break of cholera or typhoid, at those times it was obviously a much higher number).

You could have fooled me. Someone once said that under the skin of every communist is a medievalist and you are certainly beginning to fit the bill.

It's an historical fact that living conditions were better during feudalism than during the early industrial period.

Professor Moneybags

29th May 2004, 14:09

This is also generally accepted as the driving force behind industrialisation of the agriculture industry - the fear of losing the workforce forced through technology to replace the mainly manual labour involved, and as a result ended up causing thousands to involuntarily move to the cities to seek work.

Again, we seem to have this problem with telling the difference between the metaphysical and the man-made. How can one "involuntarily" move, except at gunpoint ?

As for the mills, they were often built on the edges of cities and had 'custom made' accommodation provided - Tenement buildings were constructed and families were cramped into them with no sanitation whatsoever

What sanitation did they have before the industrial revolution ?

- often two or three families per room and were paid a subsistence wage alone.

What do you think it was like before the industrial revolution ?

So these people had gone from an adequate standard of living in the country to appalling conditions as factory workers, some by choice but most by default. It was in this time that we really started to see the 'health' of the nation suffer - infant mortality rates skyrocketed, diseases such as cholera were rampant.

Cite evidence.

Infant mortality was already sky-high and disease was already rampant.
There is always talk about some alleged "golden age" before the industrial revolution. Sorry, it never existed.

The biggest breakthroughs in medicine and disease treatment came during the industrial revolution. But I suppose you think that's just a coincidence...

So to say technology improves the standards of living is a half-truth: It hurts far more than it helps.

So when are you moving into your new cave ?

Professor Moneybags

29th May 2004, 14:16

Your ignorance astounds me, I can't believe you would actualy risk looking like a complete fool by debating a topic you know absolutely nothing about. If you'd even read my earlier post you'd know that the average life span for a member of the english working class in the early 19th century was 15 years,

That is hard to believe; they would have all died out. Cite evidence for this figure.

that's half that of the surf you mentioned, although i get the feeling you just made that up. I don't know about feudal infant mortality rates but i do know that in Egland in the early 19th century over half of all children died before the age of five (EDIT: that's not during an out break of cholera or typhoid, at those times it was obviously a much higher number).

Well wouldn't it be a good idea to find out ? What you are basically saying is that people were better off without all of that labour-saving technology and life-saving medicine that came out during the industrial revolution.

It's an historical fact that living conditions were better during feudalism than during the early industrial period.

Then you won't mind citing evidence for this "historical fact".

DaCuBaN

29th May 2004, 14:39

What you are basically saying is that people were better off without all of that labour-saving technology and life-saving medicine that came out during the industrial revolution.

Wrong. What we are saying is that during the industrial revolution, conditions were worse than before it started. Once it had finished conditions were better than they had ever been before.

How can one "involuntarily" move, except at gunpoint ?

At the dawn of the industrial revolution many people felt that it would be a great thing, whilst others thought that it was an awful idea. The technology that was brought into the agriculture industry to replace those workers who had chosen to move to the rapidly growing cities eventually started to infringe on those workers who had decided to stay behind. In time they too were force to move to the city as they needed to work to earn money to survive.

What sanitation did they have before the industrial revolution ?

Before the industrial revolution, the cities of the UK weren't anything like we know them, and proportional to the population of the country were remarkably small. Most people lived and worked in rural localities, and hence sanitation wasn't such a big issue as there were not nearly as many people as close together. Even at this time it was thought as a bad idea to site the privvy next to the well - however in the cities since they only had open drains accomodating thousands of people the raw sewage flowed straight into the water supply, causing chaos.

It's the difference between rural and urban living.

What do you think it was like before the industrial revolution ?

They may not have had any more money, but they had more space.

There is always talk about some alleged "golden age" before the industrial revolution. Sorry, it never existed.
The biggest breakthroughs in medicine and disease treatment came during the industrial revolution. But I suppose you think that's just a coincidence...

Again, noone is suggesting that things were just peachy before the revolution. All I am saying is things got considerably worse before they started to improve. It was not until toward the end of the industrial revolution that the breakthroughs in medicine you mention began to show through. Even then of course, it was only the rich could afford them - but that's another argument entirely.

It's an historical fact that living conditions were better during feudalism than during the early industrial period.

http://www.revision-notes.co.uk/University...tory/index.html (http://www.revision-notes.co.uk/University/History/index.html)

This is GCSE/SG stuff by the way (age 14-16)... I'm appalled you haven't covered it in your own studies...

Misodoctakleidist

29th May 2004, 15:32

PM, I'm not going to find evidence for you, it's like asking someone to show you evidence that the Romans conquered Birtain, if you're really so ignorant then educate yourself, i'm not going to do it for you. Da Cuban has already given you one link to GSCE history, I actualy leanered about this when i was 13 in SAT history.

The "labour-saving" technology didn't save the working class any labour, they had to work the same hours, they just produced more for their bosses, infact with the introduction of a new piece technology the bourgeoisie usually took the opertunity to lower wages.

As for your comment about sanitation, they really show your clear lack of understanding. The problem in highly industrialised cities such as as London and Manchester, to take the best examples, wasn't just a lack of sanitation, it was living condition which engendered disease. I've already told you about the kind of food people had to eat which was, needles to say, rather unhealthy. I've already told you that there was one "toilet" between an entire street, which was basically a big hole which was usually overflowing with excrement forcing people to got to the toilet in the corners of rooms. Not only did people end up living in rooms full of excrement but they layout of houses in courtyards, the cheapest way to build them since is allowed alot of houses to be built in a small space, meant that when they dumped it outside the courtyards became lakes of human excrement which people had to wade through (remember most of them couldn't afford shoes) up to their knees in some cases. Another problem was that all sewage went straight into the river or canal so when there was a heavy downfall of rain the river would overflow filling the cellars, which remember were being rented out to the poorest families, of buildings with sewage. These problems didn't occur in rural areas so the lack of sanitation was much less of a problem.

perceptÂ¡on

29th May 2004, 15:51

The Enclosure Acts forced the peasants to move to the cities.

The villagers and squatters forced from the use of the common land by enclosure migrated to the industrializing cities, to the newly opened lands of America, and to the growing villages. The expansion of food production meant that more was available, but now, people needed cash to acquire food, and this meant wage employment. Although the quantity of food available to any particular family depended upon access to paying jobs and their wage levels, the fact is that the incidence of food-deficiency diseases (e.g., scurvy, rickets) virtually ended by the early 19th century.

http://www.ca.uky.edu/agripedia/Classes/GEN100/POPBEEA.asp

Nyder

31st May 2004, 09:23

I think we can all agree that if it wasn't for the industrial revolution, we would all be doing hard labour, tilling the fields, right now instead of debating economic theories on the internet.

Misodoctakleidist

31st May 2004, 11:04

Except me, I'd be playing croquet and sipping tea.

Professor Moneybags

1st June 2004, 09:26

PM, I'm not going to find evidence for you, it's like asking someone to show you evidence that the Romans conquered Birtain, if you're really so ignorant then educate yourself, i'm not going to do it for you. Da Cuban has already given you one link to GSCE history, I actualy leanered about this when i was 13 in SAT history.

Cop out. Don't belive everything you are taught as school.

The "labour-saving" technology didn't save the working class any labour, they had to work the same hours, they just produced more for their bosses, infact with the introduction of a new piece technology the bourgeoisie usually took the opertunity to lower wages.

Were those huge bridges (like ironbridge) built by machines, or by pulling it along ancient Egypt style ?

As for your comment about sanitation, they really show your clear lack of understanding. The problem in highly industrialised cities such as as London and Manchester, to take the best examples, wasn't just a lack of sanitation, it was living condition which engendered disease. I've already told you about the kind of food people had to eat which was, needles to say, rather unhealthy. I've already told you that there was one "toilet" between an entire street, which was basically a big hole which was usually overflowing with excrement forcing people to got to the toilet in the corners of rooms.

Again, you are ignoring historical context. Did this practice begin in the industrial revolution, or were people always thowing their crap out on to the streets ? (Be honest).

Although the quantity of food available to any particular family depended upon access to paying jobs and their wage levels, the fact is that the incidence of food-deficiency diseases (e.g., scurvy, rickets) virtually ended by the early 19th century.

In other words, people were starving until the industrial revolution. Thanks for proving my point.

Misodoctakleidist

1st June 2004, 09:45

Originally posted by Professor [email protected] 1 2004, 09:26 AM
Cop out. Don't belive everything you are taught as school.
The British government at the time had commissioners into things such as housing and sanitation, I'm sure you could find their reports on the internet somewhere, they would certainly have no reason to exaggerate how terrible things were, in fact, quite the opposite.

Were those huge bridges (like ironbridge) built by machines, or by pulling it along ancient Egypt style ?

Yet again I find myself reiterating this point; it made no difference to the workers, why would they care if they could produce more bridges than before they still had to work the same amount of time every day for the rest of their lives, why would they care if in that time they build 20 bridges instead of 10?

Again, you are ignoring historical context. Did this practice begin in the industrial revolution, or were people always thowing their crap out on to the streets ? (Be honest).

The practice of building houses in such a fashion certainly did begin in the industrial revolution, sanitation only became such a massive problem in the industrial revolution becuase prior to that almost everyone lived in rural areas and those who lives in cities weren't crammed into such small spaces. If you really want me to I could descibe the layout which streets of houses were built to at the time and how this restricted ventilation, I could give you names of actual streets that were built in this way if you really want.

In other words, people were starving until the industrial revolution. Thanks for proving my point.

Don't you know the difference between starvation and malnutrition? Many people starved to death during the industrial revolution because there was no welfare system for the unemployed.

Nyder

2nd June 2004, 12:46

Originally posted by [email protected] 1 2004, 09:45 AM
Yet again I find myself reiterating this point; it made no difference to the workers, why would they care if they could produce more bridges than before they still had to work the same amount of time every day for the rest of their lives, why would they care if in that time they build 20 bridges instead of 10?

If it's easier to build bridges then people can work on doing other things.

Don't you know the difference between starvation and malnutrition? Many people starved to death during the industrial revolution because there was no welfare system for the unemployed.

Many people starved to death before the Industrial Revolution as well. How did the Industrial Revolution cause these people to starve? Why would people want to work in the factories if they knew they were going to starve to death?

As for welfare, the Australian Government gives huge handouts of welfare to the indigenous people but they have the poorest health and lowest life spans compared to the rest of the population.

Misodoctakleidist

2nd June 2004, 16:48

Originally posted by [email protected] 2 2004, 12:46 PM
If it's easier to build bridges then people can work on doing other things.
Yes, people can work on other things, of course they still work the same amount of time for the same wage so really it makes no difference to the proletariat.

Many people starved to death before the Industrial Revolution as well.
Not due to unemployment.

Why would people want to work in the factories if they knew they were going to starve to death?

Do you know what unemployment is?

As for welfare, the Australian Government gives huge handouts of welfare to the indigenous people but they have the poorest health and lowest life spans compared to the rest of the population.

From these two pieces of information you incorrectly presume a causual relationship between welfare and poor health when in fact all is shows is a correlation, a much more likely explanation is that a third factor, namely poverty, is the cause of both.

Nyder

3rd June 2004, 09:00

Originally posted by Misodoctakleidist+Jun 2 2004, 04:48 PM--> (Misodoctakleidist @ Jun 2 2004, 04:48 PM)
[email protected] 2 2004, 12:46 PM
If it's easier to build bridges then people can work on doing other things.
Yes, people can work on other things, of course they still work the same amount of time for the same wage so really it makes no difference to the proletariat.

[/b]
The average construction worker would perform less labour and receive higher wages then in the past. The ltv doesn't fit here. Or are you going to say that the construction machines were built by labour, or the machines that built the construction machines were built by labour?

Many people starved to death before the Industrial Revolution as well.
Not due to unemployment.

Why would people want to work in the factories if they knew they were going to starve to death?

Do you know what unemployment is?

If you're complaining about unemployment causing starvation then surely you would want there to be more people in jobs in the factories.

As for welfare, the Australian Government gives huge handouts of welfare to the indigenous people but they have the poorest health and lowest life spans compared to the rest of the population.

From these two pieces of information you incorrectly presume a causual relationship between welfare and poor health when in fact all is shows is a correlation, a much more likely explanation is that a third factor, namely poverty, is the cause of both.

I was illustrating that throwing money at the poor doesn't solve the problem. There is no value in giving people money for nothing. People have to create value.

Misodoctakleidist

3rd June 2004, 13:21

Originally posted by [email protected] 3 2004, 09:00 AM
The average construction worker would perform less labour and receive higher wages then in the past. The ltv doesn't fit here. Or are you going to say that the construction machines were built by labour, or the machines that built the construction machines were built by labour?
No, as I've been trying to tell in my last four posts, the average construction worker would perform exactly the same amount of labour and receive the same, if not lower, wages. You don't seem to be able to grasp this concept so I'll write a little story for you; Bob workers for 18 hours a day in a linen weaving factory, his boss buys a new machine which can weave linen twice as fast. Bob's boss doesn't let Bob and his co-workers do half as many hours and keep production the same, Bob's boss keeps them working the same amount of time and doubles his production.

I'll now address your point about LTV which at first glance seems like a valid one, let's take the example above; twice as much linen can now be woven as before with the same expenditure of human labour, it would seem as though the amount of value this labour produces has doubled but this isn't the case. In fact, what happens is the value of linen is halved.

If you're complaining about unemployment causing starvation then surely you would want there to be more people in jobs in the factories.

The problem is that of there was 0% unemployment labour would have to be paid for at it's full value, due to competition, so it would be impossible for business owner to make a profit since there would be no surplus value and they would move their business abroad or go bankrupt thus creating unemployment. Capitalism always maintains unemployment, the only solution is welfare benefits.

I was illustrating that throwing money at the poor doesn't solve the problem. There is no value in giving people money for nothing. People have to create value.

And i was illustrating that without that money they would be in a much worse position, probably dead. The reason you pay them "for doing nothing" is becuase it's your fault.

perceptÂ¡on

3rd June 2004, 13:37

Professor Moneybags

3rd June 2004, 13:57

Originally posted by [email protected] 3 2004, 01:21 PM
And i was illustrating that without that money they would be in a much worse position, probably dead. The reason you pay them "for doing nothing" is becuase it's your fault.
If you starve to death through doing nothing, it's your fault, not the fault of the person who doesn't give you anything to eat.

If you jump off a cliff and plummet to your death, it's your fault, not the fault of everyone who didn't stop you.

Likewise, if you don't have a job, it's your fault. There are plenty of people to work for (you can even work for yourself). Raising taxes and subsequently putting your potential employers out of business is not the way to aleviate the problem of unemployment.

Misodoctakleidist

3rd June 2004, 14:01

As I explained in my previous post there is never enough jobs for everyone. Society creates a situation where there are people who have nothing and no way to getting anything and so it is society's responsibility to take care of them.

Perception, I think you've messed up your quote, try quoting nyder and not me quoting him.

Professor Moneybags

3rd June 2004, 14:58

As I explained in my previous post there is never enough jobs for everyone. Society creates a situation where there are people who have nothing and no way to getting anything and so it is society's responsibility to take care of them.

You speak of society as if it was a single entity or person.

Misodoctakleidist

4th June 2004, 11:58

I was generalising, allow me to explain;

The ruling class benefit from the capitalist system which puts some people in a situation where it wont let them provide for themselves (unemployment) and so it's the responsibility of the ruling class to provide for them, the reason they do so to maintain their position of wealth and privilege.

Professor Moneybags

4th June 2004, 15:18

Originally posted by [email protected] 4 2004, 11:58 AM
I was generalising, allow me to explain;

The ruling class benefit from the capitalist system which puts some people in a situation where it wont let them provide for themselves (unemployment) and so it's the responsibility of the ruling class to provide for them, the reason they do so to maintain their position of wealth and privilege.
Even if it were true, the "ruling class" is not providing for them; every worker is.

Nyder

5th June 2004, 04:40

Originally posted by Misodoctakleidist+Jun 3 2004, 01:21 PM--> (Misodoctakleidist @ Jun 3 2004, 01:21 PM)
[email protected] 3 2004, 09:00 AM
The average construction worker would perform less labour and receive higher wages then in the past. The ltv doesn't fit here. Or are you going to say that the construction machines were built by labour, or the machines that built the construction machines were built by labour?
No, as I've been trying to tell in my last four posts, the average construction worker would perform exactly the same amount of labour and receive the same, if not lower, wages. You don't seem to be able to grasp this concept so I'll write a little story for you; Bob workers for 18 hours a day in a linen weaving factory, his boss buys a new machine which can weave linen twice as fast. Bob's boss doesn't let Bob and his co-workers do half as many hours and keep production the same, Bob's boss keeps them working the same amount of time and doubles his production.

[/b]
This doesn't happen in the real world. Why would the employer keep the workers if he has a machine which can do it more efficiently? The reality is that the economy shifts as technology shifts, new jobs are created and wealth continues to grow.

I'll now address your point about LTV which at first glance seems like a valid one, let's take the example above; twice as much linen can now be woven as before with the same expenditure of human labour, it would seem as though the amount of value this labour produces has doubled but this isn't the case. In fact, what happens is the value of linen is halved.

Cutting production costs doesn't always effect the price. The value of linen depends on market conditions.

If you're complaining about unemployment causing starvation then surely you would want there to be more people in jobs in the factories.

The problem is that of there was 0% unemployment labour would have to be paid for at it's full value, due to competition, so it would be impossible for business owner to make a profit since there would be no surplus value and they would move their business abroad or go bankrupt thus creating unemployment. Capitalism always maintains unemployment, the only solution is welfare benefits.

Government maintains unemployment by enforcing taxes and regulations. In a free market the only unemployment would be frictional, structural and cyclical.

I was illustrating that throwing money at the poor doesn't solve the problem. There is no value in giving people money for nothing. People have to create value.

And i was illustrating that without that money they would be in a much worse position, probably dead. The reason you pay them "for doing nothing" is becuase it's your fault.

Poverty subsidisation = more poverty.