The LTV and Merchant Capital

[BobKKKindle$]

A Question on Marxist Economics.

As I understand it, Capital Volume One argues that labour is the source of value, and that the capitalist purchases labour in order to take advantage of its use value - workers transform the materials of production into a new product, which the capitalist then exchanges on the market place. The means and materials of production contribute nothing more than their inherent value to the finished product, and so the capitalist makes a profit - that is, he ensures that the revenue he gains from selling the finished commodities is greater than the capital he originally invested - by paying workers less than the value they contribute towards the product - the difference being surplus value.

However, reading this, it occurred to me - how does one reconcile this with a situation where the capitalist simply purchases a finished product in one location and gains a profit by selling it in another location where the market price is higher - ie Merchant Capital?(A historical example would be the voyages of the British and Dutch to the Indonesian Spice Islands) Obviously there is no change in the qualitative nature of the commodity - but given that the capitalist recieves a profit - surplus value must exist somewhere in the operation. Does the surplus value exist in the transportation of the commodity, or can Marxist economics not be applied to this scenario?

Thanks.

[Lamanov]

Easy...

Transport and distribution themselves as "labor embodied" add value; they are just specific services by which certain commodity has less difficulity to find its way to where the need for it exists, the market.

To use your example: spices did not just appear in London and Amsterdam markets from nowhere. The whole set of diffrent types of labor had to be used up for them to find a way from the East: sailors, merchants, translators, cooks, etc., and, of course, different means of production: ships, supply, etc.

[Nusocialist]

Originally posted by [email protected] 17, 2007 11:07 am
A Question on Marxist Economics.

As I understand it, Capital Volume One argues that labour is the source of value, and that the capitalist purchases labour in order to take advantage of its use value - workers transform the materials of production into a new product, which the capitalist then exchanges on the market place. The means and materials of production contribute nothing more than their inherent value to the finished product, and so the capitalist makes a profit - that is, he ensures that the revenue he gains from selling the finished commodities is greater than the capital he originally invested - by paying workers less than the value they contribute towards the product - the difference being surplus value.

However, reading this, it occurred to me - how does one reconcile this with a situation where the capitalist simply purchases a finished product in one location and gains a profit by selling it in another location where the market price is higher - ie Merchant Capital?(A historical example would be the voyages of the British and Dutch to the Indonesian Spice Islands) Obviously there is no change in the qualitative nature of the commodity - but given that the capitalist recieves a profit - surplus value must exist somewhere in the operation. Does the surplus value exist in the transportation of the commodity, or can Marxist economics not be applied to this scenario?

Thanks.
A merchant capitalist simply exploits monopolies of situation( ie different prices across different regions.) and monopolies of state.
The interference of state in their dealings in order to give them profit was a factor in the primitive accumulation that created capitalism proper.