Ltv

[Skooma Addict]

The best answer to this is to look at how Marx explains rent. A piece of land does not have any value intrinsically, because without exclusive rights of private property anyone is free to use it as they wish. It is only when land is claimed that it can be sold, or, in other words, it must be monopolized. It's this monopoly that allows even undeveloped land to be sold, not its natural resources alone.

I agree land doesn't have value intrinsically. I don't think anything does. I don't understand your point however. Property is necessary for the emergence of markets? I agree. The land is still valued by people even if there is no owner. That is why people try to claim land to begin with.

[Thug Lessons]

I agree land doesn't have value intrinsically. I don't think anything does. I don't understand your point however. Property is necessary for the emergence of markets? I agree. The land is still valued by people even if there is no owner. That is why people try to claim land to begin with.

When land is not subject to private property rights, it only has a use value. It cannot be exchanged. The practice of claiming land is a way to commoditize something that is not actually a commodity and transform those use values into exchange values. You could commoditize air as well and charge people for breathing rights, but none of this presents any problem for the labor theory of value.

[RGacky3]

That is why people try to claim land to begin with.

So they can have exclusive rights to develop it using labor into something marketable.

[Dean]

No labor went into the creation of land, yet it still has value.

The labor theory of value seems unnecessarily specific, but this is always the consequence of how one defines labor. The best way to explain why land has value as a consequence of its relation to labor is that the cost to acquire land defines the underlying value of land - and is the most succinct definition of labor, as well.

The value of undeveloped land seems peculiar, but its not different than the value of any other natural resource. Land which has no speculative value, that is value that may be acquired through the acquisition and utilization of the land, is worthless - but its not clear that such "useless land" even exists. If nothing else, land tends to have some strategic value in simply holding it. Even this requires some labor in the form of social relations to the land and posturing to achieve valorization of any costs incorporated in said holding.

Diamonds in a mine seem to develop value without labor. In fact, this is an example used by Marx in Capital to explain why the LTV applies. The short answer is that there is a (labor) cost to acquire diamonds which serves as a function of the value of the diamond and volume traded. Simply put, if no labor was accumulated in diamonds, they would be dirt cheap.

The same is true of land. The military and social bulwarks which control land form the labor basis of the value of land.

In fact, the physiocrats were an early school of economics which held that all value came from land. They further felt that agriculture was the most productive usage of land, and other industries which used up land and its products were diminishing the net value held by society. Its pretty clear why they were wrong.

A simple cost to acquire would have been a better way for Marx to describe the LTV, but its worth noting that he wasn't writing for a society he expected to have massive alienation from the industrial process of production which is what seems to have occurred in the first world these days. Nonetheless, the cost to acquire refers to labor or functions thereof.

[Thug Lessons]

A simple cost to acquire would have been a better way for Marx to describe the LTV, but its worth noting that he wasn't writing for a society he expected to have massive alienation from the industrial process of production which is what seems to have occurred in the first world these days. Nonetheless, the cost to acquire refers to labor or functions thereof.

Correct me if I'm wrong, but this sounds awfully similar to Ricardo's costs of production, which is somewhat different from Marx's understanding of value.

[Dean]

Correct me if I'm wrong, but this sounds awfully similar to Ricardo's costs of production, which is somewhat different from Marx's understanding of value.

Perhaps. I have to admit I haven't read Ricardo more than a few short passages. I don't recall him discussing this in any of them though.

Cost to acquire is just a shorthand way for me to explain that labor is a more inclusive concept than how it often appears.

[Thug Lessons]

Perhaps. I have to admit I haven't read Ricardo more than a few short passages. I don't recall him discussing this in any of them though.

Cost to acquire is just a shorthand way for me to explain that labor is a more inclusive concept than how it often appears.

Well, Ricardo did discuss the price of land, though I haven't read his theories on that myself. I have, however, read excepts of Marx's discussions of rent in Capital Vol. III, and here's a relevant portion of that:

It must be distinguished, whether the rent springs from a monopoly price, because a monopoly price of the product or the land exists independently of it, or whether the products are sold at a monopoly price, because a rent exists. When we refer to a monopoly price, we mean in general a price determined only by the purchasers' eagerness to buy and ability to pay, independent of the price determined by the general price of production, as well as by the value of the products. A vineyard producing wine of very extraordinary quality which can be produced only in relatively small quantities yields a monopoly price. The wine-grower would realise a considerable surplus-profit from this monopoly price, whose excess over the value of the product would be wholly determined by the means and fondness of the discriminating wine-drinker. This surplus-profit, which accrues from a monopoly price, is converted into rent and in this form falls into the lap of the landlord, thanks to his title to this piece of the globe endowed with singular properties. Here, then, the monopoly price creates the rent ... That it is only the title of a number of persons to the possession of the globe enabling them to appropriate to themselves as tribute a portion of the surplus-labour of society and furthermore to a constantly increasing extent with the development of production, is concealed by the fact that the capitalised rent, i.e., precisely this capitalised tribute, appears as the price of land, which may therefore be sold like any other article of commerce. The buyer, therefore, does not feel that his title to the rent is obtained gratis, and without the labour, risk, and spirit of enterprise of the capitalist, but rather that he has paid for it with an equivalent.

Maybe I'm missing something here, but it seems to me that Marx did not see the price of land to be determined by costs of production, costs to acquire or labor at all. Rather, claims to a title on land, (a form of primitive rather than capitalist accumulation), give it its "inherent value". Speculators and landlords are not involved in the production of value in the same way a capitalist is; they are pure parasites.

Are the "military and social bulwarks which control land" necessary to sell land? Of course. But do they instill value in land? Absolutely not, and Marx explicitly identified soldiers and government bureaucrats as non-productive in Theories of Surplus-Value.