The Labor Theory of Value

[Ostrinski]

People don't dive for pearls and therefore they are expensive. They are expensive and therefore people dive for pearls.

People find pearls desirable, which is what makes diving for pearls productive labor.

[RGacky3]

People don't dive for pearls and therefore they are expensive. They are expensive and therefore people dive for pearls.

THE LABOR THEORY OF VALUE IS THE PRICE WHEN SUPPLY AND DEMAND ARE AT EQUILIBRIUM!!!!!!

pay attention moron!!!

[Blake's Baby]

People don't dive for pearls and therefore they are expensive. They are expensive and therefore people dive for pearls.

People 'don't' dive for pearls and therefore they have no price. Pearls? What are they? No-one has ever procured such a thing, therefore there is no market for them. No expection of hardened snail-snot has ever developed.

People do dive for pearls. But it's hard and dangerous work - it requires labour - and therefore they're expensive. If pearls grew by the roadside, they wouldn't be expensive. We'd all just go and pick some pearls if we wanted them.

[Paul Cockshott]

What determines the "socially necessary" amount of labor? Doesn't Marx reason in circles by claiming that the market price of a good is determined by the labor socially necessary to produce it? He cannot appeal to the good's market price in order to find out how much labor is socially necessary.

For commodities which have multiple suppliers the socially necessary labour is the mean amount of labour that has to be used.
For commodities that are one off, like the Bosphorous Bridge, then the socially necessary labour is the labour actually used.

An identical flaw is at the heart of a related part of Marx's theory. How can the labor required to produce one hour of a good be compared with labor hours needed to make a good of a completely different type? How can my labor as a journalist compare with Lin's labor on the basketball court? A surgeon's labor with a bricklayer's? Unless Marx arrives at a common measure of labor, he has no labor theory of value at all.

All labours of different types count as equal expenditures of human energy, and represent an equal portion of societies total fundamental resource. The point is that human labour is versatile, people can be trained to do almost any job, but if you are working as a journalist you are not available to tend a sports ground. You can only be in one place at a time and there are a finite number of people available. These people are societies fundamental resource.
As Smith said the labour of every nation is the original currency by which it obtains its wants and necessities from nature.

[trivas7]

For commodities which have multiple suppliers the socially necessary labour is the mean amount of labour that has to be used.
For commodities that are one off, like the Bosphorous Bridge, then the socially necessary labour is the labour actually used.

The point is that it is impossible to take the labor involved in production as the measure of the value of a product because there exists no cardinal commensurability between different types of labor. Besides, the labor required for the production of a thing varies according to place and time, depending on the skill of the managers and workers at a given moment and on the extent to which techniques and means of production are perfected during the course of years. Ultimately, supply and demand come into play even in a nationalised economy.

[RGacky3]

Besides, the labor required for the production of a thing varies according to place and time

Exactly which is why Marx calls it "socially necessary labor," wihch means that the value changes based on time and place.

Ultimately, supply and demand come into play even in a nationalised economy.

For Gods sake man, please listen.

If supply and demand were the only factor then everything would cost the same at equilibrium.

I'll post it again, since you've STILL managed to miss it.

THE LABOR THEORY OF VALUE IS THE PRICE WHEN SUPPLY AND DEMAND ARE AT EQUILIBRIUM!!!!!!

[Thirsty Crow]

People don't dive for pearls and therefore they are expensive. They are expensive and therefore people dive for pearls.

What insight, what analysis!
I guess that's all we need to know about economic life, that people first don't dive for pearls which makes them expensive and then they decide to go for a dive.

[Paul Cockshott]

The point is that it is impossible to take the labor involved in production as the measure of the value of a product because there exists no cardinal commensurability between different types of labor.

The empirical literature indicates you get excellent results by treating all
labour as the same, see for example Dave Zachriahs work on Sweden so this fuss you and bourgeois economists make is just simple class prejudice.
Even old Adam (Smith) knew better, as his parable of the philosopher and the street porter indicates.

[trivas7]

The empirical literature indicates you get excellent results by treating all
labour as the same, see for example Dave Zachriahs work on Sweden so this fuss you and bourgeois economists make is just simple class prejudice.
Even old Adam (Smith) knew better, as his parable of the philosopher and the street porter indicates.

You mean like the Soviet Union in the 50? China in the 60s? Cuba in the 70s? Wow -- a piece of cake. What excellent results are you talking about? Are you seriously claiming to have successfully rebutted Mises in the calculation debate?

[Rafiq]

Are you seriously claiming to have successfully rebutted Mises in the calculation debate?

Mises was destroyed in such a debate long ago. He assumed Socialist production would take place within the constraint of capitalist production. It was essentially a straw man argument.

[RGacky3]

He assumed Socialist production would take place within the constraint of capitalist production. It was essentially a straw man argument.

Thats exactly the same strawman you get from people like Baseball and used to get from Skooma, they use capitalist rules for non capitalist economic models.

[trivas7]

Mises was destroyed in such a debate long ago. He assumed Socialist production would take place within the constraint of capitalist production. It was essentially a straw man argument.

I have no idea what it would mean for production to take place outside capitalist production. I dare say neither do you.

[Blake's Baby]

Yeah, because you've never made anything for anyone that you haven't sold them. Never made a friend a meal, a parent a birthday card or someone you fancied a little present - you've probably never posted on an internet forum either.

You probably present people with a bill if you make them coffe.

By the way, you now owe me $16 dollars because I produced opinions for you.

[Revolution starts with U]

Come on, be a real capitalist. It's 15.99. Save the people a penny.

[Rafiq]

I have no idea what it would mean for production to take place outside capitalist production. I dare say neither do you.

Mises essentially believed socialism would have the same mode of currency, of the state merely having a monopoly over capital, rather than abolishing capital completely.

[trivas7]

Mises essentially believed socialism would have the same mode of currency, of the state merely having a monopoly over capital, rather than abolishing capital completely.

Nonsense.

The core argument of Hayek and others that deserves attention is that market socialism as a method of organizing production would be unable to discover and make socially useful the dispersed, tacit, and ultimately subjective knowledge that is available for use within a competitive economic system based on private property rights. The inability of modern market socialists to answer this argument casts serious doubt on the practical workability of existing proposals for market socialism.

from here.

[Rafiq]

Even better, he's criticizing bourgeois socialism. Again, Market socialism still operates within the capitalist mode of production, the contradictions of commodity production still persist, no matter who is in control over the means of production .

Marxian Socialists, on the contrary, understand that socialism can only be brought about if there is a cataclysmic destruction of all remnants of capitalism. Mises believed it would be impossible to calculate production under "Socialism" within the constraint of capital. And of course he is correct in these regards. But Capital-Socialism is not the ultimate expression of the proletarian classes interest.

It mystifies me why Miseans take such a thing seriously. Criticisms of Socialism, in the end, are usually more useful than so-called "proof" of socialism's ability to exist (Because it provides us with questions). However, Mises's criticism of socialism is entirely a straw-man criticism of socialism.

[Paul Cockshott]

You mean like the Soviet Union in the 50? China in the 60s? Cuba in the 70s? Wow -- a piece of cake. What excellent results are you talking about? Are you seriously claiming to have successfully rebutted Mises in the calculation debate?

Well I have refuted Mises as it happens( Von Mises, Kantorovich and in-natura calculation,WP Cockshott - Intervention. European Journal of Economics , 2010, available as a preprint at : http://www.dcs.gla.ac.uk/~wpc/report...onearticle.pdf) but that was not the point I was making here. That was that the labour theory of value, using simple person hours worked with no adjustment for type of labour, predicts actual value of output with a correlation coefficient in excess of 95%, I cited Zachariahs work on th Swedish economy because the Swedish I/O tables have data on simple hours worked per sector that can be used to test the theory very easily.(http://www.reality.gn.apc.org/econ/DZ_article1.pdf)

[trivas7]

Well I have refuted Mises as it happens( Von Mises, Kantorovich and in-natura calculation,WP Cockshott - Intervention. European Journal of Economics , 2010, available as a preprint at : http://www.dcs.gla.ac.uk/~wpc/reports/standalonearticle.pdf) but that was not the point I was making here.

LOL

That was that the labour theory of value, using simple person hours worked with no adjustment for type of labour, predicts actual value of output with a correlation coefficient in excess of 95%, I cited Zachariahs work on th Swedish economy because the Swedish I/O tables have data on simple hours worked per sector that can be used to test the theory very easily.(http://www.reality.gn.apc.org/econ/DZ_article1.pdf)

OTC, labor time makes no sense as valuation of production because it is not an objective measure of anything (but you seem dense to that logic).

[Paul Cockshott]

LOL
OTC, labor time makes no sense as valuation of production because it is not an objective measure of anything (but you seem dense to that logic).

The Swedish i/o tables give labour inputs in person years. This is a simple and objective measurement that only requires you to count up the number of people working in each sector of the economy and scale by whether they are full or part time workers. People do objectively exist after all.

The same was true I think of Leontiefs original 1948 table for the USA.