Labour Theory of Value

[Young Master Smeet]

DJP wrote:

A further consequence of total prices not equaling value would be that all of Marx’s arguments about exploitation go out the window.

Not at all, profits realised as money still come from surplus value.  What it means is that there are fiddles and tricks for  screwing folk over over and above the inherent exploitation of the wages system.

DJP wrote:

I don’t think this supports at all what you are saying; the price paid from them comes out of the total surplus value, unless they are bought with funny money how can this not be the case?

The price paid for valueless objects can come out of general wealth, not just surplus value, and it is undetermined (anyone can pay any price they like).  they establish the concept that price can be independent of value.  This opens the door to the idea that prices can be under value, and generally a large chunk of value goes unrealised.

[ALB]

I agree. Marx’s Labour Theory of Value is not a theory of price but of value (and which explains why prices and values are rarely the same) whereas Smith’s and Ricardo’s was an attempt to explain prices (which both failed).

[DJP]

 

Young Master Smeet wrote:

The price paid for valueless objects can come out of general wealth, not just surplus value, and it is undetermined (anyone can pay any price they like).  they establish the concept that price can be independent of value.  This opens the door to the idea that prices can be under value, and generally a large chunk of value goes unrealised.

All prices paid come out of the general wealth, which in a capitalist society is the same thing as the total value in society. Prices can be under value for sure, they can also be over, but isn’t the fact the some prices and under value that allows for others to be above?But since all prices are just an expression of an amount of the total value, you cannot create more value by just creating more money, to do so just decreases the amount of value that a certain amount of money represents. So I’m still not sure what it would mean if prices and value did not equal in aggregate. Would this not imply that you could create wealth by just raising prices?I know some interpreters of Marx refer to price and value as being to separate systems, is this the school from which you are drawing?

[Young Master Smeet]

DJP wrote:

All prices paid come out of the general wealth, which in a capitalist society is the same thing as the total value in society. Prices can be under value for sure, they can also be over, but isn’t the fact the some prices and under value that allows for others to be above?

Well, if I exchange one valueless item for another, both of which have a large price figure, there is no value exchanged.  Two million pound opaintings could be so exchanged, and amillion pound price deal established without any comensurate value being involved.

DJP wrote:

But since all prices are just an expression of an amount of the total value, you cannot create more value by just creating more money, to do so just decreases the amount of value that a certain amount of money represents.

I wouldn’t agree that price is an expression of value, price is a definite relation expressed in commodity money.  The way I see it, it’s like saying total rulers equal total lengths, and there are more lengths than have been measured.

DJP wrote:

So I’m still not sure what it would mean if prices and value did not equal in aggregate. Would this not imply that you could create wealth by just raising prices?

In fact, it means the opposite, that raising prices creates no wealth.  I would agree that the value of total prices cannot exceed total value, that is the real limit.

DJP wrote:

I know some interpreters of Marx refer to price and value as being to separate systems, is this the school from which you are drawing?

Yes, I suspect so, certainly I have one book at home that talks of the “Value domain” and the “price domain” in Marx as related but separate things.

[DJP]

 

Young Master Smeet wrote:

Well, if I exchange one valueless item for another, both of which have a large price figure, there is no value exchanged.  Two million pound opaintings could be so exchanged, and amillion pound price deal established without any comensurate value being involved.

But the wealth (or value) that the money represents has to come from somewhere. The total value, that has been created in production is just being re-distributed.

Young Master Smeet wrote:

I wouldn’t agree that price is an expression of value, price is a definite relation expressed in commodity money.  The way I see it, it’s like saying total rulers equal total lengths, and there are more lengths than have been measured.

But if value is not realised is it value at all? Does this not instead indicate a change in the average socialy necessary labour time?

Young Master Smeet wrote:

Yes, I suspect so, certainly I have one book at home that talks of the “Value domain” and the “price domain” in Marx as related but separate things.

To me the single system interpretation seems to make more sense, but then I’m not claiming to have studied all the issues or to fully understand them.

Duncan K. Foley wrote:

In this [the single system] approach money is the form of value and labor its substance. Money prices are a form of value. Constant and variable capital are the sums of money laid out by capitalist firms to initiate production, and surplus value the total of gross profits (of which interest and rent form subsidiary parts) realized. These money value flows can be translated into labor time through a “monetary expression of labor” coefficient which represents the amount of money value equivalent to a unit of labor time in each period.From this single-system perspective there is no need to calculate a separate accounting system of “labor values”, that is, coefficients expressing the amount of labor time embodied in individual commodities, as in the “dual-system” interpretation of Marx’s theory of value…http://homepage.newschool.edu/~foleyd/marxnoneq.pdf

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