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Paul, many thanx for your OPE-L 2371 (reformatted). Your clear exposition
helps me towards a better appreciation of your position - or at least the
reason you are so adamant about labour-times.
>My first attempt came through ill formated I hope this is better
>> Nicky responds:
>> Well I don't know if I'm a chimp (quite possibly!!), but the point I don't
>> follow is why anyone would want to establish an 'alternative unit of
>> account to money' or 'the viability of calculation in terms of labour
>Well we are all members of the 3rd species of chimp, but the reason why we
>are concerned to establish an alternative unit of account to money is that
>we were polemicising against market socialism and defending the classical
>conception of communism as a moneyless economy. Mises recognised labour time
>as the only viable alternative unit of account, but thought it impractical
>>(1) with regards to the Austrians, didn't Oscar Lange already
>> prove your point, technically?
>Yes he did. But the classical Marxian conception of planning in terms of
>labour time was effectively abandoned by western socialists in the period of
>the calculation debate, if not before.
>Two issues arise in relation to labour values: the economic
>rationality ofusing labour time as a basic metric in socialist planning, and
>the technical feasibility of so doing. We wish to reopen the argument on
>both of these points. We contend
>that the alleged irrationality of labour time as a basis for calculation was
>never properly estab-lished,
>and indeed that this conception can be sustained only by reference to an
>unreal standard of perfect rationality which has little to do with actual
>market economies. We also argue that calculation in terms of labour time is
>now feasible (although admittedly it was not at the time of the original
>we also try to 'excavate' the classical Marxian arguments which had
>been forgotten or rejected by the 1920s, as these form the starting point of
>our think-ing on the matter. Lest we be misunderstood, however, we should
>stress that our own proposal for labour-time accounting is not made out of
>deference to Marx. Rather, we happen to agree with Mises's claims that
>socialist planning requires an'objective unit of value', and that labour
>time is the only serious candidate for such a unit.
>>(2) with regards to capitalism, is money
>> not necessarily the only objective measure of value, *under capitalism*?
>It is certainly the operational measure, this does not preclude, given
>adequate statistics, the caculation of the underlying labour values.
>> Of course, I agree with you that Marx doesn't need to "transform" values
>> into prices, but this is because the figures in vol. 3 are already in
>> prices (i.e. the transformation you talk about is what Fred says it is, a
>> transformation from the analysis of capital in general to an analysis of
>> many capitals in competition). Do you disagree?
>Our point is rather different, our empirical studies showed, somewhat
>to our surprise, that in the UK and US economies sectoral organic
>compositions were negatively correlated with sectoral profit rates
>contra the assumption of equalisation in volume III of capital.
>Thus in practice a simple labour theory of value like that or Ricardo
>or Capital vol 1 predicts sectoral rates of profit better than the
>theory in volume III, and does as well as the theory in volume iii
>in predicting sectoral prices.
>> The main point is, of course, that I remain unconvinced of the usefulness
>> of Marx's "Capital" for understanding socialist economies; and unconvinced
>> by your argument that Capitalism can only be completely understood from
>> vantage point of socialism.
>Of course most of the discussion of the labour theory of value in Capital is
>oriented towards the nature and dynamics of capitalism (theory of capitalist
>exploitation, theory of the tendency for the rate of profit to fall, and so
>But there are several passages which elaborate a more general conception of
>the proportional distribution of labour
>time as a basic necessity facing any form of economy, and which put the
>labour theory of value into context as the specific 'form of manifestation'
>of this necessity under the conditions of capitalism. Such passages are
>scattered, but if we collect them together they reveal a substantial
>'vision' of the economy as a system of allocation of labour time to
>different productive purposes-a vision which is as relevant to the
>organization of a socialist economy as it is to any other system.
>Perhaps the most striking statement of this general view is contained in
>Marx's letter to Kugelmann of 11 July 1868:
>Every child knows that any nation that stopped working, not for a year, but
>let us say, just for a few weeks, would perish. And every child knows, too,
>that the amounts of products corresponding to the differing amounts of needs
>demand differing and quantitatively determined amounts of society's
>It is self-evident that this necessity of the distribution of social labour
>in specific proportions is certainly not abolished by the specific form of
>social production; it can only change its form of manifestation. (Marx and
>Engels, 1988: 68, )
>This view is amplified in various passages from Volume III of Capital. For
>For a commodity to be sold at its market-value, i.e. proportionally to the
>necessary so-cial labour contained in it, the total quantity of social
>labour used in producing the total mass of this commodity must correspond to
>the quantity of the social want for it, i.e. the effective social want
>(Marx, 1972: 192).
>A passage from p. 636 of the same work similarly expands on the law of
>valueas it applies to "each total product of the particular social spheres
>of production made independent by the division of labour":
>what is required is that not only is no more than the necessary labour-time
>used up for each specific commodity,but only the necessary proportional
>quantity of the total social labour-time is used up in the various groups.
>For the condition remains that the commodity represents use-value.
>But if the use-value of individual commodities depends on whether they
>satisfy a particular need then the use-value of the mass of the social
>product depends on whether it satisfies the quantitatively definite social
>need for each particular kind of product in an adequate manner, and whether
>the labour is therefore proportionately distributed among the different
>spheres in keeping with these social needs, which are quantitatively
>A similar citation in this vein is from Volume 1 of Capital (Marx, 1976:
>Marx begins with a Crusoe story, pointing out that "Nature itself
>compels[Robinson]to divide his time with precision between his different
>functions. Whether one function occupies a greater space in his total
>activity than another depends on the magnitude of
>the difficulties to be overcome in attaining the useful effect aimed at."
>After discussing the counterpart to the Robinsonian calculations in feudal
>and primitive societies, Marx comes to the case of socialism.
>Let us finally imagine, for a change, an association of free men, working
>with the means of production held in common, and expending their many
>different forms of labour-power in full self-awareness as one single labour
>force. All the characteristics of Robinson's labour
>are repeated here, but with the difference that they are social instead of
>individual. . . .
>The total product of our imagined association is a social product. One part
>of this product serves as fresh means of production and remains social. But
>another part is consumed by the members of the association as means of
>In such a socialized economy, the (direct) apportionment of labour time
>"maintains the correct proportion between the different functions of labour
>and the various needs of the
>associations," and here "the social relations of the individual producers,
>both towards their labour and the products of their labour, are . . .
>transparent in their simplicity."
>These themes are also to be found in the well known text on planning from
>Anti-Duhring (Engels, 1954: 429-30). Engels states that under socialism,
>"when society enters into possession of the means of production and uses
>them in direct associationfor production, the labour of each individual,
>however varied itsspecifically useful
>character may be, becomes at the start and directly social labour." Then it
>is no longer necessary to express the labour-content of goods in the
>'roundabout' form of their exchange-value. Rather, "society can simply
>calculate how many hours of labour are contained in a steam-engine, a bushel
>of wheat of the last harvest, or a hundred square yards of cloth of a
>certain quality." Using this knowledge, "the useful effects of the various
>articles of consumption, compared with one another and with the quantities
>of labour required for their production, will in the end determine the plan.
>be able to manage everything very simply, without the intervention of
>>Is there any place in your theory for an
>> analysis of the specificities of 'capitalism' and 'socialism' as 'social
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