[OPE-L:3441] Re: Re: Re: objectivity of value

From: Rakesh Bhandari (bhandari@Princeton.EDU)
Date: Tue Jun 06 2000 - 10:15:19 EDT

[ show plain text ]

 Re 3439
 I am going to start with the last bit of your reply because it confuses me.

>>Don't we run into problems with imports because of their non competing
>>nature? That is, one cannot assume that existing labor coefficients in the
>>broader two or three digit categories apply to these narrowly defined
>>categories of imports.
>You misunderstand the method. Assume trade balance and that we are looking
>at the US input output table.
>We want to assign a value in US labour hours to the imports row.
>What you do is take the valuation of the exports in terms of labour hours, and
>use this as the price/value coefficeint to convert the import row into
>US labour hours.
>$1000 of imports have a US labour value of the number of hours of labour
>embodied in each $1000 of US exports.

You don't see this to be in contradiction to everything you have written
elsewhere in the post?

Following Adrian Wood, I suggest that we revise the labor coefficients used
to determine the labor value content of *non competing* imports (that is, I
grant that we adjust the labor coefficients in the developing world to come
up with some estimate of what the US labor value would be if production
were not outsourced abroad, but we cannot simply use the labor coefficients
in the US two or three digit classifications); you turn around and tell me
that equal price means equal value. Now who is determining value by price?
At any rate, how can we determine if there is unequal exchange if by
definition you are arguing that a $1000 of commodities represent the same
labor value? It seems to me obvious that the US enjoys a monopoly price in
several of its exports--software, logic chips, advanced aircraft,
pharmaceuticals, medical instruments, etc. As obvious that US capital
obviously in its commercial form buys most of its imports below value.


OK now to the top.

>I did not mean to impute to you a subjective theory of value.
>What I am arguing is that marx was inconsistent in his attitute
>as to whether realised price had anything to do with the determination
>of value.

Our confusion is over the meaning of the determination of value. I am
saying that only if realized in price is the value switch turned on, not
that the flick of the switch determines the magnitude of the current. Price
determines that there is value (the qualitative formula), not the magnitude
thereof (the quantitative one). Nor does labor embodied determine the
latter. We are already agreed that this cannot be strictly true since
technical norms enter in this determination.

The issue arrises when a product is overproduced or
>underproduced and the price rises above its value, In all but a couple of
>places in Capital that is
>exactly how he interprets it: the value is unchanged but the price
>is higher than its value.

Yes this determination of price value discepancy can be made of course only
once the commodity has become a value. The question comes to pinpointing
the moment this happens. I am saying that the source of value is exchange.
I have provided quotes from both the Critique of Political Economy and
Capital 1 that support this.

>In a couple of places he vacillates and implies that if when supply and
>demand balance 1000 tons of weat at a value of 5 hours per ton are
>sold, then if 2000 tons of wheat are produced then these will sell for
>gold worth 2.5hrs a ton. In this case he is allowing conditions of effective
>demand to determine the magnitude of value.

Of course what strikes me about this example is contradiction between use
value and value. The value magnitude of commodity output remains the same
though unit values have been halved and material wealth doubled.

Yet this results here from a good harvest, this is a gift of nature, and
cannot be strictly used to demonstrate how Marx's law of value explains
dynamic phenomena.

But I would certainly argue that if labor productivity in strictly
reproducible goods is doubled but not output sold, then less value is
indeed produced despite the doubling in material wealth. So yes in this way
demand does determine the value produced. You will find all this explained
very early on in Capital 1.

>The point is that if you allow price to determine value, then the
>theory of value becomes redundant - all you have is observed

Pearson tried to throw away the concept of the gene in favor of what he
could observe--the correlation between intergenerational traits. Marx is
not obliged to make the same sort of positivist mistake. Values do not need
to be observable to be real and effective.

If you say that a commodities value is not determined until
>it is sold, then it is the selling price that determines the value not
>the labour required to produce it.

Value is not determined by the labor required to produce it but the
socially necessary labor time required to reproduce a commodity.

 Even if we stick to the technical definition of the latter, we still
cannot determine the technical norm in the industry without determination
of output level, and this necessarily will be by price; otherwise we will
not know the last average marginal producer to include in our technical
calculation of socially necessary or technically average labor time.

>>I do not follow this formulation. The 'market' induces changes in technical
>>norms by which the mode of surplus value extraction is led to its
>Hayeks point is that it is only the discipline of the market that can determine
>what things are worth and impose technical progress. If you take the line
>that value only comes into existence on a sale, then you are rejecting
>Engels argument that socialism can directly compute labour contents and
>regulate production accordingly.

This is a non sequitur. I am making the argument that labor contents cannot
be computed directly under capitalism and capitalism alone because social
labor time is not consciously allocated or allocated ex ante.

>Well if materialised universal human labour is just a longhand phrase for money
>then what you are saying is obviously true.

It is not. The point though is that it can only be represented, is
*necessarily* represented (and still misrepresented) in the form of money
due to class relations. You are missing the necessary form of appearance of
something for its essence. This is the point of Marx's money theory going
back to his anti Prodhoun.

> The issue at stake was wether
>Scientific management could determine the amount of average labour neccessary
>for a task. I had pointed out that in the analysis of value production marx
>upon the concept of average human labour. My assertion is that this is

But this is not the problem in the paragraph of Capital from which you
quoted. The problem is not the determination of the labor time per any task
for an average worker. The problem is how and where does the reduction of a
product of skilled labor into some quantity of simple average labor occur.
In the case of a complex labor process the question is how and where does
the conjunction of the various conrete labor times of different kinds of
labor into a determinate quantity of materialized homogeneous universal
labor time occur. I do not see you speaking to your own concern here.

Yours, Rakesh

This archive was generated by hypermail 2b29 : Fri Jun 30 2000 - 00:00:03 EDT