[OPE-L:6353] Re: Re: Re: Re: Re: Re: recent science and society and Fred M's interpretation (fwd)

From: Rakesh Bhandari (rakeshb@stanford.edu)
Date: Thu Jan 17 2002 - 17:09:18 EST

re Patrick's 6352

>I have a yes and a no on whether the law of value may is necessary 
>for drawing the distinction between labor and labor-power. No, in 
>the sense that one can always say that capitalists pay for X units 
>of output from workers (based on x units/day * number of days paid 
>for by capital) but shirking workers may only provide aX units of 
>output, where 0 < = a < 1. But, this is not Marx's distinction. 
>Marx's distinction is that capital gets exactly what it paid for in 
>terms of control of laborer's work time. And, this transactions 
>takes place within a competitive economy (but not the neoclassical 
>world of perfect competition). The commodity produced by workers 
>also sells at a price where capital only earns the normal or average 
>rate of return. By working in value theoretic terms Marx is able to 
>offer a theory of profit that applies when commodities sell at their 
>Outside of Marxian economics, I am unaware of any school of thought 
>that has a logically consistent theory of profit when commodities 
>are sold at their value (when they are sold under competitive 

1. Andrew Brown has importantly argued that Marx's chapter 5 argument 
does not depend on price value equivalence as Gil says it is.

2. I also don't think it matters for Marx's argument in ch 5 whether 
labor power sells in terms of the values or the prices of production 
of the wage goods needed to reproduce it as labor will add value in 
excess of either. Price value equivalence is not the pivot of the 

3. I  agree that Gil is  is quite right that it is possible for 
surplus value to be made out of exchange by merchants in terms of 
their own circuit without an actual increase of value in circulation 
in the system as a whole. Marx himself underlines this but tells his 
reader  to defer with him the analysis of merchant capital, for 
merchant capital will be revealed to now derive from the industrial 
circuit of capital that he is about to unfold. Historically originary 
forms of capital are now revealed to be analytically and practically 
derivative of the newest form of capital.

4. Gil argues that if the latter is what Marx wanted to explain--an 
increase of the value in circulation--and if value is defined as 
labor time, it follows tautologically that circulation alone cannot 
increase the value in circulation.
Then Gil says that Marx's ch 5 argument is a big tautology.

5. And I say at one level yes indeed, but it allows Marx to sharpen 
the distinction between use value and value. That is, through 
circulation the use value of commodities can be increased to their 
owners without circulation itself having increased the value in 

6. The question then becomes how does circulation become a moment in 
the production of new value. It must be possible to purchase a 
commodity whose use value is labor itself.

7. But this means that capital cannot buy labor itself. What then 
does capital buy?

         It buys labor power, not labor.

    Marx thus discovers the distinction between labor and labor power.

8. That commodities thus have a use value and a value is thus indeed, 
as Steve K, claims Marx's fundamental discovery in the sense that it 
is explanatorily prior to discovering the distinction between labor 
power and labor.

9. Steve K then makes the fantastic argument that the consumption of 
any commodity can increase the value in circulation. But the 
consumption of dead labor cannot add live labor, and the consumption 
of wage goods extinguishes their value. So only live labor can add 
new value. And the use value of only one commodity is live labor: 
labor power.

In my opinion, there is no reason to be consumed by Gil's and Steve's 

>Marx's theory of profit is inseparably linked to his value analysis. 
>Moreover, the fact that no other school of thought has a similarly 
>powerful theory of profit might reasonably lead us to suspect that a 
>labor value theoretic analysis is the only way to develop a theory 
>of profit. In any case, no one else has done it w/o the law of value.

I would add here that Marx of course has a theory of the determinants 
of surplus value in terms of wholly original value theoretic 
variables: vcc, s/v, turnover.


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