[OPE-L:7105] Re: the value[s] of labour power, nationally and internationally

From: gerald_a_levy (gerald_a_levy@msn.com)
Date: Thu May 02 2002 - 09:44:29 EDT

Re Diego's  [7085]:

> When you want to compare internationally the VLP you may be thinking of either labor-values or credit-money-values. If the former, we have to take into account that a bigger amount of commodities in country A (more developed) entering in the workers' basket may represent less quantity of value that a smaller amount of commodities in a less developed country. 

I agree _yet_  when you write "value" at the end of the last 
sentence above, you clearly mean _international value_.  This
then becomes the issue: rather than _assuming_ international 
value this is a concept that has to be  _systematically developed_.

If the latter, we have to consider a second factor too: the different value of money in both countries, i.e. their different ratios between the labor they perform in their financial systems and the national mass of money in each case. All that does inform us about disparities between the VLP and wages globally.

Agreed.  It seems to me that the disparities in the MELT 
(monetary expressions of labor time) on the international
level presuppose an examination of state policy. To simply state
that there are "limits" to state intervention and/or that during
a crisis the LOV (law of value) reasserts itself is not enough. 
Rather -- if we are to understand this question in the context
of Simon's original question relating to how contemporary
capitalism works --  we have to develop a systematic exposition
of the conditions under which (national) values change and
the actual role(s) of the state.  

You are probably referring to another related issue. If we start from national data (either labor or money data) we won't generally arrive at the same results that if we had at our disposal worldy data, which is not the case. Well, this is one of the many statistical limitations we have to face.

Agreed. The issue isn't whether we should do empirical work 
with national income statistics constructed by different national
states. The question is how we  _interpret_  our empirical
findings in the context of international value.  To raise just one 
of many issues related to interpreting national income data:
there is no accounting in such data for commodities produced in  
the "underground economy".  Yet, clearly this is a _very_ 
important sector of many contemporary capitalist social formations.
The commodities that are produced in the "underground economy" 
aren't counted by nation states (or even estimated reliably by
international agencies).  Yet, from a Marxist perspective these
commodities _do_ count.  Whether capitalist firms are employing
"legal" or "illegal"  (documented or undocumented) workers does
not determine whether they are productive of surplus value (although,
it certainly _does_ have an impact on regional disparities between
wages and the V[s]LP.)  Similarly, whether a capitalist sells Coke
or cocaine does not alter the fact that both take the commodity-
form and "count" (indeed,  many of the commodities produced in 
the "underground economy" enter into -- and can change  over time
-- the V[s]LP).  

[Diego again:] I was writing about "the general case of the LTV", i.e. supposing there is no non-reproducible commodities land and other commodiities obtaining a rent) nor taxes, transport costs, etc. Of course, if we are starting from different national VLP we have to assume different values for many services and other non-wordly-tradable commodities, which leaves more room for differences between empirical prices and the regulating ones (those which interest mostly to students of the LTV). 

Yet, even assuming all of the conditions that you state above, 
there still _tend_ to develop systematic and persistent 
violations of the so-called LOOP.   Consider price determination
where there are oligopolies: unlike most heterodox (e.g. PK)
theories,  Marxian theory has the advantage of being able to 
explain _how_ competitive branches of production (in the classicals'
sense of the term)  become over time transformed into branches
dominated by oligopolies.  I.e. instead of simply _assuming_ two
types of market structures, Marxian theory has a causal explanation 
for the transition over time to oligopolistic markets -- i.e. rather than
simply being the anti-thesis of  competition, they are the _result_
of competition and the concentration and centralization of capital.
Yet,  once a branch of production becomes oligopolistic and 
_product differentiation (and marketing and advertising) tends to 
replace, but not totally eliminate,  price competition and technological 
change as a competitive strategy by firms_, then those firms have a 
somewhat arbitrary ability to set prices. In practice there tend not
to be large price disparities by firms selling commodities in the same
market: e.g. in a system of  "price leadership", the leading oligopoly
sets the prices for their commodities then the other oligopolies 
"follow the leader".   What is important to note is that where there are
oligopolies dominating markets, then prices _can_ be different and
there is no "regulating" mechanism that will of necessity tendencially 
bring about a uniform price.

By the way, in a theoretical model a simplifying assumption may be a law, at least in the same way that in the most general model in Capital (the book) there are only two classes whereas in the concrete historical analyses by Marx (see, for instance The class struggles in France) there a lot of different classes, fractions of class, etc.

Yet, we can not simply assume that a simplifying assumption *is*
a law.   In general I think that in Marx's theory -- if it is interpreted
as an exercise in  a systematic dialectical reconstruction in thought
of the subject matter (capitalism) -- that what is taken to be "given"
by assumption at one level of abstraction must be systematically
developed at subsequent more concrete levels of abstraction.
Thus, what might seem to be a simplifying assumption, might in fact
be viewed by the author (Marx) as a _result_ -- but a result that can
only really emerge later in the analysis as a result.

Consider a "two class simplifying assumption".   Even at the level
of analysis of "capital in general", there can not be _only_ 2 major
classes (and indeed he explicitly refers in V3 to 3 major classes).
This is because the topics addressed in "capital in general"  *presume
other classes*.   Thus, when we consider the process of the 
concentration and centralization of capital and the process of
proletarianization we see that *other classes* are presumed. 
Thus, a class of those who aren't part of the capitalist class but who
own and control their own means of production (including small 
business owners and small peasants [excluding large 'peasants'
who employ an agricultural proletariat and produce on a large-scale
-- these are really agricultural capitalists rather than peasants])
as a result of the centralization and concentration of capital are
typically proletarianized or incorporated into larger units of capital
[through mergers.]   So,   the "two class" assumption  really isn't
_just_ a simplifying assumption.  It is an assertion that must be 
developed  (because it is one-sided and incomplete) which can 
reemerge later in the presentation as a result -- or perhaps be
*inverted*  at a more concrete level of analysis.  This is one of the 
reasons why I think that it is _not_ correct to say that Marx 
employed certain "axioms" in _Capital_.  Within a systematic
dialectical presentation, there is a analytical _requirement_ that
what has been assumed to exist at one level of the analysis --
to the extent that it concerns an essential relation associated
with the subject matter -- must be fully developed and comprehended 
at subsequent, more concrete, levels of analysis (I think this is
important for how we _interpret_  Fred's claims about what Marx
takes as "given" in _Capital_.)

Yes, we have to be very careful when adopting "marginalist techniques". But also when adopting Marxist techniques or ideas that are not in Marx and that in some cases plainly contradict Marx. For instance, I think that the LTV shows a great advantage compared to the surplus approach theory (or "absence of theory"). Marginalism can be used with independence of neoclassical ideas. Historically Cournot proved this in 1838. 

What exactly did Cournot prove?

In solidarity, Jerry

PS: could you or Alejandro V or Abelardo tells us about
"Marx-Marxismos Hoy"?    It seems to me to be kind of a 
'quasi-list' in the sense that it looks to be mostly a bulletin board 
for announcements and re-posting of messages from other 
sources but _also_ a discussion list to the extent that one
can also comment on the announcements or messages of others.
It looks very promising and it is encouraging to see such a serious
forum about political economy in Spanish. Best wishes for that
project. Please tell us more.

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