Re: Labour aristocracy

From: paul cockshott (clyder@GN.APC.ORG)
Date: Fri Jan 16 2004 - 04:55:08 EST

> 1. Wage rates are determined by the rate of productivity
>    in the non-internationally traded sector, and held low
>    due to the continued existence of a substantial agricultural
>    sector.

Wage rates are determined by the exchange value of labor power (which, of
course, leaves a lot to discuss), not by productivity.  The latter would
seem quite neoclassical, at least as stated.

It seems pretty obvious that the upper bound on real wages
in a low productivity economy is much lower than in a
high productivity economy. If we assume that in
the absence of foreign trade effects the wage share
tends to be in the order of 50% then the non internationally
traded sector should have a wage share of that order in terms
of local labour values.


> 2. The factories of multinationals trading internationally
>    can take advantage of those low wage rates and sell their
>    product at a dollar price only slightly below the dollar
>    price of similar factories in the USA.

You're taking the technology itself to be quite similar; I don't quarrel
with that.

> 3. This gives these factories an above average rate of
>    surplus value. Higher both than the Mexican or US average.

I don't understand.  As Simon would say, the exchange value of labor power
is determined at the macro level, not factory by factory.  When wages
throughout an economy are the same and workers work the same weekly hours,
s/v is the same.

Firstly, I am not sure that the rate of surplus value will be
determined at the macro level in the sense that you imply.
But even if that is the case in an autarchic economy, I doubt
it will be the case when we start to deal with considerations
of foreign trade. The issue here is that the amounts of labour required
to produce things differ between countries so at the level of
the world economy the concept of socially necessary labour
is ill defined. Factories in Mexico producing for export
to the USA are part of the US system of exchange value
with respect to the valuation of their output in dollars
but part of the Mexican system of valuation with respect
to their purchase of labour power. This undermines the
assumption of a uniform rate of surplus value.

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