Re: [OPE-L] Ricardo on the value of manufactured goods, or does the tail wag the dog?

From: Philip Dunn (pscumnud@DIRCON.CO.UK)
Date: Mon Apr 11 2005 - 03:47:52 EDT

Quoting "michael a. lebowitz" <mlebowit@SFU.CA>:

> At 05:00 10/04/2005, Phil cited Ricardo:
> >Having fully acknowledged the temporary effects which, in particular
> >employments
> >of capital, may be produced on the prices of commodities, as well as on the
> >wages of labour, and the profits of stock, by accidental causes, without
> >influencing the general price of commodities, wages, or profits, since
> these
> >effects are equally operative in all stages of society, we will leave them
> >entirely out of our consideration, whilst we are treating of the laws which
> >regulate natural prices, natural wages and natural profits, effects totally
> >independent of these accidental causes. In speaking then of the
> exchangeable
> >value of commodities, or the power of purchasing possessed by any one
> >commodity, I mean always that power which it would possess, if not
> >disturbed by
> >any temporary or accidental cause, and which is its natural price.
> to support his argument that 'Differences in technology are temporary and
> changes soon
> spread throughout an industry.'
>          I think the passage refers to supply shocks and demand shifts---
> ie., before market forces remove temporary or accidental deviations of
> market price from natural price.
>          michael

I agree that the passage is referring to such temporary effects. But Ricardo's
general approch would, I think, treat technological differences as tenporary or
accidental. From chapter 31:

"He, indeed, who made the discovery of the machine, or who first usefully
applied it, would enjoy an additional advantage, by making great profits for a
time; but, in proportion as the machine came into general use, the price of the
commodity produced, would, from the effects of competition, sink to its cost of
production, when the capitalist would get the same money profits as before, and
he would only participate in the general advantage, as a consumer, by being
enabled, with the same money revenue, to command an additional quantity of
comforts and enjoyments."

I originally used Ricardo's theory to illustrate that differential rent could
seen as the wages of non-human labour-power.  This means that the landlord is
selling a commodity but not, qua landlord, producing one capitalistically. 
idea is not tied to Ricardo.

From a value accounting perspective, taking the world as it is with all its
accidents, we need to measure the money paid as pure differential rent and the
labour time of the virtual workers.  There would be empirial problems doing
this and some theoretical guide would be necessary.

In Ricardo's theory at least it is clear how much labour time is involved.

Things can easily get more complicated.  What if infra-marginal land needed
fertillizer rather than less labour?  Is the landlord then selling a virtual

Philip Dunn

This archive was generated by hypermail 2.1.5 : Tue Apr 12 2005 - 00:00:01 EDT