Re: [OPE-L] questions on the interpretation of labour values

From: Paul Cockshott (wpc@DCS.GLA.AC.UK)
Date: Mon Mar 19 2007 - 18:53:12 EDT

I strongly suspect that the abstraction you are using makes you
think that there is something there called a stock of money
capital which is distinct from the value of the means of production

In practice, certainly now, there is no stock of money capital
at all. There is a system of accounts that involve mutual debts
and sum to zero with the exception of state banknotes and credits
with the Bank of England/ European Central Bank etc.

These credits are acknowledgments of surplus rendered to the state
and can be used to cancel tax debts, but they do not represent
value itself. A dollar bill, is a trace of surplus unproductively
consumed by the state and is not itself value.

One can of course express the total quantity of plant, equipment
and work in progress in money terms - but this is just the constant
capital of the economy - there is no distict stock of value existing
as money.

Paul Cockshott

-----Original Message-----
From: OPE-L on behalf of Ian Wright
Sent: Mon 3/19/2007 8:05 PM
Subject: Re: [OPE-L] questions on the interpretation of labour values
> The latter is what I mean.
> Since money consists in the main in mutual debts there is a big
> Problem with how to define its stock.

I think you misunderstand the "stock" concept that I employ. There is
not a "stock" of money-capital distinct from the "stock" of money that
circulates. Money-capital is just a term for advanced money that earns
interest for the capitalist class over the production period. Total
costs of production are m.q, where m is unit cost prices. Capitalists
charge for the use of this money-capital at rate r. They earn
profit-income mr.q during the production period.

Certainly this is a highly abstract view of the monetary relationship
between capitalists and firms,  but consonant with the kinds of
abstractions made by the classical economists when simplifying the
problematic relationship between the labour theory of value and
uniform returns to money-capital advanced.

At this level of theoretical abstraction there are no mutual debts.

> Conservation of money is incompatible with capitalist extended reproduction
> And with the specifically capitalist form of money - bank money.

In practice I'm sure you are right, but from the point of view of
understanding the relationship between money-capital and labour-value,
I think you are introducing too many things too quickly. Models of
expanded reproduction in linear production theory under-determine the
growth of the money-supply because the numeraire is a free parameter.
But whatever the relationship between the growth rate of the economy
and the growth rate of the money supply, unit labour-values are
invariant over expanded reproduction, whether standard or nonstandard.

Of course I agree that static linear production theory is not up to
the job of capturing the real dynamics of disproportionate growth.

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