[OPE-L] Ajit Sinha and embodied labour/indirect labour

From: Jurriaan Bendien (adsl675281@TISCALI.NL)
Date: Wed Jul 11 2007 - 13:42:44 EDT

Dear Ajit,

That's fair enough and I am grateful that you took time to reply to my
queries anyhow. I have a few things to say about it,  but I do not expect
you to respond if you don't want to. I will read your articles as I am able
to get hold of them. I know you have to assume some background knowledge, if
you write a scholarly article, but you can also become too cryptic, in the
sense that something that is in truth controversial is swept under the
carpet. A quick ten points:

1) I guess for most of us, we do some that's old hat, an a bit of our own
that's new. You do actually do pretty careful scholarship which I have
respect for, pointing out mistaken vulgar interpretations, and quite a few
of your conclusions are new, at least they are new to me.

2) By value-ontology I mean Marx's categorisation (if you like, definition
of units of meaning and their relationship) of the existence of
value-related phenomena in bourgeois society. This categorisation is not
fixed and absolute as you might have in a statistical classification (where
at most you have boundary problems), it is a dialectical categorisation in
which the categories may evolve to some or other extent, and are
context-dependent. The categories are supposed to illuminate social and
economic relationships, and it is really those relationships which are of
prime importance, rather than the categories per se.

3) I have the feeling that I have a different understanding of the
"theoretical problematic of value". In classical political economy, you have
a certain sort of problematic, to which you refer. The problematic of value
could be stated in different ways. But more generally, questions arise about
why value exists, how it exists, what forms it takes, and when it takes
those forms. You as an economist seek a set of economic categories adequate
to explaining the dynamics of production and distribution (and their
linkage) in such a way that it is logically and mathematically rigorous. And
therefore, if the concepts do not meet your criteria, you are likely to
throw them out. But I am much more concerned with categories which, although
they might not be completely rigorous in that sense, help to explain social
and economic phenomena which actually evade exact definition anyway due to
the complexity, changeability or "fuzz" of aspects of the reality I am
dealing with.

4) Marx at least argues that a product has value, if it is produced by human
labour, and people economise the use of that product knowing that. This
abstract definition is of transhistorical application. All that changes in
different epochs, is the forms in which this value happens to be expressed.
In bourgeois society you have a near-universal market which means that
nearly every value also has an exchange-value, which in turn means, that
most values can be quantitatively expressed in money-units. If a product is
not being offered for sale, it may however still be a commodity. Indeed, a
company as a "going concern" may be treated as a commodity by investors,
even although currently its assets are not being offered for sale.
Commodities may be warehoused or stockpiled etc. at which point they may not
be offered for sale. In Marxist theory, a commodity is simply a object
produced for sale with a use-value and an exchange value, but in Marx's own
theory that is not so. A commodity has a social use-value, a material
use-value, a utility for the buyer, an exchange-value, a value, a market
value, a production price (we could distinguish between enterprise, sectoral
and economic production prices), and an actual market price. It may also
have a rental value, an accounting price or some sort of other ideal price.
In the case of some pseudo-commodities, notional commodities or fictive
commodities, they may have a utility for the buyer and an exchange-value,
but no value. But a commodity is in addition an alienable object, meaning
that it is subject to transferable private property rights which are legally
or practically defined. The transformation of a labor-product into a
commodity (its "marketing") is thus in reality not a simple process, but has
many technical and social preconditions as I mentioned in a wiki article.
These often include:

- the existence of a reliable supply of a product, or at least a surplus or
surplus product.
- the existence of a social need for it (a market demand) that must be met
through trade, or at any event cannot be met otherwise.
- the legally sanctioned assertion of private ownership rights to the
- the enforcement of these rights, so that ownership is secure.
- the transferability of these private rights from one owner to another.
- the (physical) transferability of the commodity itself, i.e. the ability
to store, package, preserve and transport it from one owner to another.
- the imposition of exclusivity of access to the commodity.
- the possibility of the owner to use or consume the commodity privately.
- guarantees about the quality and safety of the commodity, and possibly a
guarantee of replacement or service, should it fail to function as intended.

Thus, the "commodification" of a good or service often involves a
considerable practical accomplishment in trade. It is a process that may be
influenced not just by economic or technical factors, but also political and
cultural factors, insofar as it involves property rights, claims to access
to resources, and guarantees about quality or safety of use. The "commodity
form" in Marx's own theory is itself not fixed once and for all, but
historically emergent and subject to changes and development. In simple
commodity production, for instance, the sale of the commodity may be
episodic rather than regular (there is no necessary intention that it is
produced exclusively for sale) and it may not be produced  "by means of
commodities" or exclusively so.

5) My own argument about why Marx talks about value at all would be along
the following lines (1) he aims to ground his categories in the real history
of commercial trade, (2) he is interested in value relations which exist
quite independently of prices and which help explain price formation, (3) he
knows that you cannot even group, relate, or aggregate prices meaningfully
without reference to some kind of value theory. All accounting assumes
concepts which define the categorisation of comparable value (value
equivalence), value used up, conserved value, transferred value, and newly
created value.

6) Marx I think did not primarily seek to "prove exploitation" because he
knew that people are well aware of exploitation, and that it manifestly
occurs. You don't have to prove exploitation exists. He aimed rather to
theorise it, and explain it, with the aim of making the working classes more
self-aware and socially aware of the meaning of wage-slavery and what it
will lead to. In reality, his concept of labour-power does not differ a
great deal from Ricardo and Smith, as Ian Steedman shows philologically, but
Marx does differ from Ricardo and Smith in his theory of what the category
of labour-power implies, what its social and economic significance is.

7) I don't agree that Marx's concept of value is an incoherent idea, but I
do agree that the concept evolves in the course of his dialectical analysis,
and therefore in some aspects may defy formal-logical criteria. However,
formal-logical coherence is anyway not a requirement for the "coherence" of
a concept. The coherence requirement is only that the concept be
non-arbitrary, i.e. that we can give good reasons for employing that concept
rather than another, in a consistent way. In statistical classifications, we
sometimes obtain the effect that the categorical system produces some
results which violate logic and common sense. Nevertheless we keep the
classification system, because it covers the majority of cases adequately.

8)  You argue: "When you say "10A exchange for 5B" there is no problem. But
you are mistaken in jumping from here to a mathematical equation such as:
10A = 5B. There is nothing in the exchange that tells you that you could put
two bunch of commodities as "equal". But I am saying this proposition is
both true and false. If this is the nature of the exchange, then in a real
sense the commodity bunches ARE being equated and equalised. And oodles of
economists and accountants DO jump from there to a "=" sign, precisely
because of that evidence of the two being equated in trade. That is part of
"price theory" and without it we cannot do very much there, because we
cannot compare anything. But you are quite correct if you say that the sense
in which they are equal or unequal depends on value-theoretical assumptions.
Point is, if you had no value theory, the whole problem to which you refer
doesn't even arise, because all you can say in that case is that 10A "must
be equal" to 5B. At most you can hide your value-theoretical
presuppositions, by talking about monetary theory etc. (In Das Kapital, Marx
normally thinks of the "value" of a commodity as the ratio between the
amount of labour required to produce a reproducible good, and the
corresponding amount of labour required to produce a unit of gold, i.e. a
monetary gold standard is as he says assumed). It is precisely the fact
that, although 10A and 5B are equated, this equation may in substance
express an exchange of unequal values, which explains the need for value
theory of some sort beyond monetary comparisons. So what you project as a
problem for Marx, is I think a problem for economics generally. In everyday
life, you strike this problem all the time, because people ask themselves
about "whether they are getting value for their money". They know that the
sum of money they have will "equate" to a commodity, or that one commodity
may equate with another, but it may be bought above or below its real value,
that's the point. Even although economics may deny it, human beings are
"valuing agents", and therefore there is ultimately no escape at all from
value theory for the serious economist. All we can debate about is which
value theory has more explanatory, heuristic and predictive power. That is,
whether you like it or not, you have to assume some concept of value, if you
want to do economics, whether eclectically or systematically.

9) According to historical materialism, the mode of distribution of
resources is determined by the mode of production, to be precise by "the
specific way in which surplus labour is pumped out of the direct producers".
Another way of saying that is, that the property rights defining the
relations of production determine how the social product will be
distributed. Thus Marx argues that in producing commodities as capital,
workers simultaneously reproduce the capital relationship, in so far as they
have no title to the surplus they produce (however you want to define that).
In the Sraffian system, as far as I understand, the way of distributing the
product is relatively autonomous from the way of producing it. In that case
we cannot infer very much about the system of distribution from the system
of production.

10) Why I am critical of your proposition "the equalisation of profit rates
does not affect the distribution of value between social classes" is because
total surplus value may be distributed between different owning classes, and
if workers own stocks & securities they may indeed participate in the
share-out of surplus value. And if, for example, as a result of the
equalisation of profit rates businesses have negative profits,  this must
impact on the distribution of value between the social classes.



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