Re: [OPE] intermission: value of knowledge

From: michael perelman <>
Date: Fri Nov 13 2009 - 21:14:26 EST

Could Dogan be thinking of this, which I used in The Invisible Handcuffs:

Adam Smith remarked:

          How many people ruin themselves by laying out money on
trinkets of frivolous utility? What pleases these lovers of toys is not
so much the utility, as the aptness of the machines which are fitted to
promote it. All their pockets are stuffed with little conveniencies.
They contrive new pockets, unknown in the clothes of other people, in
order to carry a greater number. They walk about loaded with a
multitude of baubles ..., some of which may sometimes be of some little
use, but all of which might at all times be very well spared, and of
which the whole utility is certainly not worth the fatigue of bearing
the burden. [Smith 1759, IV.i.6, p. 180]

   Smith concluded that the desire for luxury is little more than a
"deception which rouses and keeps in continual motion the industry of
mankind" (Smith 1759, IV.i.9, p. 183). At that time, Smith had no idea
that this deception would involve anybody but the upper classes, who
without the prod of new demands would satisfy themselves with greater

Paul Bullock wrote:
> Dogan... have you refs to Adam Smith saying this... ie 'illusion'?
> Paul B.
> ----- Original Message -----
> *From:* D. Göçmen <>
> *To:* <>
> *Sent:* Friday, November 13, 2009 2:11 PM
> *Subject:* Re: [OPE] intermission: value of knowledge
> With minor editing again:
> "Good point, Jerry. As Marx pointed out in *Grundrisse* the idea of
> *free market* implies a market without market forces even if we
> leave out the state. Already Smith pointed out that the idea of free
> market and free trade is an illusion. More generally, Engels, in his
> investigation into the concept of competition, pointed out that the
> division of labout resulting in private property implies some kind
> of monopolies and therefore power relations. Remember what Marx says
> about the dision of labour and private property in Capital: the
> divison of labour does not require private property as in a factory
> but private property does always."
> D.Göçmen
> -----Original Message-----
> From: Gerald Levy <>
> To: Outline on Political Economy mailing list <>
> Sent: Fri, Nov 13, 2009 3:28 pm
> Subject: Re: [OPE] intermission: value of knowledge
> > What is different about knowledge is that it has high returns to
> scale,
> > but as Michael has pointed out, capitalism has difficulty with all
> > industries characterised by high returns to scale. It is forced to
> > abandon the idea of the free market and resort to monopoly in
> > these cases, whether it be railways or software publishing.
> Hi Paul C:
> Even where there are more competitive markets, the "free market"
> doesn't exist. One can only conceive of the possibility of a free
> market in the absence of a state, yet where the capital-form has
> existed historically so has the state-form. "Free market capitalism"
> is not a historical construct, it is an ideological one.
> Regarding the point that labor has to be expended preserving
> the material carriers of knowledge, that's true but it can also be
> vanishingly small. What, for instance, is the labor required to
> preserve a Class 6 SHDC and the data which has been stored in it?
> What's even more to the point is that although there is such
> preservation labor required, it doesn't correspond to the value of
> the knowledge.
> In solidarity, Jerry
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Michael Perelman
Economics Department
California State University
Chico, CA
530 898 5321
fax 530 898 5901
ope mailing list
Received on Fri Nov 13 21:16:45 2009

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