[OPE-L:1079] Re: Discussions on the labor Theory of Value

akliman@acl.nyit.edu (akliman@acl.nyit.edu)
Fri, 16 Feb 1996 07:49:06 -0800

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Andrew here, replying to Paul C. (ope-l 1060):

The term "theory of value" indicates, usually, that value is the *object*
of the theory*, i.e. the purpose of the theory is to account for the
magnitude of value (though it doesn't need to mean this). Thus we have
the usual Austrian/neoclassical objection to Marx's value theory that
it lacks generality because it doesn't explain the prices of land, non-
reproducibles, etc. But this objection loses all force if value is not
the object of the theory.

When referring to Marx, I use "value theory" as a shorthand for what Raya
Dunayevskaya called (in her _Marxism and Freedom_) his "value theory of
labor." Here, the object of the theory is labor, not value. The purpose
of the theory is then to understand how labor relations under capitalism
have the form of value relations and how this in turn shapes (forms)
the content of those relations (e.g., the real subsumption of labor under
capital). 20 years later, Diane Elson used the term "value theory of
labor," but meant something rather different. People who picked up on
Elson's usage has usually been trying to jettison the quantitative
dimension of Marx's value theory (orignially, it seems, in order to crawl
out from under the Sraffian critique, but now they've jettisoned the
determination of value by labor-time). Dunayevskaya, conversely, retained
the quantitative and qualitative dimensions in unity.

I of course do not think Marx was talking down to the working classes.
But in certain contexts, one abstracts from certain complexities in order
to focus on other issues. This is what Marx did in VP&P and in much of
_Capital_ as well, concerning the difference between production price
(or natural price, or average price) and value. Yes, one aspect of Marx's
critique of the classical notion of natural price was that it wrongly
accepted Adam Smith's "spiriting away of constant capital," but this was
not the only one. I consider it a waste of time to dig out quotations
proving that Marx affirmed a difference between value and natural price
(also called cost-price in TSV) in contrast to the classicals, because
no one has ever doubted it until now, including Paul himself. Why he
rejects his earlier view is wholly unclear to me.

With respect to the original passage that Paul quoted from VP&P, he says
I interpret is as saying that profit can't arise from exchange if we
assume prices approximate their values, and then he burdens me with a
lot of stuff about implying Marx is dishonest, etc. Nope, nope, nope.
Just as in Ch. 5 of Vol. I, Marx is saying profit doesn't arise from
unequal exchange. It doesn't matter whether we're talking about exchange
at prices differing from values or from prices differing from average
prices--the point is the same in either case, as Marx makes clear at the
end of Ch. 5. (Gil: please note that I am providing an interpretation
of Marx here and that the accuracy of that interpretation does NOT
require that I prove the non-tautological nature of the claim, much less
its validity.)

I had maintained, contrary to Paul, that although Marx says that prices
tend over longer periods to equal their natural prices and to fluctuate
around them, this does not imply that natural prices (or values) are
a good predictor of market prices. There can be a strong correlation
between movmements in A and B, even though B doesn't fluctuate around
A or equal A on average; conversely, even if B does equal A on average
and fluctuate around it, the correlation between A and B can be very
small. Thus, the Shaikh-Ochoa-Cockshott-Cottrell-Michaelson-Trigg
methodology has no clear relation to Marx's theory, even if we leave
aside the fact that nothing in Marx's theory implies a high correlation
between values and production prices.

Now, in response, Paul cites another passage from VP&P in which he
suggests that Marx implies that the fluctuation of market prices around
natural prices (or values) is *damped*. Nope. Nothing in the passage
implies that the oscillations aren't periodic or chaotic or even

Andrew Kliman