[OPE-L:1153] Re: Marx, Ricardo and money

Allin Cottrell (cottrell@wfu.edu)
Tue, 20 Feb 1996 10:19:28 -0800

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On Tue, 20 Feb 1996, Costas Lapavitsas wrote:

> The question is, does credit-money, eg banknotes, symbolise gold or
> value?

My own answer is this: There is no basis for saying that credit-money
symbolizes gold (any more than it symbolizes iron or toothpaste), and it
should be thought of as "symbolizing value" in its own right, in the sense
that at any given point in any given economy, there is a definite (though
historically contingent and mutable) relationship between the monetary
unit and the amount of embodied labour-time it commands in exchange (on
average). In a commodity money economy one can ask not only whether
relative prices (of commodities other than money) are "right" in terms of
relative labour contents, but also whether _absolute_ money prices are
"right", given the labour required to produce the money-commodity. But
under fiat money or modern credit-money, the latter question loses its
meaning. My problem with (at least some of) Marx's formulations is that
they threaten to make this unthinkable.

Would Costas agree?

Allin Cottrell