[OPE-L:5253] Re: trpf/extra profits vs. extra surplus value?

andrew kliman (Andrew_Kliman@msn.com)
Thu, 12 Jun 1997 20:07:20 -0700 (PDT)

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A reply to Paolo Cippola's ope-l 5251 and Jerry's 5252.

Paolo wrote: "If we are conceiving the extra gain as a result of the
redistribution then surplus value is given. The extra gain comes from
dislodging somebody else's market share. Yet, Marx calculates the extra
surplus labor which results from the introduction of a new technique on the
part of an individual capital: (Capital, vol. I, International Publishers,
p.318: "The ratio of the necessary labor to surplus labor, which under average
conditions was 5:1, is now only 5:3"). It seems, then, that the issue is not
only one of redistribution: there is an extra surplus value being created
here. How can the extra profits come from distribution if they are generated
as extra surplus value by the innovating firm?"

The extra gain comes purely from redistribution, but it does *not* have to do
with market share. It has to do with the establishment of social value, what
is now known as the "law of one price."

Now, here's why it is a purely distributional gain: Marx works this example
*backwards*. He *starts* from the social (average) value of the commodity.
Therefore, the surplus-labor that he arrives at by subtracting costs is not
just the surplus-labor actually *produced* in this low-cost firm. It includes
some of the surplus-labor stolen away in exchange. Precisely by selling at
the social value instead of the individual value of the commodity, the
low-cost producer realizes some of the surplus-labor that was produced by the
workers in other firms; it is being redistributed from the high-cost to the
low-cost producers.

Here's an example, measuring in labor-time and use-value. S = living labor -
V. Indiv.Value = (value produced)/(use-value produced). Indiv. value of
Total industry = social value. Value realized = (Social value)*(use-value
produced). Costs = C+V. S realized = Value realized - costs. Gain = S
realized - S produced.

Producer A Rest of Industry Total
========== ================ =====

working forward
in time:

used up C 10 90 100
V 5 45 50
living labor 20 180 200
S *produced* 15 135 150
value *produced* 30 270 300
use-value produced 120 180 300
individual value 0.25 1.50 1.00

now working

value *realized* 120 180 300
costs 15 135 150
S *realized* 105 45 150
Gain 90 -90 0

So you see that this is purely a matter of redistribution. There is no extra
surplus-labor on the social level (gain = 0) Yet a greater portion of the
labor (value) *realized* by producer A is surplus-labor. How can it be said
that these 105 labor-hours are actually surplus-labor? Precisely because the
whole thing is a pure redistribution. The 105 labor-hours of surplus-labor
realized by A includes the 15 produced in firm A plus 90 of the hours of
surplus-labor produced in the rest of the industry and stolen away by A.

Andrew Kliman