Re: Quantifying Values - response to Alan

jurriaan bendien (
Tue, 20 Jan 1998 12:18:55 +0100

Alan writes:

'Correcting' the national
> accounts does not I think reduce to eliminating things, but moving them
> from one category to another.

That is true in some cases, but not all cases. The imputed rental value of
owner-occupied houses is one big example of a spurious entry that must be
removed. I recall also having some difficulty in NZSNA with the forestry
industry accounting (the value and growth of standing timber) and
agriculture (definition of certain agricultural "stocks") where some
entries seemed spurious. It is also a moot point whether the item
"increase in stocks" included in GDP should be included as value added (a
distinction is made between the physical increase in stocks and book value
of stocks, but it isn't always clear from the information whether these
stocks are really stocks of (maybe semi-finished and not final) output or
input stocks - conceptually presumably only stocks of (finished?) output
should be included. Regretfully I never wrote up all my deliberations ! I
will have to wait and see how Bruce Cronin tackled it.

Jurriaan said:

> > Of course, interest
> > payments are a production cost to a manufacturer, an income for the
> > and an appropriation of surplus-value from the social point of view.

Alan replied:

> There is obviously something going on in your head that isn't going on
> in mine.

That is highly probable - I am writing these missives in between the

I need to know why this statement seems reasonable to you
> before I can go any further, because it seems completely unreasonable
> to me.

I confess I don't see what Alan's problem is. Insofar as the manfacturer
pays out interest on borrowed capital, it is a production cost to him, and
insofar as it is clear this cost is paid out of current manufacturer's
income it represents an appropriation of surplus-value by the lender from
the social point of view. The banks make money out of lending capital to
industry etc. and the interest they receive is a fraction of surplus-value.
That's all I am saying.
The more substantive issue however is how you account for the circuit of
interest transactions from the standpoint of the national economy as a
whole. The same transactors for instance (as Alan shows) both receive
interest and pay out interest. So what we are concerned with from the
standpoint of the value of the product is net interest. I agree with Alan
that "interest payments can be either one or the other. Either they are a
manufacturing cost, or they are an allocation out of profits. They cannot
be both". But I did not specifically argue they were both, merely saying
that interest can be a cost, or a source of income.

Alan writes:

Juriaan is toying with the idea that Marx wasn't consistent. I'm not
clear why he thinks this but I hazard a guess that if one believes
the capitalists can simultaneously pay the same sum out of both
revenue and capital, no-one else is going to appear particularly
consistent. I have heard no evidence that Marx is inconsistent or

I am not toying with the idea Marx is inconsistent. I think there are real
inconsistencies in his thinking on productive labour, i.e. not all of what
he says can be true at the same time. His thinking must in other words
have evolved. There is no evidence that Marx finally resolved a single
definition of productive labour which can be applied to the national
economy. That does not mean that such a definition cannot be found, or a
practical rule applied. It only means that none of Marx's statements on
the subject can be said to be his definitive view.