[OPE-L:1592] Re: technical change and real wages

Ajit Sinha (ajitsinha@lbsnaa.ernet.in)
Tue, 26 Oct 1999 17:37:50 +0530

michael a. lebowitz wrote:

> I would propose that a rise in real wages implies
> increase in
> the bargaining strength of the working class nor an improvement in its
> position vv the capitalist class. Rather, only a rise in the *relative*
> wage or a fall in the rate of surplus value implies these.


Mike, I have two fundamental questions, and unless I have the answers to
a feeling that we will keep beating about the bush. You begin your
a certain amount of money wages as given. My first question is, how was
wages determined in the first instance? Secondly, it seems to me that you
wages are determined ex-post, that is after the harvest the net output is
into real wages and profits according to the relative strengths of the two
This could be okay for Sraffa's model but I have not come accross any
Marx were he includes real wages in surplus. What is your reference for
interpretation? By the way, what is *relative* wages?

> Mike:
> My reasoning is as follows. Yes, tech change in Marx is as you
> it--- it displaces workers and tends to drive down money wages. However,
> tech change is two-sided in its effect--- it also reduces values. In Wage
> Labour and Capital (and the Manifesto), Marx only considers the former, but
> by the time of Capital he is clear that money wages may be falling and yet
> real wages can rise precisely because of the rise in productivity. See his
> discussion in Vol. I, Ch. 17, where when the relative position of
> capitalists and workers is unchanging and the price of labour-power (money
> wage) is unchanged, a doubling of productivity means that the money wage
> would represent twice as many use-values as before (Penguin/Vintage, p.
> 659). However, workers remain in the same relative position only if money
> wages are constant, and this is a condition that might hold if productivity
> increases drop from the sky but not if it occurs via labour-displacing
> machinery.


Those theoretical and mathematical possibilities have not been denied by
problem is basically about the theory of wage determination.

> Effectively, you ask-- wouldn't money wages, however, be driven
> the situation in the labour market to the point where all the gains from
> productivity increases are captured by capital (and in the limiting case to
> the level of bare subsistence)? This is what I take your point about
> "sticky wages" to mean.


I had meant that you were assuming sticky money wages, i.e. even when the
wage goods change, the money wages remain the same. The question is why

> I would be interested in your description of the
> mechanism by which this might occur. I think your argument might hold if we
> retain the assumption of a fixed set of necessaries but not otherwise.


Usually in the real world a general inflation accomplishes what in theory
money wages would do. The point one needs to think about is on what
could win higher wages when rate of unemployment is rising. The technical
has made the wage goods cheaper has also at the same time made the workers
throwing them out in the street.

> In the case where that assumption has been removed, my own
> that... it depends. Ie., it depends upon the degree of separation among
> workers. If workers are unorganised and that degree of separation is
> complete (eg., it approaches 1, and its inverse, the degree of unity,
> approaches zero), then yes the real wage will be driven toward the
> physiological minimum and the working day to its physiological maximum. On
> the other hand, if workers do organise, they can as Marx said succeed in
> capturing "a certain quantitative participation in the general growth of
> wealth" (cf. Beyond Capital, pp. 73-4). On the assumption that the degree
> of separation is constant (ie., that the position of the working class vv
> capitalists is given), then real wages would rise with productivity (that
> "golden age" condition); however, even if the displacement of workers by
> machinery does increase the degree of separation, there remains the
> possibility of real wage increases.


The question is why didn't these organized workers get the higher real
Are you saying that before the technical change the surplus was pushed to
acceptable level for the capitalists? My general sense is that you seem to
terms of some sort of 'social accord' that took place between the
workers in the 20th century in advanced capitalist countries. But this is
on which either Marx's theory of wages or his notion of class struggle
opinion. Cheers, ajit sinha

> in solidarity,
> mike
> Michael A. Lebowitz
> Economics Department
> Simon Fraser University
> Burnaby, B.C., Canada V5A 1S6
> Office: Phone (604) 291-4669
> Fax (604) 291-5944
> Home: Phone (604) 872-0494
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