[OPE-L:1868] Re: Re: Re: Re: the money supply

Subject: [OPE-L:1868] Re: Re: Re: Re: the money supply
From: Allin Cottrell (cottrell@ricardo.ecn.wfu.edu)
Date: Wed Dec 08 1999 - 20:39:15 EST

On Mon, 6 Dec 1999, Claus Germer wrote:

> I'm sorry but I would remind you that the problem of how the
> labor content of the commodities can possibly be measured by
> a form of money that is not a commodity remains to be
> answered, as long as one conceives of prices as expressing
> the contents of social labor in the commodities. I would
> still like to know how you handle this problem.

I have responded to this (albeit briefly) in earlier posts. I
don't think that money's "measuring" the value of commodities is
the right concept. The question is how labour contents come to
function as attractors for exchange ratios of commodities.
This is not an easy question, but I don't see that
(counter-factually) assuming a commodity money makes it
substantially less difficult. There has to be some economic
mechanism pushing exchange ratios in line with labour
contents. If money itself does not take labour-time to produce,
these ratios are no more or less difficult to determine: it just
means that the "absolute" price level is not determined by the
labour theory of value.

> It seems to me that what [Paul calls] call idealism is in
> reality a feature of Marx's method - abstraction. In the
> present case, Marx abstracts the commodity and its exchange
> in order to analyse it in isolation. Is there a different
> way of proceeding in the social sciences?

There are fruitful and unfruitful "abstractions". Attempting to
abstract from the role of the state when analysing money is
unfruitful, since it leads the analysis off on an imaginary,
counterfactual path.

Allin Cottrell.

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