(OPE-L) indirect labor, the real wage, and the production of surplus value

From: gerald_a_levy (gerald_a_levy@MSN.COM)
Date: Mon Nov 10 2003 - 08:39:16 EST

Hi Rakesh.

> Since wage
> contracts are in money terms and productivity is presumably rising
> faster on the commodity side than the money side of the exchange
> equation, a constant money wage will result in a higher real wage.
> Again the assumption here is a commodity theory of money. What
> happens with fiat money is not clear.

Even with commodity money, a constant money wage could result
in a _lower_ real wage.  This was typically the case during inflationary
periods. This is why many late 19th Century and early 20th Century
German Social Democrats thought that inflation, like gambling, was
a way of redistributing wealth among the social classes and 'cheating'
the working class.

The case of a constant money wage resulting in a higher real wage
might happen (with or without commodity money) during a
deflationary period.  Yet, deflation historically tends to happen
during the contractionary phase of the cycle when the industrial
reserve army is growing and the relative bargaining strength of
labor v. capital is declining.  This, though, would have the effect
of lowering money _and_ real wages.  So, even during this period
-- when the average prices of commodities are declining --  the
 case of a constant money wage with a higher real wage is

In solidarity, Jerry

This archive was generated by hypermail 2.1.5 : Tue Nov 11 2003 - 00:00:00 EST