From: Rakesh Bhandari (rakeshb@STANFORD.EDU)
Date: Wed Jun 23 2004 - 11:51:53 EDT
At 1:27 PM -0700 6/18/04, Ian Wright wrote: >Hi Allin > >>I was thinking of a different case: I produce some commodity, using >>best-practice technology and minimum labour-time, but consumer taste >>tuns against it, and it can be sold only at a heavily discounted >>price. Does the low price mean that my labour-time is retrospectively >>counted as less than socially necessary (i.e. that the _value_ of the >>commodity I have produced is depressed by the downturn in demand)? I >>think not: rather, price has been depressed below value -- and >>presumably the consequence is that the quantity produced will be >>curtailed, to the point where price roughly corresponds to value. > >Yes, the value of the commodity does not change, because value is not >determined by social demand, but by the technical conditions of >production. But in this case some of the labour-time expended on the >production of the total volume of commodities was socially >unnecessary, and therefore is unrewarded, leading to a reduction in >the labour-time allocated to the production of this commodity, all >other things being equal. Is this true? Isn't it the case that overproduction (say in basic steel or memory chips) often leads to even more production through which technological gains and economies of scales are realized, values further depreciated, greater quantities sold and backward plants/firms eliminated? Didn't the S&D mechanism break down long ago? In short, why should overproduction lead to less labour time being allocated to the production of this commodity. More labor time (or a greater share of social labor time) could be allocated if the market is expanded sufficiently through the reduction of unit values, no? The price mechanism is not one that provides equilibrium through negative feedback. Perhaps in a world of simple commodity production the price mechanism would work like that. But the capitalist price mechanism tends to induce continuous morphological change even as it tends to maintain the capitalist organism in homeostatis. And of course cybernetics is a flawed metaphor because it thinks away the role of real contradiction in capitalist development. > >>Does the low price mean that my labour-time is retrospectively >>counted as less than socially necessary (i.e. that the _value_ of the >>commodity I have produced is depressed by the downturn in demand)? > >The low price does mean that some of your labour-time is >retrospectively counted as less than socially necessary. You wasted >some time. But the value of the commodity does not change. > >I can take the socially necessary amount of time to produce a >particular commodity but if no-one wants to buy it then my labour was >socially unnecessary. Is there something wrong with this? > >Values can change with the volume of production (e.g., different kinds >of return to scale), and hence social demand can change values via a >change in the technical conditions of production. For example, a >really high demand can bring out-of-date technology to life, and hence >increase the value of a commodity (as discussed by Rubin in Ch.17 >"Value and Social Need", if I remember correctly). Nothing >controversial here I think ... ? right but no response from Allin on this point. > >Always worth checking on the basics. > >-Ian.
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