Re: [OPE-L] workers' consumption and capitalists' consumption

From: Ian Wright (wrighti@ACM.ORG)
Date: Wed Jun 14 2006 - 17:37:18 EDT

Hi Paul

> I can see that adding workers consumption in on the right would give
> a nonsense result, but what I was getting at is a social issue.
> What do you think it is about capitalist consumption that makes
> it productive of value when workers consumption is not?

I'm not sure any conclusion can be drawn about the cause of value from
linear algebra. For example, there are a number of different but
equivalent equations for calculating real-cost labour values. I quoted
two in an earlier reply to Allin, one which referred to capitalist
consumption and one that did not. The presence of capitalist
consumption in one equation does not imply that it is "productive",
any more that its absence from another equivalent equation implies it
is not "productive". We have focussed our attention on the equation
that refers to the technique augmented by capitalist consumption
because it is the representation that most clearly brings out
precisely what labour is not being counted in the Sraffian scheme.

> You could get a solution by the reverse, include workers
> consumption and exclude capitalists consumption.

I think you've hit on a good idea; it suggests there is another,
equivalent expression for real-cost labour value that I have not

> On the issue of productive labour, I mean in this case productive
> of value. Smith was pointing out that expenditure on personal
> consumption in the form of servants labour, did not pass on
> to the value of the product, whereas labour by manufacturing
> workers did.  Using your view of value contradicts this intuition
> of Smith.

Here I am at the edge of my knowledge. I do not know. But I would
guess that the answer depends on whether the domestic labour is
employed by a capitalist firm that sells services to capitalist
consumers, or whether the domestic labour is directly employed by
capitalists as part of their household retinue. The capitalist
consumption bundle in the circular flow model consists only of goods
and services sold by capitalist firms. So there are no servants, only
employees. All labour is therefore that of "manufacturing workers", in
the sense it is organised under the social relations of the capitalist
firm. It may be the case that Smith's distinction simply does not
arise in this model. But I am no expert on Smith, or on the
productive/unproductive distinction.

> I now think I understand what you are actually doing. You are
> calculating how many hours a worker has to work to buy a ton
> of corn. This is similar to Smiths 'Labour Commanded' view of
> value, which was criticised by Ricardo and Marx followed
> Ricardo on this.

In simple commodity production prices are proportional to
labour-values and labour-embodied equals labour-commanded. A dynamic
analysis of simple commodity production reveals that it is the
out-of-equilibrium mismatches between labour-embodied and
labour-commanded that are an essential causal link in the operation of
the law of value. That these two measures are identical in equilibrium
does not imply a rejection of a labour theory of value. Similarly for
the equilibrium of simple reproduction. Although I am no expert on
this, I believe Ricardo criticised Smith for not adhering to a labour
theory of value.

Best wishes,

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