On 06/08/2012 1:32 PM, Paul Cockshott wrote: > > _______________________________________________ >> This seems a fallback to the economics 101 > You're giving too much credit to econ 101. The latter still seeks and, > if it cannot find, makes up "determinants" on the supply side; as > without those, economics is lost. (e.g.) Money "is" a store of value, > paradoxes be damned. > --------------------------------------- > My objection was to the idea of applying supply and demand to money which is > a structure to which neither applies. It was the notions of supply and demand > that I meant were an appeal to economics 101 > Supply and demand are abstractions from the real process of production and > consumption of material goods. Money is a data structure which records > information and the application of metaphors from material production and > consumption gets you, in my opinion, nowhere in attempting to understand the > laws governing such data structures. > ------------------------------------------------------------ Thanks for the extended explanation. I didn't read as much of a critique, as perhaps I should have, in your above "fallback" line. Can't say I disagree with anything you say here. >> The currency has no price, but is the measure of price, the problem is to >> explain how a standard of price and measure of value which itself has no >> value can operate as a social form. > Get over it, there is no problem. People have found out since time > immemorial that keeping track of input, works in claiming output. > ============================ > I dont see how this even approaches addressing the problem of what determines > the value of state token money. What is the input that is kept track of to > claim output in this case? Huh? Aren't you now chastising me for failing to address "what determines the value of something which itself has no value (state token money)"? Kind of ambiguous question, don't you agree? Above, I addressed the "social form" whereby this works. A social form requires a circular structure. It isn't explainable by following a logical linear path. No knowledge of economics by anyone is required for a social form to be maintained. Quite the opposite, I find that economic theory often gets in the way of understanding what's going on in the real world. If you now want to focus on the nature of money, rather than its working as a social form, you'll need a comprehensive theory of money (which still hasn't been written by anyone); and that in turn first of all requires a set of assumptions. I've stated mine a number of times, what are yours?
The input you're asking about is gaining acquisition to the distribution _potential_ of the social product. The reason for just about everyone participating in economic production is to get a share of that output. Linear reasoning may lead one to think this is "silly", but as long as that remains the goal of the vast majority of economic participants, such a social form will work. It's only when that goal is changed to become keeping score instead, and the extraction of the economy's means of account into for instance offshore tax havens becomes a norm to a significant extent, that the system will break down. To get the full picture of a desirable overall dynamic equilibrium however, the focus should be taken off individual participants and onto employers who have to book expenses, deb(i)ts, that will require credits within a given time for continued reproduction. No incoming credits, and the production unit ceases to exist, resulting in involuntary unemployment. That may not be the real (physical) world, but it's what counts for one's daily existence. Money income fundamentally already represents to be resolved deb(i)ts, that cannot be saved to pay off other existing debts (nor can be simply extracted) without affecting the first; unless the creditor of the previously existing debt turns around and spends that income directly. Perhaps this isn't news to you, as you seem to have a better understanding of money than most people, economists included; but in just about every "learned" paper I read, money (funds) is represented as an inventory or a stock of wealth. Although inputs are kept track of in terms of a unit of account, in a dynamic structure it's a mistake to try to fix the redemptive value of that unit of account at any moment, let alone during some kind of (even short) run. The final outcome depends on a number of influences coming to bear only ex post; e.g., the experience gained during the social production process with its increased output per unit cost of input, as well as newly on the retail level induced personal incomes due to investments in additional means of production made higher up. So to be theoretically correct, the value of the unit of account has to be left floating at all times and no ex ante determination is possible. Getting back to your original question, restated later in this thread, and as following my own set of assumptions: a first approximation of the value of a currency is best approached as being the personal income embodied in final output and expended on behalf of both private and public sector income earners, with qualifiers some as listed above. Note also the consequences of all taxes being paid out of income and thus part of the embodied costs, redeemable by public income earners. So much for a short foray into the vertically integrated part of our economy; originating with an expected to be resolved debt that is passed along for a final redemption on the retail level and fully includes the public sector as well. Inclusion of the horizontal retail services sector, as well as a return into the economic sphere of previously extracted and now "used" items, and what both these processes mean wrt. the "value" of money, perhaps is for some other time. > ========================== > . Don't you think it's high time that a truly > alternate paradigm becomes developed anyway? > --------------------------------------------- > Indeed and that is what I attempt to work on. Good to hear and wishing you success. John V _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
