Re: Marx vs. Roemer
Continuing the discussion with Charles. Fast forward to... CB: (Again, just because we are doing a fine tooth comb treatment, surplus value and capital are not entirely identical, but it may not matter. I'm not trying to be picky, but I am thinking that as you are doing a very fine graded analysis, these types of details cause a question mark to sort of popup in one's mind) GS:No, that's fine, it's better to make these choices explicit. As far as I can tell, capital in the passage I cited above is shorthand for the transformation of money into capital, a phrase that Marx uses in the passages immediately preceding and immediately following the one I cite. Again as far as I can tell, Marx uses the transformation of money into capital as a corollary of creation of surplus value--compare, for example, his usage of surplus value at the top of p. 268 and the near-parallel use of transformation of money into capital near the bottom. ^^^ CB: Page 268 : Is that in Chapter 5 ? Yes, the penultimate page of Ch. 5 in the Penguin or Vintage edition. I hesitate, because it seems that the creation of surplus value is in production. I have more that idea that in M-C...P...C'-M', the surplus-values are created at P. The transformations of money into capital occurs at M-C and then again at M'-C'', no ? As I read Marx, although the creation of surplus value *requires* the production of new value, surplus value literally does not exist--is not created-- until the *completion* of the circuit of capital bracketing the P in your expression above. In other words, at the step P...C' in your expression, surplus value does not yet exist. Consequently, the creation of surplus value at least implies the transformation of money into capital. Foundation for these claims: In Chapter 4, Marx defines surplus value as the increment (delta M = M' minus M) arising from the circuit of capital, insofar as this increment corresponds to the valorization [Verwertung, Marx's coinage] of the value originally advanced. (pp 251-2). To me, this means that by definition the creation of surplus value involves something more than just production of new commodities. [Notice, for example, that he didn't define surplus value as (delta C = C' minus C).] This view is corroborated in Marx's discussion near the end of Chapter 5, when he asks rhetorically But can surplus-value originate [note the verb!--GS] anywhere else than in circulation...? and adds The commodity-owner can create value by his labour, but he cannot create values which can valorize themselves. But then it is incorrect to assert that the creation of surplus value is in production. The creation of surplus value is in production *and* circulation. Fast forward... GS: No, I'm saying that Marx's Chapter 5 argument demonstrates the claim that price-value disparities are not sufficient to explain the existence of surplus value. But he makes no demonstration one way or the other concerning the claim price-value disparities are not necessary for the existence of surplus value, leaving open the possibility that they *might* be necessary, at least under some conditions. Since no claim has been made about necessity, one cannot validly infer that price-value disparities are incidental to the existence of surplus value, as Marx does in the conclusion of Chapter 5. If A is necessary for B, then it is certainly not incidental to B, whether or not it's sufficient for B. ^^^ CB: OK ,so Marx says and demonstrates that they are not sufficient, but doesn't address whether they are necessary, so they might be necessary. To say price-value disparities are a necessary condition of surplus-value would be to say surplus value implies ( in the sense of modus ponens) price-value disparities, correct ? For at least some instance of the general formula of capital M--C--M', yes. Not price-value disparities, not surplus value. And in such a case , we would not say that price-value disparities are incidental to surplus-value. Is that what you are saying ? Your statement is certainly true, but I'm actually saying something more basic: since Marx does not even consider the claim not price value disparities, not surplus value in his Chapter 5 argument, his inference price value disparities are incidental to surplus-value cannot be entailed by that argument. He's asserted a conclusion that does not follow logically from his premises.
Re: Marx vs. Roemer
I just think that you can explain some profits by normal bourgeois means (buying low and selling high) or monopoly advantages, as in MArx's discussion of differential rent--which leads me to thing that even he doesn't accept thestrict version of the LTV, nut only uses it as an idealization. jks ^^^ CB: To be more precise, Marx's position is that labor is the only source of new value, exchange-value. Individual capitalists may increase or lose some of their share of the total surplus value by various buying and selling of all types among themselves. Marx's recognizing this does not contradict his basic proposition that labor is the only source of new value, exchange-value. Right, so you have profit taht is generated by possession of monoply advantages that does not represent value in Marx's sense. Note that this profit is not a result of redistribution of SV, a point that can be made if we imagine a situation with two capitalists, one of whom acquires a monopoly and behaves as monopolists due. His monopoly rent is not redistribute from the other guy, it's due rather to his possession of the monopoly (Marx's point): so, profits without value that are therefore NOT due to the expoloitation of labor--rather to the exploitation of consumers. Right, Gil? jks _ MSN Photos is the easiest way to share and print your photos: http://photos.msn.com/support/worldwide.aspx
Re: Marx vs. Roemer
Charles put it nicely. Here are a couple more hasty thoughts. For Marx, value is unobservable. It is a fundamental to price, in the sense that prices and profits depend on what happens in the sphere of value, but Marx paid little attention to the manner in which value gives rise to prices. I don't see that Marx paid much attention nor was he very concerned with the mechanics of the transformation problem. The so-called transformation problem is a problem only if you believe that the precise relationship to prices and values is important. I read Marx as saying that what goes on in the sphere of value is far more important than the sphere of prices. The system will prices and profits does become important in so far as it shows how an economy based on values is dysfunctional and will eventually will become a source of great dissatisfaction, so much so that people will eventually will reject the market. Charles Brown wrote: Marx vs. Roemer by Justin Schwartz 09 March 2002 22:09 UTC The existence and inevitability of exploitation under capitalsim was important to Marx, but the explanation of profits was not a central concern. You cannot prove that agriculture [Physiocrats], ownership of capital [Smith] or surplus capital is the source of profits. This strikes me as just wierd, Michael: the explanation of profits is the obverse of the explanation of exploitation, they're the same question viewed from different sides. And as to the issue not being important to him from the capitalist side, recall the discussions of frugality and risk easrly on in part I of CI as away of settily up the transition to the focus on production, and the Trinity Formula discussion in CIII, just for starters. I don't know what you mean by yr second sentence, are you restating Marx's results (?) which I largely agree with; I just think that you can explain some profits by normal bourgeois means (buying low and selling high) or monopoly advantages, as in MArx's discussion of differential rent--which leads me to thing that even he doesn't accept thestrict version of the LTV, nut only uses it as an idealization. jks ^^^ CB: To be more precise, Marx's position is that labor is the only source of new value, exchange-value. Individual capitalists may increase or lose some of their share of the total surplus value by various buying and selling of all types among themselves. Marx's recognizing this does not contradict his basic proposition that labor is the only source of new value, exchange-value. -- Michael Perelman Economics Department California State University [EMAIL PROTECTED] Chico, CA 95929 530-898-5321 fax 530-898-5901
Re: Re: Marx vs. Roemer
Justin, for Marx, value does not have anything to do with the redistribution of profit, interest or rent. That fact is irrelevant in his postulating that the exploitation of labor is the source of the surplus. Justin Schwartz wrote: Right, so you have profit that is generated by possession of monoply advantages that does not represent value in Marx's sense. Note that this profit is not a result of redistribution of SV, a point that can be made if we imagine a situation with two capitalists, one of whom acquires a monopoly and behaves as monopolists due. His monopoly rent is not redistribute from the other guy, it's due rather to his possession of the monopoly (Marx's point): so, profits without value that are therefore NOT due to the expoloitation of labor--rather to the exploitation of consumers. Right, Gil? jks _ MSN Photos is the easiest way to share and print your photos: http://photos.msn.com/support/worldwide.aspx -- Michael Perelman Economics Department California State University [EMAIL PROTECTED] Chico, CA 95929 530-898-5321 fax 530-898-5901
Re: Re: Marx vs. Roemer
Justin wrote: I just think that you can explain some profits by normal bourgeois means (buying low and selling high) or monopoly advantages, as in MArx's discussion of differential rent--which leads me to thing that even he doesn't accept thestrict version of the LTV, but only uses it as an idealizationso you have profit that is generated by possession of monoply advantages that does not represent value in Marx's sense. Note that this profit is not a result of redistribution of SV, a point that can be made if we imagine a situation with two capitalists, one of whom acquires a monopoly and behaves as monopolists due. His monopoly rent is not redistribute from the other guy, it's due rather to his possession of the monopoly (Marx's point): so, profits without value that are therefore NOT due to the expoloitation of labor--rather to the exploitation of consumers A monopolist is able to get an above-average rate of return on its capital. Nonmonopolists (except, perhaps, in Lake Woebegone..) must therefore receive a below-average return on their capital. The economic process determining these different returns to different capitals is a process of distributing the value of the total surplus product among the various claimants to that surplus value. Marx's Law Of Value applies to the aggregate surplus as produced. Because Marx defined value as a determinate quantity of labor time and capital as *capitalized* surplus value he was able to view the capitalist system as a dynamic entity subject to quantitatively determined laws of motion such as the Law of the Falling Tendency of the Rate of Profit which has been shown both to be empirically true and to be a strict consequence of the fundamental social relationships defining a capitalist economic system. Shane Mage When we read on a printed page the doctrine of Pythagoras that all things are made of numbers, it seems mystical, mystifying, even downright silly. When we read on a computer screen the doctrine of Pythagoras that all things are made of numbers, it seems self-evidently true. (N. Weiner)
RE: Re: Marx vs. Roemer
Michael Perelman writes: For Marx, value is unobservable. It is a fundamental to price, in the sense that prices and profits depend on what happens in the sphere of value, but Marx paid little attention to the manner in which value gives rise to prices. It's true that value is unobservable (like utility or preferences in the orthodox paradigm). I agree that Marx cared less about the correspondence of values and prices as he did about their deviation. In fact, their deviation is central: if values and prices corresponded to each other, then all that stuff about commodity fetishism and the illusions created by competition -- a major theme of CAPITAL -- would be irrelevant garbage. I don't see that Marx paid much attention nor was he very concerned with the mechanics of the transformation problem. The so-called transformation problem is a problem only if you believe that the precise relationship to prices and values is important. Right. That's why I think that it should be renamed a disaggregation problem: the issue is how Marx's volume I macro-societal story shows up on (and contrasts with) the microeconomic matters discussed in volume III. The main story for Marx is that total value = total price and total surplus-value = total property income, with causation running from the former categories (the macro-level) to the latter (the micro-level). But disaggregation isn't the whole story. Levins Lewontin summarize the dialectical method of analysis as whole makes parts, parts make whole, as part of a dynamic process (to paraphrase). Marx's main concern in CAPITAL was with how whole makes parts, how the structure of capitalism-in-general shapes and determines the nature of microeconomic processes. However, in his beginning efforts at developing crisis theory, you can see the feed-back from micro-processes to macro-results. I read Marx as saying that what goes on in the sphere of value is far more important than the sphere of prices. The system will prices and profits does become important in so far as it shows how an economy based on values is dysfunctional and will eventually will become a source of great dissatisfaction, so much so that people will eventually will reject the market. Both values and prices are important to Marx. In Engels's phrase, there is a contradiction between socialized production and individual appropriation. The former is represented by value and surplus-value, while the latter is represented by prices and property incomes. Marx isn't talking about reject[ing] the market as much as rejecting capitalism, which involves exploitation (in addition to markets). Jim Devine
Re: Re: Marx vs. Roemer
Michael writes: For Marx, value is unobservable. It is a fundamental to price, in the sense that prices and profits depend on what happens in the sphere of value, but Marx paid little attention to the manner in which value gives rise to prices. Marx however was concerned with exactly why the value of a commodity (thing) could only be expressed by way of another thing and eventually money price. I don't see that Marx paid much attention nor was he very concerned with the mechanics of the transformation problem. Marx's transformation demonstrates the collective nature of exploitation. This is an important result, and I don't think we should be intimidated by Bortkiewicz. The so-called transformation problem is a problem only if you believe that the precise relationship to prices and values is important. That the relationship breaks down even in the aggregate-in particular that prices can and do rise for some time as the value of commodities are falling--is not a logical contradiction in the labor theory of value but a real contradiction in the capitalist economy. In the course of a boom, there is optimism, even exhiliration, but even Keynes hints that there are *objective* facts which determine the changing mood: The disillusion comes because doubts suddenly arise concerning the reliability of the prospective yield, perhaps [!!!] because the current yield shows signs of falling off (GT, p.317) But this still seems to contradict Marx. For why would profits both as a mass and possibly even as a rate rise at all in the upward phase of the cycle since with increasing investments, accumulation of capital and concentration of production, technical improvements, etc, the OCC is growing and the tendency for the rate of profit should be falling? I would think that in the course of the boom demand outstrips supply as a result of the extension of credit and thus allows the price level to become unhinged from values. Perhaps the general price level rises faster than money wages in particular? Y/K may rise as well. However, as the yield on the marginal investment show signs of falling off--an objective fact despite Keynes' attempt to overpsychologize--credit is no longer used primarily to expand production but to speculate on the stock market and outguess rivals in futures markets. The Fed may tighten in the face of speculative excess. The price level cannot be sustained. The crisis is on. I read Marx as saying that what goes on in the sphere of value is far more important than the sphere of prices. The system will prices and profits does become important in so far as it shows how an economy based on values is dysfunctional and will eventually will become a source of great dissatisfaction, so much so that people will eventually will reject the market. Yes the value dimension becomes visible at some point like one can be reminded of the law of gravity when one's roof falls on one's head. Rakesh
Re: Re: Re: Marx vs. Roemer
Shane Mage When we read on a printed page the doctrine of Pythagoras that all things are made of numbers, it seems mystical, mystifying, even downright silly. When we read on a computer screen the doctrine of Pythagoras that all things are made of numbers, it seems self-evidently true. (N. Weiner) Shane, do you endorse this idealism? Mario Bunge has argued against the myth that the universe is made of bits rather than matter, a myth strengthened by the enormous role that information plays in industrial societies has given rise to the myth An instant's reflection suffices to puncture this idealist fancy. In fact, an information system, such as the Internet, is composed by human beings (or automata) that operate artifacts such as coders, signals, transmitters, receivers, and decoders. These are all material things or processes in them. Not even signals are immaterial: in fact, every signal rides on some material process, such as a radio wave. In other words, it is not true that the world is immaterial or in the process of dematerialization - or, as some popular authors put it, that bits are replacing atoms. We eat atoms, not bits. And when we get sick we call a physician, not an electronic engineer. What is true is that E-mail is replacing snail-mail. But both the electromagnetic signal that propagates along a net and the letter carried by a mailman are concrete items. The information revolution is a huge technological innovation with a strong social impact, but it does not require any changes in worldview: today's world is just as material and changeable as yesterday's. Bunge, Mario A humanist's doubts about the information revolution.(The Freedom to Inquire) Free Inquiry v17, n2 (Spring, 1997):24 (5 pages)
Re: Re: Re: Re: Marx vs. Roemer
- Original Message - From: Rakesh Bhandari [EMAIL PROTECTED] To: [EMAIL PROTECTED] Sent: Monday, March 11, 2002 10:29 AM Subject: [PEN-L:23822] Re: Re: Re: Marx vs. Roemer Shane Mage When we read on a printed page the doctrine of Pythagoras that all things are made of numbers, it seems mystical, mystifying, even downright silly. When we read on a computer screen the doctrine of Pythagoras that all things are made of numbers, it seems self-evidently true. (N. Weiner) Um, the GUI wasn't invented until after Weiner was dead so the above seems of dubious origin. Shane, do you endorse this idealism? Mario Bunge has argued against the myth that the universe is made of bits rather than matter, a myth strengthened by the enormous role that information plays in industrial societies has given rise to the myth An instant's reflection suffices to puncture this idealist fancy. In fact, an information system, such as the Internet, is composed by human beings (or automata) that operate artifacts such as coders, signals, transmitters, receivers, and decoders. These are all material things or processes in them. Not even signals are immaterial: in fact, every signal rides on some material process, such as a radio wave. In other words, it is not true that the world is immaterial or in the process of dematerialization - or, as some popular authors put it, that bits are replacing atoms. We eat atoms, not bits. And when we get sick we call a physician, not an electronic engineer. What is true is that E-mail is replacing snail-mail. But both the electromagnetic signal that propagates along a net and the letter carried by a mailman are concrete items. The information revolution is a huge technological innovation with a strong social impact, but it does not require any changes in worldview: today's world is just as material and changeable as yesterday's. Bunge, Mario A humanist's doubts about the information revolution.(The Freedom to Inquire) Free Inquiry v17, n2 (Spring, 1997):24 (5 pages) The silent assumption here is that information is immaterialTheories of quantum computation go quite a ways towards undermining the information/matter distinction, a Newtonian legacy.. The space-time continuum? Even continuum existence itself? Except as an idealization neither the one entity nor the other can make any claim to be a primordial category in the description of nature. [John Wheeler] Ian
Re: Re: Re: Re: Re: Marx vs. Roemer
Title: Re: [PEN-L:23827] Re: Re: Re: Re: Marx vs. Roemer When we read on a printed page the doctrine of Pythagoras that all things are made of numbers, it seems mystical, mystifying, even downright silly. When we read on a computer screen the doctrine of Pythagoras that all things are made of numbers, it seems self-evidently true. (N. Weiner) Um, the GUI wasn't invented until after Weiner was dead so the above seems of dubious origin. I don't remember the origin of that quote. Ma se non e vero e ben trovato The space-time continuum? Even continuum existence itself? Except as an idealization neither the one entity nor the other can make any claim to be a primordial category in the description of nature. [John Wheeler] Ian But can nature be described without mathematics? And are any natural entities needed to describe arithmoi? If the answer to both questions is negative, which then is primordial? Shane
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- Original Message - From: Shane Mage To: [EMAIL PROTECTED] But can nature be described without mathematics? And are any natural entities needed to describe arithmoi? If the answer to both questions is negative, which then is primordial? Shane = Let me consult the oracle of undecideability and I'll get back to you..;- Ian
Re: Re: Marx vs. Roemer
CB writes CB: To be more precise, Marx's position is that labor is the only source of new value, exchange-value. Individual capitalists may increase or lose some of their share of the total surplus value by various buying and selling of all types among themselves. Marx's recognizing this does not contradict his basic proposition that labor is the only source of new value, exchange-value. and JKS replies Right, so you have profit taht is generated by possession of monoply advantages that does not represent value in Marx's sense. Note that this profit is not a result of redistribution of SV, a point that can be made if we imagine a situation with two capitalists, one of whom acquires a monopoly and behaves as monopolists due. His monopoly rent is not redistribute from the other guy, it's due rather to his possession of the monopoly (Marx's point): so, profits without value that are therefore NOT due to the expoloitation of labor--rather to the exploitation of consumers. Right, Gil? I'm not sure, given some syntactical and spelling oddities in your statement above. Let me try to address that point directly: 1) Although monopoly power (or perhaps more to the point, monopsony power exercised by capitalists in markets for labor power) may increase the rate of surplus value, other things equal, it is not necessary for the *existence* of surplus value in Marx's analytical framework. 2) What *is* necessary for the existence of surplus value, by Marx's stipulation, is that new value is produced subsequent to, and dependent on, the initiation of a circuit of capital (denoted M--C--M'). Since value magnitudes are determined by socially necessary labor time expended in production, surplus value therefore cannot arise merely from the redistribution of value that existed prior to the initiation of the circuit. Thus, the mere existence of monopoly power in commodity markets is also not *sufficient* to account for the existence of surplus value as Marx defines the term. 3) It does not, however, follow from (1) or (2) that disparities between commodity values and their respective prices are incidental to the existence of surplus value, as Marx explicitly claims at the end of Volume I, Chapter 5. What Marx affirms in Chapter 5 is that such disparities are not *sufficient* of themselves to account for the existence of surplus value. However, this leaves entirely open the possibility that particular price-value disparities might be *necessary* (and therefore not incidental!) to the existence of surplus value, *and Marx doesn't address this possibility one way or another in Chapter 5.* The reason this is potentially relevant is that Marx stipulates *two* conditions for the existence of surplus value: A) As noted above, new value must be produced subsequent to, and financed by, the initiation of a circuit of capital. B) A portion of the newly produced value must be appropriated by someone (i.e., the capitalist) *other* than the one(s) who created that value (cf Marx's discussion of the leather and boots example on p. 268 (Penguin ed.)). Granting that *targeted* price-value disparities cannot, by definition, account for condition (A), Marx's argument in Chapter 5 entirely fails to address whether they might in any case be *necessary* for condition (B). And since he does not consider this possibility, he cannot validly conclude at the end of Chapter 5 that price-value disparities are merely disturbing incidental circumstances which are irrelevant to the actual course of the process. [p. 269, footnote] NB, I'm making no claims here about the significance of this lacuna vis-a-vis Marx's Volume I argument. If the reader feels that this logical deficiency is unimportant in the larger scheme of things, so be it. Gil
Re: Re: Re: Marx vs. Roemer
Shane writes in response to Justin: A monopolist is able to get an above-average rate of return on its capital. Nonmonopolists (except, perhaps, in Lake Woebegone..) must therefore receive a below-average return on their capital. This does not necessarily follow. Suppose, for example, that capitalists enjoy monopoly (more accurately, monopsony) wage-setting power in markets for labor power due to the empirically relevant fact that workers face significant costs of job search (this is a typical feature of search models; see for example the survey article on monopsony in labor markets by Boal and Ransom in the J. of Econ Lit, 1997). Then more monopsony power, and thus more surplus value, for one capitalist does not imply less for any other capitalist. Rather it implies that workers as a class perform more surplus labor. [I could have made an exactly parallel point using markets for credit extended directly to value producers, per Roemer's isomorphism theorem, but obviously this introduces an extra complication, so I won't go there.] Another way of putting this is that Marx's remark in Chapter 5 to the effect that The capitalist class of a given country, taken as a whole, cannot defraud itself, (p. 266, top, Penguin ed.) is *doubly* a red herring, first because fraud is not at issue in any case, and second because the issue is not whether capitalists exploit *each other*, but rather whether they as a class exploit *workers.* The economic process determining these different returns to different capitals is a process of distributing the value of the total surplus product among the various claimants to that surplus value. Marx's Law Of Value applies to the aggregate surplus as produced. Because Marx defined value as a determinate quantity of labor time and capital as *capitalized* surplus value he was able to view the capitalist system as a dynamic entity subject to quantitatively determined laws of motion such as the Law of the Falling Tendency of the Rate of Profit which has been shown both to be empirically true and to be a strict consequence of the fundamental social relationships defining a capitalist economic system. For what it's worth, I'd say the empirical relevance of this law remains an open question, as does the sense in which it is a strict conseqeuence of the fundamental social relationships defining a capitalist system.
RE: Re: Re: Re: Marx vs. Roemer
Shane [Mage] writes in response to Justin:A monopolist is able to get an above-average rate of return on its capital. Nonmonopolists (except, perhaps, in Lake Woebegone..) must therefore receive a below-average return on their capital. Gil writes: This does not necessarily follow. Suppose, for example, that capitalists enjoy monopoly (more accurately, monopsony) wage-setting power in markets for labor power Shane Mage can talk for himself, but I think that it's a big mistake -- or even a rhetorical bait and switch -- to suddenly change over to talking about monoposony in labor-power markets. I read Shane as talking about monopoly in product markets, not monopsony. (BTW, Marx wasn't familiar with the concept of monopsony as far as I can tell. But he assumed at one point in volume III that it didn't apply, in that he assumed that Smith's concept of compensating wage differentials did apply and that the rate of surplus-value equalizes between sectors. True monopsony is a microeconomic phenomenon which would cause the monopsonistic industry to enjoy an above-average rate of surplus-value. In theory if the monopsonist is large enough as part of the economy, it might tilt class relations in favor of capital, raising the rate of surplus-value overall.) Gil continues: ... due to the empirically relevant fact that workers face significant costs of job search (...). Then more monopsony power, and thus more surplus value, for one capitalist does not imply less for any other capitalist. Rather it implies that workers as a class perform more surplus labor. You'd think that in a neoclassical world, the capitalists would also face search costs in their efforts to hire employees. This would give the employees who currently have jobs a little bit of monopoly power vis-a-vis their employers. There's no reason in the neoclassical world for the monopsony power of the employers to _a priori_ exceed the monopoly power of the employees, so that we've got a indeterminate bilateral monopoly situation. So there's no reason in the neoclassical world for workers to perform more surplus-labor. But what if it's normal for job vacancies to be less in number than job seekings, i.e., if there's Keynesian cyclical unemployment? In that case -- where there is a non-neoclassical situation of persistent excess supply (a.k.a. reserve army) of labor-power, the workers would be at the disadvantage that Gil refers to. Strictly speaking, that doesn't have to be Keynesian: it could be due to the cut-back in accumulation that occurs whenever profits are squeezed by high wages, in a version of Marx's KI/25 story. That is the capitalist hammerlock -- their class control over the accumulation process and of the production process -- would _ensure_ that normally the bilateral monopoly story doesn't apply, so that instead Gil's capitalist monopsony story applies. [I could have made an exactly parallel point using markets for credit extended directly to value producers, per Roemer's isomorphism theorem, but obviously this introduces an extra complication, so I won't go there.] are you saying that lending money gives the lender monopsony power? doesn't the borrower have the ability to cheat? Another way of putting this is that Marx's remark in Chapter 5 to the effect that The capitalist class of a given country, taken as a whole, cannot defraud itself, (p. 266, top, Penguin ed.) is *doubly* a red herring, first because fraud is not at issue in any case, and second because the issue is not whether capitalists exploit *each other*, but rather whether they as a class exploit *workers.* First, I believe that Marx was using the word defraud metaphorically. What he was saying that capital as a whole can't benefit from mere unequal exchange (i.e., when price exceeds value, benefiting one capitalist). That's why, turning to the second point, Marx was very clear that capitalists _must_ get their profit out of production, by workers. Jim Devine
Re: RE: Re: Marx vs. Roemer
Jim, thank you for your mostly excellent comments. I agree that the gross deviation of crisis and values is important to Marx. In fact, I have argued that that phenomenon represents an important element of his crisis theory. Also, I should have been more careful in referring to the rejection of capitalism rather than the market. Devine, James wrote: Michael Perelman writes: For Marx, value is unobservable. It is a fundamental to price, in the sense that prices and profits depend on what happens in the sphere of value, but Marx paid little attention to the manner in which value gives rise to prices. I don't see that Marx paid much attention nor was he very concerned with the mechanics of the transformation problem. The so-called transformation problem is a problem only if you believe that the precise relationship to prices and values is important. Right. That's why I think that it should be renamed a disaggregation problem: the issue is how Marx's volume I macro-societal story shows up on (and contrasts with) the microeconomic matters discussed in volume III. The main story for Marx is that total value = total price and total surplus-value = total property income, with causation running from the former categories (the macro-level) to the latter (the micro-level). But disaggregation isn't the whole story. Levins Lewontin summarize the dialectical method of analysis as whole makes parts, parts make whole, as part of a dynamic process (to paraphrase). Marx's main concern in CAPITAL was with how whole makes parts, how the structure of capitalism-in-general shapes and determines the nature of microeconomic processes. However, in his beginning efforts at developing crisis theory, you can see the feed-back from micro-processes to macro-results. I read Marx as saying that what goes on in the sphere of value is far more important than the sphere of prices. The system will prices and profits does become important in so far as it shows how an economy based on values is dysfunctional and will eventually will become a source of great dissatisfaction, so much so that people will eventually will reject the market. Both values and prices are important to Marx. In Engels's phrase, there is a contradiction between socialized production and individual appropriation. The former is represented by value and surplus-value, while the latter is represented by prices and property incomes. Marx isn't talking about reject[ing] the market as much as rejecting capitalism, which involves exploitation (in addition to markets). Jim Devine -- Michael Perelman Economics Department California State University [EMAIL PROTECTED] Chico, CA 95929 530-898-5321 fax 530-898-5901
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I agree with your comments. Rakesh Bhandari wrote: Marx however was concerned with exactly why the value of a commodity (thing) could only be expressed by way of another thing and eventually money price. I don't see that Marx paid much attention nor was he very concerned with the mechanics of the transformation problem. Marx's transformation demonstrates the collective nature of exploitation. This is an important result, and I don't think we should be intimidated by Bortkiewicz. The so-called transformation problem is a problem only if you believe that the precise relationship to prices and values is important. That the relationship breaks down even in the aggregate-in particular that prices can and do rise for some time as the value of commodities are falling--is not a logical contradiction in the labor theory of value but a real contradiction in the capitalist economy. In the course of a boom, there is optimism, even exhiliration, but even Keynes hints that there are *objective* facts which determine the changing mood: The disillusion comes because doubts suddenly arise concerning the reliability of the prospective yield, perhaps [!!!] because the current yield shows signs of falling off (GT, p.317) But this still seems to contradict Marx. For why would profits both as a mass and possibly even as a rate rise at all in the upward phase of the cycle since with increasing investments, accumulation of capital and concentration of production, technical improvements, etc, the OCC is growing and the tendency for the rate of profit should be falling? I would think that in the course of the boom demand outstrips supply as a result of the extension of credit and thus allows the price level to become unhinged from values. Perhaps the general price level rises faster than money wages in particular? Y/K may rise as well. However, as the yield on the marginal investment show signs of falling off--an objective fact despite Keynes' attempt to overpsychologize--credit is no longer used primarily to expand production but to speculate on the stock market and outguess rivals in futures markets. The Fed may tighten in the face of speculative excess. The price level cannot be sustained. The crisis is on. I read Marx as saying that what goes on in the sphere of value is far more important than the sphere of prices. The system will prices and profits does become important in so far as it shows how an economy based on values is dysfunctional and will eventually will become a source of great dissatisfaction, so much so that people will eventually will reject the market. Yes the value dimension becomes visible at some point like one can be reminded of the law of gravity when one's roof falls on one's head. Rakesh -- Michael Perelman Economics Department California State University [EMAIL PROTECTED] Chico, CA 95929 530-898-5321 fax 530-898-5901
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At 03:04 PM 3/11/02 -0800, you wrote: Shane [Mage] writes in response to Justin:A monopolist is able to get an above-average rate of return on its capital. Nonmonopolists (except, perhaps, in Lake Woebegone..) must therefore receive a below-average return on their capital. Gil writes: This does not necessarily follow. Suppose, for example, that capitalists enjoy monopoly (more accurately, monopsony) wage-setting power in markets for labor power Shane Mage can talk for himself, but I think that it's a big mistake -- or even a rhetorical bait and switch -- to suddenly change over to talking about monoposony in labor-power markets. I read Shane as talking about monopoly in product markets, not monopsony. I don't think it's a mistake, because in Chapter 5, where this issue arises, Marx makes no distinctions about *which* commodity markets he's talking about. If the argument holds for the expression of price-setting power in one commodity market, it should hold for the expression of price-setting power in *any* commodity market (including the commodity called labor power). (BTW, Marx wasn't familiar with the concept of monopsony as far as I can tell. But he assumed at one point in volume III that it didn't apply, in that he assumed that Smith's concept of compensating wage differentials did apply and that the rate of surplus-value equalizes between sectors. True monopsony is a microeconomic phenomenon which would cause the monopsonistic industry to enjoy an above-average rate of surplus-value. In theory if the monopsonist is large enough as part of the economy, it might tilt class relations in favor of capital, raising the rate of surplus-value overall.) Yes, that's my point. Gil continues: ... due to the empirically relevant fact that workers face significant costs of job search (...). Then more monopsony power, and thus more surplus value, for one capitalist does not imply less for any other capitalist. Rather it implies that workers as a class perform more surplus labor. You'd think that in a neoclassical world, the capitalists would also face search costs in their efforts to hire employees. This would give the employees who currently have jobs a little bit of monopoly power vis-a-vis their employers. There's no reason in the neoclassical world for the monopsony power of the employers to _a priori_ exceed the monopoly power of the employees, so that we've got a indeterminate bilateral monopoly situation. There's also no necessary grounds in neoclassical terms for insisting on bilateral search costs. The point here is theoretical possibility, not generality. So there's no reason in the neoclassical world for workers to perform more surplus-labor. There is, in the entirely neoclassical scenario of one-sided search costs. Again, the issue is about theoretical possibility, not generality. But what if it's normal for job vacancies to be less in number than job seekings, i.e., if there's Keynesian cyclical unemployment? In that case -- where there is a non-neoclassical situation of persistent excess supply (a.k.a. reserve army) of labor-power, the workers would be at the disadvantage that Gil refers to. I don't believe that persistent excess supply...of labor-power has any necessary connection to *Keynesian* unemployment, per se. Marx, for instance, talks about the former in V. I, Ch. 25 without making any evident reference to the latter. And if so, there's nothing essentially non-neoclassical about the former condition. One can establish that condition in the context of a suitable intertemporal neoclassical model. Strictly speaking, that doesn't have to be Keynesian: it could be due to the cut-back in accumulation that occurs whenever profits are squeezed by high wages, in a version of Marx's KI/25 story. I agree, which is why, in my reading, this aspect of Marx's KI/25 chapter is not inconsistent with a neoclassical framework. That is the capitalist hammerlock -- their class control over the accumulation process and of the production process -- would _ensure_ that normally the bilateral monopoly story doesn't apply, so that instead Gil's capitalist monopsony story applies. I would say further that *as a class* capitalists might enjoy a hammerlock...over the accumulation process even in the absence of monopsony, understood as wage-setting power by *individual* capitalists. [I could have made an exactly parallel point using markets for credit extended directly to value producers, per Roemer's isomorphism theorem, but obviously this introduces an extra complication, so I won't go there.] are you saying that lending money gives the lender monopsony power? No. doesn't the borrower have the ability to cheat? Maybe, but you don't need to posit the ability to cheat in order to make my point--for example, you can assume perfectly complete contracting conditions. Another way of putting this is that Marx's remark in Chapter 5 to the effect that The capitalist class of a given
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Shane writes in response to Justin: A monopolist is able to get an above-average rate of return on its capital. Nonmonopolists (except, perhaps, in Lake Woebegone..) must therefore receive a below-average return on their capital. This does not necessarily follow. Suppose, for example, that capitalists enjoy monopoly (more accurately, monopsony) wage-setting power in markets for labor power due to the empirically relevant fact that workers face significant costs of job search (this is a typical feature of search models; see for example the survey article on monopsony in labor markets by Boal and Ransom in the J. of Econ Lit, 1997). Then more monopsony power, and thus more surplus value, for one capitalist does not imply less for any other capitalist. Rather it implies that workers as a class perform more surplus labor No. If one capitalist holds monopsony power over a significant group of workers it follows that the other capitalists, dealing with a smaller labor-power market, will have to pay above-average wages and thus settle for below-average profits. The economic process determining these different returns to different capitals is a process of distributing the value of the total surplus product among the various claimants to that surplus value. Marx's Law Of Value applies to the aggregate surplus as produced. Because Marx defined value as a determinate quantity of labor time and capital as *capitalized* surplus value he was able to view the capitalist system as a dynamic entity subject to quantitatively determined laws of motion such as the Law of the Falling Tendency of the Rate of Profit which has been shown both to be empirically true and to be a strict consequence of the fundamental social relationships defining a capitalist economic system. For what it's worth, I'd say the empirical relevance of this law remains an open question, as does the sense in which it is a strict conseqeuence of the fundamental social relationships defining a capitalist system. If I failed to prove both points in my 1963 dissertation, please enlighten me on any defective points in my argument. Shane Mage Thunderbolt steers all things. Herakleitos of Ephesos, fr. 64
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I believe that it is a disservice to Marx to make him out to be an academic economist trying to work via theorems. Obviously he wasn't an academic. Maybe you are responding with the prickliness of an unorthodox economist to thwe word in ana instititional context where the expexctation is that econokics is supposed to be mathemaetical. I happen to agree with Leontiff that Marx is, whatever else he is, a great mathemaetical economist. But my favorite economists are not mathematical: they are Marx, Keynes, Hayek, Coase--people who had visions, not jsut technical ability. Anyway, Michael, I'm a philosopher, I'm used to dealing with vagueness and fuzziness and arguments taht work at odd angles, so try me out. My institutional context or was different. I am not one who says that all argument has to be deductive and mathemaetical. What I meant by a theorem is that the point you stated about SV is supposed to be something that is shown based on other stuff somehow, by whatever deveious an obscure bits of dialectical reasoning, though of course Hegel fans think that this stuff is all rational and necessary, in fact, are theorems in what they take to be the relevant sense. That is by the way, the point si that I was talking about value at more fundamental level than SV, After all, for value to be surplus, you need a notion of what it is that is surplus. Also, Marx was not really trying to show where profits come from, but to show the perverse consequences of the social relations of value. Sure he was trying to show where profits come from. ARe you telling me that the existence and inevitability of exploitation under capitalsim was not the prime concern of Marx's critique of political economy? I mean really! jks _ Chat with friends online, try MSN Messenger: http://messenger.msn.com
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The existence and inevitability of exploitation under capitalsim was important to Marx, but the explanation of profits was not a central concern. You cannot prove that agriculture [Physiocrats], ownership of capital [Smith] or surplus capital is the source of profits. Justin Schwartz wrote: Sure he [Marx] was trying to show where profits come from. are you telling me that the existence and inevitability of exploitation under capitalsim was not the prime concern of Marx's critique of political economy? I mean really! jks _ Chat with friends online, try MSN Messenger: http://messenger.msn.com -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Re: : Marx vs. Roemer
I never said that he was not using theory. Ian Murray wrote: - Original Message - From: Michael Perelman [EMAIL PROTECTED] To: [EMAIL PROTECTED] Sent: Friday, March 08, 2002 8:55 PM Subject: [PEN-L:23729] Re: Re: Re: Re: Re: Marx vs. Roemer I believe that it is a disservice to Marx to make him out to be an academic economist trying to work via theorems. Also, Marx was not really trying to show where profits come from, but to show the perverse consequences of the social relations of value. === Ok, so if Marx wasn't using theorems as he understood them, wasn't doing theory, wasn't engaged in creating a representation of capitalism a la Hegel, Ricardo, Locke, Smith, Carey, Leibniz, winding back to Aristotle in order to make normative claims and back them up with hypotheses etc. then what was he doing when claiming social relationships manifest perversity? Ian -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
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After all, for value to be surplus, you need a notion of what it is that is surplus. Justin, the surplus concept has to be thought through. It would be very helpful if we could do this on the list. I think one of the ironies of economic thought here is that while Marx criticized Ricardo for ultimately reducing capital and the surplus to money value terms--Ricardo only cares (Marx noted) about net revenue, whether an employer makes the same 10% of $2000 on an advance of $20,000 whether that advance employs 100 or 1000 workers; Ricardo cares little about gross revenue, the volume of production and consumption in terms of use value and hence according to Marx denies the importance of life itself, Ricardian political economy thereby reaching with such abstraction the peak of its infamy; the neo Ricardians on the other hand treat the surplus only in physical terms--as a collection of the various use values not needed for replacement/reproduction. It seems to me that the neo Ricardian surplus is thus more like the physiocratic one than the Ricardian conception of net revenue which according to Marx ultimately loses all touch--as if it were as abstract as the Hegelian dialectic--with the process of production and the quality of consumption in technical and quantitative use value terms. For Marx, the surplus however has two aspects--a value form and a physical form; the surplus is both a monetary expression of unpaid labor time and a collection of more or less use values. For Marx, the surplus in the latter form has great indirect insignificance for the accumulation process. Unlike the Physiocrats, Ricardo and the neo Ricardians, Marx does not treat the surplus in either value or use value terms; he grasps both aspects of the surplus in his theory of accumulation. His ability to do is based on his key discovery of the dual aspects of labor. Here is an example of Marx's ability to understand the surplus in both its aspects: ...the development of labour productivity contributes to an increase in the existing capital value, since it increases the mass and diversity of use values in which the same exchange value is represented, and which form the material substratum, the objective elements of this capital, the substantial objects of which constant capital consists directly and variable capital at least indirectly. The same capital and the same labour produce more things that can be transformed into capital, quite apart from the exchange value. These things can serve to absorb additional labour, and thus additional surplus labour also, and can in this way form additional capital. The mass of labour that capital can command does not depend on the its value but rather on the mass of raw and ancillary materials, of machinery and elements of fixed capital, and of means of subsistence, out of which it is composed, whatever their value may be. SINCE THE MASS OF LABOUR APPLIED THUS GROWS, AND THE MASS OF SURPLUS LABOUR WITH IT, THE VALUE OF THE CAPITAL REPRODUCED AND THE SURPLUS VALUE NEWLY ADDED TO IT GROWS AS WELL. Capital 3, p. 356-7. vintage
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The existence and inevitability of exploitation under capitalsim was important to Marx, but the explanation of profits was not a central concern. You cannot prove that agriculture [Physiocrats], ownership of capital [Smith] or surplus capital is the source of profits. This strikes me as just wierd, Michael: the explanation of profits is the obverse of the explanation of exploitation, they're the same question viewed from different sides. And as to the issue not being important to him from the capitalist side, recall the discussions of frugality and risk easrly on in part I of CI as away of settily up the transition to the focus on production, and the Trinity Formula discussion in CIII, just for starters. I don't know what you mean by yr second sentence, are you restating Marx's results (?) which I largely agree with; I just think that you can explain some profits by normal bourgeois means (buying low and selling high) or monopoly advantages, as in MArx's discussion of differential rent--which leads me to thing that even he doesn't accept thestrict version of the LTV, nut only uses it as an idealization. jks _ MSN Photos is the easiest way to share and print your photos: http://photos.msn.com/support/worldwide.aspx
Re: Marx vs. Roemer
Re: Marx vs. Roemer by Justin Schwartz 07 March 2002 20:07 UTC Says who? But in short, the main two things where I think R improves on Marx is to to insist (a) that a coherent and defensible notion of exploitation has to be defined in terms of a superior alternative; Marx was wrong not to want to write recipes for the cookshops of the future and ^^^ CB: I take it you mean that a coherent and defensible notion of exploitation AS SOMETHING THAT IS WRONG WITH CAPITALISM must be opposed by Marx with a superior socialist alternative. So, you this is a sort of philosophical version of Thatcherite TINA. Seems something of an overstatement to say that Marx didn't give us very important elements of communism: no state, no war, no poverty. That's an enormously superior alternative to capitalism as it has actually existed. (b) that the labor theory of value, in the form Marx uses it, is indefensible ^ CB: Indefensible from what ? Everytime you raise some attack , it has been very readily refuted. The whole discussion of doubly free labor, labor as a commodity, labor as the source of all new value stands up in the face of what you say. You haven't raised any successful arguments against Marx's law of value, and whole theory of value. and should be scrapped; ^ the notion of exploitation should be reconstructed without it. I don't agree with hwo Roemer does that. My own version of the reconstruction (which I attribute, insofaras the text will allow, to Marx himself) is in my paper What's Wrong with Exploitation, which you have. As far as that goes, I have morethan discharged any burden of proof I may have. CB: OK, The last time I started to raise more specifics of your paper you ended the discussion ( I copy some of the posts below). You can't summarily assert the validity of your critique if you are not going to allow specific extended discussion of your text. When I started that with your paper in front of me, you ended the thread. What's up on that ? I mean you can summarily assert said validity, but it is a fake move not to discuss the specifics of your paper. Now a few of the concepts have come out here and there over many discussions, so some of what you have said has been responded to here. I have not yet seen a point where Marx did not seem to have the better of the disagreement with you. I will address the specifics of your paper, but it is shell game to refuse to discuss it. I have put papers I have written on this list, in case you want to say I am not willing to discuss my own papers. I'll send any and all of my articles for critique if you want to put me on the hot seat. I'm not saying they are on the exact same subject, I am just saying this is not an issue of me not willing to put my writing out on the table where it can be critcized while expecting you to do it. PRIOR POSTS Historical Materialism by Justin Schwartz 03 February 2002 04:25 UTC CB: Before you get to that, isn't the burden on you to demonstrate that the theory alternative to Marx's explains what Marx's theory does ? Justin and the AM's haven't quite proven that to everybody yet. Well, Marx and Engels collected writings are 50 volumes. ^^^ CB: Yes, but more conscious of the need to unite theory and practice than most intelligentsia, they made a lot of effort to state their whole theory in much smaller statements' then their whole body of work. ^^ However, I think I've made a tolerable start by showing how Marx's theory of exploitation, the core of Capital I, can be resttaed without the LTV (this in my two papers on exploitation), and by sketching how the theory of commodity fetishim, the core of Marx's mature theory of ideology, can also be statedwithout it (this in The Paradox of ideology). The papers are available on line, and I think you have copies, Charles. ^^^ CB: Yes, I am reviewing them again now. And of course , we have discussed these issues before when they came around on the merrygo round of this group of related lists. ( Hope the merry go round does go past before I finish something worth saying this time). ^ So, since I put some years into doing that, the ball is now in your court to show how I have failed. ^ CB: Well, I'll take up the volley, although have commented repeatedly over the years of our exchange, for example on the equality/liberty issues. I got The Paradox of Ideology from you almost ten years ago now, in regular mail correspondence. Your arguments are thick, in the sense a lot packed tight, so it rather than trying to discuss every issue that comes to my mind, I have tried to make comments on specific statements, to initiate an exchange. One question I had on the paradox of ideology is that I don't think Marx and Engels fold all theory into ideology in the pejorative sense that they use it in _The German Ideology_ and elsewhere. So, that the theory
Re: Re: Marx vs. Roemer
Marx was wrong not to want to write recipes for the cookshops of the future and ^^^ CB: I take it you mean that a coherent and defensible notion of exploitation AS SOMETHING THAT IS WRONG WITH CAPITALISM must be opposed by Marx with a superior socialist alternative. So, you this is a sort of philosophical version of Thatcherite TINA. No, it;s the obverse of TINA. TINA is ana rgument for capitalism. To refute it, you have to show TIAA. Seems something of an overstatement to say that Marx didn't give us very important elements of communism: no state, no war, no poverty. That's an enormously superior alternative to capitalism as it has actually existed. No, anyone can list a pie in the sky story about hwo wonderful things will be if only. What is need to show TIAA is to specidy the institiuonal structure in outlinew ithout enough detail to answer plausible objections. If it won't work in theory,w hy think it will work in practice? (b) that the labor theory of value, in the form Marx uses it, is indefensible ^ CB: Indefensible from what ? Everytime you raise some attack , it has been very readily refuted. The whole discussion of doubly free labor, labor as a commodity, labor as the source of all new value stands up in the face of what you say. You haven't raised any successful arguments against Marx's law of value, and whole theory of value. I don't awntto get into this. Obviously I don;t agree, and you won't agree, so let's leave it, eh? I see no point in spinning our wheels on this one. When I started that with your paper in front of me, you ended the thread. What's up on that ? I mean you can summarily assert said validity, but it is a fake move not to discuss the specifics of your paper. Now a few of the concepts have come out here and there over many discussions, so some of what you have said has been responded to here. I have not yet seen a point where Marx did not seem to have the better of the disagreement with you. I will address the specifics of your paper, but it is shell game to refuse to discuss it. Pose me a specific question, and if I ahve the energy and inclination, i will try to answer it. I alsoo lookeda t those exchanges, and I don't read them as evasive or refusing to answer any concrete question. I'm not going to do another round on the LTV, though, I've said my say, I haven't a lot to add to what I've said, I'm not real interested in the point. I've heard y'all's say, we're each not convinced. That's life, let's move on. Note that in WWWE the LTV is only indirectly a target of my atatck: I didn't, except in a footnote, argue aaht it was wrong, just that Marx could get along without it. That a a version of the redundancy theory. jks _ Join the worlds largest e-mail service with MSN Hotmail. http://www.hotmail.com
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No, it;s the obverse of TINA. TINA is ana rgument for capitalism. To refute it, you have to show TIAA. Well, I can show you TIAA. In fact, I can show you CREF. (They are parts of my retirement package.) Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
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Please do not let flame wars from other lists spill into this thread. By the way, I suspect that the thread will not prove to be very productive. You cannot prove Marx, the Labor Theory of Value, or Neoclassical economics to be wrong. You can show an inconsistency, but mostly the inconsistencies have to do with setting up a straw man. Of course, Marx never finished capital and does have some inconsistencies around the edges, but they are not really central to his theory. -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Re: Marx vs. Roemer
Question to Roemer readers: If we assume that the LTV and/or the LOV is, at best, redundant, does the concept of total social labor exist in a quantative form? In other words, without Marx's notion of value, how can one add up labor time? Or, do we just add up concrete labor hours and say that's that. Or do we just dismiss the notion as 19th Century nonsense? thanks
Re: Re: Marx vs. Roemer
Question to Roemer readers: If we assume that the LTV and/or the LOV is, at best, redundant, does the concept of total social labor exist in a quantative form? In other words, without Marx's notion of value, how can one add up labor time? Or, do we just add up concrete labor hours and say that's that. Or do we just dismiss the notion as 19th Century nonsense? Not at all. I think that Marx's notion of SNALT is a useful one, but it's not necesasrily a notion of value, or anyway doesn't exhause the notion. Btw it is important to distinguisg between the theses that SNALT is the measure of value and that labor is the source of all value. The first is true in a limited way; as Roemer among other argues, anything can be the numaire, labor, corn, iron. The question, from thsi point of view, is whether it is useful or illuminating to use labor as the numaire, and that is where the redundancy theory kicks in. The other matter, whether labor is the sole source of value, is a different quesion: labor might be the source and not the measure (and vice versa). Here I think that labor is _a_ source of value, anda major one. But not the only one. Ina nay case, Marx simply uses the first version, and trues tos hwo that using the laboras the measure you get interesting results. As to thesecond, hewassumes taht it is true as a matter of definition, with only a passing swipe at subjectivist theories, which were underdeveloped in those days. jks _ Chat with friends online, try MSN Messenger: http://messenger.msn.com
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Justin, I suspect that you merely have a different idea about what value is than I do. It does not mean that either of us would be wrong. Marx, as I read him, is saying that value is a particular social relationship unique to capitalism; only living labor creates surplus value; dead labor cannot. He does not mean that nature is unimportant or that machines do not have an important place, but that in capitalism, the key relations for him is what sort of social relations exist under capitalism. You may read him differently; if so, labor may not be the sole source of value in your interpretation, but that does not mean that Marx is wrong. For that reason, I don't see how this debate can lead anywhere. Justin Schwartz wrote: Not at all. I think that Marx's notion of SNALT is a useful one, but it's not necesasrily a notion of value, or anyway doesn't exhause the notion. Btw it is important to distinguisg between the theses that SNALT is the measure of value and that labor is the source of all value. The first is true in a limited way; as Roemer among other argues, anything can be the numaire, labor, corn, iron. The question, from thsi point of view, is whether it is useful or illuminating to use labor as the numaire, and that is where the redundancy theory kicks in. The other matter, whether labor is the sole source of value, is a different quesion: labor might be the source and not the measure (and vice versa). Here I think that labor is _a_ source of value, anda major one. But not the only one. Ina nay case, Marx simply uses the first version, and trues tos hwo that using the laboras the measure you get interesting results. As to thesecond, hewassumes taht it is true as a matter of definition, with only a passing swipe at subjectivist theories, which were underdeveloped in those days. -- Michael Perelman Economics Department California State University [EMAIL PROTECTED] Chico, CA 95929 530-898-5321 fax 530-898-5901
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Justin, I suspect that you merely have a different idea about what value is than I do. It does not mean that either of us would be wrong. Marx, as I read him, is saying that value is a particular social relationship unique to capitalism; only living labor creates surplus value; dead labor cannot. This is suppose to be a theorem that follows from some of the assumptions I sketched below, plus a bunch of other stuff. I don't think it is a theorem, or anyway, that it is an interesting one if it is. The real issue about SV is where profits come from: do they derive from the exploitation of labor? I agree that they do, mainly, I also think that Marx shows this. He also thinks that you need the assumption that they derive only from living labor, that you need the notion of SV defined in labor theoretic terms to show this. There I disagree. He does not mean that nature is unimportant or that machines do not have an important place, but that in capitalism, the key relations for him is what sort of social relations exist under capitalism. Agreed. You may read him differently; if so, labor may not be the sole source of value in your interpretation, but that does not mean that Marx is wrong. For that reason, I don't see how this debate can lead anywhere. Maybe not, I have so repeatedly. jks _ Send and receive Hotmail on your mobile device: http://mobile.msn.com
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- Original Message - From: Michael Perelman [EMAIL PROTECTED] To: [EMAIL PROTECTED] Sent: Friday, March 08, 2002 8:55 PM Subject: [PEN-L:23729] Re: Re: Re: Re: Re: Marx vs. Roemer I believe that it is a disservice to Marx to make him out to be an academic economist trying to work via theorems. Also, Marx was not really trying to show where profits come from, but to show the perverse consequences of the social relations of value. === Ok, so if Marx wasn't using theorems as he understood them, wasn't doing theory, wasn't engaged in creating a representation of capitalism a la Hegel, Ricardo, Locke, Smith, Carey, Leibniz, winding back to Aristotle in order to make normative claims and back them up with hypotheses etc. then what was he doing when claiming social relationships manifest perversity? Ian
Re: Re: Marx vs. Roemer
I think that Roemer's limit is about money. He don't refer to abolish money. In " Critique of the Gotha programme" Marx point out that in socialist society exchange through money not exist. MIYACHI TATSUO 9-10.OHTAI,MORIYAMA-KU NAGOYA CITY 463-0044 JAPAN [EMAIL PROTECTED] Comrade There are many debate about market socialism, economic characater of cuba,evaluation of Roemer,etc. We(BUND a faction of new left)already defined current world as " Transitional world which included to define existing "socialist,or communist contry as transitional contry toward socialism,and capitalist contries as credit capitalcountiries which become to contradict itself toward association society, so, our definition was not to recognize any socialist countries existed. Below is published inj 1978 in order to summerize critique of USSR China party. It can go under current situaiton MIYACHI TATSUO Psychiatric Department KOMAKI MUNICIPAL HOSPITAL JOHBUSHI,1-20 KOMAKI CITY AICHI Pre JAPAN 0568-76-4131 [EMAIL PROTECTED] study of the criticism against the $B!H(J gang of the Four$B!I(J by the Chinese Commmunist Party A; criticism by Wu Lien The china-Soviet dispute can be traced back to the 20th convention pf the CPSU in 1956,but it did not become public untill 1963. The CCP formed a different view on distribution acording to labor from tha of the CPSU in the rocess of faction struggle with the CPSU about their termination of socialistic reform by enlargement of pepole$B!G(Js communes. This unique view has much to do with the problem whether there are classes and class struggle, whether there is a need for proletarian dictorship in a socialist society, and particularly in China whether socialism is a reality in present Soviet or Chinese society. Wu Lien$B!G(Js artic;e which was published inj 1960 in $B!H(J the study of economics; no.5$B!I(J defines socialist society as a transitional society from the view-point that in a scoalist society there are classes, $B!H(Jtwo roads$B!I(J, and a need for the power of tge proletarian dictorship. Wu Lien argue thqat the whole process of transformation from a capitalist society to a higher stage of communist society is the transitional period and, therefore, so is the socialist society which is the first stage of communism,(Wu Lien does not emphasize the necessity of the proletariat dictorship. The CCP came to emphasize its necessity after the CPSU declared the dissolution of the proletarian dictorship and the establishment of $B!H(J the whole people$B!G(Js state$B!I(J at the 22nd Congress of the CPSU in October, 961), Wu Lien$B!G(Js argument confronted the revisionist nature of Khrushchev$B!G(Js policy in the 20th Congress of the CPSU where the general move from a socialist society to a higher state of communism was discussed, and it became a weapon of criticism against the dissolution of the proletarian dictorship at the 22nd Congress. Wu Lien$B!G(Js understanding on distribution accroding to labor is, however, based on a subjective interpretation of $B!H(J the birth-marks of the old scoety$B!I(J and $B!H(J bourgeois right$B!I(J described in $B!H(J Critique of the Gotha Programme$B!I(J. The criticism by the CCP in the China-Soviet is politically correct, but some subjective interpretation in it should be corrected. In $B!H(JCritique of the Gotha Programme$B!I(J, Marx$B!G(Js description of socialist society states that it is $B!H(J..still stamped with the birthmarks of the old society from whose womb it emerges " Wo Lien in turn, depicts "the birth-marks ofn the old scociety" as follows. $B!X(J This remnant of the old society appears in every aspect of the socialisy production relationship. First, in the field of possession of production means ,althoguh economic ownership by all the people has done away with bourgeois right in ralation to production means,due to the influence of the socialist material interest principle , there is an incentive wage system in national coroporations, in which a small portion of the profits is used fro the welfare of a group of employee ot individulals, and here a bourgoies right is retained. At th same tome ,ata certaion stage of socialism i.e. at an unddeceloped stage, there are two types of joint ownership-economic ownership by all th4 people and socialist collective owbership. Socialist collective ownersgip is what negates private ownership, and there production means are basically public-owned and no exploitation is allowed. Collective ownership is ,however , a transitional forms of economy from private possession to economic ownership by all the people, and when compared to economic ownership by all the people , it has quite a few remnents and traces of private ownership. This is because members of a commune still have their own holdings of land and their tools-avocations. Collecitive economy itself still has traces of private ownership. That is, in collective ownership
Re: Marx vs. Roemer
On other points, R does imprive on Marx. jks ^^ CB: Like what other points ? The presumption is against you, and the burden of proof on you. Says who? But in short, the main two things where I think R improves on Marx is to to insist (a) that a coherent and defensible notion of exploitation has to be defined in terms of a superior alternative; Marx was wrong not to want to write recipes for the cookshops of the future and (b) that the labor theory of value, in the form Marx uses it, is indefensible and should be scrapped; the notion of exploitation should be reconstructed without it. I don't agree with hwo Roemer does that. My own version of the reconstruction (which I attribute, insofaras the text will allow, to Marx himself) is in my paper What's Wrong with Exploitation, which you have. As far as that goes, I have morethan discharged any burden of proof I may have. jks _ Join the worlds largest e-mail service with MSN Hotmail. http://www.hotmail.com
Re: Marx vs. Roemer
my understanding is that Roemer would have accepted Marx's story (of capitalist exploitation as based on structural coercion) when he developed his own story, but saw the structural coercion as unnecessary to the existence of exploitation. That is exactly correct. jks ^ Charles: On this Roemer makes the understanding of capitalism less exact than Marx's, I agree, but why do you think so? yet he crtiques Marx under the rubric of making him more exact. Marx developed nice empirically based differentia specifica for capitalist exploitation; Roemer seeks to make the understanding more blunt, less sharp. Roemer's point is logical, that on his notion of exploitation, you can have exploitation without corcion. I discuss this at length in my paper on the subject; so dooes Jim in his and Dymski's now classic paper. jks _ Get your FREE download of MSN Explorer at http://explorer.msn.com/intl.asp.
RE: Re: Marx vs. Roemer
Justin writes:Roemer's point is logical, that on his notion of exploitation, you can have exploitation without corcion. I discuss this at length in my paper on the subject; so dooes Jim in his and Dymski's now classic paper. BTW, in terms of purely normative issues, in my 1996 article in Bill Dugger's book INEQUALITY (Greenwood Press), I follow Arjun Makhijani to define exploitation as taxation without representation. Capitalists tax (coerce) workers using their class monopoly of the ownership of the means of production and subsistence, the reserve army of labor (or similar institutions), and thus the supervisor's credible threat of the sack. (Strictly speaking, it's not just the macro-level capitalist supremacy (the producers' proletrianization) and the micro-level subjection of labor by capital, but it's also the workers' conscious submission that allows this state of affairs. Obviously, the power of the capitalist class is also crucial.) If one accepts this normative definition of exploitation, then the Roemerian idea of exploitation without coercion doesn't make sense. If some people surrendering a piece of the pie to others in a totally and utterly voluntary way, it's not taxation (coercion) without representation. (Thus, what John Elliott and Gary Dymski call secondary exploitation (redistribution of surplus-value via markets) isn't really exploitation at all in these terms.) Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
Re: RE: Re: Marx vs. Roemer
I developed a similar argument to Jim's, not using the taxation analogy, though, in In defense of exploitation, Econ Phil 1995. Frank Thompson also hasa piece alomh these lines in Science and Society. jks Justin writes:Roemer's point is logical, that on his notion of exploitation, you can have exploitation without corcion. I discuss this at length in my paper on the subject; so dooes Jim in his and Dymski's now classic paper. BTW, in terms of purely normative issues, in my 1996 article in Bill Dugger's book INEQUALITY (Greenwood Press), I follow Arjun Makhijani to define exploitation as taxation without representation. Capitalists tax (coerce) workers using their class monopoly of the ownership of the means of production and subsistence, the reserve army of labor (or similar institutions), and thus the supervisor's credible threat of the sack. (Strictly speaking, it's not just the macro-level capitalist supremacy (the producers' proletrianization) and the micro-level subjection of labor by capital, but it's also the workers' conscious submission that allows this state of affairs. Obviously, the power of the capitalist class is also crucial.) If one accepts this normative definition of exploitation, then the Roemerian idea of exploitation without coercion doesn't make sense. If some people surrendering a piece of the pie to others in a totally and utterly voluntary way, it's not taxation (coercion) without representation. (Thus, what John Elliott and Gary Dymski call secondary exploitation (redistribution of surplus-value via markets) isn't really exploitation at all in these terms.) Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine _ Join the worlds largest e-mail service with MSN Hotmail. http://www.hotmail.com
Re: RE: Re: Marx vs. Roemer
I think the difference between Roemer and Marx concerning the role of (systemic or class) coercion is more apparent than real, more a matter of choice of language and emphasis rather than deep analytical differences. According to Roemer's analysis, capitalist exploitation *requires* differential class ownership of scarce means of production (DOSMP). In a two-factor world, differential ownership means that workers must work for capitalists to secure their subsistence. Scarcity means that labor power is in excess supply relative to means of production, implying a reserve army exists. In this world, coercion exists at the class level: workers may choose *which* capitalist to work for, but will suffer if they don't work for *some* capitalist. Thus I don't see the suggestion that exploitation can exist without at least class-level coercion in Roemer's world. Forgive me if I got it wrong, Justin, but I thought the point of your 1995 article was just that. If so, if Roemer ever said exploitation in his sense didn't involve coercion, he was just applying the wrong notion of the term. On a separate note, in my reading capitalist exploitation in Roemer's sense does not reduce to Elliot and Dymski's notion (taken from a passage in Volume III) of secondary exploitation; that is, it does not involve simple redistribution of values that existed prior to the initiation of the relevant circuit of capital. Roemer's isomorphism theorem states that the profits accrued by capitalists in hiring labor power are equivalent to the interest payments capitalists would receive in an otherwise identical economy in which capitalists loan the means of production to workers rather than capitalists hiring labor power. In both cases, the surplus value received by capitalists is produced *subsequent to*, and in fact is financed by, the initial M in the circuit of capital. This argument is based on reading Marx's definition of surplus value as stipulating *two* conditions: 1) the production of new value, financed by the initial M in the circuit of capital, and 2) appropriation of a portion of that newly produced value by someone other than the producer, namely the capitalist(s) who provided the initial M (cf Marx's comments in V.I, chapter 5 about a commodity-owner adding his own labor to his own means of production) I *don't* see Marx anywhere stipulating direct capitalist control of production (i.e., subsumption of labor under capital)as part of his *definition* of surplus value, or thus capitalist exploitation. To the contrary, he repeatedly affirms instances in which capitalist exploitation arises without labor subsumption. Gil Justin writes:Roemer's point is logical, that on his notion of exploitation, you can have exploitation without corcion. I discuss this at length in my paper on the subject; so dooes Jim in his and Dymski's now classic paper. BTW, in terms of purely normative issues, in my 1996 article in Bill Dugger's book INEQUALITY (Greenwood Press), I follow Arjun Makhijani to define exploitation as taxation without representation. Capitalists tax (coerce) workers using their class monopoly of the ownership of the means of production and subsistence, the reserve army of labor (or similar institutions), and thus the supervisor's credible threat of the sack. (Strictly speaking, it's not just the macro-level capitalist supremacy (the producers' proletrianization) and the micro-level subjection of labor by capital, but it's also the workers' conscious submission that allows this state of affairs. Obviously, the power of the capitalist class is also crucial.) If one accepts this normative definition of exploitation, then the Roemerian idea of exploitation without coercion doesn't make sense. If some people surrendering a piece of the pie to others in a totally and utterly voluntary way, it's not taxation (coercion) without representation. (Thus, what John Elliott and Gary Dymski call secondary exploitation (redistribution of surplus-value via markets) isn't really exploitation at all in these terms.) Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
Re: Marx vs. Roemer
CB: If you mean that capitalist exploitation is characterized by a less directly coercive method than feudalism or slavery, Marx already made that point. Roemer does not improve on what Marx has already taught. On this point I agree with you, as I explain in IDoE, which I believe you have. On other points, R does imprive on Marx. jks _ MSN Photos is the easiest way to share and print your photos: http://photos.msn.com/support/worldwide.aspx
