labour theory of value

May 2024 Forums General discussion labour theory of value

Viewing 8 posts - 1 through 8 (of 8 total)
  • Author
  • #80945

    Hi all

    I am currently reading a rather interesting peice on the Marxian LTV and its precursors in classical political economy. Its seems Adam Smiths brand of the LTV was very different to Marx’s (and Ricardo’s).  Whereas Marx  posited value as embodied socially necessary labour time, Smith subscribed to a subjectivist LTV  where labour values were  considered in terms of disutility – or  “toil and trouble” as he put it.  This would put Smith rather closer to the necoclassical economists than I had previously supposed. They , the neoclassical lot, in turn   – or at least some of them , like Marshall -might be seen as advocating a kind of transitional approach between a purely objective “cost of production” theory of value and a purely subjective theory of value as entertained  by the likes of Austrian School.  In the case of Marshall, for example , he used the famous metaphor of the scissors cutting a peice of   paper and asked rhetorically which blade of the scissors cut  the paper.  What he was getting at,  as I undertstand it , is that both cost of production and subjective utlity  have equal explanatory value.  The Marxian theory of value  on the other hand would hold that the cost of production approach ( i.e. embodied SNLT) is primary in this respect  and suply/demand interactions are secondary approximations of reality .  The price of commodities depart from their values because  of the influence of  the latter but are nevertheless drawn towards  their values because of the gravitational pull of the former. Prices, in short, revolve around value.

    What I am wondering is whether the SPGB has any published material on the history of the concept of value and its development over time that I could look at. I am particularly interested in the relationship between Marxian and Marginalist economics and whether there is indeed any scope for a  partial synthesis of sorts (obviously, it could never be more than “partial”). Some of the concepts developed by mainstream economists do have a kind of intuitive  appeal –  like the law of diminishing returns, indifference curves and such like and might even be utilised for the purpose of shedding light on  the way in which  production might be organised in  a socialist society  – particularly with regards to things like  the allocation of  factor inputs – a heretical thought that I am currently toying with right now .  Needless to say,  a lot of the other concepts peddled by mainstream enomicss are a load of ideological balderdash but not everything that it has to say has to be rejected out of hand..    Nobody is ever entirely right or wrong – not even mewink  Supply-demand interactions about which it has a lot to say  is a particularly fruitful area where some kind of convergence might be possible

    Anyway, your thoughts on the matter woild  be  greatly appreciated and,  of course, any links that you could point me to….




    Perhaps the Simon Clarke’s book Marx, Marginalism and Modern Sociology may have some relevant stuff.Or this article.’The law of diminishing returns’ is a piece of bunk that is taught in economics lessons but especially in relation to corporation size and efficiency doesn’t really have any bearing on the real world of business.To be honest though, to me it seems like you heading down a dead-end ally…


    Thanks for that  DJP  – I will follow up the links
    I wasnt thinking so much of diseconomies  of scale  which relates more specifically to corporation size but the classic presentation of diminishing marginal utility. You know –  the one about  the first ice cream consumed yielding a high marginal return in terms of the pleasure it provides, the second somewhat less and  the third even less. And so on and so forth. Granted  utility or “utils “is not exactly something that can be measured in a cardinal sense although in the early period of utilitarian thought  (a la Bentham & co) the workinga assumption  was indeed  that utility  could be thus measured.  All the same as the icre cream example demonstrates there is undeniable kernal of  truth in marginalist economics – its not alll cock and bull stuff.
    Question is – does it have any possible appplication to the way a socialist society could organise production?  For example , given two  or more  particular ends uses how might one allocate a given input common to both of  them ?   And in what proportions? Is there a case for saying that something like the “equimarginal principle” – the opttimal allocation of an input, as in this case, between several end uses  – might  apply and, if so, how might might  we apply it?


    Doesn’t Nicolai Bukharin deal with this, from a Marxian perspective, in his Economic Theory of the Leisure Class.  As it was written in 1914 it is free from Bolshevik apologetics. Bukharin, in fact, was probably the best (least worst) of the Bolshevik writers on Marx.


    Thanks for that Adam . Yes very interesting.  I notice on the very first page Bukharin distinguishes  Adam Smith’s subjective LTV from Marx’s objective version of the same  characterising the latter as an extreme example of objectivism.   Its a long peice so it will take some time to read through but it will be interesting to see what comments he comes up with on marginalist economics. 
    This question of how to allocate inputs under conditions of scarcity in proportion to the relative importance of end uses needing them is something that is preoccupying me just at the moment.  I wonder if anyone here has any thoughts on the matter?  We cannot just assume that in socialism the available supply of an input will be ample enough to satisfy every possible end use .  We have to prioritise end uses in that case and allocate the input accordingly  but how and in what proportions?  Are we talking about some kind of cascading model of allocation – end use 1 gets is requirements fully met, end use 2 likewise and then, when the supply starts running out, end use 3’s requirements are partially met , while 4 and 5;’s are completely neglected.   And so on and so forth.
    Capitalism can, of course, fall back on the “equimarginal principle” to resolve this particular problem.  But  what about socialism? Might  marginalist economics actually have something useful to say after all  about  the practical organisation of a non market  socialist system?  Hhmmm


    in vid 3/4: “the goal of the worker is for her private labour to become social labour” ehhh.. Isn’t the goal of the worker to do what is asked so she can get the money to get her needs and desires met?If that happens to be “social labour” then thats a plus, but can we really say it is the worker’s goal?I’m not too fond of the LTV concept because it seems to imply that workers ought to be the owners of “their” soclal product.If I work in factory A and you work in factory B and we both work the same amount of hours, yet my products are more in demand so is my work more socially valueable? Am I entitled to more because my labour’s value is higher? I think that putting a quantitative value on human activity is demeaning to the person and their work.Think of how school grading systems undermine the activity of learning and reduce it to quantitative values on report cards. It just takes out all the fun and enjoyment and subconsciously telling students: “you don’t want to learn, that’s why we need this carot on a stick to force you to!”The fact that human needs can be met sustainably and much more efficiently but isn’t being done for unsound reasons is all the reason I need to feel outraged. 


    Your probably better of putting your questions about the videos to their maker Brendan Cooney at, that sentence doesn’t seem quite right. You’re right the goal of the worker is to get money to buy the things they need. However as far as the capitalist is concerned if private labour doesn’t become social labour then nothing of value has been produced and the money invested in production will be lost.The Marxian LTV does not imply that workers should ‘be the owners of ‘their’ social product at all. All it suggests is that the only thing that can expand the total amount of value in the economy is the surplus labour of the wage worker. Some socialists make a fuss about the fact that the worker does not receive the total value of their product, I do not think that this is a problem in itself – under a system of socialised production the worker would not receive the whole of their product either. The problem with capitalism is that is the law of value, the profit motive, and not human need that determines where and in what way resources and human labour power is used up.Not all wage workers produce value. Marx made the distinction between productive and unproductive labour. Most service sector jobs can be classified as ‘unproductive labour’ this is not to mean they are valuable to society but do not produce any new ‘value’ in the sense of the Marxian LTV.

Viewing 8 posts - 1 through 8 (of 8 total)
  • You must be logged in to reply to this topic.