robbo203
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ALB wrote:The other objection to the theory is that it tries to explain the regularly recurring economic downturns that are a feature of capitalism by some event outside the system rather than by something inherent in the system itself.
To be fair, though, you could argue that the sunspot theory could serve as a "triggering" event that impacted upon capitalism/s tendency towards disproportionate growth which underlies the capitalist trade cycle. So while on its own it cannot account for the trade cycle, it could be incorporated as part of a larger explanation. So, for example, if good weather caused by changes in solar radiation resulted in a bumper harvest causing prices to drop, this could have knock on consequences that exacerbate disproportionalities in the economy and so lead to crises. This is only in theory, mind you. I suppose it would depend on how serious an impact changes in agricultural prices had on the economy. Capitalism is capable of absorbing minor oscillations in prices without this resulting in crises – though, in the long run, the cumulative effect of these inter sectoral changes will assert itself in the form of the trade cycle. Specifically , in relation to sunspot theory, the impact would be mediated by others factors such as how much of an effect changes solar radiation actually had on agricultural output itself – the argument that a change in quantity leads to a change a quality which implies there is some kind of threshold the former needs to reach before effecting qualitative change, This in turn might depend on the kind of agricultural technology employed and whether it could use more of some kinds of inputs (e,g, articfical nitrogen fertilisers) to compensate for the decline of others. It would also depend, I guess, on how important the agricultural sector is in the economy, generally. In a part of the world where agriculture comprises the majorty of paid empkyment, changes in incoming solar radiation could, in theory, I imagine have significant knock on economic repsercusions One way to test the theory would be to see if there is significant temporal correlation between sun spot events and economic events like crises. Did Jevons ever do this or was it just speculation on his part that such a correlation actually existed?
There is a related problem to do with the question of whether machines produce surplus value. We talk about the value of a product being determined in the long run by the amount of "socially necessary labour" it contains. This is not something that can be measured by a stopwatch so to speak, but constitutes a kind of "social average". This is why labour intensive businesses using outmoded technologies cannot be said to produce more value than capital intensive businesses with high levels of labour productivity. However, the value of a commodity depends on it being sold on the market. No value is produced to the extent that there is an overproduction of commodities in relation to what the market can absorb and, of course, this makes the question of measuring "value" all the more problematic because we cannot know in advance whether a commodity that has been produced will actually be sold. It is only in the process of exchange that value manifests itself so to speak. It is then that the value of goods, the SNLT embodied in them, will express itself indirectly through the prices such goods command – which prices will tend to vary, in the long run, in accordance with the quantity of SNLT embodied in them. In other words, the expression of value is mediated through money units – prices. As Marx put it: "Social labour-time exists in these commodities in a latent state, so to speak, and becomes evident only in the course of their exchange…. Universal social labour is consequently not a ready-made prerequisite but an emerging result’ ( A Contribution to the Critique of Political Economy). Indeed, it is for this very reason that Michel De Vroey has suggested that the creation of value seems to be located "not in production but at the articulation of production and circulation" ("Value, Production and Exchange" M de Vroey, The Value Controversy, NLB, London, 1981, p.173) It is this kind of thinking that informs G A Cohen’s claim that the "relationship between the labour theory of value and the concept of exploitation is one of mutual irrelevance" (ibid, P202-223). Cohen bases this claim on the argument that past labour – the amount of time actually spent on producing a commodity – is not strictly relevant as a guide to what is currently socially necessary labour time which is what constitutes that commodity's value in Marxian terms. Since SNLT is itself a constantly shifting potentiality it cannot therefore be meaningfully be said to "embodied" in a commodity in the way that actual (past) labour may be said to be thus embodied (as in the case of the machine the worker is using to prpduce some product). As mentioned earlier, what is socially necessary labour only becomes apparent a posteriori through market competition and is finally determined by conditions subsequent to the actual production of commodities themselves. Thus, commodities that cannot be sold do not possess value. In effect, what that means is that workers in capitalism do not, and cannot logically, actually "produce" value as such and, hence, cannot be said to "produce" surplus value either. What they produce are the commodities that contain value – a subtle but all-important difference. It is because they, and not the capitalists, manifestly, produce what has value (rather than produce value as such) that the workers are exploited by the capitalists in the sense that the capitalists appropriate part of the value of what has been produced but without actually contributing to the production of what has been produced. This, according to Cohen, makes the exploitation of the proletarian, "more similar to the exploitation of the serf than traditional Marxism says" (ibid p.222) Its an interesting argument. Any thoughts?
"Unless it changes, capitalism will starve humanity by 2050" http://www.forbes.com/sites/drewhansen/2016/02/09/unless-it-changes-capitalism-will-starve-humanity-by-2050/#2296bf074a36Yet another example of the kind of deceitful "Trojan horse" strategy that, deliberately or otherwise, seeks to steer criticism away from capitalism by engaging in the rhetoric of anti-capitalism. I despair when I read articles like this with its glib talk of a "new generation of companies showing the way forward" and "infusing capitalism with fresh ideas". Its just so much timewasting superficial BS. Never mind how you get from the highly concentrated and increasingly concentrated and centralised pattern of ownership we have today to one in which we have distributed ownership – how is this going to alter the basics of capitalism and its driving force of capital accumulation or economic growth? There is a fundamental contradiction involved in attributing the problem of environmental crises to capitalism and then proposing to tackle these crises while keeping capitalism intact albeit supposedly modified. I notice that one of solutions proposed is that of "holacracy" which was being enthusiastically promoted on this forum not so long ago
twc wrote:Bortkiewicz recognised that Marx didn’t do this, and yet Sweezy accepts Bortkiewicz’s dual-system correction of Marx, thereby “improving” Marx against Marx, but in the name of Marx [Kliman p. 46].And yet Sweezy seems to go along with the labour theory of value in the article I mentioned….Could it be that 1) Sweezy changed his mind (is Kliman referring here to the view expressed by Sweezy in 1942 which may be different to what he wrote in 1980?) or 2) Sweezy is unaware of the basic contradiction involved in adhering to a Marxian labour theory of value and adopting a simultaneist physical approach a la Sraffa?
twc wrote:It is instructive to watch carefully as Kliman analyses the entrails of Dimtriev’s argument, and by extension subsequent physicalist [anti-value] “improvements” by Bortkiewicz, Sweezy, Sraffia, Samuelson, Steedman, Okishio, et tutti frutti. Keen, as commentator, sits off in the salad bowl.I am not so sure you can include Sweezy in this list. He may have given publicity to Bortkiewicz's argument but I have just been reading his contribution in the book "The Value Controversy" (1981, ed Ian Steedman, NLB) in which he very clearly endorses the labour theory of value He argues (p.26) that an analysis of reality cannot effectively be made in terms of prices since this precludes what for him is a key variable in the hstory of capitalism – the rate of surplus value/exploitation He regards the rate of profit as a secondary variable by comparison. And contrary to Steedman, he argues that there are "general ways" to surmount the transformation problem – that is to get from the value/surplus value prong in Steedman's diagram to the price/profit prong. In other words, prices are ultimately regulated by, and explicable in terms of, labour values It is possible that Sweezy might have had a change of heart since 1942 when he wrote "Theory of Capitalist Development" – I havent read that book so I dont know what his position was then on the LTV. But in this article he seems to endorse it
robbo203 wrote:From Wikipedia Steve Keen[1] argues that "Essentially, Marx reached the result that the means of production cannot generate surplus value by confusing depreciation, or the loss of value by a machine, with value creation" . His argument is, that a machine can add a value to new output in excess of the value of economic depreciation charged[2] https://en.wikipedia.org/wiki/Constant_capital#Variable_capitalIt seems to me that the confusion is Keen’s, not Marx’s, in this case. He (Keen) maintains that machines add value to a product in excess of the value of the economic depreciation incurred. But if that were the case then why might not pristine raw materials do the same? But here’s the rub; pristine raw materials, by definition, don’t have labour time embodied in them – even if machines do – and if you argue that they contribute value to a product, then you are not defining value any more in terms of socially necessary labour time. You are employing a different definition of value and are thus not dealing with the Marxian theory on its own terms. Unless you deal with the Marxian theory on its own terms and follow its inner logic to its own ultimate conclusion, you cannot claim to have refuted the theory.
From Wikipedia Steve Keen[1] argues that "Essentially, Marx reached the result that the means of production cannot generate surplus value by confusing depreciation, or the loss of value by a machine, with value creation" . His argument is, that a machine can add a value to new output in excess of the value of economic depreciation charged[2] https://en.wikipedia.org/wiki/Constant_capital#Variable_capital
Capitalist Pig wrote:ah so you have an anarchist view. interestingI think there would need to be a constitution explaining everyones' rights pertaining to property, speech, privacy, y'know.by the way don't mean to be patronizing I am really curious to what you thinkYou refer to everyone' rights pertaining to property. It is important to understand what is meant by "property". In its economic sense the term refers to "means of production". It does not mean possessions In a socialist society there is common ownership of the means of production from which it axiomatically follows that there is no more economic exchange or exchange-related institutions such as wage labour, profits, markets , banks, tax departments and so on. Logically, the "rights" that arise out of common ownership of the means of production are those of full and unrestricted free access to the products of industry. The flip side of the coin of free access , is volunteer labour and the sense of obligation that goes with to contribute to society according to your abilities.. Common ownership however does not extend to possessions. I have no more desire to share your toothbrush than you have, mine.
twc wrote:.On the other hand, it is remotely possible that his Sraffian economy may treat pristine inputs in the same way as it treats all other inputs—as variable capital.Variable-capital inputs may continue to be productively consumed/used [even long] after they have reproduced their own maintenance cost. Consequently, pristine raw materials (considered as variable capital) will always contribute toward profit since they take absolutely no time to reproduce their own [zero] maintenance.Again, you’d have to check if he treats them as such, i.e. as actual inputs, on equal par with machinery and possibly working animals.If he doesn’t you’d consider asking him why not, since these homeopathic inputs contribute miraculously to profit?As long as Keen treats machinery as variable capital, then whether or not he treats pristine raw materials as variable capital too, his theory will run into insurmountable conceptual problems. This is why I mentioned pristine raw materials which are different from machinery inasmuch as the latter obviolusly has embodied labour content. Its a way of calling into question his treatment of machinery as varable capital
twc wrote:In the Sraffian context, Keen raises the issue of machinery and animal labour as variable capital rather than constant capital. Read Keen’s Debunking Economics.How does he classify pristine raw materials in that case?
Lew wrote:robbo203 wrote:His book Debunking Economics is a must-read (and I haven't read it yet)I have read it and it's a waste of time:http://www.worldsocialism.org/spgb/socialist-standard/2000s/2003/no-1182-february-2003/book-reviewsLew
Lew, What I mean is it is a "must-read" if you are going to debate with the guy. Its his main book, innit? I can't comment on its worth, mind you , as I haven't read it but I am to at some point …..
ALB wrote:He's actually based in the Kingston University which falls within the area of West London branch, so we could contact him. What, a debate on "Is the Labour Theory of Value" valid?Hmm. You might find a title like that for a debate a little too dry and abstract to attract any but the most hardened enthusiasts although I could be wrong. Keen is quite well known in certain circles , I even have a work acquaintance here in Spain who installed my solar panel who is quite ..er.. keen on him (sorry, couldn't resist that). Maybe a more generalised title like "The Economics of Capitalism – is Marxism still relevant? Just a thought. I would advise, though, to gem up on where he specifically stands within the spectrum of heterodox economic theory. I don't know enough about his writings to quite place him except to say that he regards himself as a post Keynesian sympathetic to some aspects of Marx's thought and critical of neoclassical economics. . His book Debunking Economics is a must-read (and I haven't read it yet) and of course there is ton of stuff you can get on the internet by googling Keen
ALB wrote:robbo203 wrote:He would probably say that even with relatively labour intensive businesses, machines still add value to the product as opposed to simply transfer the value congealed in them over the lifetime of the machine.But does Keen actually say this? And does he say that it is only machines that add surplus value and not the other elements of Marx's constant capital (academic economics's "non-labour inputs")? If so, why does he exclude buildings, raw materials and power from creating surplus value too? Or does he accept the concept of "constant capital" but wants to narrow it to exclude machines? If so, again why?I'm a bit surprised that, as an academic economist even if one who wants to make a name for himself as a bit of an unorthpdox one, he has any use for the concept of "value" at all and doesn't want to try to analyse the capitalist economy in terms of price only.(which the so-called "transformation problem" is basically all about).
Adam,Im not too sure whether Keen makes a distinction between machinery and other elements of constant capital. That would be an interesting line of enquiry to pursue precisely because of the embodied labour content of machines. I haven't read enough of the guy to give you an informed opinion but it could be an Achilles Heel in his argument What I can say is that he:1) rejects the labour theory of value on grounds of its "unjustified asymmetrical treatment of the labor and non-labor inputs to production" (http://keenomics.s3.amazonaws.com/debtdeflation_media/papers/Keen1993UseValueDemiseLabourTheoryValue_JHET15pp107-121.pdf) 2) that he subscribes to the "surplus appropriation" school of thought, which means that he considers workers are still exploited – despite his rejection of the LTV. As such, this puts him in the same boat as some "Analytical Marxists" like G A Cohen who argue that you dont need the LTV to show that workers are exploited Why doesnt the SPGB invite Keen along to a debate or discussion? I think he is based in London but I might be mistaken
A quote from John Ramsay McCulloch, The Principles of Political Economy (5th ed.) [1864] http://oll.libertyfund.org/titles/mcculloch-the-principles-of-political-economy-5th-ed-1864 "That commodities could not be produced without the co-operation of the powers of nature, is most certain; and we are very far, indeed, from seeking to depreciate the obligations we are under to our common mother, or from endeavouring to exalt the benefits man owes to his own exertions by concealing or underrating those which he enjoys by the bounty of nature. But it is the distinguishing characteristic of the services rendered by the latter, that they are gratuitous. They are infinitely useful, and they are, at the same time, infinitely cheap. They are not, like human services, sold for a price; they are merely appropriated. When a fish is caught, or a tree is felled, do the nereids or wood-nymphs make their appearance, and stipulate that the labour of nature in its production should be paid for before it is carried off and made use of? When the miner has dug his way down to the ore, does Plutus hinder its appropriation? Nature is not, as so many would have us to suppose, frugal and grudging. Her rude products, and her various capacities and powers, are all freely offered to man. She neither demands nor receives a return for her favours. Her services are of inestimable utility; but being granted freely and unconditionally, they are wholly destitute of value, and are consequently without the power of communicating that quality to any thing" The implication of this is that value (and hence surplus value) is essentially a social relationship based on generalised commodity exchange. Machines, like pristine raw materials, do not enter into an exchange with the capitalists but unlike pristine raw materials have labour already congealed in them. Workers on the other hand , do enter into an exchange relationship with the capitalists. Labour power is exchanged for a wage. So there is a qualitiative difference between labour power and machines. At the end of the day, machines are simply the extension or amplification of human labour One further point, I think. Value (and surplus value) is only comprehensible as a concept at the level of the economy as a whole. As stated, it is not a thing but a social relationship. The suggestion that machines produce surplus value is an attempt to "concretise" (turn it into something with "thinglike" qualities) the concept of value by locating it within the confines of the individual business firm employing machinery to raise the productivity of its workforce. This makes no sense in terms of the labour theory of value Finally, if machines produce surplus value then you could just easily assert that slaves produce surplus value (or indeed animals). But they dont. Slaves produce an economic surplus but not surplus value. I like Mandel's succinct explanation of the difference betrween surplus value and other forms of the economic surplus: It can take the form of straightforward unpaid surplus labour, as in the slave mode of production, early feudalism or some sectors of the Asiatic mode of production (unpaid corvée labour for the Empire). It can take the form of goods appropriated by the ruling class in the form of use-values pure and simple (the products of surplus labour), as under feudalism when feudal rent is paid in a certain amount of produce (produce rent) or in its more modern remnants, such as sharecropping. And it can take a money form, like money-rent in the final phases of feudalism, and capitalist profits. Surplus-value is essentially just that: the money form of the social surplus product or, what amounts to the same, the money product of surplus labour. It has therefore a common root with all other forms of surplus product: unpaid labour (Ernest Mandel, 1990, "Karl Marx", Marxian Economics, John Eatwell, Murray Milgate & Peter Newman (eds.), London 1990, p.1-38).
Some interesting comments in these links to a blog which seems decidedly hostile to Marxian economics…. http://socialdemocracy21stcentury.blogspot.com.es/2015/05/karl-popper-on-labour-theory-of-value.html http://socialdemocracy21stcentury.blogspot.com.es/p/the-labour-theory-of-value-as-presented.html http://socialdemocracy21stcentury.blogspot.com.es/2015/04/the-labour-theory-of-value-and-animal.html
