[OPE-L:2039] Re: Re: the money supply

From: Claus Germer (cmgermer@sociais.ufpr.br)
Date: Wed Jan 05 2000 - 14:05:58 EST

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Answering to Akira, Allin wrote [ope-l:2018]:

>You're supposing (as Marx did) that setting the exchange value
>of a commodity must, in some ultimate sense, depend on a
>comparison of (a) the value of the commodity with (b) the value
>of the monetary unit itself (which becomes an impossibility if
>money has no inherent value). But in my opinion this is quite
>wrong. It is not the only way in which relative prices can come
>to reflect relative labour-contents.

>From your statement it is not clear how you figure the process which you
call comparison of values. The exchange between a commodity and the money
commodity provides the exchange value. Marx called value to what underlies
the exchange value
and represents amounts of abstract labor. The exchange value is a mere
quantitative relation between an ordinary commodity and another commodity,
singled out of the universe of commodities as a general equivalent of
value. Now, what we call value cannot be explained taking value as a factor
of the explanation. The point then is: what is it that causes each
commodity to be exchanged against a given amount of the equivalent
commodity? It's not value, because value is the result of the process,
value is the name we give to the amount of the equivalent commodity given
in exchange for an ordinary commodity. But what makes them compare to each
other according to equal amounts of social labor? This is the point about
which I
have attempted to present my understanding.

In [OPE-L:1896], answering a post of mine, you made a statement that may be
a part of your answer:

> I attempted to provide a summary of the materialistic
> character of Marx's approach to value and money, which is
> based on the assumptions first that human labor is the basic
> condition of existence,

Allin: OK.

> second that in the presence of division of labor, there must
> be a way of distributing labor,

Allin: OK.

> and third that in a market economy this way springs out of
> the process of exchange and expresses itself in money.

Not OK. This short-circuits the analysis of money, which cannot
simply be taken for granted as an "expression" of certain
general needs associated with a "market economy". One has to
back up and recognize a public power ("the state") as a further
condition of existence of complex societies, and look
historically at the genesis of money in association with the
state's power to tax.

Claus writes now:

In order for me to understand your point of view, could you explain:
1) how does the state influence the determination of the exchange values of
the commodities, and how do these exchange values come to correspond to the
labor contents af the commodities?
2) what are the theoretical assumptions - or else the theoretical framework
- that underly the examination of the historical genesis of money in
association with the state's power to tax?
3) what are the other ways in which relative prices can come to reflect
relative labour-contents?

In reference to my third point above and the following phrase in your


....money, which cannot
simply be taken for granted as an "expression" of certain
general needs associated with a "market economy".

Claus: my point may not have been clearly stated. What I meant to say in
points two and three above is the trivial in Marx's system: that in a
market economy there is no conscious previous process of distribution of
among the different sectors of production, since the producers are free to
choose what to produce. However, if the society is to be able to reproduce
itself, there must be a process of distribution of labor which is
unconscious and must therefore occur spontaneously, i.e., without the
conscious initiative of nobody. The rule that underlies this process is
what has to
be uncovered by research. For Marx this rule is value and is represented by
money. Thus, this doesn't mean that money is the expression of some
abstract general needs, but expresses the objective need for the
distribution of
social labor according to the needs of the social reproduction.

Claus Germer
Departamento de Economia
Universidade Federal do Paraná
Rua Dr. Faivre, 405 - 3º andar
80060-140 Curitiba - Paraná

Tel: (041) 360-5214 - Ufpr
       (041) 254-3415 Res.

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