On Sun, 1 Oct 2000, Ajit Sinha wrote: > Gil Skillman wrote: > > > I'm writing in response to a much earlier post from Fred on this topic. > > > > Fred writes: > > > > > >..... Marx's labor theory of value, as I > > >understand it, assumes that, in a given period of time in the real > > >capitalist economy, each hour of average social labor produces a certain > > >amount (say, m) of money new-value (or money value added). Even though we > > >don't know what m is (i.e. we can't observe m), and even though we cannot > > >explain what determines m, the theory assumes nonetheless there is an > > >actual, unique m in the real capitalist economy. And it is this actual, > > >unique m that is taken as given in the determination of the total > > >new-value produced in this period. > > > > The measure m is real enough, but its existence does not in any way depend > > on the assertion of a labor theory of value. > > For example, in the NI understanding of m discussed below, m is equivalent > > to what neoclassicists would immediately recognize as the average product > > of labor--in this case, the average *net* product of "socially necessary" > > labor. But since Marx defines "socially necessary" labor in terms of > > averages in any case, the latter condition doesn't add any bite. > > > > >>As Duncan has argued in (3761) (and elsewhere), the unique value of m in a > > >given period must be equal to NV / L, i.e. to the ratio of the money > > >new-value produced in this period to the average social labor performed > > >during this period. > > > > Rather, m is *defined* as NV/L. The labor theory of value itself doesn't > > demand that this ratio be defined at all; we could instead follow Marx's > > explicit lead in defining commodity values in terms of embodied labor time. > > Then we could determine directly the average labor value of aggregate net > > product, and not bring in prices at all. And the measure NV/L is only > > "unique" if one can agree on how the net product vector mentioned by Fred > > is valued--by labor values? current prices? inflation-adjusted prices, > > relative to some base? Sraffian prices of production? Neoclassical > > competitive prices? > > > > > This does not mean that m is determined by NV / L. > > >It only means that m has this unique value. We don't know what > > >determines m. > > > > Rather, m is "determined" by NV/L, but we don't know by this what > > determines NV and L. > > > > >But whatever determines m, and whatever the value of m, if > > >it is assumed that NV = m L, then m must be equal to NV / L, and cannot by > > >assumption be equal to anything else. > > > > That's right: it's equal by assumption, i.e. a tautology. > > ____________________ > > Actually, in Fred's case it is not a tautology. It is a case of trying to > determine two unknowns with one equation. In his case, both NV and m are > unknowns, only L is known. Not true, Ajit. As I have argued in recent posts, Marx's theory assumes that there is an actual m in the economy, with a definite magnitude; i.e. that each hour of abstract labor produces a definite quantity m of money new-value. It is this actual m, with a definite magnitude, that is taken as given in Marx's theory of new-value and surplus-value. m is not an unknown. m is taken as given. There is only one unknown, NV, which is determined by the mL. Comradely, Fred
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