[OPE-L:6378] Re: On the meaning and implications of price-value equivalence

From: Rakesh Bhandari (rakeshb@stanford.edu)
Date: Sat Jan 19 2002 - 14:34:29 EST


Gil writes in 6366


>
>Of course it doesn't, since Marx never mentions the term "labor power" (or
>for that matter, "prices of production" or "wage goods") in Chapter 5.  The
>term, and the corresponding distinction between "labor" and "labor power"
>is first introduced in Chapter 6.  However, what *does* matter is that
>Marx's *sole* justification for introducing these concepts in *Chapter 6*
>(not chapter 5) is in order to account for the existence of surplus value
>*given price-value equivalence*.  Thus Marx:
>
>"The change must therefore take place in the commodity which is bought in
>the first act of circulation...but not in its value, *for it is equivalents
>which are being exchanged, and the commodity is paid for at its full
>value.*  The change can *therefore* originate only in the actual use-value
>of the commodity, i.e. in its consumption.  In order to extract value out
>of the consumption of a commodity, our friend the money-owner must be lucky
>enough to find within the sphere of circulation...a commodity whose
>use-value possesses the peculiar property of being a source of value..."
>[p. 270, emphases added]
>
>It is *this* reasoning, based explicitly and solely on the postulate of
>price-value equivalence, that Marx uses to motivate his subsequent
>treatment of the labor-labor power distinction in Chapter 6.  To put this
>point another way:  granting entirely that profit and thus surplus value
>requires the expenditure of surplus labor, it does not follow that
>capitalists must *purchase labor power as a commodity* in order to achieve
>this result.  The latter conclusion is dictated *solely* by the postulate
>of price-value equivalence.

Gil, so you agree (at least implicitly, it seems) that if  value is 
not increased in circulation and/or PVE is postulated, surplus value 
can in fact be appropriated if it is not labor time itself but rather 
not only labor power but also labor power at its full value  that is 
alienated in exchange?

But your point is that Marx does not prove that surplus value has to 
be produced that way?

Merchants may indeed be able to appropriate surplus value through the 
putting out system that is based on exchanges that violate 
price-value equivalence. If this is what you are saying, I agree.

Are you saying that if one postulates PVE then one is eliminating by 
fiat the putting out system since it relies on violation of PVE and 
thus not explaining why for the most part surplus value has come to 
be appropriated through the exploitation of free wage labor rather 
than through the putting out system?

Are you saying that you can't rule out the putting out system (or 
some variant thereof) by simply making the arbitrary postulate of PVE?

Are you saying that Marx is trying to show the necessity of the 
commodification of labor power by arbitrarily postulating 
price-value equivalence?

And by the law of value do you mean PVE? And is this why you are 
saying that the law of value is an arbitrary postulate in the logical 
derivation of the commodification of labor power? And is why you are 
saying we must do away with value based reasoning and discover 
microinstitutional reasons for the vanquishing of the putting out and 
like systems by the system of free wage labor?
I am trying to understand you, am I doing a good job?


I even had Steve Keen express amazement that I understood what he was 
saying about use-value/exchange value dialectic.

Now try to understand my perspective.


First, I agree that Marx gives no reason in chs 5 and 6 why the 
putting out system has historically been displaced by the 
commodification of labor power because I don't think is Marx's 
concern in the least.


But you do agree--no?--that if the working class has been 
proletarianized (that is assume the expropriation of independent 
producers and the creation of a free wage labor market; assume a 
fully developed capitalism) and now assume that  value cannot be 
created in circulation itself, the working class can still be 
exploited and surplus value produced even *if* the thing that it 
exchanges is not in fact its labor time but rather its labor power 
even if this labor power is sold at its full value and the so called 
laws of exchange in this way respected.

Now please understand that for Marx's argument it does not matter 
whether labor power actually does sell at its value.

You are way hyping the importance of PVE in the argument as it unfolds.


For Marx himself realizes that surplus value can result from labor 
power having sold *below* its value.


But this would be *extra* surplus value that results when price-value 
equivalence does not hold and in this case the working class is in 
effect *super* exploited.

  Then Marx tells us that he will not consider this possibility in the 
course of his investigation though we do learn that the wage must 
cover the prices of production rather than the value at which wage 
goods sell.

Now you speak of the legitimate impact of your theory, I ask you 
please to refer us to one person who agrees with you that even if 
your criticism is legitimate in some detail it is in any way 
important. Either on this list or off.

I know that no one agrees with my inverse transformation 
interpretation but it builds on insights of Allin and Fred and 
Alejandro. I am trying to put together pieces of puzzle that others 
see and hoping that they will come to agree with what I take to be 
the strong sides of their respective interpretations.

  I am trying to put together Jerry's criticism of the V=0 assumption 
with what I think is the legitimate dropping of the input 
price=output price assumption by Ersnt, Carchedi, etc.

But you are not getting any support that you are on to something 
important, any agreement that it's not legitimate for Marx to focus 
on and work out how the exploitation of free wage labor is possible 
under the strictest conditions,  any support that at the very least 
it's not a neat thing to turn the Lockean game on itself by 
postulating PVE and showing how the laws of exchange can become laws 
of appropriation.

But you go on.

No one has been able to state your criticism back to you in a way 
that you find legitimate; Fred however understands exactly what I am 
saying. And when people understand what you are saying, they say big 
deal.

And I say big deal as well.  Surplus value can and did result quite 
often in the early stages of capitalism from the putting out system 
that is explicitly not based on PVE--by the way Grossmann emphasized 
this. You did not discover this; in fact you say that Marx himself 
had a good historical sense of this--so he just forgot about it in 
chapter 5?

There was some argument about whether only free wage labor can 
produce surplus value.

I agreed with you and Patrick against Jerry against this formalistic 
stricture (modern plantation slavery in my and grossman's opinion was 
sv producing, and surely there was no PVE there).

I even follow Jan Breman and Jairus Banaji that surplus value is 
produced in India today not uncommonly outside the free wage labor 
form, but these forms are unstable modes of surplus value production.

I still don't think this matters very much as to what Marx is 
accomplishing in chs 5 and 6.

But I suppose that you will admit that your ch5/6 critques has been a 
needless detour the same your fellow economists admit that Marx does 
not have a transformation problem.

Rakesh













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