From: Gil Skillman (gskillman@wesleyan.edu)
Date: Mon Sep 30 2002 - 16:50:37 EDT
Hi, Fred. Where I said > > I agree with this characterization as far as it's possible to in light of > > what Marx actually wrote in the chapters under discussion. On one hand, I > > have no problem with the suggestion that Marx is referring to "REAL, > ACTUAL > > quantities of money-capital in circulation," but see a serious caveat, > > based on what Marx actually wrote, with the suggestion that Marx's > > theoretical argument at this stage does not involve "a hypothetical model > > and hypothetical magnitudes." The caveat is that *in between* his > > introduction of the circuit of capital M-C-M' in Chapter 4 and his > > definition of the "component parts" of M, C and V, in Chapter 8, Marx > > imposes the postulate that all commodities exchange at their respective > > values, even while noting at the end of Ch. 5 that [even] "average prices > > do not directly coincide with the values of commodities.." [p. 269]. This > > is, therefore, a "hypothetical model" of the actual, aggregate circuit of > > capital, since, by Marx's own acknowledgement, commodity prices don't > > typically correspond to values; and therefore the latter constitute > > "hypothetical magnitudes" insofar as they are representations of commodity > > prices. you write >Marx's interesting and important footnote at the end of Chapter 5 does not >contradict my interpretation. I didn't say it did. I said it contradicted your assertion that Marx's argument at this stage does not involve "a hypothetical model and hypothetical magnitudes." Insofar as he posits exchange of individual commodities at their respective values, at the same time acknowledging that commodities don't in general exchange at their respective values, he's invoking a hypothetical model involving hypothetical magnitudes for commodity prices. > As I explained in the second part of >(7714) (not yet discussed in your (7719)), (Of course I haven't yet discussed it. As I said, I'm dealing with issues pertaining to method before turning to the substantive claims advanced in the second part of your post.) > Marx's theory of surplus-value >in Volume 1 is about the TOTAL surplus-value produced in the real >capitalist economy as a whole. Although I don't entirely disagree with this representation, I think it mischaracterizes what Marx is trying to do in Volume I. As he makes clear at the beginning and conclusion of Chapter 5, and in the middle of Ch. 7, Marx is primarily concerned to account for the *existence* of surplus value, rather than its "TOTAL" magnitude. I agree with Jerry on this point. > Therefore, Marx's assumption that >commodities exchange at their values applies most rigorously to the TOTAL >price of all commodities together. I have no idea what this statement means, other than perhaps the purely tautological claim that one can express the ratio of aggregate values to aggregate prices as a ratio-- but of course, one can do this even if individual commodities *don't* exchange at their respective values. In fact, it's precisely at the macro or "TOTAL" level that the assumption of exchange at value has no particular bearing, as I'll discuss below. In any case this statement has no obvious connection to what Marx actually wrote in justifying his invocation of this scenario. First, the assumption itself is not a statement about "the total price of all commodities together"; it's a statement about how commodities exchange with *each other,* i.e.at their respective values; this is the clear meaning of Marx's phrase "exchange of equivalents" in Chapter 5. Second, so far as I can see Marx does not invoke a "less rigorous" (micro) and "more rigorous" (macro) version of the assumption; rather he simply assumes that all commodities exchange at their respective values, and then draws all subsequent inferences from this basic assumption. Third, I have no idea what it means to say that an assumption is more or less "rigorous"--and thus what it means to speak of a "most rigorous..." application. Marx assumes that commodities exchange at their respective values, period. Subsequent inferences either follow from this assumption or they don't. Fourth, I don't see how you derive the "therefore" claim above from Marx's explicit assumption, or even what your claim means, because of course commodities don't exchange "all...together", as if all commodities in an economy were exchanged at once for money. They exchange individually, at exchange rates that Marx specifies are given by their respective values. And again, in doing so Marx invokes a hypothetical model involving hypothetical price magnitudes. >The provisional assumption is also made that individual commodities also >exchange at their values, to the extent that exchanges of individual >commodities are considered. No there is no "provisionality" about it, at least in the context of Volume I, nor is there any "also." Beginning at the end of Chapter 5, Marx asserts, unprovisionally, that accounting for the transformation of money into capital--i.e. the existence of surplus value, must be made on the basis that commodities exchange at their respective values. He doesn't assert that "all commodities together" exchange at their values, whatever that means, and then "also" assert that individual commodities exchange at their respective values; rather he asserts only the latter. And as for "the extent that exchanges of individual commodities are considered," well, that's Marx's primary focus beginning in Chapter 1 of Volume I until at least Chapter 6. The *foundation* of his explanation for surplus value is an analysis of the exchange of *one particular* "individual commodity," i.e. labor power. > But, as I explained, the prices of individual >commodities are not determined in Volume 1, but are instead determined in >Volume 1. Assuming the last number should be 3, of course I agree, since that's what I've been saying: while acknowledging that commodity prices are *not* in fact generally proportional to their respective values, Marx assumes instead that commodities exchange at their respective values. > And this provisional assumption plays no role in Marx's theory >of the total surplus-value in Volume 1. This assumption is no more "provisional" than whatever macro version of the assumption you're invoking, and as far as I can tell Marx never suggests that it is in Volume I (where exactly does Marx indicate that this assumption is "provisional"? He asserts at the end of Chapter 5 that one *must* explain surplus value on the basis of exchange at value, in order to "prevent our observations from being interfered with by disturbing incidental circumstances"), but your comment here misses my point: insofar as Marx defines labor values and specifies their quantitative determination (as he does in Ch. 1) and posits that commodities exchange at their respective values (as he does beginning at the end of Chapter 5), theoretical coherence requires that any subsequent analytical results must explicitly be shown to be consistent with these prior steps. > It is simply the only assumption >consistent in Volume 1 with the macroeconomic labor theory of value in >Volume 1, to the extent that exchanges of individual commodities are >considered. So far as I can tell, neither you nor Marx demonstrate this uniqueness claim, and unless it is simply circular I don't even know what this claim means. One could, for example, posit that total values equal total prices times a given conversion factor (labor times into monetary units) *whether or not* individual commodities exchange at their respective values. But second, it appears that you're insisting on inconsistent positions here. How can you assert on one hand, as you do here, that exchange at value is "the *only* assumption consistent...with the macroeconomic labor theory of value in Volume I," and then assert on the other, as you do above and below, that this assumption "plays no role in Marx's theory of the total surplus-value in Volume 1." How in the world can it be that an assumption that "plays no role" in the theory is "the only assumption consistent" with the theory? >In general, individual commodities in Volume 1 represent the >total commodity product. What is "total commodity product"? Is this a term Marx actually uses anywhere? Do "total commodity products" exchange with each other? In any case, I don't see how this observation, whatever it means, contradicts anything I've said. >That is why Marx can say in the footnote that the fact that individual >prices are not equal to their values does not affect his theory of the >total surplus-value. Because his theory of the total surplus-value does >not depend on the prices of individual commodities. Again, Marx does not use the phrase "*total* surplus-value* anywhere in the footnote in question, or for that matter anywhere in Chapter 5 or 6; you supplied that extra adjective. As far as I can see, Marx doesn't use your phrase because he is primarily concerned to account for the *existence* of surplus value (or, in the language of the footnote, "the origin of capital"), not its aggregate *magnitude.* > Even though >individual prices that = values are hypothetical magnitudes, these are not >the prices that are determined in Volume 1. Rather, the total price of >the total commodity product and the total surplus-value contained therein >are the variables determined in Volume 1, and these are real magnitudes. None of this is at odds with my point that Marx's analysis along these lines must be explicitly shown to be consistent with the postulate of exchange at value. > > So first I must ask: do you agree that Marx introduces at least this > > element of "hypothetical magnitudes" in a consequently "hypothetical > model" > > of the circuit of capital, M-C-M', *before* proceeding to the treatment of > > C and V in chapter 8? > > > > Second, if you agree to the first question, isn't it then > *necessarily* the > > case that the magnitudes of C and V subsequently "taken as given" by Marx > > must be *consistent* with Marx's prior stipulation that all commodities > > exchange at their respective values? Would it be legitimate for Marx to > > postulate exchange at value if this were inconsistent with the magnitudes > > of C and V realized in a "real capitalist economy"? > >C and V are not taken as given SUBSEQUENTLY to the assumption that >commodities exchange at their value. C and V are taken as given in >Chapter 4, because M is taken as given and M = C + V (although not >explicitly distinguished yet). This is the "prior stipulation" - that M, >C and V are taken as given. Given amounts of money-capital are invested >to purchase means of production and labor-power (C and V) and their sum is >the total money-capital invested (M). Well, first, I would need you to show me the passage in Chapter 4 where Marx posits M as a *given value,* rather than simply the starting point for the circuit of capital. As the last line in the chapter indicates, Marx's primary concern in this chapter is to identify M-C-M' as the "general formula of capital," and define surplus value in terms of this formula, rather than to specify any given value of aggregate M. But second, I don't see how your claim follows, even granting that Marx posits a given value of M. It seems sort of like saying that if you posit the number 4 you posit a particular division of 4 into 2 + 2. But this doesn't follow, nor is it consistent with the order of Marx's argument. He first defines labor values, then identifies the general circuit of capital M-C-M', and then invokes the assumption of exchange at value, before he even distinguishes labor power and means of production, let alone constant and variable capital. Following this order, one would logically *derive* C and V as respective vector products of input requirements and commodity prices (under the assumption of exchange at value, of course), since this is how they are constituted in any case! If you were to implement your theory empirically, you'd have to calculate these vector products to arrive at "concrete" measures of C and V. As I mentioned before, Marx's own characterization of C and V indicates that he acknowledges this connection. And finally, you haven't answered the substance of my question here: *whatever* the order of introduction of concepts, doesn't theoretical coherence *require* that the magnitudes of C and V subsequently "taken as given" by Marx must be *consistent* with Marx's stipulation that all commodities exchange at their respective values? Would it be legitimate for Marx to postulate exchange at value if this were inconsistent with the magnitudes of C and V realized in a "real capitalist economy"? >As I have explained, the provisional assumption that the prices of the >means of production and the means of subsistence are equal to their values >is a partial explanation of the given C and V. But, again, the magnitudes >of C and V are not determined by this provisional assumption. Rather, the >magnitudes of C and V are taken as given. And this provisional assumption >plays no role in the determination of the total price of commodities and >the total surplus-value in Volume 1. Again, this misses my point. Whether or not Marx posits "given C and V," the coherence of his argument in Volume I still requires that this postulate is *consistent* with the assumption of exchange at value, given the prior inference that value magnitudes are determined by SNLT. For what it's worth, I agree that the aggregate magnitudes C and V are not *completely* determined by these conditions, so long as the technical composition of capital varies across sectors. Given the assumption of exchange at value, the determination of commodity values, and the initial magnitude of M, the magnitudes of C and V are entirely determined by the sector composition of output. But in any case, the assumed values of C and V must be shown to be consistent with Marx's additional stipulations, or the theory isn't internally coherent. > > Third, to anticipate, do you agree that Marx understands commodity values > > to be determined by the labor times "socially necessary" to produce > > them? If so, how do you understand SNLT, and thus labor values, to be > > calculated? > >Gil, what do you mean by "values" here? Do you mean "labor values" as in >your next sentence? If so, then I don't understand the difference between >"labor values" and "socially necessary labor-time." Aren't they the same >thing? I don't see how "labor values" can be determined by "socially >necessary labor-time." Please explain. I guess we'll have to ask Marx, since I mean simply to follow his usage: "What exclusively determines the magnitude of the value of any article is therefore the amount of labour socially necessary, or the labour-time socially necessary for its production." [I, p. 129] Note that in this representation Marx doesn't assert that SNLT is "the same thing" as labor values; he says rather that SNLT determines the magnitude of a commodity's value. In any case, our difference here is at most semantic. Do you agree that Marx understands the magnitude of commodity values to be determined in this way, and if so, how do you understand SNLT to be calculated? Bottom line: I see clearly that you have a particular, "macro-monetary" take on Marxian theory, and my issue isn't primarily with that approach in itself. It's less clear to me, though, that this approach is consistent with what Marx actually writes in Volume I: e.g., where does he posit M as a given aggregate magnitude in Chapter 4? Where does he distinguish more and less rigorous "applications" of the assumption that commodities exchange at their respective values? Where does he say he's primarily concerned in Vol. I to determine the *magnitude* of total surplus value, as opposed to accounting for the *existence* of surplus value? Where does Marx speak of the "total commodity product," or that his assumption of exchange value applies primarily to that aggregate notion? Finally, how can one coherently assert that the assumption of exchange at value is the *only* one consistent with Marx's theory of value in Volume I, while simultaneously insisting that the assumption "plays no role" in the theory? If it plays no role in the theory, then it must be unnecessary for the claims of the theory, and thus the latter could be made without making the postulate of exchange at value, no? Gil
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