From: Fred Moseley (fmoseley@MTHOLYOKE.EDU)
Date: Sun Jun 06 2004 - 23:33:17 EDT
On Thu, 3 Jun 2004, ajit sinha wrote:
> --- Fred Moseley <fmoseley@MTHOLYOKE.EDU> wrote:
> > > _______________
> > > Fred, I'm glad to see you moving firmly in my
> > > direction.
> >
> > I don't know about that. See below.
> >
> >
> > > So you agree that
> > > "the basic unit of measure of abstract labor, as
> > the
> > > "substance of value", is one hour of simple,
> > unskilled
> > > labor, of average intensity, and using average
> > > conditions of production." This is what I have
> > been
> > > belaboring for ages. Now, this measure does not
> > need
> > > money.
> >
> > No, this is not what I mean. The measure of
> > abstract labor DOES NEED
> > MONEY, because the measure of abstract labor in
> > terms of labor-time is
> > INVISIBLE, i.e. NOT DIRECTLY OBSERVABLE as such.
> _______________
>
> But then you are contradicting what you had said
> above. To remind you, you said "the basic unit of
> measure of abstract labor, as the "substance of
> value", is one hour of simple, unskilled labor, of
> average intensity, and using average conditions of
> production." Now in any society there is a good
> understanding of what kinds of labors are considered
> unskilled. So there is no problem in terms of
> observation. In any case money cannot help you in
> dertermining what labor is unskilled. Second, average
> intensity is also an accepted norm of labor intensity
> that can be observed or generally considered to be a
> part of socially prevalent technology of production
> and various labor laws. Again, money in no ways helps
> you in determining the average intensity of work.
> Thirdly, average conditions of production is also
> determined by observing what kind of technology and
> labor conditions are dominant in production of given
> commodities. Again, money, by no means, will help you
> in determining the average conditions of production.
>
> So I have two questions for you:
>
> (1) How does money help you in determining the above
> three variables that both you and Marx identify are
> variables needed to measure abstract labor and value?
I am not saying that money helps determine what the skill multipliers are,
nor what the intensity multipliers are. I am saying that we don't know
what the skill and intensity multipliers are. They are simply taken as
given, not explained (and are not very important to the main conclusions
of Marx's theory). Money does not tell us that the skill and intensity
multipliers are. Rather, money provides the necessary form of appearance
of abstract labor, after all these multipliers have determined the
quantities of abstract labor, according to an invisible and unknown
process.
> (2)If, as you say below, that "abstract labor" only
> shows up in money terms but its measure is in labor
> terms, then could you tell me how do you get your
> money values first and then how do you go about
> translating those money values to labor values?
This will take a longer answer. I realize now that your earlier question
about how abstract labor is measured is different from what I originally
thought. My answer to you in my last message about the measurement of
abstract labor had to do with the high level of abstraction of Part 1 of
Volume 1 (the "simple circulation of commodities"). Since most of the
recent OPEL discussion about Marx's theory of money initiated by Rakesh
was in terms of this high level of abstraction, that was also the implicit
assumption of my answer.
However, I argue that Marx's theory of price becomes more complicated once
we reach capitalist production and the circulation of capital in Parts 2
and 3 of Volume 1 (and beyond). In Part 1 ("simple circulation of
commodities"), commodities are assumed to be present, with given
quantities of socially necessary labor-time contained in them. Money is
derived as the necessary form of appearance of socially necessary
labor-time, and prices are determined as proportional to socially
necessary labor-times (with the inverse of the value of money as the
factor of proportionality, as in my original message):
(1) Pi = Li / Lg
"Simple circulation" is analyzed according to the symbolic formula:
C - M - C
in which the commodities assumed present are first sold for money and this
money is then used to purchase other commodities.
Then, beginning in Part 2, the level of abstraction changes to the
circulation of CAPITAL, expressed symbolically to begin with in Chapter 4
in the abbreviated version of the "general formula for capital":
M - C - M' where M' = M + dM
In the circulation of capital, the starting point is not already produced
commodities (C), but rather a quantity of money (M) advanced as
capital. This initial quantity of money-capital (M) provides the initial
givens in Marx's theory of price and surplus-value in Part 3 (and beyond).
This initial money-capital (M) is divided into two components: constant
capital advanced to purchase means of production (mp) and variable capital
advanced to purchase labor-power (lp). Marx emphasized in Chapters 7 and
8 of Volume 1 that these two components of the initial money capital play
entirely different roles in the determination of the price of the output
and the resulting surplus-value. The money constant capital is
transferred to the price of the output, and becomes the first component of
the price of the output, and thus cannot be a source of
surplus-value. This given money constant capital advanced is added
together with the money new-value produced by current labor in order to
determined the aggregate price of commodities (I have argued on many
occasions that Volume 1 is about the capitalist economy as a whole).
Therefore, in capitalist production, which is preceded by the advance of
money capital, the determination of prices is different from the
determination of prices in "simple circulation". Instead of equation (1),
we have:
(2) P = C + N
= C + m L
In this equation, the C is taken as given, as the initial money-capital
advanced to purchase mp. This given money constant capital is transferred
to the price of the output, and becomes the first component of the price
of the output. The L is also taken as given, as the total quantity of
current socially necessary labor-time in the economy as a whole. This
total quantity of labor is made homogeneous and added together by the
given skill and intensity multipliers, as discussed in previous
messages. The proportionality factor m is also taken as given, and is the
inverse of the value of money ( m = 1 / Lg ), or the amount of money
new-value produced per hour of abstract labor (which Foley and others have
called the MELT - the monetary expression of labor-time). These given
magnitudes co-determine the aggregate price of commodities according to
equation (2).
The first component of the price of commodities (the C) is taken as given
because it has already been advanced at the beginning of the circulation
of capital and thus existed prior to production. Other authors who have
also argued that the initial money-capital is taken as given in Marx's
theory of prices include Yaffe, Carchedi, Mattick Jr, and Mage.
The second component of the price of commodities, the new-value component
(N = mL) did not exist prior to production, but is instead created by the
labor of the current period. N = mL is the basic assumption of Marx's
labor theory of value, as an aggregate theory of price and
surplus-value. The "new interpretation" has also emphasized this
assumption as the fundamental assumption in Marx's labor theory of value.
In the past, I have calculated the labor-time represented by the given
money constant capital, as the ratio of this given money constant capital
to m (or the MELT):
i.e. Lc = C / m
I then added this quantity of labor represented by the given money
constant capital to the total current living labor (L), in order to obtain
the total labor contained in the total commodity product: TL = Lc + L.
Ajit, I think this derivation of Lc from C is what your second question is
about, right (or at least part of it)?
The reason for making this calculation is to emphasize that the labor
transferred to the total labor of the product is this Lc, the labor
represented by the given money constant capital, not the labor-time
required to produce the means of production (Lmp), because the labor-time
contained in the means of production have already been represented as a
price (when the mp were sold and purchased). And it is this
already-represented price of the mp ( = C) that is transferred to the
price of the output, even if this price of the mp is not proportional to
Lmp (and in general will not be proportional). Therefore, it is Lc that
is transferred to the total labor, not Lmp.
However, strictly speaking, this calculation of Lc from C is not essential
to Marx's theory of price. As just mentioned, the first component of the
price of commodities is the initial money constant capital advanced to
purchase mp at the beginning of the circulation of capital, and this
initial money-capital is taken as given. The magnitude of C is not
derived from Lc, but is instead taken as given, and determines Lc.
There is much more to discuss (especially variable capital, which is also
taken as given in Marx's theory of surplus-value, as the initial
money-capital advanced at the beginning of the circulation of capital to
purchase labor-power), but it is late and I think I will stop for now, and
see what Ajit (and others) have to say about this.
Thanks for the good discussion.
Comradely,
Fred
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