From: Diego Guerrero (diego.guerrero@CPS.UCM.ES)
Date: Fri Oct 07 2005 - 05:57:27 EDT
Paul:
>I have read the example below and there seem to me to be three
> problems with it.
>
> 1. This relates to how you account for the product of the servants.
> You show the capitalist as initially spending 2 person years on
> the wages of servants. This does not mean that the value of his
> total new net product is 12. His 12 factory workers produce
> 12 person years new value, 6 of which are paid back as wages.
> But the servants will also work a long working day, 2 person
> years worth of expenditure on servants wages will allow him
> to employ 4 servants. Thus his consumption was originally
> 3 person years production of ordinary consumer goods
> 1 person years production of luxuries
> 4 person years labour by servants
> Thus he is initially consuming 8 person years labour not
> 6 as you show.
No. I disagrre with "2 person years worth of expenditure on servants wages will allow him to employ 4 servants". It is supposed that the wage of a servant is the same as the wage of a factory worker. The difference is that the former do not create surplus value at home.
> 2. The second problem is that you have still done the calculation
> at the level of an individual capitalist not in terms of entire
> sectors as is done in volume II.
> Once you do this you have to ask 'who purchases the luxuries?'.
> If you construct an example you will find that the total number
> of person years appropriated by the capitalist class has not changed
> if the servants go to work in dept III.
I don't think this is a problem. My single capitalist can be divided into as many as you want. Money for buying the new luxuries come from surplus value created by all factory workers who were former servants.
> 3. You show that there is a larger net production of means of production
> after the transfer of the servants to making luxuries. This implies
> more employment in dept I which you can not examine properly because
> you are not working with reproduction equations.
Of course, we must take into account the other departmentes. But suppose that all workers formerly working as servants are now distributed according to the new structure of production between departments. My point is that WORKERS IN DEPARTMENT III ARE ALSO PRODUCTIVE, AS PRODUCTIVE OF SURPLUS VALUE AS THE OTHER WORKERS IN DEPARTMENTES I AND II. Remember that it was this that we were discussing.
Diego
> I suggest that in order to isolate the question at issue, whether
> a shift from domestic service to the production of luxuries adds to
> surplus value, you try to construct an example encompassing the whole
> economy, and explicitly modeling the allocation of the entire working
> population.
>
> Diego Guerrero wrote:
>> Paul, I think that you are wrong. May be your interpretation of
>> reproduction
>> is biased by the fact that you usually work with models of economies that
>> are always growing at the maximum rates of growth, and therefore there is
>> no
>> place for increasing accumulation using money coming from outside the
>> capitalist sector or from capitalists who were not yet investing all his
>> surplus value? I don’t know.
>>
>>
>>
>> But suppose a capitalist who consume all his surplus value: his
>> production
>> of value amounts to 24: 12 c + 6 v + 6 s, and he consumes all his s in
>> this
>> way: 3 units of normal goods (Sg), 1 luxury good (Sl), and 2 units of
>> domestic services (servants): Sd. We can see this in Table 1:
>>
>>
>>
>> Table 1
>>
>>
>>
>> C = 12
>>
>>
>>
>>
>> V = 6
>>
>>
>> Sg = 3
>>
>>
>> Sl= 1
>>
>>
>> Sd = 2
>>
>>
>>
>>
>> In terms of use value, production is 24, ie 12 means of production, and
>> 12
>> means of consumption = 6 normal means of consumption for workers plus 3
>> for
>> himself plus 1 luxury means of consumption, and 2 means of consumption
>> for
>> servants. We have it in Table 2:
>>
>>
>>
>> Table 2
>>
>>
>>
>> MP = 12
>>
>>
>> MCg = 6 + 3
>>
>>
>> MCl = 1
>>
>>
>> MCg = 2
>>
>>
>>
>>
>> But if he puts his servants to work in a firm of luxuries (that,
>> according
>> to you, would be a firm where labour is unproductive) he will “enrich”
>> himself instead of “impoverishing” himself (using approximate words from
>> Smith). Of course he will need to invest in new means of production and
>> combine them with the same work he was paying at home and now pays inside
>> the firm as productive labour. Those workers will produce now new surplus
>> value for him and of course new value added and new total value. Total
>> value
>> produced is now 26,67 instead of 24, and value added 13,33 instead of 12.
>> Note that the rate of surplus value and the value composition of capital
>> do
>> not change.
>>
>>
>>
>> In terms of value he detours the 2 units of money that he consumed before
>> as
>> revenue for his servants to buy now means of production for 1,33 units
>> and
>> capital variable for 0,67 (wages are the same, but they were not capital
>> before but revenue), and then obtain 0,67 of additional surplus value.
>> See
>> Table 3: his surplus value is now 6,77 = the sum of 6 (as before) plus
>> 0,67
>> coming form his new productive workers.
>>
>>
>>
>> Table 3
>>
>>
>>
>> C = 12
>>
>>
>>
>>
>> V = 6
>>
>>
>> Sg = 2,33
>>
>>
>>
>>
>> Sl = 3
>>
>>
>> Sk=
>>
>> 1,33
>>
>> ∆C = 1,33
>> ∆V = 0,67
>>
>>
>>
>>
>> Of course, that means that the material composition of production has
>> changed. We have now more means of production (14,67), and the same means
>> of
>> consumption (12). But the composition of the means of consumption has
>> changed at its turn: we have now 3 units of luxuries and just 2,33 of
>> normal goods consumed by the capitalist; the rest (6,77) are of course
>> consumed by workers. See Table 4:
>>
>>
>>
>> Table 4
>>
>>
>>
>> MP = 13,33 + 1,33
>>
>>
>>
>>
>>
>>
>> MCg = 6,67 + 2,33
>>
>>
>> MCl = 3
>>
>>
>>
>>
>>
>>
>> So the conclusion is clear. To put servants to work in a productive firm,
>> even if that firm produces luxuries, amounts to the capitalist to expand
>> the
>> ground for accumulation (of both, value and surplus value on the one
>> hand,
>> and means of production on the other hand). Of course all luxuries are
>> “contingent” in my own terms, but require labour that is absolutely
>> productive if the workers are employed in a capitalist firm instead of at
>> home.
>>
>>
>>
>> And note finally that the luxuries referred to could even be the same
>> “domestic services” as before, ie of the same material nature that those
>> workers performed at home before.
>>
>>
>>
>> PS. I add a word file because of tables' deformation.
>>
>>
>>
>>
>> ----- Original Message -----
>> From: "Paul Cockshott" <wpc@DCS.GLA.AC.UK>
>> To: <OPE-L@SUS.CSUCHICO.EDU>
>> Sent: Tuesday, October 04, 2005 11:19 AM
>> Subject: Re: [OPE-L] basics vs. non-basics and financial services
>>
>>
>> > Diego Guerrero wrote:
>> >> Paul, you say: "The mass of surplus value can not
>> >>
>> >>> be altered by activities in the 3rd sector producting luxuries etc."
>> >>
>> >>
>> >> Suppose a system producing 10 iron, 10 corn and 100 luxuries, with
>> 10, 10
>> >> and 100 workers respectively. As distribution can be any
>> distribution,
>> >> this
>> >> would be possible. Do you mean that wages and profits in this third
>> >> sector
>> >> come from the two former? I don't think so. Another, very different
>> >> thing,
>> >> would be if this third sector were public administration. Then
>> >> productivity
>> >> in the two productive sectors would have to be much higher that in
>> the
>> >> other
>> >> sector in order for them to be able to pay taxes and redistribute
>> such a
>> >> quantity of surplus value.
>> >>
>> >> In my opinion, in the first case we have new areas for accumulation
>> of
>> >> capital and production of new surplus value. In the second case we
>> would
>> >> have new areas outside value production that would reduce the
>> potential
>> >> of
>> >> accumulation of capital.
>> >>
>> >> Diego
>> > What I mean is that the third sector
>> >
>> > 1. Can not produce relative surplus value
>> > 2. Can produce some absolute surplus value but, and this is crucial
>> > 3. This absolute surplus value can not be accumulated
>> >
>> >
>> > 1. The luxury sector can not produce relative surplus value
>> > since to produce relative surplus value its output would
>> > have to enter directly or indirectly into the real wage.
>> >
>> > 2. It could produce absolute surplus value, so its employees
>> > can be exploited by being forced to work beyond the time
>> > necessary to reproduce the value of their wages, but in
>> > this they are no different from butlers and the other feudal
>> > retainers that Smith stigmatised as unproductive. These too
>> > may have to work long hours.
>> >
>> > 3. Why can the surplus value produced in this sector not be
>> > accumulated?
>> >
>> > Because of its material form.
>> >
>> > Assume depts I, and II remain unchanged, but that working hours
>> > increase in dept III. This increase in working hours will result
>> > in a more valuable product in dept III, but this surplus comes
>> > in the material form of luxuries and services which can not be
>> > accumulated as constant capital. Its output must thus be
>> unproductively
>> > consumed by the capitalist class.
>> >
>> > Thus the third sector is not what you describe as "new areas for
>> > accumulation of
>> > capital and production of new surplus value".
>> >
>> > It is what it always was, a drain on the process of accumulation and
>> > thus on capitalist economic progress. This is the reason why Smith
>> > insists on productive labour producing vendible commodities that
>> > persist through time.
>> >
>> > This is the same reason why the production of weapons is unproductive,
>> > whether this takes place in state factories or private factories.
>> > Workers engaged in the production of nuclear missiles are
>> > producing means of *destruction* not means of *production* and
>> > as such can not contribute directly or indirectly to the
>> > accumulation of the means of production.
>> >
>> > If we loose sight of the underlying material relationships of
>> > production and focus only on legal superficialities we get led
>> > astray by the 'illusions of competition'.
>> >
>> > Given your figures for labour inputs we have
>> >
>> > Let us now look at your example
>> >
>> > labour wages constant gross value
>> > capital output
>> > I 10 1 10 20
>> > II 10 1 2 12
>> > III 100 10 8 108
>> >
>> > Sales by dept I
>> > 10 within the department
>> > 2 to dept II
>> > 8 to dept III
>> >
>> > Sales by dept II
>> > 1 to workers in dept I, 1 to workers in dept II, 10 to workers in
>> dept
>> > III
>> >
>> > Sales by dept III
>> > 9 to capitalists in dept I
>> > 9 to capitalist in dept II
>> > 90 consumed by themselves
>> >
>> > Now suppose that hours of work in III are raised 10%, we get
>> > labour wages constant gross value
>> > capital output
>> > I 10 1 10 20
>> > II 10 1 2 12
>> > III 110 10 8 118
>> >
>> > Sales by dept I - unchanged
>> >
>> > Sales by dept II - unchanged
>> >
>> > Sales by dept III
>> > 9 to capitalists in dept I
>> > 9 to capitalist in dept II
>> > 100 consumed by themselves
>> >
>> > So the net effect can only be to increase the personal consumption of
>> > one section of the capitalist class - that section whose workers make
>> > luxuries. The effect therefore is identical to what would have
>> > occurred if they made their personal servants work longer hours.
>> >
>> >
>> >
>> > --
>> > Paul Cockshott
>> > Dept Computing Science
>> > University of Glasgow
>> >
>> >
>> >
>> > 0141 330 3125
>>
>
>
> --
> Paul Cockshott
> Dept Computing Science
> University of Glasgow
>
>
>
> 0141 330 3125
>
This archive was generated by hypermail 2.1.5 : Tue Oct 11 2005 - 00:00:01 EDT