Re: [OPE] Invention, Inventors, and the Productivity of Labor

Ian W.: “This is why I am wary of post-capitalist schemes that reproduce different rewarding schemes:”   1) “That some members of a firm get paid wages, while other members have claim over the profits, solely in virtue of property rights, is part of the very "DNA" of capitalist economies.”   In my model, the claims over rewarding founds (there are not profits) are not I virtue of property rights, since I’m talking of Market Socialism where property is a public asset in most part of the economy.     2) “The different rewarding schemes are the root cause of antagonistic economic classes, enormous income inequality, the corruption of democratic life, and many other social ills.”   At least concerning income inequality, I already argued that my model might reach the lowest Gini index in the history of contemporary societies. Concerning the other ills, your argument is supported solely by moral claims. They are important, but here rest a lot of undemonstrated causalities.     Ian W.: “Yes there is division of labor, and different members of a firm contribute different kinds of concrete labor during the production of a firm's output. But all members of a firm are "responsible" for the output.”   For the sake of incentives and economic calculation, we have to distinguish different degrees of “responsibility” for the output. Maybe you, as Jerry and other fellows in this list, are thinking in a rewarding system feasible only in one or two thousand years ahead, when our morality has changed radically and nobody wanted to take somebody else for a ride.   I don’t believe in a permanent egotistic state of war, but these mild egotistic phenomena happen even in Scandinavia today.     Ian W.: “There's nothing *qualitatively* special about managerial or entrepreneurial work that justifies *qualitatively* different "reward schemes". In contrast, if you have different rewarding schemes you must make a qualitative distinction between different kinds of concrete labor (e.g., entrepreneurial vs. managerial vs. production vs. research etc.)”   Of course there is! Is there any qualitatively difference between working in a Taylor fashion production line and designing the shape of the 21th century Ferrary?     Ian W.: “I wonder if this is an echo of Schumpeter's heroic entrepreneur in your thought? The Austrian school overplays the contribution of entrepreneurial labor in order to justify capitalist property laws.”   Of course it is! The problem with the majority of my fellow socialists is that they miss the qualitative properties of market dynamics, of “catallactic competition”. To start with, there are deep prejudices about prices and most of the supporters of a labour value accounting (except Cottrell & Cockshott) think that it is possible an economy where prices that distort labour values are redundant. If this were the case we wouldn’t need Strumilin’s rule and a real-life planner to execute it, and not the allegedly gravitational force of labour.   It is true that Austrians try to justify the capitalist property laws, but I support public ownership of means of production.     Ian W.: “You'll need cumbersome accounting schemes to measure when a particular individual outputs different kinds of concrete labor (e.g., half a day being an entrepreneur and half a day producing), and so forth. This is messy”   Are these accounting schemes cumbersome in nowadays mixed economies? In my system neither.     Ian W.: “In a competitive environment, it is in the interest of all members of a firm to differentially reward talented workers otherwise they will leave and join another firm.”   Based only in quantitative differences of labour? What are the criteria behind the decision of introducing an incentive bonus? You can have two workers working the same amount of time, but the fact that we can detect further differences in the quality of this time of work revels that there is something more. Maybe the Marxian differentiation between abstract and substantive work revels that Marx also perceived a qualitative side of work.   Regards,A. Agafonow ________________________________ De: Ian Wright <wrighti@acm.org> Para: Outline on Political Economy mailing list <ope@lists.csuchico.edu> Enviado: sábado, 8 de noviembre, 2008 3:05:50 Asunto: Re: [OPE] Invention, Inventors, and the Productivity of Labor Alejandro Agafonow wrote: > Are there different rewarding rules in Mixed economies? Well, in my > scheme too. Sure, but that's not an argument for preserving different "rewarding schemes". That some members of a firm get paid wages, while other members have claim over the profits, solely in virtue of property rights, is part of the very "DNA" of capitalist economies. The different rewarding schemes are the root cause of antagonistic economic classes, enormous income inequality, the corruption of democratic life, and many other social ills. So this is why I am wary of post-capitalist schemes that reproduce different rewarding schemes. How the surplus gets created and distributed defines the economic basis of society. Different rewarding schemes will, I think, produce new kinds of class divisions. > Since we’ll have a social division of labour during so long, until we’ll > be able to synthesize goods at zero cost, it doesn’t have sense to > establish the same rewarding rule for people that bear so different > responsibility for the outcome of certain productive unit. Yes there is division of labor, and different members of a firm contribute different kinds of concrete labor during the production of a firm's output. But all members of a firm are "responsible" for the output. The question is, "by how much" are they responsible? For example, the CEOs of almost all capitalist firms get renumeration far in excess of their objective contribution to the financial success of a company. How can we know that? If we got the funding we could perform a large-scale social experiment: (i) convert a sector of the economy into worker-owned, democratic firms, (ii) allow the members of those firms to distribute the residual income in a democratic fashion, and (iii) record how much the CEOs gets renumerated. Will it be the same as before? (The answer is of course "no".) There's nothing *qualitatively* special about managerial or entrepreneurial work that justifies *qualitatively* different "reward schemes". However, some very talented leaders do contribute more to a firm's success than other workers. If so, this *quantitative* difference will be recognized by the other members of the firm and the talented workers will be more highly rewarded to reflect that. In a competitive environment, it is in the interest of all members of a firm to differentially reward talented workers otherwise they will leave and join another firm. They will lose that value-added. > Even more, managers should be encouraged to experiment with different > rewarding rules within their firms for the sake of competition and > efficiency increment. That depends on the legal framework in which they are allowed to experiment. For example, capitalist property relations, in which labor is hired and the supplier of capital is the residual claimant on firm income, should be illegal. In just the same way that voluntary slavery is illegal now (e.g. I am not allowed to capitalize my future income stream and receive a lump-sum now in return for working for life for a single firm). > The important thing is the degree of income inequality emerging from > these rules (that should be low), not the rules themselves. I think income inequality will be low if the constitution of firms genuinely reflects the equality of all people, and is founded upon constitutional principles that enforce decision-making mechanisms that maximize the probability that quantitative differences in renumeration objectively reflect quantitative differences in contribution. I think some kind of voting-scheme to split up the pie could satisfy these requirements. In contrast, if you have different rewarding schemes you must make a qualitative distinction between different kinds of concrete labor (e.g., entrepreneurial vs. managerial vs. production vs. research etc.) You'll therefore need to define and enforce those differences. You'll need criteria to decide which category a particular worker belongs to (this will be contested). You'll need cumbersome accounting schemes to measure when a particular individual outputs different kinds of concrete labor (e.g., half a day being an entrepreneur and half a day producing), and so forth. This is messy, but I also think it's unnecessary, and not well motivated. I wonder if this is an echo of Schumpeter's heroic entrepreneur in your thought? The Austrian school overplays the contribution of entrepreneurial labor in order to justify capitalist property laws. Be interested in what you think, -Ian. _______________________________________________ ope mailing list ope@lists.csuchico.edu https://lists.csuchico.edu/mailman/listinfo/ope

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Received on Thu Nov 13 16:27:59 2008