Let me add a wrinkle to Riccardo's excellent posting:
I read, perhaps in Engels more than Marx, a historical dimension in the
process of abstraction. I have a picture of an intermediate stage of simple
commodity production where everybody knows how much concrete labor is
required to produce any particular commodity. Values and prices would more
or less coincide.
Under capitalism, labor becomes more indirect, with the greater reliance on
constant capital. New technologies make the labor process more opaque. At
this point, I would see the sort of exchange oriented abstraction that
Riccardo describes, taking hold.
I know that many people do not approve of a historical approach to the
transformation problem, but it does help in this case to get a handle on
how the process of abstraction would work.
--
Michael Perelman
Economics Department
California State University
Chico, CA 95929
Tel. 916-898-5321
E-Mail michael@ecst.csuchico.edu