I have not had the time to keep up with all the discussion of Chapter 5 of
Volume 1, but I have wanted to make a comment, and Gil's reply (1094) to my
earlier post about individual prices in Volume 1 (1083) provides the opprtunity
to do so.
In that earlier post, I concluded that Marx's theory of surplus-value in
Volume 1 is an aggregate theory about the total amount of surplus-value in
the capitalist economy as a whole and this aggregate theory does not depend
in any way on the assumption that the prices of individual commodities are
equal to their values
Gil replied:
There is at least one step in the argument of Volume I for which the
characterizations isolated above are manifestly not true. This is
Marx's conclusion at the end of Ch. 5, where he argues that
capitalist exploitation *must* be explainable on the basis that all
commodities exchange at their values. In saying this he is clearly
denying that "the main conclusions of Volume I do not depend in any
way on whether or not the prices of individual commodities are equal
to their values", since he is asserting that any case of capitalist
exploitation is institutionally isomorphic to one in which
price-value equivalence holds.
In earlier posts, a key point of Gil's argument has been Marx's footnote at
the end of Chapter 5. Let's take a look again at the key sentence from
this footnote. Marx stated that the problem of the formation of capital
should be formulated as follows:
How can we account for the origin of capital on the assumption that prices
are regulated by average price, i.e. ultimately by the value of
commodities? I say "ultimately" because average prices do not directly
coincide with the values of commodities, as Adam Smith, Ricardo, and others
believe.
(C.I. 269)
I do not see how this footnote can be interpreted to mean that Marx is
arguing that surplus-value must be explained on the basis of the assumption
that individual commodities exchange at their values. In fact, it seems to
me that Marx is saying the opposite: that individual commdities DO NOT
exchange at the values, contrary to Smith, Ricardo, etc. The prices of
individual commodities are "ULTIMATELY REGULATED" by their values, but these
prices "DO NOT DIRECTLY COINCIDE" with their values. However, this
divergence of individual commodities does not affect the analysis of the
aggregate amount of surplus-value in Volume 1. In this analysis of the
aggregate amount of surplus-value, the prices of individual commodities play
no role. Rather, the AGGREGATE price of commodities is assumed to be
proportional to the aggregate labor-time required to produce these
commodities. Therefore, contrary to Gil, Marx did not argue in Chapter 5
that surplus-value must be explained on the basis of the assumption that the
price of individual commodities must be equal to their values.
The aggregate nature of Marx's theory of surplus-value and of Marx's
discussion in Chapter 5 about the possible origin of surplus-value in
circulation is indicated by Marx's discussion of the "capitalist class as a
whole" in Chapter 5 (C.I. 265-66). Marx argued that, although one may
explain the profit of individual capitalists by fraud or by selling
commodities above their value, this gain can only come at the expense of
other capitalists who lose value. Thus, the profit of the capitalist class
as a whole - which is Marx's main question here - cannot be explained in
this way.
There is another sense in which I think that Gil has fundamentally
misunderstood the general nature of Marx's argument in Chapter 5. Gil
argues that Marx's main question in Chapter 5 was whether capitalist
exploitation (i.e. surplus-value) could be explained without assuming the
capitalist mode of production. However, this is not Marx's question in
Chapter 5. As I have argued before (and there seemed to be at least a fair
amount of aggrement on this key methodological point), Marx's theory in
Capital ASSUMES THE CAPITALIST MODE OF PRODUCTION FROM THE VERY BEGINNING IN
CHAPTER 1. Marx's theory, from the very beginning, is about capitalism as
an existing totality. Marx's theory begins in Parts 1 and 2 of Volume 1 by
analyzing the abstract sphere of exchange, but this is the sphere of
exchange IN CAPITALISM, not the sphere of exchange in some pre-capitalist
mode of production or a general analysis of exchange in all modes of
production. Chapter 5 is part of this analysis of the abstract sphere of
exchange of the existing totality of capitalism.
Therefore, Marx's question in Chapter 5 is not whether capitalism is
necessary to explain surpus-value, as Gil argues, but rather WITHIN
CAPITALISM, can surplus-vlue be exchanged solely on the basis of exchange.
Marx is not trying to explain the historical origins of capitalism, but is
rather trying to explain the origins of surplus-value within capitalism.
Marx was also arguing against the influential theory of the mercantilists
and later classical economists (such as Malthus and Torrens), according to
which surplus-value within capitalism could be explained on the basis of
exchange alone, e.g. by commodities selling above their value. Gil's
question is important, both for historical analysis and for the analysis of
non-capitalist modes of production in today's world economy, but Marx's
question is the most important question in a theory of currently existing
capitalism, both in Marx's time and in our's.
Marx's answer to his question about the origin of surplus-value within
capitalism was of course no - surplus-value cannot be explained on the basis
of exchange alone or by assuming that commodities sell above their value.
This conclusion follows trivially from Marx's assumption that new-value is
produced only in production, and not in exchange. But this chapter, simple
as it is, was nonetheless necessary in order to expose the logical
contradictions of the still influential "exchange" theory of profit. As
Marx expressed this necessity in the earlier draft of Chapter 5 in the
1861-63 manuscript (in a part recently published for the first time):
one still meets the nonsensical assertion, even from renowned economists
that surplus-value as such can be derived from things being sold dearer
than their value. (MECW.30. 26)
My interpretaton that Chapter is about the origin of surplus-value within
capitalism, and is not about whether surplus-value is possible in other
non-capitalist modes of production, is further supported by Marx's explicit
discussion of merchant profit and interest in Chapter 5 and by his later
determination of these forms of suruplus-value in Parts 4 and 5 of Volume 3.
It is clear from these discussions that MERCHANT PROFIT AND INTEREST ARE
ANALYZED BY MARX AS PARTS OF THE TOTAL SURPLUS-VALUE PRODUCED IN THE
CAPITALIST ECONOMY AS A WHOLE, not as forms of income in non-capitalist
modes of production.
In Chapter 5, Marx noted that the main conclusion of the abstract analysis
to exchange in capitalism - that no surplus-value is created in exchange -
seems to imply that merchant profit and interest are impossible. However,
Marx stated, this apparent contradiction cannot be explained at this
abstract level of analysis, but instead can be explained only have a "long
series of intermediate steps" have been completed (C.I. 267). In other
words, these particular forms of surplus-value within capitalism can be
explained only after the total amount of surplus-value produced in the
capitalist economy as a whole has been explained (which is the main subject
of Volume 1). Merchant capital and interest-bearing capital are to be
analyzed as "derivative forms" which are subordinate to industrial capital,
not as forms of capital historically prior to capitalism (see also MECW.30.
28-29) It is clear that Marx did not argue that merchant profit and
interest cannot exist, either within or without capitalism, about rather
simply pointed out that, according to his logical method, merchant profit
and interest within capitalism would be explained at a later stage of the
analysis.
In Volume 3, merchant profit and interest are explicitly analyzed as parts
of the total surplus-value produced within capitalism, not as forms of
income in non-capitalist modes of production.
Since commercial capital does not itself produce any surplus-value, it is
clear that the surplus-value that accrues to it in the form of the average
profit forms a portion of the surplus-value produced by the productive
capital as a whole. (C.III. 395-96)
Interest ... is ... nothing but a part of the profit, i.e. the
surplus-value, which the functioning capitalist, whether industrialist or
merchant, must pay to the owner and lender of capital is so far as the
capital he uses is not his own but borrowed. (C.III. 493)
It is this Volume 3 analysis of merchant profit and interest within
capitalism that Marx's comments in Chapter 5 of Volume 1 refer to.
Therefore, I conclude that: (1) Marx's theory of surplus-value in Volume 1
is an aggregate theory about the total amount of surplus-value in the
capitalist economy as a whole and does not depend in any way on the
assumption that the prices of individual commodities are equal to their
values. (2) Marx's discussion in Chapter 5 of Volume 1 is about whether
surplus-value within capitalism can be explained on the basis of exchange
alone, not about whether surplus-value requires the capitalist mode of
production.
Fred