[OPE-L:4362] Re: Brazilian diamonds and value

aramos@aramos.b (aramos@aramos.bo)
Tue, 11 Mar 1997 16:24:48 -0800 (PST)

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I am grateful with Hans E, Makoto I and Costas L who have commented
the following passage.

> According to Eschwege, the total produce of the Brazilian
> diamond mines for the eighty years ending in 1823 still did
> not amount to the price of 1 1/2 years average produce of
> the sugar and coffee plantations of the same country,
> although the diamonds represented much more labor, therefore
> more value.
> Vol I, Ch. 1, Penguin, p. 130

There are interesting sub-threads suggested: Hans's "scarcity
analysis" (see my post on this), Makotos's slave labor and Costas's
"social mechanism which accounted for the labor". A possible reading
--I think near Costas's line-- is the following.

The main idea is that Brazilian mines are relatively infertile. One
can work out the following hypothetical numerical example:

Diamond production in the 80 years ending 1823

----------------------------------------------------------------------
Labor-value Physical Individual Social Social
(total) Output labor-value money-value money-value
(unit) (unit) (total)
----------------------------------------------------------------------
Brazil 5000h 1000Kg 5h/Kg $2 $2000

Others 5000h 4000Kg 1.25h/Kg $2 $8000
----------------------------------------------------------------------
Total 10000h 5000Kg 2h/Kg $2 $10000
----------------------------------------------------------------------

h: hours
Kg: Kilograms
$: unit of currency
1 hour = $1

So, Brazil is an inefficient producer of diamonds. Individual labor-
value is 5h/Kg while the average is 2h/Kg. Let us assume that 1 hr =
$1. Diamonds are sold at $2 which is the social money-value
(market price) per Kilogram. Socially necessary labor time is 2 hours
per Kilo which are represented by $2. This means that brazilian
producers have only appropriated $2000 for their 1000Kg of diamonds.
These diamons are, however, the materialization of 5000 hours of
labor. So, since market price is $2, efficient producers appropriate
3000 "extra" hours, which have been "lost" by brazilian producers.
For the branch, total labor-time *materialized* is equal to total
labor-time *appropriated* under the form of money: 10000 hours =
$10000.

On the other hand, Brazil would be an "average" producer of coffee +
sugar. Let us suppose that the "1 1/2 years average produce of the
sugar and coffee plantations" has required 3000 hours. As Brazil is
an average producer and $1 = 1 hour, sugar + coffee are sold for
$3000 > $2000 that diamond producers have effectively obtained in
the market in "the 80 years ending 1823". However, "diamonds
represent much more labor [5000 hours > 3000 hours], therefore more
value [$5000]". The problem is that a fraction of this "more value"
[$3000] has not actually been appropriated by brazilian producers but
by those exploiting more fertile mines. This is a result of the
difference between individual labor-value (5h/Kg) and social value
(2h/Kg) of diamonds.

Are you agree?

Alejandro Ramos M.
11.3.97