Wednesday, 5 August 2015

Capital III, Chapter 12 - Part 1

Supplementary Remarks 

1) Causes Implying a Change in the Price of Production 

The price of production, of a commodity, can change as a result of just two factors; either a change in the general rate of profit, or a change in the actual value of the commodity itself.

The general rate of profit may change because the general rate of surplus value changes. If the general rate of surplus value rises, this may be because the value of labour-power has fallen, i.e. wage goods have become cheaper. Provided this fall in the value of wage goods does not, at the same time, result in a rise in the value of constant capital, we would have an increased volume of surplus value, relative to the advanced capital, and so, all other things being equal, the rate of profit would rise.

The same thing would apply if the rise in the general rate of surplus value was the result of a reduction in wages, but, as Marx describes in Chapter 11, a cut in wages is only possible if wages were already above the value of labour power, or else are reduced below it. The same effects apply in reverse if the rate of surplus value falls.

“If the change in the rate of surplus-value is not due to a depression of wages below normal, or their rise above normal — and movements of that kind are to be regarded merely as oscillations — it can only occur either through a rise, or fall, in the value of labour-power, the one being just as impossible as the other unless there is a change in the productivity of the labour producing means of subsistence, i.e., in the value of commodities consumed by the labourer.” (p 205)

The rate of profit can also rise if the rate of surplus value remains constant, but the advanced social capital is reduced, again assuming the rate of turnover etc. remain the same. Similarly, if the advanced social capital value rises, whilst the rate of surplus value remains the same, the rate of profit will fall. 

If the advanced social capital rises, because wages or the value of labour power rises, then the rate of profit will fall, for two reasons. Firstly, the rise in v means a corresponding fall in s, but, secondly, c + v has risen so that the ratio of s to c + v (the rate of profit) falls.

But, the advanced social capital may change whilst v remains constant. The same quantity of labour may mobilise a greater volume of constant capital if the productivity of labour rises.

“The mass of this part, technically considered, increases or decreases in proportion to the quantity of labour-power bought by the variable capital, and the mass of its value thus increases or decreases with the increase or decrease of its own mass. It also increases or decreases, therefore, proportionately to the mass of the value of the variable capital. If the same labour sets more constant capital in motion, it has become more productive. If the reverse, then less productive. Thus, there has been a change in the productivity of labour, and there must have occurred a change in the value of certain commodities.” (p 205)

However, the price of production may also change, even if the general rate of profit remains constant. In that case, the change must stem from a change in the actual value of the commodity itself, i.e. the labour-time required for its production must have changed.

Again, there are two ways this might arise. Either the value of c rises, more labour-time is required to produce the means of production required to produce this commodity, or else the productivity of the labour used in its production has changed, so that more or less labour is required to process a given quantity of means of production.

“The price of production of cotton yarn may fall, either because raw cotton is produced cheaper than before, or because the labour of spinning has become more productive due to improved machinery.” (p 206)

The number of combinations that may here cause a rise or fall in the price of production are, therefore, almost endless. The value of c may rise or fall and be compensated by or exacerbated by a rise or fall in v. The value of some elements of c may rise or fall, and be compensated or exacerbated by the rise or fall in the value of other elements of c and so on.

“All changes in the price of production of commodities are reduced, in the last analysis, to changes in value. But not all changes in the value of commodities need express themselves in changes in the price of production. The price of production is not determined by the value of any one commodity alone, but by the aggregate value of all commodities. A change in commodity A may therefore be balanced by an opposite change in commodity B, so that the general relation remains the same.” (p 206)


Victor Onrust said...

Hi Boffy, For a long time I have been "wrestling" with the labor theory of value. Wrestling in the sense that older and newer developments in capitalism don't seem to fit in very well. I haven't found insights that can help and would like to correspond with you but can't find an address. Would you please send a mail to victor.onrust(at) No need to admit this post of course.

Boffy said...

Hi Victor,

I don't really like giving out my e-mail address, including mailing to people. Moreover, on a further point of sort of principle, the purpose of this blog is to further knowledge and discussion around Marxist theory, so I would much prefer that any questions you have be posted as comments here, for open discussion.

Victor Onrust said...

First of all I think comments should react on the issue at hand, as posted by the author. So if you could offer me a guest post on your blog where I can pose my questions that would be an idea. How this text can reach you without a mail is a bit of a problem. I could post it on a non public page on my blog and then you could copy it.
Posting on my own blog is a bit too far out of the way for my readers. On the side I guess your blog is visited by knowledgable people who could help.
As an alternative you could create a gmail account for just this purpose and delete it when done or when you don't like the mail you get there anymore. I have four different accounts, only one is private (not this one).

Boffy said...


Yes, sorry to be a pain over this, but I'm sure we can work something out. Here's a thought. If I write up a blog post setting out the purpose to discuss the LTV, and your questions about it, you could write whatever questions you have there. If you have long statements to make they can be put over several comments, and if you like, I could combine them, and submit them as a guest post.

Alternatively, the idea of you posting your ideas to your own blog, and me responding on mine, seems a good idea, because it is likely to reach a wider audience. My only other point here would be that I currently have a heavy workload, I'm in the process of getting two books ready for publication, plans to start on two more, before the end of the year, work to do on writing two more books for next year, as well as trying to write current stuff for the blog, and undertake research. I'm still trying to do some major research in relation to Africa, for example, and have a backlog of material to write for the "Glossary of Marxist terms."

So, I would, in any case, only be able to respond as and when time permits. Let me know what you think.

Victor Onrust said...

Ok, I'll post a blog on my own site and you can copy the text into a guestpost. I think the discussion should be in one place. Maybe there is a better place for the discussion, but you can suggest that after reading my blog. Will take some time, I guess at least two weeks.

Boffy said...

That's great Victor. Just give me a quick comment here to let me know when you have posted to your blog, so I can pick it up. Then I'll copy to here. I suggest a series of separate posts giving your queries etc., and my responses. That way it opens up each for any comments.