Thursday, 29 June 2017

Theories of Surplus Value, Part I, Chapter 4 - Part 114

Senior is right that,
““The wealth of a nation does not depend on a numerical proportion between those who produce services and those who produce values, but on the proportion between them that is most fitted to render the labour of each more efficacious” (Senior, l.c., p. 204).” (p 289)

But, as Marx points out, Smith never denied this, he only wanted to reduce the ratio of the unproductive to the productive.

“And this is in any case the “proportion” in which they make the labour of productive labourers most efficacious. As for the other “unproductive labourers”, whose labours are only bought voluntarily by anyone in order to enjoy their services, that is, as an article of consumption of his own choice, different cases must be distinguished.” (p 289)

In other words, it may be necessary to have a certain number of police to ensure that highways are safe, and traffic flows efficiently, so that productive workers can receive materials, and get finished commodities to market more quickly, and in so doing this will increase the amount of surplus value produced.

However, if a capitalist instead uses their surplus value to hire the unproductive labour of a cook for their home or to spend money in a brothel, the unproductive labour, thereby employed contributes nothing to increasing the productivity of the workers in the capitalist's factory, or anywhere else.

The medieval barons consumed the surplus product in the shape of agricultural products, and maintained a large number of retainers on it. But, when the barons also began to consume this surplus in the form of manufactured goods, less was available to maintain the retainers who, thereby, had to be set to work.

On the other hand, in a society that is very productive, and where productive labour creates a large surplus, the owners of that surplus are able to use more of it unproductively. So, in the 19th century, Marx points out that a rapid rise in productivity, in Britain, as more machines were introduced, resulted in more profits, and a large supply of workers who could be employed unproductively, so that the number of domestic servants increased markedly.

Over the last 30 years, a sharp rise in productivity and profits, and large falls in commodity prices, including luxury commodity prices, has seen capitalists and other exploiters use a large part of their revenue for other unproductive purposes, such as speculation in financial markets.

Echoing the point made earlier, Marx comments,

“Taking two countries with equal populations and an equal development of the productive powers of labour, it would always be true to say, with Adam Smith, that the wealth of the two countries must be measured according to the proportion of productive and of unproductive labourers. For that means only that in the country which has a relatively greater number of productive labourers, a relatively greater amount of the annual revenue is reproductively consumed, and consequently a greater mass of values is produced annually.” (p 290)

In other words, a large amount of value is produced by this large number of productive workers, but their large number also constitutes a large cost of production, which must be taken out of the total product, in order for their labour-power to be reproduced.

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