Friday 4 May 2018

Theories of Surplus Value, Part II, Chapter 15 - Part 37

Ricardo also determines the value or natural price of labour in this way, so that although the value of corn varies, the value of labour does not, because one month of labour always commands 1 quarter of corn as wages, no matter how much labour was actually expended in the production of the corn. 

“The value of the corn too changes only in so far as we are considering the labour required for its production. If, on the other hand, we examine the quantity of labour against which it exchanges, which it sets into motion, its value does not change. And that is precisely why the quantity of labour, against which a quarter of corn is exchanged, is the standard measure of value. But the values of the other commodities have the same relation to labour as they have to corn. A given quantity of corn commands a given quantity of labour. A given quantity of every other commodity commands a certain quantity of corn. Hence every other commodity—or rather the value of every other commodity—is expressed by the quantity of labour it commands, since it is expressed by the quantity of corn it commands, and the latter is expressed by the quantity of labour it commands.” (p 402) 

So, if a chair equals a quarter of corn, a chair also commands a month of labour, irrespective of how much labour is actually required to produce a chair. An inevitable contradiction arises here, between a determination of value on the basis of the quantity of labour required for production, i.e. the labour-time, and a determination of value on the basis of the value of labour used in production. A chair may have a value equal to 1 week of labour-time, required for its production, but of 1 month in terms of the labour it can command, or put alternatively the labour that the worker must perform in order to buy it. 

“But how is the value of other commodities in relation to corn (means of subsistence) determined? By the quantity of labour they command. And how is the quantity of labour they command determined? By the quantity of corn that labour commands. Here Adam Smith is inevitably caught up in a vicious circle. (Incidentally, he never uses this measure of value when making an actual analysis.) Moreover here he confuses—as Ricardo also often does—labour, the intrinsic measure of value, with money, the external measure, which presupposes that value is already determined; although he and Ricardo have declared that labour is “the foundation of the value of commodities” while “the comparative quantity of labour which is necessary to their production” is “the rule which determines the respective quantities of goods which shall be given in exchange for each other” (Ricardo, l.c., p.80).” (p 402-3) 

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