This is also the division represented by Marx in his schemas of reproduction in Capital II, into Department I, and Department II. Similarly, consumption divides into two components, productive consumption and unproductive consumption. The latter finds its equivalent demand in total revenues, leaving the question of where the demand for productive consumption comes from, i.e. the demand for materials and wear and tear of fixed capital?
The answer has already been given. It comes from capital, in the same way that the constant capital contributes its value to the total output, so too that value is withdrawn from the total output value, and forms the required demand, for its own replacement. It is the same as the farmer who takes 100 kilos of grain from their production and simply uses it to replace the 100 kilos of seed, without it ever entering, at any point, into revenues.
“It is seen that the problem presented here has already been solved in the consideration of reproduction of the total social capital — Book II, Part III. We return to it here, in the first place, because surplus-value had not been developed there in its revenue forms: profit (profit of enterprise plus interest) and rent, and could not, therefore, be treated in these forms; and then, also because precisely in the form of wages, profit and rent there is contained an incredible blunder in analysis, which pervades all political economy since Adam Smith...
On the other hand, the fantasy of men like Say, to the effect that the entire yield, the entire gross output, resolves itself into the net income of the nation or cannot be distinguished from it, that this distinction therefore disappears from the national viewpoint, is but the inevitable and ultimate expression of the absurd dogma pervading political economy since Adam Smith, that in the final analysis the value of commodities resolves itself completely into income, into wages, profit and rent.”
(Capital III, Chapter 49)
This division of total output into capital and revenues is the basis of Marx's analysis, in Capital II, Chapter 20, of the division of total output into Department I, producing capital goods and Department II producing consumption goods. The output of Department II is the equivalent of GDP. The value of its output, under simple reproduction, all of which is consumed unproductively, is equal to the total revenues produced in the economy, which is equal to National Income.
The equation of GDP with National Income is also the basis of Smith's “absurd dogma”, because, in it, superficially, the value of this final output appears to confirm Smith's argument that the constant capital, consumed in its production, itself dissolves into revenue, i.e. into the equivalent v + s in Department I. It is indeed true that Department II c is equal to Department I v + s. But, the final output of Department II does not constitute the whole of social production. Department I's output resolves not only into v + s, but also into c, the value of its own consumed constant capital, that it must replace directly out of its own production.
The value of c in Department II output is equal in GDP to intermediate production, i.e. only to the value added by labour, in their production. But, precisely for the reason described above, this intermediate production is not equal to the total value of constant capital consumed in production. It takes the form of the use values produced by Department I, i.e. capital goods, but its value comprises not one penny of the value of constant capital. It is equal only to the new value created by labour in Department I, i.e. Department I (v + s). It contains none of the value of constant capital consumed by Department I.
No comments:
Post a Comment