In fact, what that means is that the unit value of each of these use values is reduced. Wealth increases, as value reduces.
“From the taste of wheat it is not possible to tell who produced it, a Russian serf, a French peasant or an English capitalist. Although use-values serve social needs and therefore exist within the social framework, they do not express the social relations of production.” (p 28)
But, as Marx again sets out in his Letter to Kugelmann, this is not true in relation to value. If we take a primitive commune, or a peasant household, that produces use values, for its own consumption, value takes a very restricted form of only individual value. In other words, the value of these products is only that determined by the specific labour employed in the commune or household. As Marx says in relation to Robinson Crusoe, who he says tells us all we need to know about value,
“In spite of the variety of his work, he knows that his labour, whatever its form, is but the activity of one and the same Robinson, and consequently, that it consists of nothing but different modes of human labour. Necessity itself compels him to apportion his time accurately between his different kinds of work. Whether one kind occupies a greater space in his general activity than another, depends on the difficulties, greater or less as the case may be, to be overcome in attaining the useful effect aimed at. This our friend Robinson soon learns by experience, and having rescued a watch, ledger, and pen and ink from the wreck, commences, like a true-born Briton, to keep a set of books. His stock-book contains a list of the objects of utility that belong to him, of the operations necessary for their production; and lastly, of the labour time that definite quantities of those objects have, on an average, cost him. All the relations between Robinson and the objects that form this wealth of his own creation, are here so simple and clear as to be intelligible without exertion, even to Mr. Sedley Taylor. And yet those relations contain all that is essential to the determination of value.”
Capital I, Ch. 1. Section 4
If, however, we take a community of small, independent, commodity producers, the value of the commodities they produce is no longer that of individual value. Each producer of linen, because they are in competition with several other producers of linen, is now forced to accept that the value of their product is not its individual value, i.e. the quantity of their labour used in its production, but is a social value, or market value, which is equal to the average labour-time required for production across all producers of linen. In other words, the mean average of all those individual values. And, for this reason, individual value does not cease to exist for them, but is subsumed in the market value.
For some linen producers, the individual value of their output will be lower than this average or market value. In selling at the market value they will make an additional profit, or, put another way, they will obtain more labour for less labour. They will then be able to expand their production, so gaining economies of scale. They will be able to employ machines and better equipment, further enhancing their competitive advantage. But, other linen producers will produce linen with a higher individual value than the average, and so will make smaller profits, exchanging more labour for less labour. In this way, a process of differentiation of the small commodity producers, in the towns, sets in, and when markets in the towns grow to a big enough size, this means that the more successful producers are then able to take over the means of production of the ones who fail.
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