Marx sets out what Ricardo's “proof” amounts to.
“The proof consists in postulating what has to be proved, i.e., that any quantity of the precious metal serving as money, regardless of its relation to its intrinsic value, must become a medium of circulation, or coin, and thus a token of value for the commodities in circulation regardless of the total amount of their value. In other words, this proof rests on disregarding all functions performed by money except its function as a medium of circulation.” (p 174)
The obvious fallacy of Ricardo's argument was obscured, because he presented it in terms of international trade, and money flows. Marx, now, examines these arguments in relation to international trade. He begins by restating the basic premise that, in relation to money itself, i.e. gold, the quantity in circulation is determined by a) the aggregate value of the commodities to be circulated, b) the value of gold, and c) the velocity of circulation. In other words, a) and b) flow from the fact that money is the universal equivalent form of value, so that the value of commodities, in aggregate, is represented/measured, indirectly, by a given quantity of the money commodity, and this quantity then depends on the value of the money commodity itself. As currency, only a fraction of this quantity of money is required, because each unit of currency performs several transactions, each year.
Before considering these other international relations, its also worthwhile considering the position in relation to the value of commodities traded on the world market. Marx deals with this in Capital I and III. The value of commodities is determined by the average labour-time required for their production, but how is this to be understood when comparing the value of cloth, produced in Britain, using power looms, in large factories, themselves forming part of an integrated, industrial economy, as against cloth produced in India, using hand looms, by village producers, in a pre-industrial economy?
It is quite clear that one hour of British labour is, then, not the same, and produces more value, than an hour of Indian labour. As Marx puts it, it is as though the British labour represents complex labour, compared to the Indian labour. In reality, this difference in productivity, means that the British labour does not create more individual value, but that it creates more, in terms of market-value, and consequently surplus value. That is why, despite much higher living standards for labour in developed economies, it is their labour that is super-exploited, not that of workers in developing economies.
Why is that the case? In describing what constitutes socially necessary labour, Marx sets out that, in conditions where demand and supply are more or less in long-run equilibrium, this average is the mean average, calculated across all producers. If 90% of cloth is produced by hand loom weavers, then, it is they that will determine the market value of cloth, i.e. it is the labour-time they require for production that determines its value. If, however, 10% of output is accounted for by one producer, who employs power looms, so that the individual value of their production is only half that of the hand-loom weavers, they will still sell their output at the market value value for cloth, determined by the hand-loom weavers, who account for 90% of production. To be more accurate, as Marx describes, they will sell their output at slightly less than this, in order to ensure that they sell all their output easily, and so rapidly expand their market share.
The situation is this. A hand loom weaver produces 10 metres of linen per day, but the power loom weaver produces 100 metres. Both produce new, individual value equal to 1 day (10 hours), but the latter produces 10 times as many use values, equal, thereby, to a market value of 100 hours.
The greater the proportion of output accounted for by machine production, the more it determines the mean average, and so the market value of cloth. Not only are other producers led to move to machine production, but even the single machine producer is led to expand their output. First, they expand market share, but, also, in contributing to a reduction in the market value of cloth, they bring about an expansion of the market itself, as these lower market prices cause demand to rise. An increased market means increased potential to expand into it, and production on a larger scale, meaning economies of scale.
As Marx describes, in Capital I, this means that the cloth producer using power looms can even pay their workers higher wages – though never proportionally more than their higher level of productivity – and, yet, still undercut their competitors. They obtain an increase in relative surplus value, compared to their competitors, despite these higher wages. Indeed, as such machine production extends to other types of wage goods, they obtain further increases in relative surplus value, because not only do they benefit from employing labour that appears complex, but cheaper wage goods also reduces the value of labour-power itself.
Extending this to an international comparison, Marx noted that, although British textile workers wages were 50% higher than those in Europe, British textiles continually undercut those of European producers, and British firms made a higher rate of profit, and greater volumes of profit, because each British worker was backed by much more fixed capital, raising their level of productivity. This is why it is in developed economies, where living standards are higher, that the rate of exploitation is also much higher.
No comments:
Post a Comment