The Labor Theory of Value and the Concept

8/2/2019 The Labor Theory of Value and the Concept

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Ali RehmanKhizar bin NasirUmair Kiani

Saquib iqbalArmaghan Khan


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Define value by reference to exchange-value

Exchange-value is a property of things which are

desired

In Marxian Language, then, it is a property of

use-values

Property, not of all use-values, but of those use-

values which are bought and sold


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Exchange-value, then, is a property ofcommodities

Exchange-value of a commodity is its power ofexchanging against quantities of other

commodities.

Exchange-value is measured by the number ofcommodities of any other kind for which it will


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The central claim of the labor theory of value isthat magnitude of value is determined by socially

necessary labor time

The exchange-value of a commodity variesdirectly and uniformly with the quantity of labortime required to produce it under standardconditions of productivity


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Inversely and uniformly with the quantity of labortime standardly required to produce other

commodities, and with no further circumstance.

The labor theory of value is not true by the very

definition of value, as we defined it.

Alternative presentations

Value is defined as socially necessary labor time


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We have two propositions

(1) Socially necessary labor time determines

value.(2) Value determines equilibrium price.

We say that (2) is true by definition. Others saythat ( 1 )


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The conjunction of ( 1 ) and (2) entails

(3) Socially necessary labor time determinesequilibrium price

Author says that 3 is wrong by the definition.


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The labor theory of surplus value is intended toexplain the origin of non-wage income under

capitalism.

Under capitalism labor power is a commodity


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The value of labour power is the value of themeans of subsistence necessary for themaintenance of the labourer.

The origin of non-wage income is, then, thedifference between the value of labor power andthe value produced by him in whom it inheres


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The capital paid out as wages is equal to thevalue of the producer's labor power. It is knownas variable capital

The value produced by the worker over andabove that represented by variable capital iscalled surplus value


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The ratio of surplus value to variable capital iscalled the rate of exploitation


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Author begin with an argument which is basedon the labor theory of value

Which Conclusion is that the worker is exploited.

Author call it the Traditional Marxian Argument.


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It may be attributed to those believers in (4) whohold that the labor theory of value supports (4)

(4) Stated that One reason for overthrowingcapitalism is that it is a regime of exploitation(and exploitation is unjust).


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1. Labor and labor alone creates value.

2. The labourer receives the value of his laborpower.

3. The value of the product is greater than thevalue of his labor power.

4. The labourer receives less value than he

creates.5. The capitalist receives the remaining value.

6. The labourer is exploited by the capitalist


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(1) comes from the labor theory of value, and thelabor theory of surplus value supplies premises(2), (3), and (5).

This statement of the Traditional MarxianArgument is incomplete.

The incompleteness is the argument's failure, asstated, to characterize pertinent features of therelationship between capital and labor


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As the fact that the labourer is forced, by hispropertylessness, to work for the capitalist.

The Traditional Argument, speaks of "thelabourer" and "the capitalist," therebyindividualizing the class relationship, in imitationof Capital's practice

This sidesteps the problem of identifying theworking and capitalist classes


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The Traditional Argument employs the labortheory of surplus value, which yields premises(2), (3), and (5).

Author modify these point that depend on theLabor theory of surplus.

The result is this simpler Marxian argument


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Labor and labor alone creates value.

(Add.)The capitalist receives some of the value

of the product.

The labourer receives less value than hecreates.

The capitalist receives some of the value thelabourer creates.


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The labor theory of surplus value is, then,unnecessary to the moral claim Marxists makewhen they say that capitalism is exploitative

It does not matter what explains the differencebetween the value the worker produces and thevalue he receives, there will always be somedifference.


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Labor theory of value, states that the value of acommodity is determined by the sociallynecessary labor time required to produce it.

Suppose a commodity has a certain value at atime t. Then that value, says the labor theory, isdetermined by the socially necessary labor timerequired to produce a commodity of that kind.


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The amount of time required to produce it in thepast, and, the amount of time actually spentproducing it are magnitudes strictly irrelevant to

its value, if the labor theory is true.

The theory demands that past labor is irrelevantto how much value a commodity now has, Butpast labor would not be irrelevant if it created thevalue of the commodity. It follows that labor doesnot create value, if the labor theory of value is

true.


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Suppose the thesis that value is determined by sociallynecessary labor time-that is, the labor theory of value

1. the strict doctrine, and let us say that such sentencesas , or ones which speak of value as embodied orcongealed labor, belong to the

2. Popular doctrine


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There are two reasons why the amount of laborwhich was actually spent on a particular productmight differ from the amount now standard

required to produce that kind of product.

1. The first is a non-standard level of efficiency inthe actual labor process, which can be more orless efficient than the social norm.

2. The second is techno-logical change, which

alters that norm.


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Consider the case of inefficient labor. Marxists have

always regarded it as a particularly inept criticism of

the labor theory of value to object that it entails that

an inefficiently produced lamp has more value thanone produced efficiently and therefore in less time.

If inefficient labor takes more time, should that lamp

be considered to be of more value?


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What was required in the past, and still more what

happened in the past-these facts are in principle irrelevant

to how much value a commodity has, if the labor theory

of value is true.

Since technical conditions change relatively slowly, sociallynecessary labor time in the recent past is usually a goodguide to socially necessary labor time now.

Typical past actual labor time is, moreover, the best guideto how much labor time was necessary in the past.Thereby what did occur becomes a good index of what isnow required. It does not follow that it creates the value of

the commodity


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Value determined by what???

Ownership or the labor?


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But if value is something the explanation ofwhich must literally create it, then sinceownership of means of production literally

creates nothing, it would follow that, despiteappearances the pattern of that ownershipcannot effect value formation


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But this line of defense depends essentially onthe idea that labor creates value. If we stay withthe strict doctrine, which rightly does not requirethat anything creates value, it has no motivation

what so-ever. To make this more clear, we returnto the three propositions in our initialpresentation of the labor theory of value:

( 1) Socially necessary labor time determinesvalue.

(2) Value determines equilibrium price.

(3) Socially necessary labor time determines


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Labor theory Is proven wrong by his owncontradiction

Differences of phrasing

This does not answer the difficult question, Who

is a producer?


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The laborer is the only person who creates theproduct, that which has value.

The capitalist receives some of the value of theproduct. .

The laborer receives less value than the value ofwhat he creates, and

The capitalist receives some of the value ofwhat the la-borer creates.

The laborer is exploited by the capitalist.


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It is labor's creation of what has value, not its(sup-posed) creation of value, which founds thecharge that capitalism is a system of exploitation.

Even if labor did create its own value, still wouldhave no bearing on the question of exploitation.


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Value is created by desire and not by labor

It remains true that labor creates all that has

value, and that the capitalist appropriates someof the value, does the charge of exploitation loseforce?

Surely not.


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Then the assertion that the workers create valuecannot be necessary to that charge

If labor's creation of value would give the laborer

a claim to value because he had created it? Then the desirers could claim to

Absurd notion


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Absurd but does not seem like it

Impossible to forget that labor creates what has

value

Naturally think that they could create value only

by creating what has it

In solidarity they state only that we are

exploited with out mentioning about value


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So in the end its not that labor creates value

Its only the obvious truth that labor creates somethingthat has value.

The real paradigm of exploitation in Marxism, it is theexploitation of the feudal serf, who does not, according toMarx, produce value

His exploitation is the most mani-fest.

The proletarian's is more covert


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Marx seeks to show that he too is exploited

Part of what he produces redounds not to him

but to his feudal superior

This is not so in the same plain sense under

capi-talism

Now Marxists allege that the labor theory ofvalue is required to un-cover the exploitation ofthe wage worker


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Authors disagreement

What we need is the concept of value, as

defined, independently of the labor theory

Marxists say that

1. The serf produces the whole product, but thefeudal lord appropriates part of the product


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2. The serf produces the whole product, but thefeudal lord appropriates part of the product

Author agrees with 1 however alter 2 to say

The proletarian produces the whole product, but

the capitalist appropriates part of the value of theproduct


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Author continuously denies that labor creates itsvalue

Although it can be said that Since labor createswhat has value, labor creates value

But the objection is misguide

It is not the relevant traditional sense, thatintended by Marxists


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How could it follow from the fact that laborcreates what has value that the amount of valuein what it creates varies directly and uniformly

with the amount of labor expended?

If an artist creates a beautiful object out ofsomething which was less beautiful, then we find

it natural to say that he creates beauty.


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Similarly natural to say of a worker who creates avaluable object out of something less valuablethat he creates value

But that would not support the popular version ofthe labor theory of value,

If anything justifies the Marxian charge that thecapitalist exploits the worker

That workers alone create the product


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The Labor Theory of Value and the Concept

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