this post was submitted on 07 Dec 2023
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Reminder that while the labour theory of value can be practical to understand certain aspects of society, it is still culturally biased and not "objectively" true.
What creates value can only be answered in a cultural framework.
How is it culturally biased? It's a theory of how exchange value functions within capitalism
You're right. It's one theory. There is however ongoing debate on which theory is "correct".
This vid explains it quite well and with Simpsons clips so the hour of video is bearable:
https://www.youtube.com/watch?v=8Z2LCNAVfMw
Yeah but the way you said made it seem that value (exchange value according to Marx) is determined by cultural factors, thus making it untrue. The debate around labour theory of value have existed since the 19th century.
I was talking about the theory, not value. Sorry if that didn't come across.
Now that I think about it: isn't value culturally determined in many things? Why are apple products more expensive than other computers with the same specs? Why is a ticket to a Billie Eilish concert more valuable than one to my neighbor's indie rock band?
There is a difference between use value and exchange value
It really seems like you're conflating 'value' and 'price' here.
Don't the two correlate?
What problem?
What a mess we've made.
As far as I understand: Price tries to measure value. Therefore: A price needs a value, but value doesn't need price. They correlate but are not the same.
Were am I making the mistake? Genuine question.
This is probably where your misunderstanding is, and it is the justification Adam Smith gives for the free market. If price is a measure of value (or an approximation), then the price must be fair (after all, you are paying for an equivalent of use value).
Marx evaluates price and value differently. He delineates 'real price' (the price to produce a good, including costs to the capital owner and the cost of labor) and 'market price' (which includes the profit extracted). He also defines value differently - Smith argues value is mostly subjective (which is a necessary condition for price to be a measure of value), while Marx argues that value is more specifically related to the labor that goes into it and the use-value, and criticized capitalist systems for fetishizing commodities and obscuring the role of labor. To Smith (and to those who take issue with the 'labor theory of value'), value justifies the price (it is the price a buyer is willing to pay if they were perfectly rational), but to Marx, the use value is more firmly grounded in the commodity itself (a shovel produces the same amount of use-value whether it is sold for $5 or $25), and the market price they end up paying is dictated more by other factors than the value it represents. The capital owner, then, is adding to the cost to the buyer without adding to the 'use value' , which means they are either stealing from the laborers (since the product exists thanks to the labor that produces it) or the purchaser (who is being taken advantage of by paying more for a product than what the product's use-value is). In either case, the owner is only able to do this by virtue of their ownership - of the means of production and the product of the laborers. They only part they play is choosing to put their capital to use and choosing to sell the commodity, and both the labor and the buyer operate at the risk of the capital owner withholding what others have produced (the buyer needs goods to sustain, and the laborer needs wages to purchase goods to sustain, but the capital owner puts their capital to work only to make a profit)
TLDR - People incorrectly associate LTV with Marx, even though other proponents of capitalism also make heavy use of it (namely Adam Smith), and they also assume that LTV is a statement about the price of a commodity dictated by the labor it embodies (e.g. I moved this boulder 200 miles, who is going to pay me for my value?) and instead it is a description of labor's relationship to value and is generally agnostic to the degree. It is, as you said, a framework for understanding how labor relates to value. While 'stolen surplus value' is explicitly a marxist statement, 'labor theory of value' is not, and is often misunderstood anyway as a way of dunking on something marx does not assert.
Not disagreeing with anything you said, but use-value is a qualitative property of a commodity, not quantitative, so we can't speak of an "amount of use-value", AFAIK.
True, and I think this is the point of contention that underlies the discussion. Currency is a stand in for exchange value, which is meant to be a zero-sum representation of 'value'. The 'transformation problem' only exists as a need to reconcile that desire to quantify what is (IMHO) a fundamentally unquantifiable thing. Just ask yourself "what is the value of my own life", and feel the humanity drain from you as you ponder the arithmetic.
The video this person is referencing critiques LTV through the lense of modern economics, which is built on quantifiable exchange values. I can't speak to Marx's intent, if he was trying to 'prove' a calculation for value and labor's objective contribution to it (I read Capital through a metaphysical lense, maybe that was wrong of me), but I find this need to rationalize price values objectively to be a waste of time.
If a pragmatist heard this conversation, they'd be asking "what do you precisely mean by 'value'?" To quote William James:
I'm not following what you specifically mean.
Could you provide an example of when the theory fails due to a culture's differing views of value?
There's not even academical consensus what value actually is, AFAIK. Do preasts add value to anything with their labour? If not: Do social counsellors? What if a priest acts as a counsellor? Ask different economists with their theories of value and you'll get several answers.
Economic theories aren't as rigid as theories from the natural sciences or mathematics. They are dependent on the culture in which they are perceived. A non-capitalist society would have different theories or value (or none at all) than we do.
This guy can explain it properly, I'm not an economist and kinda regret making that comment.
I actually watch Unlearning Economics, though only his video essays and not his streams. It's been a while since I've seen this one.
So what we're meaning is how much of Western culture undervalues care-giving since it produces no product, so stay at home moms, nannies, therapists, etc.
I thought of another example. In more nomadic and naturalist cultures, actually doing things to the environment destroys value, while leaving it be and allowing it to recover creates value. That is something else that is not accounted for in any theory of value to my knowledge.
An example would be American Indians in their dependance on foraging and hunting. I think that gives creedance to the idea that they thanked the things they harvested/hunted (I don't know the factuality of that), since from their perspective they were only a burden that the ecosystem was 'kind' enough to support.
Thank you for that comment. I feel like finally someone understood what I was trying to get across.
Probably formulated it badly, but still: the answers are a bit exhausting.
EDIT: Thought of another example of your qase where harming nature decreases value. Having to buy carbon certificates for releasing CO2 models the destruction of value by polluting the environment.
Caregivers may not produce a product but they provide a service.
We have no issues with the plumber providing you a service and getting paid well for it, I don't know why we have such a hard time with caregivers... :(
A reminder that the labour theory of value is not a marxist concept. When people wave their hands around and say "labor theory of value isn't objectively true!!", they're shadowboxing a ghost.
Value != price
Umm... Thanks for that unnecessarily aggressive seeming and a bit incompehensible addendum, I guess?
I think it's more assertive than aggressive.
What part of my response did you find incomprehensible?
Sorry, I interpreted it as aggressive. Figuring out tone in text form is hard and all that. Sorry that I wrongly accused you.
Things I didn't get:
Marx hasn't been explicity brought up yet (at least not in my comment). Only implicitly in the original post. Again: thought you were attacking me and was like "umm... So what?"
I thought you meant me, since that was what I was basically saying. 😅
Now, that one wasn't even implicitly mentioned.
I hope you don't hold my misunderstanding against me.
I was certainly being critical, though it was unclear by your phrasing if you were saying what I thought you were. That's why I was using passive language.
True enough, but I assume the implicit connection your comment was making to the op was the reference to "your stolen labour value", which would be a marxist concept, and "labor theory of value" is commonly misused as a counterargument against marx's central critique of stolen surplus labor. Feel free clarify if I got that wrong.
Well now i'm confused. If 'labor theory of value isn't objectively true' isn't making an argument about the price of a commodity not being equal to the labor it embodies, I am not sure what you're trying to say by it.
A theory o value doesn't necessarily say anything about price. As you said: "value != price".
Then what do you mean by "the labor theory of value is not objectively true"?
It's an economic theory and therefore more to be understood as a model on how economics work.
The natural sciences have a hard core. The theory of gravity depends on how matter interacts in an objective, physical framework. Economic theories basically describe human interaction which are based on psychology and sociology. Therefore they depend on the societal context they are made in.
If you understand them as models that are tools on how to understand the world, they become more useful in political analysis (I know we are in a meme community here, but everything is politics and so on and so on...).
I do subscribe to many conclusions the labour theory of value and especially Marx came to. But I want y'all to remember that the theory is a mere tool for understanding and not a sacred, holy theory.
..... Ok? Why the neutral language all of a sudden? Yes, labor theory of value is an economic theory, which as a field of study is considered a 'soft science'. Are you trying to say 'all economic theories and models are not objectively true"?
What am I missing here? Why would that be worth saying in response to the OP? It really just seems like you disagree with the 'your stolen labor value' claim in the OP, and are attributing it to the 'labor theory of value', and dismissing it as a soft-science (as opposed to dismissing it because you disagree with some portion of the theory you've neglected to mention).
My hunch is that you don't feel confident enough in your understanding to make any kind of firm claim and are just dancing around making vague gestures toward 'labor' and 'value' definitions as a way of avoiding it.
I was trying to be understood a bit better.
Not explicitally, but yeah: models aren't used for "objective truth". They're used to model (i.e. simplify) reality to make observations and guesses for the future.
I feel like a lot of leftists think that understanding economics starts and ends with "capitalists exploit the labouring class", while not actually engaging with the subject matter. I guess most can't even explain LTV properly before getting mad at capitalists.
As I've written before: I agree with most conclusions of marxist analysis that I know and I probably don't even know half of them. But I think that political analysis should use LTV as a tool to understand the world and not the end of socio-economical disgussion (because that would ignore important parts of today's economy).
I don't. I wanted to remind people as to make political analysis not too easy by taking the mental shortcut of reducing current capitalism on the problems pointed out by Marx rendition of LTV.
I don't disagree. I also don't disagree with the atomic model of Niels Bohr when it comes to calculating electron potential. When it comes to observing e.g. electron spin, that particular model will probably fall flat. That doesn't mean I "disagree" with the model, though.
I'm not too confident in my economic knowledge, true. But I am quite confident in how models should be used in soft sciences.
Addendum: I'd like to kindly ask you to give me a little bit of benefit of the doubt. Otherwise, I'll just disengage due to that accusatory tone I'm getting from you being a bit exhausting.
My tone is reflective of my mistrust of your intention, I am sorry if that is uncomfortable.
On the contrary, I think applying theoretical models to current real-world economics is the only way to make sense of where theory and reality deviate. I don't consider it a mental shortcut at all. The only prerequisite for it being a useful exercise is to be explicit about where those deviations occur when they arrise. When theories are publicly dismissed wholesale without elaboration it can cause confusion about what the intent is, and there are plenty of those who *do * aim to drive wedges between those in the working class.
I would have found it more interesting if you had been more specific in how you think LTV was being misused.
How have I earned that mistrust? Do you think it's fair to continue that mistrust after my efforts to elaborate my point?
Pardon my tone, but: That's a nonpology. I can do without those.
I agree. My original "reminder" was to point out that deviations occur. The mental shortcut that I meant was to only take LTV into account when discussing economics.
I don't know if "misused" is the right term, but one example where LTV falls flat is that it doesn't model the destruction of value due to environmental pollution.
After watching the video you've been citing, i think i understand where you're coming from now.
You have to understand that absent the necessary context, 'LTV isn't objectively true' can come across as a troll. Because while nobody was actually mentioning LTV, the assumption that people in the thread were thinking it - and misusing it as a way to quantify some value for stolen labor - is a bit insulting.
Unlearning economics is taking LTV as a theory of 'exchange value' and evaluating it on economic terms. That isn't to say those critiques aren't valid (they are), but it does two things that might mislead someone into thinking leftists don't understand economics and mistakenly believe something that's incorrect:
He discusses Adam Smith as having developed the labor theory of value first, then discusses it as something new when he gets to Marx at the end of the video. It makes it unintentionally seem like LTV is a Marxist conception when even he mentions that it isn't
He starts the video discussing what 'value' is and how various scholars tried to define it, but then carries on with the rest of the video with the implication that 'value' is synonymous with 'economic value' and then evaluates Marx's theory by taking that as granted.
These aren't even a critique of him - he runs an economics youtube channel, it makes sense that he'd be evaluating these theories from that lens. But as you mentioned before, LTV (as Marx uses it) is useful as a political philosophy more than an economic model. Admittedly, I read Capital through the lens of metaphysics, so Marx's discussions of calculating the values of various things came across less as explicit proofs for determining objective value and more like a critique of the economic theories of the time. I can't speak to the intent of those assertions, but I can tell you that I (and many other) leftists do not evaluate labor-value-relations as quantifiable properties but as a way of evaluating the success and failure of capitalism to promote it.
You and I agree that 'value' as capitalism accounts for it, does not satisfy a idealistic definition of value; if economic value and abstract value were the same, there wouldn't be that contradiction that you pointed to (e.g. the creation of economic value coming at the cost of environmental pollution, ect). Similarly, I view the employee-employer relationship as fundamentally in-tension, and I see "stolen labor value" as an accurate framing from the point of view of competing interests.
Sorry for mistaking your intentions, it wasn't my intention to bully you.
But I have moved 8 tons of dirt from location A to location B. Who else is going to do it? I deserve compensation for my task.
You're conflating value and utility.
Where?
LTV is about the value contribution of labour to the production of commodities, ultimately reducible to the subsistence requirements of that labour. It's entirely from the supply side and can be thought of as embodied labour. I've had a very tiring day at work so won't go into more detail now, but LTV doesn't address perceived utility or demand side "contributions" to value as they are not materially grounded.
I wouldn't have been able to write it this consise, but that's kind of one thing I wanted to point towards in my original comment.
But labour's contribution to value and - crucially - the irreducible subsistence requirements of that labour provide the only materially grounded analysis. They are not culturally bound, that's the strength of LTV.
Doesn't that only take the economics of people into account that are close to this irreducible subsistence requirement?
It provides a materialist foundation for further analyses that would otherwise be absent. It's extremely useful for the precise reason that it is objectively true, while demand side economic models are ideologically based.
An LTV analysis begins with such workers because they are the original contributors of surplus value that is appropriated by the ownership class.
I recommend reading about it in more detail if you're interested, I'm not certain but I think it is addressed in Chapter 6 of Capital 1. I don't mean to be rude but I really did have a tiring day at work and you seem to be clutching at straws a little with some of your comments.
And what's that reasoning, if not based on ideology?
I really suggest watching unlearning egonomics video on the matter. I'm a leftist and mostly agree with Marx, but the LTV is a model and should be treated as such.
I believe you have fundamentally misunderstood LTV. It's a observational model rooted in objective, material reality - hence historical materialism.
I generally educate myself by reading, rather than watching YouTube. I'd prefer not to continue this conversation.
I think you've misunderstood what a model is.
Thank youfor the ableist, condescending comment. /s
no worries fam
Because at its core, a commodity is comprised of natural material and the labor that transforms it into something with use value. It isn't an ideological statement to say a commodity is only a commodity by the labor that creates it, it's just a statement of fact.
Reducing value to nothing but commodities is already a very ideologically charged act. We were talking about value before. The value of commodities is only a subset of what counts as value.