I thought he was referring to the paper he linked, that I would’ve been interested to comment on.
What you posted however, I am not.
I think that few people have Capital sitting on their shelf. But I have a nice hardcover set that I have been meaning to read so I think I will pick it up and start reading. I am near the end of Man, Economy and State so it will be a nice change.
I linked everyone to the MIA where they can find this book online. That’s how I usually read it.
http://mises.org/books/mengerprinciples.pdf
“Utility is the capacity of a thing to serve for the satisfaction of human needs…Of course the error underlying the confusion of utility and use value has had no influence on the practical activity of men. At no time has an economizing individual attributed value under ordinary circumstances to a cubic foot of air or, in regions abounding in springs, to a pint of water. The practical man distinguishes very well the capacity of an object to satisfy one of his needs from its value. But this confusion has become an enormous obstacle to the development of the more general theories of our science.” (P.119)
The Relationship Between the Use Value
Exchange Value of Goods
“In an isolated household economy, economic goods either have use value or they have no value at all to the economizing individuals possessing them. But even in a society that has undergone considerable cultural development and in which there is an active commerce, economic goods can frequently be observed that have no exchange value to the economizing individuals possessing them, even though their use value to these same persons is beyond all doubt…”
“It is true, as we have seen, that the importance of goods to us with respect to a direct employment and with respect to an indirect employment for the satisfaction of our needs are only different forms of a single general phenomenon of value. But their importance to us may simultaneously be very different in degree in the two forms. A gold cup will undoubtedly have a high exchange value to a poor man who has won it in a lottery. By means of the cup he will be in a position (in an indirect manner, through exchange) to satisfy many needs that would not otherwise be provided for. But the use value of the cup to him will scarcely be worth mentioning at all. A pair of glasses, on the other hand, adjusted exactly to the eyes of the owner, probably has a considerable use value to him, while its exchange value is usually very small.” (P.229-230)
Marx makes adistinguishment that need not be made. He take something that “no economizing idinvidual” would and form complex abstractions out of them to try and obfuscate the conception of the idea at all.
Marx says in Kapital that there is only a, “semblance of objectivity possessed by the social characteristics of labour.” (P.834 in my compilation) it is not an all encompassing thing.
Price is whatever two individuals agree upon in a given exchange. The $60,000 pen is just a pen with an asking price of $60,000. It has no definite price until a buyer agrees with the seller to make an exchange. So if no one buys the pen the price may be lowered, until the asking price has a lower utility for a buyer than the pen. Then the buyer will agree to purchase the pen.
I have a $1,000,000 pen if you want it.
Rothbard in Man, Economy and State points out that all transactions occur in distinct quantities of a thing. Individuals buy either a bushel of apples, or a yard of linen, and so on. It makes no sense to talk about a commodity in the abstract (that is, unitless). Then it ceases to be a commodity. Even “an apple” means one apple. I think that Marx is making a similar point.
A bushel of apples and one apple are two different commodities.
Could you clarify what you mean hear? You are suggesting that it is hours that are being traded, not commodities. But if commodities are being traded, surely I will be able to get more in trade from some people, and less from others. While Q may give me 2 fish for one coconut, S offers 3 fish for one coconut.
This isn’t real-estate, Amazon isn’t going to bargain with you.
Supply and demand, we’ve gone over this.
No, they are different AMOUNTS of a commodity.
Surely, but do you see Wal-mart cashiers bargaining with every customer that comes through? Why not? Because there’s a social average that becomes set through the ups and downs you mentioned.
Essentially, that’s exactly what’s happening.
Pizza are you gonna examine Menger? He doesn’t ignore exchange value and menttions all of the angles Marx does; albeit in different terminology.
I really don’t have that kind of time unfortunately, I’m juggling 8 different books on 4 different topics as it is, along with debates within my organisation and I’m running my own little personal Communist project too.
red herrings don’t look good in debates, mate. I put the paragraphs with citations and a link up there. You seem to be avoiding it.
"Democracy is a political method, that is to say, a certain type of institutional arrangement for arriving at political - legislative and administrative - decisions and hence incapable of being an end in itself. "
“Marxism is essentially a product of the bourgeois mind.” - Joseph A. Schumpeter
Lets look at it this way. A tailor preforms a specific concrete labour. More abstractly, he preforms general human labour. The former is what characterises use-value, the latter Value/exchange-value.
Well, I can get that a physical thing is a product of concrete labour, since I’m not sure what else it could be, but isn’t it also a product of ‘general human labour’, if you just mean that we can abstract from the ‘concrete’ production process to say that a labourer performs ‘human labour’?
In the same way that “weight” is quantitative. We measure weight by numbers and such, as we do with exchange-value (namely price).
Marx doesn’t seem to only measure exchange-value in money price, but in all commodities. In that case, things would have a different exchange-value in relation to different physical commodities, so then wouldn’t it be just as much qualitative?
Value-form is just the form of how social labour is distributed in society. Under slavery, it was forcefully distributed from the slaves to the slave-owners. Now it is transferred via an exchange of equivilants.
I’m not sure that I understand it any better from that explanation. Doesn’t Marx say that the value-form is a form taken by the commodity which is distinct from its ‘natural form’? Also, I’m quite sure that slavery in, for example, the USA had often involved things being produced for exchange, with a price.
What you call “subjective” here I would call the Anarchy of the market. You have to guess, at first, of how much of a commodity to create in order to satisfy demand.
Well, yes, but in order to satisfy your own subjective demand, not only that of others. Production for the market is ultimately done out of self-interest, after all.
Yes sorry, labour is considered as a social average. If the social average time to make a car is currently 60 hours, and tomorrow it is 1 hour, all cars made today will be forced to sell cheaper tomorrow because now cars can be made in 1 hour, so no one will pay for a 60 hour car.
I wouldn’t have brought up the value-price relationship if you didn’t do so consistently.
That’s typically one of the many misunderstandings. We could say that the money-commodity, or money in general is crystallised human labour.
“Let us now look at the residue of the products of labour.. There is nothing left of them in each case but the same phantom-like objectivity; they are merely congealed quantities of homogeneous human labour, i.e. of human labour-power expended without regard to the form of its expenditure. […] As crystals of this social substance, which is common to them all, they are values - commodity values.”
I’d like the specific context if you could refer me to a specific chapter or section.
See previous.
If a person “overpays,” that is, pays far more than the value of a commodity, they will then, obviously, have less money than normal to spend on other commodities, thus cutting back the market on other commodities by EXACTLY how much they overpaid. For everyone up, a down. Thus total price remains = to total value.
So basically, if one commodity has more labour-time spent on it, and another has less, then one person will gain ‘value’ when exchanging them, and the other will lose it, so that gains and losses even out? I suppose so, but then that would also apply to the masses of the objects exchanged.
Only if you fail to udnerstand what Marx is saying, which, if you read what Marx is saying instead of reading what you want him to say then it makes perfect sense.
It’s nice of you to imply so subliminally that we go around dishonestly reading what we want Marx to say, and hence coming down here to enlighten all of us as to our follies. Still, if you’re ready to stop acting like Jesus without the charisma, perhaps you could in fact help at least one or two members to understand one or two things about the history of economics. Or, of course, you could troll, that is up to you.
The $60,000 pen is just a pen with an asking price of $60,000. It has no definite price until a buyer agrees with the seller to make an exchange.
And?
if no one buys the pen the price may be lowered, until the asking price has a lower utility for a buyer than the pen. Then the buyer will agree to purchase the pen.
Indeed.
So Marx, in his analysis, is not considering the fact that exchanges take place in certain quantities (gallons, quarts, bushels, grams) at each exchange?
I went back and read the section we are discussing, which happens to be the opening paragraphs. The point he seems to be making is that wealth is to be measured by a quantity of commodities, which can be expressed in such terms. Thus, the wealth of “Paradise Island” consists of three houses, fifteen pairs of shorts, a ton of bananas, and so on.
This section precedes exchange. I was jumping ahead.
I think I get it. But I have some questions.
Marx writes: “As use-values, commodities are, above all, of different qualities, but as exchange values they are merely different quantities, and consequently do not contain and atom of use-value.”(p.44 of Kerr & Co. edition of Capital)
Yes, commodities are of different quality, otherwise there would be no need to exchange them (if we imagine a world with only one commodity). The second part of the above sentence is a little confusing. Marx seems to be saying that a commodity can at one point in time have use-value, and in another exchange value but no use-value. But if we are examining the commodity scientifically, as I believe Marx intends, then it makes no sense to say that certain properties appear and disappear while there is no physical change to the commodities being exchanged. What am I missing?
When Marx talks about exchange, he writes: “We have seen that when commodities are exchanged, their exchange value manifests itself as something totally independent of their use-value. But if we abstract from their use-value, there remains their Value as defined above.”(p.45 of Kerr & Co. edition of Capital)
By use-value he must mean something other than the usefulness of the commodities for the individuals involved in the exchange, otherwise the above statement is a blatant contradiction. So what is this use-value? Is it an objective quality of the commodity that we can assume exists by virtue of the historical and emprical nature of commodities in actual exchanges? That is, when talking about an exchange, such as my giving you a hammer for your coat and scarf, the historical fact of an exchange taking place confers commodity status on the objects exchanged, as opposed to some kind of non-commodity status? Once a commodity, does the object lose its use-value permanently or can it be regained? I feel like I am getting close but I need some help here.
If Marx’s theory is correct or has explanatory power, then it should also apply in a “desert island” hypothetical example. Let’s say Jon makes spears and exchanges them for Tom’s coconuts. The spears are used for fishing, but they break from time to time and this keeps Jon in business. Now let’s say that Tom learns to make nets for catching fish, and so Tom no longer needs to exchange his coconuts for Jon’s spears. In fact, the nets allow Tom to be far more productive in fishing than the spears. How can it be that the spears have the same use-value and labor value, while the exchange value has fallen? Clearly, the spears have no use-value for Tom as long as he can make and use nets.
Yes precisely.
100% right.
Not quite, the relationship is still characterised only by the amount of commodity that changes hand.
Yes sorry that was my mistake.
This very case is discussed around chapter 10 or 12 I think.
I have no objections here.
Hmm?
I think I recall hearing somewhere that, in austrian economics, two commodities are exchanged when the owner subjectively value them at the same value right? Marx is merely saying that the owner of the commodity doesn’t havea use-value for the commodity AT ALL, EXCEPT as a medium of exchange.
Merely the intentions of the owner of the commodity. If the owner wants to sell the commodity, it is no use to him except as an object of exchange. Marx says that use-value is only realised by consumption.
Just a minor point.
Use-value IS the usefullness of a commodity. It is only potential until it is actually consumed, at which point it is no longer a commodity.
Precisely.
A commodity brought to market has no use-value to the owner except as a medium of exchange. The commodity may have a use-value to its purchaser though.
The fact that the spears have no use-value means they have no exchange-value.
- I think I recall hearing somewhere that, in austrian economics, two commodities are exchanged when the owner subjectively value them at the same value right? Marx is merely saying that the owner of the commodity doesn’t havea use-value for the commodity AT ALL, EXCEPT as a medium of exchange.
No, Meneger and others who pioneered the subjective theory of value claim that an exchange occurs when, given the conditions surrounding the exchange (including time), both parties value what is being exchanged MORE than what they already have. That is, Bob has eggs and Steve has bread. They exchange these at a ratio based on thier subjective valuations of each commodity, which can include costs like labor. However labor isn’t the whole story, which if you step back from Marx for a second, is obvious. If you’re a farmer trying to buy, say, a tractor via barter in exchange for your wheat, do you really care, or even know, how much labor went into the tractor, and the machine tools used to build it, refine the fuel, etc? Or do you think “this is what I can use the tractor for, and what potential increases in yield it gives me”. The seller has an expected value, costs to be made up for, demand to hold, etc. The buyer also has a demand to hold, the costs of what he’s exchanging, and the percieved utlity/reward the item gives him.
This inequality of valuations is precisely the point of the exchange. Why would one exchange something that is worth just as much as they have now? They’d be no better off. This throws a huge monkey wrench into Marx’s whole arguement that it is labor, or labor time, that rules value. His reasoning is based on the fact that items exchange for equal amounts of labor time. This simply isn’t the case, and results in all sorts of convolutions later on, like simple-labor vs. complex labor.
Also, are you going to respond to Jacob or just leave that point unadressed?