First let me point out a few places where you didn’t read my post carefully enough before replying, which will explain my lack of a response on these points:
It should have been clear enough that I was talking about equivalent commodities.
I (carefully) said “wild berries that you stumble upon”.
On to the rest…
I’m perfectly familiar with this perspective, which is after all the prevailing one. But presenting this in no way addresses the points I raised about the utility of the labor ToV.
That’s absurd; it takes hundreds of hours to become a good cook.
You can of course bring up the example of sentimental items, which have nearly infinite value (“I will not sell my grandma’s necklace for any price!”) though they cost no more to produce than other necklaces. But the Labor ToV only regards exchangable commodities; and as far as I can tell, the more widely exchangeable they are, the more it holds true and has the ability to explain their value (i.e., the more widely exchangeable something is, or the more broad the demand for something is, the more its value can be explained by how much labor-time is incorporated in it).
Aside from sentimental items and other items which are completely off-limits for exchange (and which might thus be argued to have no value at all…or at least that their prevailing market value istheir true value and their inflated sentimental value is an artificially inflated one) , I can’t think of many items whose value is not intimately tied to the cost of their production. I would also admit as an exception those items whose value is directly tied to the way in which they were produced, by some sort of consumer superstition about how “hand-crafted” or “home-baked” equals higher quality. Minus this type of silly superstition however, equivalent products have equal utlity, and cost is determined only by the labor efficiency of the process that produces them.
I eagerly wait for you to finish this point…
Once again, I am not the one in denial of supply and demand and the power of a marginal utility viewpoint to explain many economic phenomena. It is the posters on this board who are in denial about the labor ToV to do the same.
Actually, no one is denying the LTV powers it really doesn’t have - namely, explaining the source of value, which remains the individual and in this case the consumer. That prices may over time approximate costs as profits are whittled away in the rare case of a market remaining at equilibrium doesn’t prove otherwise. The value of the good is still contingent on its serviceability to the consumer, and TP will continue to discount “worker” MVP in the present relative to the future.
You do realise clumsily tossing statistics about isn’t going to make your point, do you? The “justification” for “worker” (please stop using this word to designate an imaginary class) toil, is that the entrepreneur (and the capitalist, should they overlap) extend the income of “workers” greatly (boosting their MVP and also by capital lowering the cost of goods), advance income before the product is completed and in the case of the entrepreneur, shoulder losses of the firm in the case that a product is not profitable. There are jobs that do entail elevated risk with correspondingly elevated rewards, but it really isn’t up to you whether one should take that risk or not.
Oh, and by the way, social mobility is not solely moving into the highest of the highest brackets… disabuse yourself of the notion that it is. That the USA has or doesn’t have high social mobility could just as well be an indictment of all the statist policies it has hindering individuals from entering its “upper echelons”.
Take none of the above as a defence of the present order. I’m not really interested in defending the wealth of individuals who benefit from subsidies, regulations &c.
Tell that to any manager at Denny’s. But honestly, that’s besides the point.
Pretend you’re a complete amateur, making something for a bake sale. Pick up a cook book. Find a recipe for a cookies. Gather all the ingredients. Make two batches - one following the recipe as best you can, and the other following the recipe as best you can but replacing the sugar with salt. You will, for the most part, have expended exactly the same amount of labor making each batch. Which cookies will have more value?
This is exactly my point. It does not matter if one good is “better” or not. It only matters how highly a good is valued by the consumer.
Utility, in economic terms, is a synonym for desire, as it is judged solely by the subjective opinions of the consumer.
That may be a starting point of price, but if something does not sell at a price above cost, it very well be eventually priced below cost.
I don’t know what else to say. You are claiming that because prices are generally slightly above cost, that the cost is somehow causing an item to be priced so. I am claiming that this is correlation, not causation.
You do realize that saying “correlation doesn’t imply causation” without suggesting an alternative is generally a rather weak point?
“Babies follow sex by nine months, correlation does not imply causation, WELP!”
Of course cost determines price. The difference between them is profit–you know, that thing that drives the economy. If you believe otherwise, I’ve got a bridge I’d like you to sell me. It costs $500,000 to build and I’ll pay you $400,000 for it.
why? what you do whenever you decide to act is fully determined by what you think, in your brain. yet it is certainly influenced by the way the world is (the world outside your brain).
Well, if I understand you correctly, you’re now talking about different levels of causation, some more proximal and others more distal (e.g., the world that you experience–>your brain–>your actions). Is that what was meant about prices (e.g., cost–>demand–>prices)? If so, that has some plausibility, but why can I not just as reasonably assert that cost–>prices–>demand?
How is price determined? Person A and Person B agree to the price. This is what Supply & Demand is; people agreeing to an exchange at a certain price. However, there are factors that influence the price. One influence is cost of the good; the seller might not agree to a price below cost. Furthermore, you implied that only cost determines price, however, this is false. Someone might sell a good out of necessity at a price below cost, or sell the good because he might see better opportunies with some other good.
because its subjective value that gets things going.you cant have a meaningful price theory without a meaningful value theory first.
costs come in later quoting Reisman from Capitalism
In Effect, determination of price by cost is simply determination by supply and demand and by marginal utility operating across the whole of the relevant market or markets, not just the narrow market immediately concerned. Cost is what communicates to the narrow, individual market the state of supply and demand and marginal utility in these broader markets.
he has a tremendous section focused on the confusions surrounding the labour theory of value. he is particularly thorough on that topic.
also liquidating ones stock necessitates it. why overlook liquidation?
anyway, why are you satisfied with a partial theory that pretends its the whole story and is wrong on those grounds.
read material on subjective value theory, go to someone like Reisman for a detailed look at how costs come into play.
then you will enjoy a value theory and therefore a price theory (catallactics) that is not merely partial and therefore ‘false’ , but comprehensive and true.
As I’ve said, I’m not satisfied with any one theory. Because there is no perfect theory in economics. It is not a science. However, different theories lend different insights; only an idiot, or more likely, an ideologue, would willingly impoverish him or herself by neglecting theories that lend unique insights.
you should be satisfied with true theories that explain things, and you should favour them over inferior theories. so hopefully given some time you will familiarise yourself with what we have to offer, which is massively superioir to marxian beliefs.
Economics is a science, there are universal laws, timeless laws. like maths is a science, or is math an art? the proper method for studying economics is praxeology not positivism. economics is not a ‘natural science’ but a ‘human science’ we study human action. thymology is tougher…its more of an art i suppose… .
