Cultural Theory: The Labor Theory of Value

[TheRevolutionaryBob]

What if something requires a huge amount of labor but has very low utility to society?

[volumexxvii]

@TheRevolutionaryBob - Then whoever produces the commodity will probably not make very much money. But 'utility' doesn't necessarily determine a commodity's value; desire contributes as well. If I make a lot of popsicle-stick abstract art, one could hardly argue that this is valuable to society, but I might be able to convince a lot of rich people that popsicle-stick art is fashionable ... and then I get rich.

[TheRevolutionaryBob]

@volumexxvii

But that only means that popsickle stick art has found a new utility and use-value.Desire is contingent upon the utility a use-value has to society. The utility of something can be defined as anything that satisfies some human desire.

[volumexxvii]

@TheRevolutionaryBob - True that in Marxian analysis desire can be read as contingent upon 'utility' in a broad sense, or anything that serves a social function. Which I think can be a useful analytical tool, but not the only way to read desire, if it reduces desire to strictly economic terms. It's been a while since I've read Marx, and the Marxists that I have been reading aren't economic theorists, so I'm probably not the best person with whom to have this discussion. (cont.)

[volumexxvii]

@TheRevolutionaryBob - (next) But I do think that understanding value only in terms of labor is inaccurate, as you suggested in your question (at least that was my interpretation of your question). And then there's the problem of what is 'actually' useful to society, requires a great amount of labor, but is under-valued in terms of remuneration. I'm not that well-versed in Marxist economic theory, so I'll probably bow out instead of pretending to know how Marxisms answer these questions. =)

[vanzpp]

Very interesting. Good video. I'm reading Thomas Sowell's book on Marxism. He claims that Marx ignored the role of risk under capitalism, that labor is not the only or even the most important input. Risk capital is just as important, so the capitalist deserves a return for taking this risk.

I consider myself a socialist, but this is a pretty devistating argument. Any idea of how Marx would respond to this? Thanks.

[arzoyan]

Capitalism. the wage slavery of immense humanity in a politically manipulated,tyrannical MARKET SYSTEM OF ARTIFICIAL scarcity and distortions, to perpetuate wage-slavery/exploitation in the interest of the OWNING/RULING CLASS. A socio-economic modality of production for profit as the sole consideration with devastating consequences of perpetual war,enviornmental destructions,animalcruelty and sufffering, a social reality of fear,insecurity,devaluation and dehumanisation.

[akikohannri]

Online Asian girls #lushfmlk.info#

[cleanmrbroadway]

SEE BILL ABRAMS part 2. MARX just confused the whole concept . Its a very simple concept. Mainstream media hates american concepted LTV. SEE BILL ABRAMS part 2.  BY THE WAY. The gold standard is another HOAX.

[speedgraphic]

This was awesome - thanks for making these webcasts, professor!

[ocybin]

if profits are a signal that producers are efficiently supplying consumers, then why is it that in the long run profits tend to zero? Does that mean that in the long run businesses are not actually being efficient in supplying consumers?? no.. this makes sense if we consider that the value of a commodity naturally gravitates towards the value of labor required to produce it.

[zsylvana]

I read some Austrians but noted economist Mark Blaug has called Austrian methodologies "so cranky and idiosyncratic that we can only wonder that they have been taken seriously by anyone." 2. Mark Blaug, The Methodology of Economics (New York: Cambridge, 1980), p. 93

[zsylvana]

I have read them.But Mainstream or All other Economic Schools infact see them as Cranks.

Nobel economist Paul Samuelson wrote About Austrians that "I tremble for the reputation of my subject" after reading the "exaggerated claims that used to be made in economics for the power of deduction and a priori reasoning "the Austrian methods." Paul Samuelson, Economics, New York: McGraw-Hill,!964 page736.

[maganz]

A good thing about Austrian theory of economics is that it does not presuppose the false marxist theory of the objective value of goods, and the obviously false presupposition that exchange takes place because good have equal value. It's obvious that is exchanged because goods have different value for different persons, because of their different subjective value. Another good thing is that they recognize that values goods have for us are dependent on memes.

[rlstrick]

Thanks for these suggestions. I haven't read Mises, but I have had discussions/debates with an economist who follows Mises' theories. Does Mises make a distinction between "value" and "surplus value" or "profit"? I'll look into that text. And I don't know Rothbard's work.... I'll check it out!

[zsylvana]

Austrian professors, Peter Boettke, writes: "It must be admitted that Austrian economics is plagued with many thorny issues of an epistemological, theoretical, empirical, and political nature. Disagreement within the ranks of Austrian economists still persists over many issues"

[zsylvana]

"The Austrian School" is often divided about periphere things.But they belive in Goldstandard.And no FED-Bank.Perhaps the largest split is between among "Austrian School" is the "narrow church" of Mises and the "broad church" of Hayek.. The Miseans do not consider Hayek a "true" Austrian, and even refer to him privately as a "social democrat," . 7. Peter J. Boettke, "What is Wrong With Neoclassical Economics (And What is Still Wrong With Austrian Economics)"(Edward Elgar Publishing, 1996).

[underdg22]

Mises is brilliant and well worth reading. Although if you like Marx you'll hate him.  For Mises, profits are a signal that a product or service is efficiently supplying consumers with something they wanted or needed and thereby make all economic calculation possible. Not exactly in the Marxist playbook! Also, he's a big proponent of the subjective theory of value.

[zsylvana]

"And how does the bourgeoisie get over these crises? On the one hand, by enforced destruction of a mass by the conquest of new markets, and by the more thorough exploitation of the old ones. That is to say, by paving the way for more extensive and more destructive crises, and by diminishing the means whereby crises are prevented.

The weapons with which the bourgeoisie felled feudalism to the ground are now turned against the bourgeoisie itself."

Karl Marx. Das Kapital

[fabolous2482004]

Hi, I liked your expanation on labor theory of value...have you read Ludwig Von Mises' theory of Objective value..? or Murry Rothbard's work on where money originates, and how its value is determined..? Just friendly questions..not here to knock or bash..sharing ideas is key..

[kantimmanuel05]

anybody have the page number of the second quote?

[mohbyte]

Thanks for the Video. Much of Marx's theory results proved beneficial to western regimes. but was a disater to communist countries. This proved that the flaw is not in the theory itself but on how politicants can benifit from any phylosopher thinking

[ElGeneral09]

The value of anything is subjective, not only according to the laborer, or the owner of the means of production(which could be one in the same), but also the buyer/consumer. The owner of the capital, controller of the means of production could "exploit" the worker or the buyer/consumer, the reason he/she does, usually, is self interest, to sustain, the means of production by which he/she can provide labor to the laborer to receive a reciprocal value(whatever it may be) that is agreed upon, ...

[ElGeneral09]

and of course his/her self, which is why, probably but not absolutely, they entered in the contract with the laborer, assuming the worker and the owner are not one and the same, and the buyer/consumer to exchange property for property, value for value, tit for tat. To make DOUGH, and progress, through surplus capital, the standard of living for , arguably, the worker, the owner, and consumer. I wish i could write more explaining my views and thought, unfortunately youtube has limits. nice vids.

[emahunn]

Remember, the laborer does not determine use value. Therefore, use value cannot be subjective. The example Dr. Strickland uses (water) is an excellent one in that water is useful because it is necessary to and for all individuals. Hence, use value is inextricably linked, more times than not, to our existence; that is to say that usefulness of something is predicated on our needs. There is a reason why Marx, in "Das Kapital," starts with use value, because it is the foundation of value.

[emahunn]

Remember, the laborer does not determine use value. Therefore, use value cannot be subjective. The example Dr. Strickland uses (water) is an excellent one in that water is useful because it is necessary to and for all individuals. Hence, use value is inextricably linked, more times than not, to our existence; that is to say that usefulness of something is predicated on our needs. There is a reason why Marx, in "Das Kapital," starts with use value, because it is the foundation of value.

[hellomynameisty]

Finally a video on YouTube where the people who post comments aren't being ridiculously vulgar and bad-mouthing each other! Thank you!

[dragonman98]

Ever heard of "the free development of each is the condition for the free development of all?" This means that everyone can freely develop their talents and abilities and work will be something that will be done for pleasure and creativity. And Yes because the people making fertilizer will most likely be making it for themselves, or be glad to help our their society.

[ericrolofson]

"work will be something that will be done for pleasure and creativity."

Okay then, who will do the shitty jobs, like mining resources? The vast majority of work that needs to be done is not enjoyable and does not provide an adequate outlet for creativity. The reason people take a shitty job over a fun and creative job is because the shitty job offers a higher wage and a chance to get ahead. It offers a chance to save and build a future.

[rlstrick]

Thanks to both dragonman and ericrolofson for their contributions.... Marx never said much about this beyond his tongue-in-cheek "hunting in the morning, fishing in the afternoon..." comment from _The German Ideology_. He was concerned to analyze capitalism rather than to prescribe a visionary utopia. But, it seems to me that ericrolofson is wrong about high-paying shitty jobs. Under capitalism, the worst jobs typically command the lowest pay, and the smallest prospects for advancement.

[ericrolofson]

I never said that a shitty job guarantees success, so I don't know how you can draw the conclusion that I'm "wrong". My point was that a higher wage is used as an incentive to compensate for shitty work. If a job sucks, an employer has to provide an incentive to make it worthwhile to the worker, or else the worker will find a job with a similar rate of pay that doesn't suck as much. This point should be obvious to anyone that has worked a day in their life.

[destructicon500]

There is a general consensus in society that service-industry jobs (fast food, retail, etc) are among the "shittiest." But people working in those jobs get paid minimum wage... not much of an incentive there.

[ericrolofson]

I don't agree with this statement. I would generally say that service-industry jobs, like the one's you've mentioned (fast food, retail, etc) are viewed as "entry level" work, and are often the type of jobs where you will find young people that don't have a lot of real-world experience. Socially, these types of jobs are looked upon as "shitty" because they don't require skills, not because they mentally challenging or physically demanding. Most anybody can do such jobs, so they pay squat.

[kutthroat84]

but isn't that in agreement with marx's concept of labor power? i don't understand are in conflict or in agreement with the labor theory of value?

[trisix99]

Incredible how Marx's philosophy is so coherent! I have a question though. This Labor Theory of Value and Surplus Value is true, except for when and where there are enough raw materials to produce and provide the laborer a fair wage, i.e. enough for the laborer to reproduce his/her own resources.

Is this correct or incorrect?

[destructicon500]

As far as I know, the laborer will never be presented with a "fair wage" (ie. a wage in accordance to ALL the work the worker has done in a day) because that would not allow the owner to create a surplus value and make a profit.

[g3okar]

@rlstrick Part 1

Suppose that your correct about the worst jobs typically paying the lowest wages and having small advancements. Then why are people still doing them? Is the alternative to not having that job better? Because if it was then they wouldnt be doing that work. right?

[g3okar]

@rlstrick Part 2

Now, think about the absolute worst job that could be, and understand that there is a specific tool that is used. That tool would have only been created by a person that worked that horrible job. They bettered themselves and others by making their work a little easier and/or left that job to produce that tool for others....that is advancement for themselves and society.

[riversideharp]

Thank you

[ericrolofson]

What is the Marxist stance on media ownership?

[dragonman98]

The people own the media, duh. Actually in a Marxist society stuff like video games and movies will all be better and free because they were made by people who want to make good movies not to make movies to sell.

[ericrolofson]

I hear the grass will be greener too because fertilizer will be made by people who want to make good fertilizer rather than make fertilizer that will sell.

[destructicon500]

"The ideas of the ruling class are in every epoch the ruling ideas" - Karl Marx, the German Ideology.

[inkus2000]

good vidio

I have encountered Austrian school economists who say that the labor theory of value is wrong - surely a theory's are subjective ?

It is my understanding that if society adheers to one theory of value that is what makes it so - their is no one correct method

[falstaffswims]

you sure, kromando33, that that wasn't merely a historical distinction? one that's meant to change into identity as reality unfolds through and out of its contradictions?

[dragonman98]

China is under a "state capitalism" and produces commodities and runs businesses controlled by the state. The only difference between America's Capitalism and China's Capitalism is that China's system has businesses run by the government rather than private businessmen.

[Mockni]

not anymore

[dragonman98]

how?

[majorMcpharter]

What collapsed in the old soviet bloc was a brutal regime of state run capitalism.Socialism/communism has not failed its never been tried.

[inckamarx]

it wasn't capitalism, but you are right that neither was it communism/socialism. the reason it wasn't capitalism is that there was no capital! it was collectively owned. however the workers did not have political control over it, this was controlled by a caste. the caste did not own it - they enriched themselves not from their economic relation to the labour, but from their political control over it.

[IntelligentHoodlum]

Some entity (via the control of humans) had to own it; so what (read: who) did?

[bobbokrull2]

About you example with the well in the desert. You say that according to Marxism it is only the labor that creates a value. But how about the IDEA that generates the labor in the first place? Doesn't ideas have any value at all? A marxist friend of mine says that all profit should belong to the workers. But shouldn't the workers then also be held responsible if the result of a business venture should turn out badly? Doesn't the risk taking of the capitalists have a value in itself?

[rlstrick]

Marx distinguishes between "use value" and "exchange value"; any idea might have "use value" if it is useful, but it will only have exchange value if it is not readily accessible--i.e., if it is protected by patent law, or copyright, or if it requires advanced education in order to deploy the idea, etc. All of these conditions, he would argue, involve labor--hence it is the labor that creates the "exchange value," on top of or even aside from the "use value" of the idea (or thing).

[rlstrick]

Further, about "risk": Marx would say that an investor or entrepreneur might risk his/her capital and gain more capital, but another person will risk capital and lose it. In the aggregate, and the long run, he argues, this gain/loss will even out. Such a risk venture may result in increased resources (use value) for the society as a whole, but any increase in "value" (exchange value) that results, will be produced by the deployment of some quantity of "socially necessary" labor.

[majorMcpharter]

Your friend is no marxist if he says all profit belongs to the worker.Socialism/communism will abolish the wages system and with it the profit motive.

[rictorn]

@bobbokrull2 hello i don't think you have read das capital (which is fair enough brilliant it may be but deadly dull) his is a criteke of capitalism not so much of capitalists, qoting fropm memory and very much paraphrasing he suggests that even a good (nice) capitalist must exploite his workers its inherent in the system there fore a bad system, marx is happy in capital to point up the progressive developmental tecnological progress capitlaism encorages you could selecitavly qote from capital

[rictorn]

@bobbokrull2 hello i don't think you have read das capital (which is fair enough brilliant it may be but deadly dull) his is a criteke of capitalism not so much of capitalists, qoting fropm memory and very much paraphrasing he suggests that even a good (nice) capitalist must exploite his workers its inherent in the system there fore a bad system, marx is happy in capital to point up the progressive developmental tecnological progress capitlaism encorages you could selecitavly qote frm capital

[rictorn]

@bobbokrull2 

[rictorn]

@rictorn qoutingf selectiverly from capital you could accuse marx of being quite right wing, this is becasue he is in proper economist mode not so much political /utopian mode (in fact he is showing the sillyness of the market utopians such as the dreamer adam smith), this is of corse because marx as well as being the most brilliant thinker on economics of his genoration is eager to fair anallsis of capital seeing both the good and bad inherent in the system

[rictorn]

@rictorn as a libatarian socialist i belive we need freedom from exploitation, freedom to live in a faired society, freedom to work and freedom to do anything which dosent harm another human being, the ultra capitalism of freidman ragan pinochet thatuer et al denys all of these freedoms socialists of the worls unite we have nothing to loose but an imorral system that steels labour to enrich the few

[rictorn]

@rictorn also to modern socialists marx can seam weird not because of teh things we may see as marxist now but because he dosent employ the argements of either modern redistributive socialists like me (who want to redistribute wealth and power within for short hand a kainsian capitalist system, or the franckly weird welfare capitalism the lefet is accused of. this is realy an enevertability of ultra capitalism and therefore a problem caused by the right, its such a bad system we currently have

[rlstrick]

No, not at all.... Let me recommend a critique of Marxism by a conservative pundit: Thomas Sowell's _Marxism, Philosophy and Economics_ (New York: William Morrow, 1985). It's very accessible--I learned a lot from it.

[Xproletariatx]

Hows the normal person on the street, or the average worker suppose to understand this stuff if we all see these theories as essential towards changing the world by overthrowing capitalism and so on? I've been reading Marxist literature for freaking 3 years now, and its still all a blur to me. I dont know what to do, i should just give up on all of it.

[rlstrick]

In my experience, it's just about impossible to make sense of this vast body of writing if someone is trying to read it in a "vacuum," so to speak--that is, outside the context of a community of informed readers. There is just so much of it, one doesn't know where to start. But, I do seriously recommend the Jonathan Wolff book I mentioned in an earlier post (above).

[jbgood3]

So theres your answer. Surround yourself with other Marxists and everything will begin to make sense. Start recruiting!

[inckamarx]

rlsrick was obviously not recommending this because he is recommending a critque of marxism earlier...

try reading books marx wrote for workers. wages, prices, profits - that's one. good introductions.

[Xproletariatx]

I still dont get it. Im stupid, lol. Were all being exploited, in a nutshell. Thats all i need to know.

[BrianBekker]

Thank you for your lectures. Could you please recommend some books that would help us to understand this topic?

Thanks

[outrider52]

one of my favorites is Terry Eagleton's Marx, its very short but it lays out some of the most moving and powerful elements of marxism

[Shonbul]

Can you please explain your lecture topics simply and clearly, so that college students can digest what you say. thank you

[rlstrick]

Thanks for your question. These videos were originally made for my students who have read assigned texts related to them. For someone seeking a good basic introduction to Marx, I recommend _Why Read Marx Today_, by Jonathan Wolff (Oxford U P, 2002).

[rlstrick]

Thanks for your comment. Marx would agree with you that "value is not inherent" in the commodity. He also makes a distinction between "price" and "exchange value." Price can be determined by supply and demand, but, in the aggregate--over time and across geographical space--value will gravitate toward the money equivalent of the "socially necessary labor" (itself a commodity) embedded in the product. I think we will continue to disagree, but I hope this will clarify our disagreement.

[RussellsParadox]

No, you don't. You've made it apparent that your purpose is not to clarify anything, but to confuse.

[brendanmcooney]

Actually I think Ristrick's explanation is quite clear. In Marx's theory exchange value is really a measure of a social relationship- it explains the way in which people interact in a commodity economy. This means that value is not some mystical quality inside a commodity but a constantly fluctuating measure of social relations. I think that Marxists don't always do a good job of making these concepts accesible. While not always explained in an accesible way these concepts are quite important.

[Longlivethe4th]

Brendanmccooney : you're right in part but don't forget that value is also related to the labor put inside the commodity otherwise you'll end up like liberals saying wealth can be created infinitely by capitalism. am I right ristrick ?

[rlstrick]

I like Brendanmccooney's emphatic point that exchange value is a measure of a social relationship, but it's also true, for Marx, that exchange value is a representation of ("socially necessary") congealed labor embedded in other commodities. The "socially necessary" qualifier is crucial because it enables the theory to account for new technologies that might render existing labor processes obsolete, redundant, and hence "valueless".

[funkmasterswede]

As much as alot of Marxian analysis is quite interesting, I find his economic theories to be quite flawed. Value is not inherent; only demand can create a quantifiable average price for a certain portion of power.