Thanks, for this post, Rod. But (as usual) I have a few quibbles....
Rod Hay wrote:
>Both labour and nature can produce things of value.
I don't know about this use of an active verb ("produce") as applied to
nature. In Marx, at least, production involves prior consciousness of what
is to be produced, something nature lacks (as far as I can tell). That's
quibbling about the meaning of words, but it's good to avoid reducing human
society to nature -- or vice-versa -- by being clear about what
distinguishes the two.
Further, I'd say that while nature is a source of use-values, labor is a
source of both new use-values and new exchange-value.
>But it is society that gives a value to things. It assigns a value to
>things appropriated from nature and to transformations made to those
>things by labour.
Right. Value is a societal phenomenon rather than being something inherent
in the thing (or in the relationship between the thing and its human
appropriator, its use-value).
>Marx claims that the value of a thing will be proportional to the labour
>socially necessary for this appropriation and transformation.
It's the value of a _commodity_ that is proportional to the SNALT
(socially-necessary abstract labor time) needed to produce it at a specific
time, where a commodity is a new good or service produced for sale.
BTW, why do you say that value is _proportional to_ SNALT? To Marx, the
magnitude of value is labor-time. It would be the value _denominated in
money_ that's proportional to SNALT. (Gesundheit!)
>Presumably, in the case of the waterfall, things are produced with less
>labour than is socially necessary on average. The sellers of the things
>produced can thus sell them for more than the labour cost of producing
>them. Thus the rate of surplus value will be greater than the average.
This rate of surplus-value would be as measured for the individual
waterfall-owner.
>Surplus value has been transferred to the sellers from the rest of the
>society. So there has been a redistribution of the surplus.
Right. The specific group that would lose would be the capitalists in this
line of business who don't own waterfalls, who are producing using more
labor than is socially necessary on average.
It should also be pointed out -- to refer to a case I have ignored in my
missives in this thread -- that the waterfall-owners may drive the
non-waterfall-owners (who have lower labor productivity) out of the
business, so that the formers gain no differential rent from the latter.
This is the case that Michael P referred to when talking about the
depression of prices preventing the waterfall-owner from gaining
differential rent. (In the California gold rush of 1849, for example, it's
only the folks who got there first who got "something for nothing.")
I'm ignoring absolute rent, which I don't quite get, at least not without
sufficient caffeine rolling through my veins.
BTW, when Marx discusses differential rent, it turns out that _demand_
helps determine the value of the commodity (since it determines whether or
not the low-productivity non-waterfall-owners stay in business or not,
i.e., whether they are counted in the social average or not. But this does
not contradict Marx's theory, since it's an _ex post_ theory of the
valuation of commodities rather than a Ricardian _ex ante_ theory of
cost-determined pricing.[*] However, Ricardian _ex ante_ ideas about the
determination of value say something about the values of commodities,
specifically the limits on the amount of value that can be realized.
[*] In chapter 3, section 2, of volume I of CAPITAL (p. 202 of the
Vintage/Penguin edition), he indicates another case where demand plays a
role, that of a microeconomic realization problem: "if the market cannot
stomach the whole quantity at the normal price ... this proves that too
great a portion of the total social labor-time has been expended... [so
that] the effect is the same as if each individual weaver had expended more
labor-time on his particular product than was socially necessary."
>At the same time, appropriating the energy of the waterfall, allows a
>given quantity of total social labour to produce more things than before.
>And so long as the waterfall users are in a unique position, the value of
>the things produced will not change. (i.e., the socially necessary labour
>time will not change). But the total value of output of the society will
>increase. And the total surplus
>value will increase.
Right. The first sentence brings in time, i.e., dynamics or diachronics.
Marx's "law of value" is a static or synchronic theory (property income is
a result of surplus-labor), one that's true at any specific time. But he
also is quite aware that over time, values are altered, due to
technological changes and the like. (An individual durable use-value can
lose value, i.e., be devalorized as less SNALT is needed to reproduce it
than was needed to produce it.)
The creation of the water-driven mill is a result of labor, but the
discovery of the ability of the waterfall to power a mill may be an
accident -- or the application of science to develop a new technology. The
creation of the water-driven mill may also be the result of the
monopolization of the land around the river around the fall line as private
property (or as public property that is assigned to some private owner).
The creation of the water-driven mill is thus part of the process of
technological change and property appropriation.
Technological change involves labor by scientists and engineers seeking out
possibilities within nature that would allow new kinds of use-values and
increases in labor productivity. The appropriation of pieces of nature as
private property involves rent-seeking of another sort, trying to
monopolize the gifts of nature. I'd say it's the former that allows the
rate of surplus-value to rise over time (assuming that wages don't rise).
The latter is a redistributive enterprise, part of a zero-sum game.
NC economists sometimes argue that the appropriation of pieces of nature
as private property (the redistributive enterprise) creates the incentives
for the application of science and technology which would create new kinds
of use-values and increases in labor productivity. But that assumes perfect
markets, with no incentive to internalize all the beneficial externalities
and to externalize internal costs (dump pollution on others). "Perfect
markets" include the naturally impossible perfect futures markets, of course.
>So both sides in the debate are correct.
Among reflective and honest people, they usually are, to different degrees
and in different ways. If the "truth is the whole," as Hegel said,
different people typically see different parts of the totality and thus of
the truth. But only a god could actually know the totality completely.
Query: could someone explain Marx's theory of absolute rent?
Jim Devine [EMAIL PROTECTED] & http://liberalarts.lmu.edu/~jdevine
