Walt, I'll try for a more comprehensive response to your thoughts/questions on the LoV later, but let me start with the justification you offer for believing that "the Law of Value...(and the theory of surplus value) is the most successful of all economic theories in explaining the facts of capitalism."
You write:
Now, as for why I think Marxian economic theory explains the facts better other theories (mainly neoclassical): In neoclassical economics, there ARE situations in which the capitalist has an incentive to increase the intensity and length of labor AND it is in the worker's interest to resist this. But, whether or not this condition holds depends on the level of competition within the demand and supply sides of the labor market (among other things). So, the conditions under which this situation holds are somewhat limited "(not as likely to apply in highly competitive markets) and even when it does apply, there will be limits to how much the capitalist wants to push the laborer, and limits to how much the laborer wants to resist. In Marxian economics, I think that the conditions under which this holds are more broad, and there is less of a limit to how much the capitalist wants to increase the intensity of labor, and less of a limit to how much the laborer wants to decrease it. In my reading of labor history and the history of class struggle, it seems the Marxian contention is borne out better.
I have no idea how the foregoing establishes a case for the superiority of Marxian value theory or the "law of value" (whatever that is) over neoclassical theory. Here's why: 1. Under standard neoclassical assumptions, the profit of a given firm is increasing, *other things equal*, in the labor hours or labor intensity of its workers, and a given worker's payoff to employment is strictly decreasing, other things equal(including labor income), in labor hours or labor intensity. Thus in this ceteris paribus sense, capitalists "have an incentive" to increase labor hours and/or intensity, and workers "have an incentive" to resist this. These claims are unremarkable in the neoclassical context and certainly not "situation"-al. 2. In the real world, whether or not a *given* capitalist firm can profitably require its workforce to increase hours and/or intensity will surely depend on market conditions such as the number and availability of alternative employers for workers in the market and bargaining power of incumbent workers. Neoclassical--or more precisely, mainstream-- theory addresses the entire gamut of such possibilities from the case in which an individual firm has pure monopsony power to the case of bilateral monopoly to the case of competitive labor buyers. Which case obtains is an empirical matter and varies from labor market to labor market. Real-world labor market surveys confirm that individual firms do not typically perceive that they can cut wages or increase hours or intensity unilaterally without suffering costs from increased turnover or reduced hiring rates. But whatever the empirical case is, there's a mainstream model that addresses it in terms of degree of competitiveness. 3. Not so Marxian value theory, because values are based on "socially necessary labor time" (SNLT). And whether this is determined on the basis of "average" magnitudes, per Marx's own representation in V.I, chapter 1, or "some randomly determined point *within* the range", as you suggest, the fact that capitalists *as a whole* would gain by increasing the length of the working day, other things equal, or reducing the labor embodied in the wage bundle, other things equal, is necessarily *silent* with respect to the question of whether, given empirically relevant competitive conditions in markets for labor power, it would pay *individual* capitalists to do this. And if it's not profitable for any individual capitalist to pursue such strategies, it's not clear how Marx's value theory offers any empirically relevant insights. So on one hand, neoclassical theory places no *a priori* "limits to how much the capitalist *wants to* push the laborer, [or] limits to how much the laborer *wants to* resist", contrary to your suggestion, but does have the capacity, *unlike* Marxian value theory, to specify market conditions which limit how much a given capitalist *can* profitably push laborers, and how much given laborers *can* effectively resist. To the extent that such considerations are empirically relevant, this is an argument for the comparative superiority of mainstream theory over Marxian theory. 4. But in any case, since mainstream theory encompasses the scenario in which individual firms enjoy monopsony power and thus can set hours, intensity, and/or wage levels with relative impunity, Marxian theory at best adds nothing of net interest or insight to the empirical story, whatever one might think of the *normative* significance of the Marxian notion of capitalist exploitation.
I also enjoyed books by Ben Fine and Howard Botwinick which argued from different perspectives about how Marxian economics explains observed patterns of labor market segmentation better than neoclassical.
What's wrong with the existing mainstream theories of labor market segmentation? What empirical regularities with respect to this phenomenon are demonstrably better explained by Marxian theory relative to neoclassical theories based, e.g., on efficiency wages or bargaining power? For example, in the extensive empirical work of Dickens and Lang on dual labor markets, what part of their empirical results *requires* an explanation unique to Marxian value theory?
Of course, I'm sure Gil will disagree with me on most of this....
I'll be interested to hear what it is about the "law of value" that has unique explanatory power with respect to the phenomena discussed above.
