Is price and value interchangable? - Page 7 - Politics Forum.org | PoFo

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#14948129
B0ycey wrote:If they are equal factors explain why both water and diamonds are not roughly the same price.


Because they are two very different items with different uses and importance to society. There are also very different ways to obtain and process them. These methods of obtaining and processing them will have different costs associated with them. There is also the generally perceived value of the items. Not to mention diamonds are run by a cartel too.

I don't see how you would think anything I said previously would even suggest that water and diamonds should cost the same. :?:
#14948130
Rancid wrote:Because they are two very different items with different uses and importance to society. There are also very different ways to obtain and process them. These methods of obtaining and processing them will have different costs associated with them. There is also the generally perceived value of the items. Not to mention diamonds are run by a cartel too.


You quote marginal utility and this is your answer? :lol:

But sure, a seller won't invest in a loss and that is reflected in price. That is fair statement. But now we are evolving this debate forward to microeconomics. And something I have not put a statement forward on as of yet.
#14948131
Rancid wrote:
I don't see how you would think anything I said previously would even suggest that water and diamonds should cost the same. :?:


Because you said that both supply and demand are equal variables in price.

So why does something that is in high demand have a lower price than something that is low in supply. To the buyer, he doesn't give a shit about how much the seller has invested in obtaining the item btw.
#14948162
B0ycey wrote:
You quote marginal utility and this is your answer? :lol:

But sure, a seller won't invest in a loss and that is reflected in price. That is fair statement. But now we are evolving this debate forward to microeconomics. And something I have not put a statement forward on as of yet.


Economics is a complex system with a large number of variables. I don't understand why you are having a hard time with this. Supply and demand is just one general concept/true within this system.

What is inconsistent about the concept of marginal utility, and then the varied costs to process and delivery different items like water versus diamonds? Can you explain how these two concepts are at odds with each other? I don't see it.

B0ycey wrote:Because you said that both supply and demand are equal variables in price.


I don't think I said that exactly. What i do know is that economics is complex, and there's a lot more to it than just supply and demand. Supply and demand is simply a first order variable in the pricing of something, but it's not the only set of variables that government price.
#14948166
Rancid wrote:Economics is a complex system with a large number of variables. I don't understand why you are having a hard time with this. Supply and demand is just one general concept/true within this system.

What is inconsistent about the concept of marginal utility, and then the varied costs to process and delivery different items like water versus diamonds? Can you explain how these two concepts are at odds with each other? I don't see it.


Has this got anything to do with what we have been debating?


I don't think I said that exactly.


I asked you what is the major factor in price, supply or demand. You said both. That is a ratio of 1:1.

I said supply. That is, if you lose half the supply of any product it will have a greater impact on price than if you lost half your customers. Your marginal utility notion back that up. So does comparing water and diamonds. So does OPEC cutting production of oil than customers turning to Electric cars etc etc etc.
#14948173
B0ycey wrote:I asked you what is the major factor in price, supply or demand. You said both. That is a ratio of 1:1.


I'm going to make this my last post on this specific matter because you're very dense and boring.

I think I said supply and demand are like space-time. They push and pull on each other. It's all context driven as to which one is more "important."

B0ycey wrote:I said supply. That is, if you lose half the supply of any product it will have a greater impact on price than if you lost half your customers. Your marginal utility notion back that up. So does comparing water and diamonds. So does OPEC cutting production of oil than customers turning to Electric cars etc etc etc.


Look, write an economics research paper about this, and turn the economics world on its head with your massive insight into this.

Have you taken a basic economics course? I'd like to see you argue this with your professors.
Last edited by Rancid on 22 Sep 2018 15:08, edited 1 time in total.
#14948178
Rancid wrote:I'm going to make this my past post because you're very dense.

I think I said supply and demand are like space-time. They push and pull on each other. It's all context driven as to which one is more important.


Rancid, perhaps understand what we are arguing about before the insults. Supply and demand are both needed to determine price. What I have mentioned is what variable is more important. That last time I asked you, you said both. So I will ask again. I am not asking whether both variable are needed, but which is more potent. Like salt in cake, sugar is more relevant in flavour in a cake.

Look, write an economics research paper about this, and turn the economics work on its head with you massive insight into this.

Have you taken a basic economics course? I'd like to see you argue this with your professors.


Maybe I have. But even if I haven't Adams has already written everything I am telling you through the Diamond-Water paradox anyway.
#14948185
B0ycey wrote:Then what have you been doing for two pages then?


Further exploring the concepts of value, & price of goods. That alone should have helped in showing how dumb of a question you are "debating" or "arguing" or whatever it is you're doing.
#14948187
Rancid wrote:Further exploring the concepts of value, & price of goods. That alone should have helped in showing how dumb of a question you are "debating" or "arguing" or whatever it is you're doing.


Then I don't know why you even entered the discussion with me. But I do understand that if do not even understand what you are talking about, insults are the losers approach to the debate. Perhaps you should read about marginal utility before trying to debate it. But sure, if I bore you just walk away.
#14948190
B0ycey wrote:Then I don't know why you even entered the discussion with me.


I was discussing, you were just arguing.

I think you entered into it with me. I think you were pigeon holing the discussion into this supply versus demand stuff. I think you were making the combative statement of "make your case!".

I was more interested in discussing the thread title. That is, if price and value are interchangeable. I managed to convince myself that they are not interchangeable. However, when the perceived values of seller and buyer on a good intersect and thus a transaction occurs, this means the price could be a decent/rough analog of value. This is all stuff I walked through previously.

You decided to keep pulling it back into this stupid supply being more important shit.

B0ycey wrote:insults are the losers approach to the debate.


I don't believe I insulted you directly. The "debate" and claim that "supply is more important to pricing than demand" is just stupid, uninteresting, and uninsightful. I'm pretty sure I previously posted I wasn't interesting in that discussion (because it's dumb).
Last edited by Rancid on 22 Sep 2018 15:37, edited 1 time in total.
#14948191
Rancid wrote:I was discussing, you were just arguing.

I think you entered into it with me. I think you were pigeon holing the discussion into this supply versus demand stuff. I think you were making the statement of "make your case!".

I was more interested in discussing the thread title. That is, if price and value are interchangeable. I managed to convince myself that they are not interchangeable. However, I when the perceived values of seller and buyers intersect and thus a transaction occurs, this means the price could be a decent/rough analog of value. This is all stuff I walked through previously.


Then you have reached your answer. But you were the one diverting the debate. Just go back and check.

I don't believe I insulted you directly. The "debate" about "supply versus demand" is just stupid, uninteresting, uninsightful.


Perhaps that was what everyone was discussing at the time when you came in. I do think you tried to enter it in some form, but maybe unintentionally. It has taken up most of this thread as well. So in good will, I think we should not discuss this part of the issue further as you think it is boring and I am getting frustrated in the lack of understanding we are having with each other.
#14948192
B0ycey wrote:Then you have reached your answer. But you were the one diverting the debate. Just go back and check.


I was responding to the thread title.

B0ycey wrote:So in good will, I think we should not discuss this part of the issue further as you think it is boring and I am getting frustrated in the lack of understanding we are having with each other.


sure
#15094392
@B0ycey
Know this is an old thread but I wanted to throw something into the ring as it seemed you were once interested and I'm trying to cut my teeth in comprehending some of the assertions about Marx whose supporters seem to be the only ones left asserting the existence of value and it's content as distinct from its form as price.

It was my understanding that the subjective theory of value by conflating prices or alternatively, exchange ratios (such as in a preference scale) with subjective desire for the use of a thing, such that one denies that value, as conceived as distinct from price, exists or assert that cannot be examined (too metaphysical for positivist research).
John Stuart Mill is the first to propose studying instead utility and price. Although later have the marginalist revolution which introduces is a garb of mathematics (calculus) who instead of investigating the relation between price and other phenomenon focused on the rate of change in price due to supply and demand.

And to be clear from the outset, supply and man definitely exists and it would be nonsensical to deny, but I suspect there are asserted reasons for suggesting that it is inadequate to understanding the motions of the capitalist economy ie the social relations as it possibly presupposes value due to it's an explanatory limitation, at least this is my take from Marxist summaries.

So, for example, we hear from Marx that whilst the equilibrium between supply and demand is rarely a reality, the very assumption of their equilibrium suggests their real value. Marx talks about prices being the quantitative form of value but not value itself of course.
https://www.marxists.org/archive/marx/works/1865/value-price-profit/ch01.htm#c4
But to consider matters more broadly: You would be altogether mistaken in fancying that the value of labour or any other commodity whatever is ultimately fixed by supply and demand. Supply and demand regulate nothing but the temporary fluctuations of market prices. They will explain to you why the market price of a commodity rises above or sinks below its value, but they can never account for the value itself. Suppose supply and demand to equilibrate, or, as the economists call it, to cover each other. Why, the very moment these opposite forces become equal they paralyze each other, and cease to work in the one or other direction. At the moment when supply and demand equilibrate each other, and therefore cease to act, the market price of a commodity coincides with its real value, with the standard price round which its market prices oscillate. In inquiring into the nature of that VALUE, we have therefore nothing at all to do with the temporary effects on market prices of supply and demand. The same holds true of wages and of the prices of all other commodities.

It's my impression that Marx thinks of Supply and Demand disciplining the needed labor of different industries, it is a feedback mechanism as different branches of industry receive varying profit and then reallocate labor.
https://kapitalism101.wordpress.com/2011/10/24/further-draft-of-subject-object/
In addition to producing at the average level of productivity, there also must be a demand for the products of labor if private labor is to become social. If too much private labor goes into the production of elevator music than there is demand for elevator music then some of this music will remain unsold and some of this private labor will not become social. Producers will be forced to move their labor elsewhere. But rather than this being an example of demand creating value, it is an example of how changes in demand effect the distribution of social labor. This is part of the phenomenon Marx is explaining in his theory of value: the labor of society is coordinated through the fluctuations of prices, a phenomenon only possible because there is a relation between prices and labor time.

As it's the only means for feedback in this indirectly social mode of production where the private labor becomes social labor only in having it's value realized on the market.
There is also another reason Marx seems to want to investigate deeper for the real value of things as distinct from price and that is because exchange in itself cannot create new value, even if on the individual level one tricks someone into paying more for something, this is simply a shifting of value around but doesn't change the total value in society as a whole.

https://www.marxists.org/archive/marx/works/1867-c1/ch05.htm
Abstractedly considered, that is, apart from circumstances not immediately flowing from the laws of the simple circulation of commodities, there is in an exchange nothing (if we except the replacing of one use-value by another) but a metamorphosis, a mere change in the form of the commodity. The same exchange-value, i.e., the same quantity of incorporated social labour, remains throughout in the hands of the owner of the commodity, first in the shape of his own commodity, then in the form of the money for which he exchanged it, and lastly, in the shape of the commodity he buys with that money. This change of form does not imply a change in the magnitude of the value. But the change, which the value of the commodity undergoes in this process, is limited to a change in its money-form. This form exists first as the price of the commodity offered for sale, then as an actual sum of money, which, however, was already expressed in the price, and lastly, as the price of an equivalent commodity. This change of form no more implies, taken alone, a change in the quantity of value, than does the change of a £5 note into sovereigns, half sovereigns and shillings. So far therefore as the circulation of commodities effects a change in the form alone of their values, and is free from disturbing influences, it must be the exchange of equivalents. Little as Vulgar-Economy knows about the nature of value, yet whenever it wishes to consider the phenomena of circulation in their purity, it assumes that supply and demand are equal, which amounts to this, that their effect is nil. If therefore, as regards the use-values exchanged, both buyer and seller may possibly gain something, this is not the case as regards the exchange-values. Here we must rather say, “Where equality exists there can be no gain.” [5] It is true, commodities may be sold at prices deviating from their values, but these deviations are to be considered as infractions of the laws of the exchange of commodities [6], which in its normal state is an exchange of equivalents, consequently, no method for increasing value. [7]

Hence, we see that behind all attempts to represent the circulation of commodities as a source of surplus-value, there lurks a quid pro quo, a mixing up of use-value and exchange-value. For instance, Condillac says: “It is not true that on an exchange of commodities we give value for value. On the contrary, each of the two contracting parties in every case, gives a less for a greater value. ... If we really exchanged equal values, neither party could make a profit. And yet, they both gain, or ought to gain. Why? The value of a thing consists solely in its relation to our wants. What is more to the one is less to the other, and vice versâ. ... It is not to be assumed that we offer for sale articles required for our own consumption. ... We wish to part with a useless thing, in order to get one that we need; we want to give less for more. ... It was natural to think that, in an exchange, value was given for value, whenever each of the articles exchanged was of equal value with the same quantity of gold. ... But there is another point to be considered in our calculation. The question is, whether we both exchange something superfluous for something necessary.” [8] We see in this passage, how Condillac not only confuses use-value with exchange-value, but in a really childish manner assumes, that in a society, in which the production of commodities is well developed, each producer produces his own means of subsistence, and throws into circulation only the excess over his own requirements. [9] Still, Condillac’s argument is frequently used by modern economists, more especially when the point is to show, that the exchange of commodities in its developed form, commerce, is productive of surplus-value.

For a summary: https://kapitalism101.wordpress.com/2012/04/05/value-cant-be-created-in-exchange/
So if we accept Marx's criticism that there can be no surplus or new value in exchange, that true to bougerosie equality and freedom, there is an equality of exchange in commodities, then there must be another thing which produces surplus value in order that capitalists can expand their capital.
And of course Marx's answer is the distinction between actual labor perform and labour-power, the wages to reproduce the worker's capacity to labor instead of the full price of his labor. To which I will make a small note that it is Ricardian Socialism, not Marx, due to the false conception of the embodiment of labour in an individual commodity as opposed to Marx's Socially Necessary Labor Time which leads to the conclusion that each individual worker has a right to the full value of his own labor. Marx's critique of Capitalism is much more radical and isn't recommending a bunch of individual producers for themselves but that capitalism socialized production and so too should it's products be socialized directly.

And then there is the issue of whether the theory of prices within the subjectivism camp can explain prices exactly, which appears to conflate use value and exchange value like Condilliac above so that they can speak vaguely of the 'profit' of one's utility/happiness muddling up the actual profit of the capitalist conceptually.
Because money and price seems to be neutral possibly in this thinking, its simply a more efficient means of exchange than barter and lost is any notion of the particularity of money within capitalist production and exchange. So that prices are reduced to the singular and abstract utility and thus erasing difference when it is quite an important part in our consumption to consider.
https://kapitalism101.wordpress.com/2011/08/18/bukharin-on-the-subjectiveobjective-value-debate/
The second thing I like about Bukharin’s point here is his critique of the “historical” defense of circularity. It could be argued that circularity of subjective value theory is not a theoretical problem because this pre-existing world of prices is itself the result of subjective decisions, and those decisions were based on a previous set of prices themselves the result of another past set of decisions, and so on, resolving the problem of circularity to merely a historical description of the movement of prices… Indeed Bohm-Bawerk uses such an approach to explain “substitution prices” and later the Austrian von Mises would use this historical method to create an Austrian theory of the value of money. Bukharin objects. He says that this is actually an abandonment of theory, replacing theory with mere idiographic depictions. Merely stating that events happen in historical succession does not prove anything about causation, does not prove any essential economic laws. (3)

https://kapitalism101.wordpress.com/2011/11/15/law-of-value-8-subjectobject/
When you are in the supermarket calculating your preference scales with the Preference App on your iPhone you aren’t just considering your preferences for fish and coconuts in the abstract, as if on a desert island. You are also considering the market prices of these commodities. This market price already exists before you make your subjective value judgements.

But this is problematic. Subjective valuations were supposed to explain price, but now we have to assume the prior existence of prices in order to explain subjective value judgements. It seems we are stuck in a big messy circle.

And if we are exchanging everything for money then we must have a utility for money right? But money has no direct utility. It’s not even good for blowing your nose on. The value of money is what it will buy. And this is not set by our preferences but instead reflects the relation of money to all other commodities, reflecting the vast interpenetration of millions of markets all over the world. There is no such thing as a personal utility for money because money’s value is already established by forces beyond our control. (3)

And there are more difficulties presented to subjective value theory by the presence of money. On Barter Island Eugene and Ludwig had direct knowledge of what they were getting from each exchange. But in our world we don’t know exactly how much everything is going to exchange for ahead of time. When we sell a product in the market we don’t know exactly what products we will be able to buy with that income. There is a high degree of uncertainty.


And there is also an inference for labor/power being the source of new value based on the contradiction of the commodity as both use and exchange value where to determine how we can compare entirely different use values requires a third thing in order for a quantity of value to be possible. A point of quality into quantity im not familiar of being explained in the subjectivist theory of value.
https://www.marxists.org/archive/marx/works/1865/value-price-profit/ch02.htm#c9
Besides, if I say a quarter of wheat exchanges with iron in a certain proportion, or the value of a quarter of wheat is expressed in a certain amount of iron, I say that the value of wheat and its equivalent in iron are equal to some third thing, which is neither wheat nor iron, because I suppose them to express the same magnitude in two different shapes. Either of them, the wheat or the iron, must, therefore, independently of the other, be reducible to this third thing which is their common measure.
To elucidate this point I shall recur to a very simple geometrical illustration. In comparing the areas of triangles of all possible forms and magnitudes, or comparing triangles with rectangles, or any other rectilinear figure, how do we proceed? We reduce the area of any triangle whatever to an expression quite different from its visible form. Having found from the nature of the triangle that its area is equal to half the product of its base by its height, we can then compare the different values of all sorts of triangles, and of all rectilinear figures whatever, because all of them may be resolved into a certain number of triangles.
The same mode of procedure must obtain with the values of commodities. We must be able to reduce all of them to an expression common to all, and distinguishing them only by the proportions in which they contain that identical measure.
As the exchangeable values of commodities are only social functions of those things, and have nothing at all to do with the natural qualities, we must first ask: What is the common social substance of all commodities? It is labour. To produce a commodity a certain amount of labour must be bestowed upon it, or worked up in it. And I say not only labour, but social labour. A man who produces an article for his own immediate use, to consume it himself, creates a product, but not a commodity. As a self-sustaining producer he has nothing to do with society. But to produce a commodity, a man must not only produce an article satisfying some social want, but his labour itself must form part and parcel of the total sum of labour expended by society. It must be subordinate to the division of labour within society. It is nothing without the other divisions of labour, and on its part is required to integrate them.

This leads into the poorly understood understanding of abstract labor as a real thing in capitalist production rather than an abstraction as simply a product of the mind because it isn’t a tangible sensory object.
For further elaboration: https://www.google.com/amp/s/kapitalism101.wordpress.com/2014/05/03/on-labor-as-the-substance-of-value/amp/

There is of course more to defending this but I think this does well enough to at least point in the direction of why one would infer value as distinct from price even if one doesn't agree with Marx's view of labor vs of labour-power which I think requires another set of debates in examining his logical deductions about the nature of man based in satisfying one's needs through labour and then examining the specifically historically contingent capitalist mode of production.
#15094821
@Wellsy, I have been spending my time on another forum recently as the user's there a much more up-to-date on current affairs than PoFo. I will still come on here to see if anyone has written anything interesting such as you have now from time to time. I only tell you this as my responses if directly aimed at me won't be as frequent as they once were.

As for this thread, I vaguely remember it. It is a shame VS isn't around anymore as Agora was always my favourite forum and there simply isn't the users who care about philosophy like you do now and he did then. But my understanding on price and value is down to the diamond water paradox and not Marx as his writings on the matter were conclusions for explaining alienation and oversupply. But that isn't to discard anything he says on the subject as he was indeed true and I cannot fault the quotes and conclusions that he wrote that you have provided.

It was my understanding that the subjective theory of value by conflating prices or alternatively, exchange ratios (such as in a preference scale) with subjective desire for the use of a thing, such that one denies that value, as conceived as distinct from price, exists or assert that cannot be examined (too metaphysical for positivist research).
John Stuart Mill is the first to propose studying instead utility and price. Although later have the marginalist revolution which introduces is a garb of mathematics (calculus) who instead of investigating the relation between price and other phenomenon focused on the rate of change in price due to supply and demand.


I wouldn't really dismiss the principle that utility is a factor in value, but it hasn't got the same forces behind it as in regards to price. That is to say you might desire something more if you cannot possess it and as such some people might attach value to that desire. But I would say that desire would be more of a factor in what you are prepared to pay for that possession and if you cannot afford something you will instinctively value what you are able to possess more instead. In other words, you might desire a Porsche and would pay more for that desire than you would for own car at home, but because you can only drive your car due to it being what you can afford, you care more about that car being vandalised than some showroom Porsche.

And to be clear from the outset, supply and man definitely exists and it would be nonsensical to deny, but I suspect there are asserted reasons for suggesting that it is inadequate to understanding the motions of the capitalist economy ie the social relations as it possibly presupposes value due to it's an explanatory limitation, at least this is my take from Marxist summaries.

So, for example, we hear from Marx that whilst the equilibrium between supply and demand is rarely a reality, the very assumption of their equilibrium suggests their real value. Marx talks about prices being the quantitative form of value but not value itself of course.
https://www.marxists.org/archive/marx/works/1865/value-price-profit/ch01.htm#c4

It's my impression that Marx thinks of Supply and Demand disciplining the needed labor of different industries, it is a feedback mechanism as different branches of industry receive varying profit and then reallocate labor.
https://kapitalism101.wordpress.com/2011/10/24/further-draft-of-subject-object/


On this regard, this is an issue with Capitalism, or to be more specific over production. Where the forces of Supply and demand are manipulated by producing more than we need. This only supports the notion that they are interchangeable so I would agree. Although on this point I believe Marx was trying to argue in terms of the labor we need to excert in order to understand the true value of something and not necessary that supply determines value.

As it's the only means for feedback in this indirectly social mode of production where the private labor becomes social labor only in having it's value realized on the market.
There is also another reason Marx seems to want to investigate deeper for the real value of things as distinct from price and that is because exchange in itself cannot create new value, even if on the individual level one tricks someone into paying more for something, this is simply a shifting of value around but doesn't change the total value in society as a whole.


I totally agree with what Marx wrote. And again addresses why price changes. There is a sense in his writings on emotional attachment to the value of something being lost when producing for someone else - which is true. But that is because it is the labor that is of value to the worker and not the attachment of something he will not ever use.

So if we accept Marx's criticism that there can be no surplus or new value in exchange, that true to bougerosie equality and freedom, there is an equality of exchange in commodities, then there must be another thing which produces surplus value in order that capitalists can expand their capital.
And of course Marx's answer is the distinction between actual labor perform and labour-power, the wages to reproduce the worker's capacity to labor instead of the full price of his labor. To which I will make a small note that it is Ricardian Socialism, not Marx, due to the false conception of the embodiment of labour in an individual commodity as opposed to Marx's Socially Necessary Labor Time which leads to the conclusion that each individual worker has a right to the full value of his own labor. Marx's critique of Capitalism is much more radical and isn't recommending a bunch of individual producers for themselves but that capitalism socialized production and so too should it's products be socialized directly.


I would agree with your conclusion in regards to surplus labor being a factor in the price of an item. And that additionally profit is required to determine the true value of his labor in regards to the price of that item which won't reflected in his paycheck. But it doesn't really address the value of things. Air for example doesn't require any labor. Its abundance make the price of air as zero. Yet what value do you put to air where oxygen is required to keep you alive?

And then there is the issue of whether the theory of prices within the subjectivism camp can explain prices exactly, which appears to conflate use value and exchange value like Condilliac above so that they can speak vaguely of the 'profit' of one's utility/happiness muddling up the actual profit of the capitalist conceptually.
Because money and price seems to be neutral possibly in this thinking, its simply a more efficient means of exchange than barter and lost is any notion of the particularity of money within capitalist production and exchange. So that prices are reduced to the singular and abstract utility and thus erasing difference when it is quite an important part in our consumption to consider.
https://kapitalism101.wordpress.com/2011/08/18/bukharin-on-the-subjectiveobjective-value-debate/

https://kapitalism101.wordpress.com/2011/11/15/law-of-value-8-subjectobject/


By and large I would agree that money and price are merely a method to find value in exchange. That is to say exchange value and not value itself. Where the simplicity of exchange is more quantifiable with a medium such as currency and that exchange is done by something we know as price. But again it doesn't determine value. Money is after all a concept. If it didn't exist you would still value water over diamonds because of necessity over greed. But due to the abundance of water and rareity of Diamonds, you would still exchange more for the possession diamonds than something you can get yourself down the river.

And there is also an inference for labor/power being the source of new value based on the contradiction of the commodity as both use and exchange value where to determine how we can compare entirely different use values requires a third thing in order for a quantity of value to be possible. A point of quality into quantity im not familiar of being explained in the subjectivist theory of value.
https://www.marxists.org/archive/marx/works/1865/value-price-profit/ch02.htm#c9

This leads into the poorly understood understanding of abstract labor as a real thing in capitalist production rather than an abstraction as simply a product of the mind because it isn’t a tangible sensory object.
For further elaboration: https://www.google.com/amp/s/kapitalism101.wordpress.com/2014/05/03/on-labor-as-the-substance-of-value/amp/

There is of course more to defending this but I think this does well enough to at least point in the direction of why one would infer value as distinct from price even if one doesn't agree with Marx's view of labor vs of labour-power which I think requires another set of debates in examining his logical deductions about the nature of man based in satisfying one's needs through labour and then examining the specifically historically contingent capitalist mode of production.


It is interesting to see that even using the ideas of production, the same conclusion can be reached. As I said, there is nothing that Marx has said that I don't disagree with. But it is almost impossible to explain value in production. That is it is Labor itself that is value to an individual and not the item he makes with his labor. So to try and explain a link to production and surplus labor to price and value and whether they are interchangeable might explain why price changes depending on the production of quanity made but not the value itself. For that you have will have to look the Labour theory of value done by contemporarys before Marx as Marx has merely used their ideas to reach a conclusion rather than explain why price and value are interchangeable.
#15095004
This is a bit rushed and like a lot of my posts you’ll probably notice I reach the limit of my own understanding and resort to speculation and merely point in a direction of interest as I can’t explain it.
B0ycey wrote:@Wellsy, I have been spending my time on another forum recently as the user's there a much more up-to-date on current affairs than PoFo. I will still come on here to see if anyone has written anything interesting such as you have now from time to time. I only tell you this as my responses if directly aimed at me won't be as frequent as they once were.

As for this thread, I vaguely remember it. It is a shame VS isn't around anymore as Agora was always my favourite forum and there simply isn't the users who care about philosophy like you do now and he did then. But my understanding on price and value is down to the diamond water paradox and not Marx as his writings on the matter were conclusions for explaining alienation and oversupply. But that isn't to discard anything he says on the subject as he was indeed true and I cannot fault the quotes and conclusions that he wrote that you have provided.

I understand and I am patient. If we continue this conversation and it doesn’t get too time consuming for you, it’d probably still be a bit of fun to see how it goes and hear your thoughts as I like to bounce them off of you. You make for actual and good conversation.

Oh so you were wanting to examine the explanations for why water is so cheap comparatively to diamonds.
I wouldn't really dismiss the principle that utility is a factor in value, but it hasn't got the same forces behind it as in regards to price. That is to say you might desire something more if you cannot possess it and as such some people might attach value to that desire. But I would say that desire would be more of a factor in what you are prepared to pay for that possession and if you cannot afford something you will instinctively value what you are able to possess more instead. In other words, you might desire a Porsche and would pay more for that desire than you would for own car at home, but because you can only drive your car due to it being what you can afford, you care more about that car being vandalised than some showroom Porsche.

I think utility only relates to use-value which is something that isn’t specific to Capitalist production but is true of humanity’s labor upon nature throughout human history. To which we have created new needs that aren’t natural in the sense that they were a given from nature but are our own making even if we don’t understand how they work ie the need for money.
Indeed, the crude impression I take from Lacanian view of desire is that it is excessive, that you can get what you need but not what you want. That the starving man imagines not just bread and butter to survive but the most lavish of food and in mass amounts. It’s the difference between wanting water to quench your thirst and wanting a coke or pepsi. It goes beyond need.

I would wonder how one’s sense of money and what it affords continues throughout one’s life and what one desires. Like my father’s upbringing in intense poverty has given him a persistent anxiety about losing it, my brother in-law was adamant of buying a house because he was moved around so much when his family couldn’t afford rent. And just now I’m purchasing a watch so I can keep the time at work throughout the facility and I resisted the more expensive watch, keeping in mind not just the item itself but the price because I didn’t feel like the object justified the money for it based on my sense of how much money I have and like to spend it, although could easily afford it.

And I’ve seen a point made that the desires we have are very situated in a structural way despite the asserted conflation between what the capitalist and worker desires when they come to market. The point being that we know when a worker gets extra cash there are very clear needs/wants that they’ll realize with their money compared to a capitalist reinvesting in their business or purchasing luxury goods. Not sure if it is the case, but apparently neoclassical economics doesn’t distinguish this sort of thing as it doesn’t identify classes but individuals in a atomistic sense and presumes the rationality of capitalist relations in the psychology of the individual rather than social beings within the particular relations of capitalist production.

But in regards to being willing to pay for more for what you desire, I would think it interesting to investigate how certain status items become so expensive although they don’t seem to be that much more elaborate than other products on the market. Like Air Jordans or Dre’s Beats or even iphones these days.
https://www.marxists.org/glossary/terms/l/a.htm
Nowadays, many people say that “Marx’s theory of value is out of date” by which one can presume is meant “value is no longer determined by the quantity of labour-time required for its production”, for Marx only claimed to describe the dynamics of social relations of the bourgeois society of his day, not to have constructed an eternal scientific theory. The question remains though: is labour-time now irrelevant to value determination? Have we changed our values in this respect?

For example Nike shoes, produced by sweated labour in “free trade zones” by people who do not earn enough in a week to buy one pair of the shoes they produce in five minutes, while Michael Jordan is paid more than the entire Indonesian labour force for lending his name to the product.

Firstly, integral to this trick is maintaining the separation between the workers in these countries and workers in the country where the shoes will be consumed. The act of exchange is an act of measuring the value of one person against that of another. Within bourgeois society “the notion of human equality has already acquired the fixity of a popular prejudice” but it is a fact that this notion does not yet extend from an imperialist country to people in the “Third World”.

“The secret of the expression of value, namely, that all kinds of labour are equal and equivalent, because, and so far as they are human labour in general, cannot be deciphered, until the notion of human equality has already acquired the fixity of a popular prejudice. This, however, is possible only in a society in which the great mass of the produce of labour takes the form of commodities, in which, consequently, the dominant relation between man and man, is that of owners of commodities. [Capital, Chapter 1]

The labour of an animal or a slave and equally that of a distant foreigner is consumed as such, adding value according to the cost of acquiring it, and does not create labour. Insofar as these countries become part of the same market and merge with the working class of the imperialist countries and enjoy the same rights and standard of living, then this aspect of the issue will disappear.

Further however, Intellectual Property laws ensure that it is not possible for anyone else to make a Nike shoe – a sneaker, for all intents the same, but a copy, not a Nike, not a sneaker with the Nike brand name. Consequently, the equivalence of labour, of the content of socially necessary labour, is indeterminate. Adam Smith put it:

“What everything is really worth to the man who has acquired it, and who wants to dispose of it or exchange it for something else, is the toil and trouble which it can save to himself”,

and if there is no way of getting a Nike shoe other than buying one off Nike, then the question is: exactly what need is being fulfilled by buying a Nike shoe? What other equivalent means is there of satisfying this need? Obviously it is not a need that can be fulfilled by just any sneaker, and:

“A commodity is, in the first place, an object outside us, a thing that by its properties satisfies human wants of some sort or another. The nature of such wants, whether, for instance, they spring from the stomach or from fancy, makes no difference” . [Capital, Chapter 1]

So the fact is that the young person who purchases a Nike sneaker is paying not for the few minutes of labour involved in gluing together the pieces of rubber and plastic, but for the “image” or “aura” surrounding the Brand name which is far more costly.

So it would seem that the claim that the labour theory of value is no longer applicable is misguided; what has changed is the nature of human needs, which in this postmodern world, are very different from what those of the world in which life hinged more around food, warm and security than image, and the manner of their satisfaction. For example, if one determined the value of two hours spent in a cinema watching Moulin Rouge without taking account of the complex emotional and cultural qualities of the images and story line of the movie, and the labour-time involved in producing that, it would be quite impossible to understand what the moviegoers were paying for.

This I don’t quite understand although I get the change in the human needs but not the relationship exactly of how people’s different labour is socially valued. Like how back in the day a woman or a black person’s labor wasn’t socially equivalent to that of a white man until there were the liberation struggles. There is still a status effect from a lot of the divide despite formal equality in law but that there could be such disparity between the value of labor between some peoples not based on education/skills and such is not understood by me or how exactly the new need for fancy shoes acquires such high value.
Wonder what your take might be on this dynamic of brands and celebrity image making something more expensive because it satisfies a social want/need as opposed to a biological need.

On this regard, this is an issue with Capitalism, or to be more specific over production. Where the forces of Supply and demand are manipulated by producing more than we need. This only supports the notion that they are interchangeable so I would agree. Although on this point I believe Marx was trying to argue in terms of the labor we need to excert in order to understand the true value of something and not necessary that supply determines value.

Well as far as I can tell from summaries of Marx, supply and demand are merely a means to change the allocation of labour within the division of labor within society. It is a signal after the capitalist’s commodities have either succeeded or failed to realize their value on the market of what they should do in their next production cycle.


I totally agree with what Marx wrote. And again addresses why price changes. There is a sense in his writings on emotional attachment to the value of something being lost when producing for someone else - which is true. But that is because it is the labor that is of value to the worker and not the attachment of something he will not ever use.

Well that is the alienation part, you don’t go to work of your own drive to do the actual work itself necessarily but in order to get a paycheck so you can then do and get the things you actually want. This is an indifference to what one produces at work because it is the capitalist’s product. Although I think this gets more complicated where some people do find work somewhat satisfying even amidst some of its stifling elements, where they do derive some intrinsic satisfaction from the particular task itself whilst also getting paid. This is that balance between being paid enough and work that is satisfying enough to feel like you’re doing something humanly worthwhile and as such take pride in one’s work.


I would agree with your conclusion in regards to surplus labor being a factor in the price of an item. And that additionally profit is required to determine the true value of his labor in regards to the price of that item which won't reflected in his paycheck. But it doesn't really address the value of things. Air for example doesn't require any labor. Its abundance make the price of air as zero. Yet what value do you put to air where oxygen is required to keep you alive?

Well yes the use-value of air is immense and is a natural given from earth, something noted by Marx. And you ofcourse come to desire it greatly as you no longer able to breathe.
https://www.marxists.org/archive/marx/works/1867-c1/ch01.htm
The use values, coat, linen, &c., i.e., the bodies of commodities, are combinations of two elements – matter and labour. If we take away the useful labour expended upon them, a material substratum is always left, which is furnished by Nature without the help of man. The latter can work only as Nature does, that is by changing the form of matter.[13] Nay more, in this work of changing the form he is constantly helped by natural forces. We see, then, that labour is not the only source of material wealth, of use values produced by labour. As William Petty puts it, labour is its father and the earth its mother.


Although in terms of something actually coming to market for trade, this is where things like the diamond/water and stuff whilst seemingly natural products take a lot of effort. To drink water from a random puddle or stream is free, but to put in the infrastructure or transport in bottles and so on requires labor, just as wood whilst natural requires labor to transform a tree into the wood. In fact one could labor as such for one’s own need without ever entering the market such as with farmers who own their own means of production and land and thus can provide for themselves. But exchange-value never enters because it’s purely for the use-value and not for trade in which it has to equalize with other commodities in some way in order to be comparable for trade.

I think more and more perhaps you’re interested in the psychological interest of why something acquires a use value which might make it interesting as to why somethings on the market acquire a value where they seem quite useless in a practical sense but they do meet some social need whether as luxury items and the sort. Like how do certain social needs develop in human beings which haven’t existed in the outset and how we then go onto satisfy those needs through our labor upon nature and within very particular production and social relations.
By and large I would agree that money and price are merely a method to find value in exchange. That is to say exchange value and not value itself. Where the simplicity of exchange is more quantifiable with a medium such as currency and that exchange is done by something we know as price. But again it doesn't determine value. Money is after all a concept. If it didn't exist you would still value water over diamonds because of necessity over greed. But due to the abundance of water and rareity of Diamonds, you would still exchange more for the possession diamonds than something you can get yourself down the river.

Indeed, the price is a signal that should approximate or serve as a proxy of a things value although it isn’t value itself but a quantitative form of value. And indeed, there would be no thought of price and exchange values without a market or without a currency such as money which has become so universal that all commodities are put in relation to it.


It is interesting to see that even using the ideas of production, the same conclusion can be reached. As I said, there is nothing that Marx has said that I don't disagree with. But it is almost impossible to explain value in production. That is it is Labor itself that is value to an individual and not the item he makes with his labor. So to try and explain a link to production and surplus labor to price and value and whether they are interchangeable might explain why price changes depending on the production of quantity made but not the value itself. For that you have will have to look the Labour theory of value done by contemporarys before Marx as Marx has merely used their ideas to reach a conclusion rather than explain why price and value are interchangeable.[/ QUOTE]
Again I think with your point about the value of labor itself as distinct from the object sounds like you’re interested in the very contradiction Marx identified in the commodity and and wished to explore where it is both a natural and social product and where value seems to be a social relations although not solely that as it is based in material relations of productions also.
So the use-value of things is very critical, they must satisfy a human need and want otherwise they’re without value, but the social relationships organized within the relations of production seem to play some part in establishing value as the unity of use-value and exchange-value.
https://www.marxists.org/archive/pilling/works/capital/pilling5.htm#Pill7

https://www.marxists.org/archive/pilling/works/capital/ch04.htm#4.5

And this is the very complex and dialectical part of Marx’s work it seems, he doesn’t one sidedly emphasize commodity’s as the creation of use-values and meeting human needs but he doesn’t one sidedly emphasize the exchange value of commodities either, where the value is some sort of suprasensous embedded in material things such that we confuse ideal properties within material objects as belonging to the objects themselves or we simply disavow them as in the case of those who describe money as solely an imaginary sign of value in recognizing it has no use-value in itself but losing sight of the real world relations which allow it to constitute the form of value and dictate production.
[url] https://www.marxists.org/archive/ilyenk ... /ideal.htm[/url
Evald Ilyenkov’s summary of ideality is quite pivotal to this in the sense that the social connections and activity that underpin a thing give it’s ideal character such that it’s not the whim of an individual mind and can’t be wished away. People attempt to articulate this in talking about our collective agreement and imagination to give money value but it’s not dependent on anyone’s will but in the relations which already govern our lives and we are born into. Money really does have value within our system as much as the ancient gods were quite real to the people who believed in them and not in terms of something of their mind but a product of the society, something above any individual consciousness.

To which in trying to explore the social relations and relations of production, the unity of material forms with their ideal qualities and so on, Marx didn’t subscribe to a labour theory of value as the predecessors exactly as much as he criticized them and the reification of their concepts hiding the real relationships which give meaning to their categories of political economy.

Something at the moment I’m looking to explore further is the connection between labor, exchange value and value as there is a connection established between these which isn’t clear as it’s got the Hegelian dialectical method underpinning it.
https://www.marxists.org/archive/rubin/abstract-labour.htm

I’m seeing more the relevance of Ilyenkov’s point about ideality and how the essence of things is based in social relations and can’t be found by abstracting a material object from its real world relations because it then simply becomes an empty sign. And it’s still not clear to me how labour determines value exactly.

And it does seem that Marx has some very nuanced distinctions which can appear to be the same as use-value is often confused as exchange-value or ignored in many thinkers and then he sometimes even speaks of value when speaking of exchange vale although it is the unity of use-value and exchange-value. Then there is “the form of value, the substance of value and the magnitude of value.”
But all this gets way over my head and seems I just have to study Marx really and enter the debates once I’ve stablished some familiarity.
#15101305
Think this is an interesting point in distinguishing value from exchange value and having intuitive explanatory value. Where as emphasis on exchange value only pretty much ignores the question of how such an equivalence of value is possible.

https://kapitalism101.wordpress.com/2014/04/28/intrinsic-value/
Throughout the opening chapter of Capital Marx jousts with many intellectual opponents, not all of whom are immediately named. One of these is Samuel Bailey. (cite Rubin, Kliman.) In Bailey’s “Critical Dissertation”, published in 1825, he sets out to clear up the mess of confusion associated with the concept of value in economics. He does so by arguing against any notion of an intrinsic value possessed by commodities. Rather, for Bailey, value is nothing more than the fleeting and temporary exchange value a commodity has when it finds itself being exchanged for another commodity. Following Adam Smith Bailey defines value as “the power of purchasing other goods.” (p.11)

“According to this definition, it is essential to value, that there should be two objects brought into comparison. It cannot be predicated of one thing considered alone, and without reference to another thing. If the value of an object is its power of purchasing, there must be something to purchase. Value denotes consequently nothing positive or intrinsic, but merely the relation in which two objects stand to each other, as exchangeable commodities.” (Bailey p. 11)

Bailey is setting up a clear dichotomy between a notion of intrinsic value in which value is something belonging to the commodity in isolation from other commodities, apart from and prior to exchange, and a relative notion of value in which value is only something that exists through the relation of one commodity to another. Since in everyday life we measure the values of commodities in their relation to one another (so much of A is worth so much of B) Bailey advocates for this second, relational notion of value and rejects the intrinsic notion.

This leads to some interesting conclusions. Because value is only relational for Bailey, not intrinsic to the commodity, the value of A is whatever it is exchanged with. If today A exchanges for 2B then 2B is the value of A. If tomorrow A exchanges for 4B then 4B is the value of A. An intrinsic theory of value would say that perhaps the value of A has stayed the same while the value of B has changed or that the value of A has changed while the value of B has stayed the same, or even that both values have changed. But for Bailey this makes no sense. There is no intrinsic value of A or B that can stay the same or change. The value of A is only its exchange value with B at the moment of being exchanged. It has no value of its own before or afterwards.

Examining how this might relate to the classical labor theory of value Bailey asks the reader to consider a quantity of corn, the value of which is determined by the labor time required to produce it. What happens if the labor time required to produce the corn stays the same while the labor time of all other commodities changes? Even though the corn’s labor time has remained the same it will exchange for a different quantity of other commodities. It will form new exchange ratios every time the labor time of other commodities change. Thus its “value” changes even though the labor time that it takes to make the corn has not changed. Here Bailey is attempting to prove that value is not an intrinsic aspect of commodities because exchange ratios are inherently relational. Since a ‘value’, as he defines it, is nothing more than a relation between two commodities, it cannot, by definition be the property of one commodity outside of this relation. [This is a repetition of the previous paragraph, but perhaps still helpful.]

Marx sets out to argue the exact opposite of Bailey. Marx argues that value is an intrinsic property of commodities and, at the same time, its also a relative concept. How is this possible?

The key theoretical move that makes this possible for Marx is to distinguish between value and exchange value. Value is intrinsic to commodities. It is the amount of labor time society requires to produce the commodity. If a widget takes 2 hours to produce then its value is two hours. Exchange value is the ratio in which one commodity exchanges for another. If a widget exchanges for 3 apples then 3 apples is the exchange value of the widget. If the widget exchanges for 30 pencils then 30 pencils is the exchange value of the widget. What then is the relation between value and exchange value?

Similar to Bailey’s conception each different pairing of the widget with a different commodity produces a different exchange value. However where Bailey sees in this nothing but random, fluctuating, relativist values, Marx argues that each of these exchange values is a reflection, a measure of an intrinsic value.

Marx’s argument is quite simple actually. If we say that commodity X is equal to commodity Y this means, by definition, that they both contain quantities of a common substance/property. Just as the comparison of physical properties like weight, volume and height is only possible if both objects share the same property, the comparison of economic value is only possible if both commodities possess an intrinsic value. [footnote: there are debates as to the validity of Marx’s argument. Kliman provides a stellar defense of Marx in his paper “The 4th thing on the 3rd Thing”. I will not repeat those arguments here.]

When we say that commodity X is equal to commodity Y this implies that they are both made up of the same substance, value, and that their values are of the same magnitude. We cannot see the value of X by looking at it in isolation. Commodities do not walk around with their values ‘stamped on their heads.’ Instead we only see the value of X when it stands in relation to Y. Y measures the value of X. X is worth so much Y. The same is true if we measure the weight of an object. A piano has a weight of its own that does not depend on other objects. But we can only measure the piano’s weight in relation to some standard unit of weight, a pound or kilogram. This unit of weight, the pound, is always defined in relation to an actual object, arbitrarily chosen to be the standard.

Bailey had argued that the value of X cannot change without also meaning a change in value for Y. Look at how Marx’s distinction between value and exchange value allows us to see the problem differently. Both X and Y have an intrinsic value. Let us imagine that the value of Y changes while X stays the same. This variation in the value of y produces different exchange values (x=y, x=2y, x=3y, etc.) The intrinsic value of X does not change but its exchange value does change! Various quantities of Y are expressing the value of X.

I believe that this way of understanding value is much more intuitive and inline with common sense. Consider the effect of inflation on the value of a widget. If I sell widgets for $10 and a decade later the value of the dollar falls by 50% I will adjust the price of the widget to $20. Has the value of the widget changed? Are widgets worth more to society? Not at all. All that has changed is the value of the unit by which we measure the value of the widget.

Marx’s argument that commodities have an intrinsic value is immediately followed by his argument as to what this value is and what determines the magnitude of this value. His answer is that value is objectified human labor and that living labor determines the magnitude of this value. Often discussion/debate immediately jumps to this issue of whether or not labor is the substance of value, skipping over the important implications of the notion of intrinsic value. We will deal with the notion of labor as substance of value in the next chapter. For the remainder of this chapter we will examine some of the important implications of Marx’s notion of intrinsic value
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