[p2p-research] p2presearch Digest, Vol 19, Issue 150

[Franz Nahrada]

sorry for just looking occasionally into this list, I feel that the shere
amount of postings makes it undreadable and proves there is no real focus.

I was just provoqued by Ryans posting to do a short comment on the Labor
Theory of Value


Ryan Langham  writes:

>It is typically taken by economists to be a pre-modern concept that is no
>longer very useful or insightful because simple observation in any number
>of
>types of economies proved it to be inaccurate.   People don't set values
>on
>the basis of contributed labor.

The Labour Theory of Value is not about value people *set*. Its rather a
property of the system and a natural law which is inflicted upon people,
like the law of gravity, and as the airplane is no proof against the law
of gravity the seeming "violations" of LTV can be explained and have been
explained best by nobody else but Marx himself. The popular image of Marx
is a curse, it seems many people talk about him but have not really read
him.
>
>
>Carl Menger, who was an Austrian forerunner of Friedrich Hayak, and I
>believe his teacher, is famous for critiquing the LTV--really taking it
>out
>of modern discussion.  That occurred in the late 1800s.

Here is a message from Austria, saying that there is more than one modern
discussion.
>
>Most who deal with these things would argue that prices are not determined
>by labor but by demand and supply. 

Marx had a very classic argument this: what determines the quantity of
value if demand and supply of a good are equal? 

The indifference curves and exchange relations of microeconomics are based
on given value, not expaining it.


> If prices were determined by labor,
>there would be little incentive to be efficient--a major problem with all
>authoritarian socialist economies which tend to produce things people
>don't
>want.  North Korea, Soviet Union, etc.  They didn't put things on store
>shelves that people wanted but that they could produce.  That's not very
>desirable to most people.

Thats an enormous blunder. Because prices are determined by the average
social labour, there is both:

* a penalty for those who work below average productivity  - the penalty
felt by authoritarian socialist economics who wantet to mingle with world
markets

* an incentive for those who produce above productivity to collect extra
surplus value. The reason why producivity is constantly boosted in
capitalistic economies without systemic considerations.

Far away from not being able to explain productivity, the LTV is the only
theory that really can explain it. And more than that: only the LTV
explains why capital even cares to become producing capital.

just my 2 cents.

Franz