Marx

http://www.lrb.co.uk/v34/n07/john-lanchester/marx-at-193

this is good

What's that Engels quote (I *believe* it is Engels) that essentially goes: "one man wants one thing and another man wants another thing. They both struggle and they both get something else entirely in the end. That is history."

it's put a bit better than that.

What are (1) the best brief explanations of his theory of value and (2) the best critiques of it?

I'm for some strange reason reading Capital, but I'm struggling a bit with the concept of socially necessary labor time as the source of value, which strikes me as pretty much the key to the whole thing.

you've understood it

(i.e, it is as silly as it sounds)

Does it just mean cost of production?

Or I guess rather average cost of production?

I guess the thing is there has always been something about neoclassical theories of value (at least in the very crude form I understand them - haven't thoroughly studied econ or anything) that strike me as incomplete and self-serving of capitalists, and Marx is saying that at least the theories of value prevalent at his time were in fact incomplete and self-serving of capitalists, but I guess maybe Marx, while advancing the ball in a lot of ways, got some things wrong? I wish I had studied econ.

Like the whole version of things in which capitalists are compensated for "risk" always struck me as a misnomer -- it seems to me more that they are compensated for the very fact that they have capital (which I guess equates to what Marx calls the means of production). And neoclassical/neoliberal theories don't seem to want to account for or care much about how or why capitalists got their capital, almost presuming that they must deserve it on their merit. And it seems like that relates to what Marx was critiquing in the theories of his time, but I still can't quite get my mind around the socially necessary labor time concept.

Or rather I think I get what Marx is saying it is, but I'm not sure I understand how/why it's the true center of value according to him.

I'll teach you economics, Hurting

I did a big push to grok marxist economics a year and a bit ago before basically deciding it was a shell game/dead end. At work now but I'll write up some thoughts this weekend and bump the thread. LTV and Cambridge Capital Controversy are both pretty weird niggling things for left econ ppl to be hung up on and I think most sane people have rightly moved on.

I dug the explanation of Marx used in Michael Goodwin's Economix

http://economixcomix.com

But I can't find the page where they describe it in graphic novel form

flopson who do you consider worth reading from a left economics perspective that is not hung up on these not-worth-being-hung-up-on things? Or do you not like lefty economists?

i thought this might be a revive about marx attacking his arse boils with a pair of scissors

my lefty economist bros

Suresh Naidu

doesn't tend to stick his neck out in public debates much, but has written prob the only worthwhile economics content in Jacobin: https://www.jacobinmag.com/author/suresh-naidu/ hopefully once he gets tenure he'll write more or join twitter

Arindrajit Dube

not a blogger or pundit but writes stuff sometimes; his research bestowed a LOT of legitimacy to state minimum wage hikes (he presented that research before congress https://www.youtube.com/watch?v=ABM0_L_5vLw)

JW Mason

often disagree with him but worth reading http://jwmason.org/the-slack-wire/

Chris Dillow

this guy is fucking amazing imo. writes a lot about british politics http://stumblingandmumbling.typepad.com/

Marshall Steinbaum

this guy is kind of annoying to me but worth having around. recently got fired from berkeley's washington center for equitable growth but was immediately picked up by roosevelt institute where he's been doing good shit off the get go such as http://rooseveltinstitute.org/demand_side_dynamism/

http://steinbaum.blogspot.ca/
https://twitter.com/econ_marshall

xp- RE: ass boils; i'm still searching for that reference since James tipped me to that

What is that black monolith thing and why is this the second time it's shown up in an ilx post for me today?

site having problems loading youtube video is my guess?

i think thats what youtube embed with the https left in look like now? i was hoping it just wouldn't embed

https://www.youtube.com/watch?v=ABM0_L_5vLw

aha

ok im not the only person having that problem either then

Has anybody read any of Dierdre McCloskey's stuff? I've seen her mentioned positively elsewhere, but all the bits I've encountered seem libertarian-y.

that's because she's a libertarian

I'm only on chapter 4 of Capital so far. The Harvey lectures are very helpful. It's gonna take me forever to finish, but I do find a lot of it interesting, useful and insightful whether or not the LTV really works. Also seeing the source of a lot of received ideas I got just growing up in a left-leaning family.

that's because she's a libertarian

Ah well then I guess that sorts that out.

McCloskey's secret sins of economics is good. The libertarian stuff is easy to filter out.

Or rather I think I get what Marx is saying it is, but I'm not sure I understand how/why it's the true center of value according to him.

― socka flocka-jones (man alive), Thursday, August 11, 2016 12:08 PM Bookmark Flag Post Permalink

if i can reconstruct this from memory:

he doesn't say its the source of all value. he says its the source of _some_ value but _all_ profit. but he says also that its a common _measure_ of value. which is to say that two goods put into exchange are incomparable outside of the exchange in a general social way. they become comparable to the extent they're valued in a single universal commodity, money. but what's the way in which disparate things can be valued in a single common way? what does that market price represent? just... itself? or is there some other way to say why some things have some prices, and others have other prices. and the argument goes that there's another "universal" element lying about in aggregate which market values of other things factor through -- labor power, which is a universal factor of production as much as cash is a universal factor of exchange. and so one can go through and sort of work out a "socially average labor hour" and see the price of goods in the market as being to some degree reflective of the socially average labor hours that went into them in toto (and factoring through their constituent bits and the wear on machinery in their production etc), in aggregate. but again, in so doing we also need to look at other components of their value that might not accrue through expenditure of labor, but rather through "rents" etc. and that becomes a whole other complicated thing because we want to think of those rents again in terms of their value as somehow determined vis a vis labor power.

In one passage, Marx set out to answer a puzzle. Changing levels of supply and demand explain why the price of a commodity goes up or down, but does not explain why the equilibrium price of that commodity is what it is. For instance, why are strawberries pricier than apples?

To solve the puzzle Marx relied on the “labour theory of value”. He helped prove that the price of a commodity was determined by how much labour time had gone into it—which showed how workers were exploited. However, he “arbitrarily ruled out the relative desirability or utility of commodities,” says Mr Stedman Jones, which would strike most people as the obvious explanation. The author encapsulates a feeling of many students of Marx: read the dense, theoretical chapters of “Capital” closely, and no matter how much you try, it is hard to escape the conclusion that there is plenty of nonsense in there.

that last part sentence describes my experience exactly

from The Economist's review of the Steadman biography

http://www.economist.com/news/books-and-arts/21705665-value-marx-21st-century-false-consciousness?fsrc=scn/tw/te/pe/ed/falseconsciousness

I get the impression that the "socially necessary" part of socially necessary labor time is supposed to help account for desirability. However so far it feels like he's buried that concept and not explained it much, especially compared to how methodically and almost painfully he has fleshed out other concepts. Maybe he comes back to it later?

Maybe he comes back to it later?

*rueful laughter slowly morphs into sullen stare into the abyss of time irretrievably lost asking myself this very question*

https://media.giphy.com/media/Ic97mPViHEG5O/giphy.gif

lol

I think also what's missing from that critique is that according to Marx a higher price for the more "desirable" commodity can't be sustained (assuming equal cost of production) because the more profitable one will attract more investment until competition erases the profit differential. So if strawberries are really considered yummier than apples, but they do in fact take the exact same amount of labor to produce and transport to market (which I doubt is true), more capital will be attracted to strawberry growing until competition among strawberry growers forces prices back toward that of apples. Also according to David Harvey this is all happening in an ideal market world and is not intended to capture everything that happens in the real world -- the concept is purportedly to take the perfect "free market" of classical economics and say "Okay, if you actually had your magical free market, here's how it would actually work and why it would ultimately collapse."

Nonetheless, I feel like Marx uses labor/socially necessary labor time/labor power all in really slippery and confusing ways that he does not adequately flesh out, and it does make me wonder if he's eliding something.

in one of those videos David Harvey says something like 'every time i read Capital i have a different interpretation of it' as if it's a good thing, and i'm like... that's, er, NOT a good quality for an economics book to have

ah the lineage between Das Kapital and Frank Ocean's Blonde

xp

However, he “arbitrarily ruled out the relative desirability or utility of commodities,” says Mr Stedman Jones, which would strike most people as the obvious explanation.

This isn't as nonsensical as it might seem at first blush, in that the amount of labor anyone is willing to expend on bringing an article to market will be just as closely linked to the value of that labor as to its 'desirability or utility'. The idea of 'value' can be applied to either side of the equation, because they are equivalent.

I think also what's missing from that critique is that according to Marx a higher price for the more "desirable" commodity can't be sustained (assuming equal cost of production) because the more profitable one will attract more investment until competition erases the profit differential. So if strawberries are really considered yummier than apples, but they do in fact take the exact same amount of labor to produce and transport to market (which I doubt is true), more capital will be attracted to strawberry growing until competition among strawberry growers forces prices back toward that of apples. Also according to David Harvey this is all happening in an ideal market world and is not intended to capture everything that happens in the real world -- the concept is purportedly to take the perfect "free market" of classical economics and say "Okay, if you actually had your magical free market, here's how it would actually work and why it would ultimately collapse."

there was a debate about this in the 60's when General Equilibrium Theory (now the mainstream theory of the joint determination of prices and quantities of all goods and inputs in a market) was being banged out, this dude called Morishima wrote a book called Marx's Economics kind of summarizing it. it's a bit mathematical but was one of the best things I read

In general equilibrium there actually *IS* no profit differential between the apple and the banana (because firms enter/enlarge production driving the price down whenever there's an arbitrage opportunity), but relative prices are not all equalized. the zero profit thing is a good example of The Equilibrium Paradox (a good blog post on it: http://blog.supplysideliberal.com/post/140130680535/the-equilibrium-paradox-somebody-has-to-do-it)

This isn't as nonsensical as it might seem at first blush, in that the amount of labor anyone is willing to expend on bringing an article to market will be just as closely linked to the value of that labor as to its 'desirability or utility'. The idea of 'value' can be applied to either side of the equation, because they are equivalent.

― a little too mature to be cute (Aimless), Friday, August 26, 2016 1:40 PM (eleven minutes ago) Bookmark Flag Post Permalink

Nah this is wrong, too. I want to work in a diamond mine because the wage for diamonds is high, not because I want to bring diamonds into the world.

one thing i will say about Marx, at his best he is a great prose stylist. Not as good as Keynes but close. apparently a lot of the het up fiery rhetoric in Communist Manifesto was written by Engels but there are some beautiful passages in Capital.

I think one of the hardest things about reading Marx in the 21st century is just maintaining a clear grasp on his system of terminology, some of which seems counterintuitive today, especially if you're steeped in neoclassical economic ideas (which we p much all are). Like I keep having to remind myself "when he says value he means the amount of socially necessary labor time" and "when he says socially necessary labor time" he means a kind of averaged unit of labor time not the exact number of labor hours it took to produce something, and then I'm like "wait wtf does that actually mean?"

Yup

Nah this is wrong, too. I want to work in a diamond mine because the wage for diamonds is high, not because I want to bring diamonds into the world.

― flopson, Friday, August 26, 2016 1:52 PM Bookmark Flag Post Permalink

but marx never suggests otherwise. he's trying to answer the question -- if you have capital to deploy, why do you want to say mine for diamonds instead of coal, and the answer is "you see more opportunity for profit" but the question of why you see more opportunity for profit has to do with _many_ things over time, in part demand, but also in part other relative questions of cost of production.

its also silly to drag general equilibrium into this because marx is not trying to describe a stable system of capital in equilibrium, but rather the a highly dynamic system in constant transformation and disruption, but nonethless with identifiable pressures and tendencies and momentary balances and imbalances.

anyway its totally silly to say marx rules out the relative desirability or utility of commodities -- he begins with that but notes that it well predates capitalism, or even money as a universal medium of exchange. if your complaint is "where are the supply/demand curves" the answer is really "that pertains to distribution but doesn't account for the factors driving and determining choices in production"

if you have capital to deploy, why do you want to say mine for diamonds instead of coal, and the answer is "you see more opportunity for profit" but the question of why you see more opportunity for profit has to do with _many_ things over time, in part demand, but also in part other relative questions of cost of production.

"other relative questions of cost of production" are what determine (wait for it) Supply

its also silly to drag general equilibrium into this because marx is not trying to describe a stable system of capital in equilibrium, but rather the a highly dynamic system in constant transformation and disruption, but nonethless with identifiable pressures and tendencies and momentary balances and imbalances.

you can shock general equilibrium, make firms discover new prices etc, there is a whole literature on it. but it doesn't give you anything like marxism afaik

"where are the supply/demand curves" the answer is really "that pertains to distribution but doesn't account for the factors driving and determining choices in production"

genuinely don't know what this means. pertains to the distribution of what? factors driving and determining choices in production you mean inputs? they're also determined by S&D

> "other relative questions of cost of production" are what determine (wait for it) Supply

but whence the reason for the quantity of that supply.

supply and demand don't explain anything about the general structure of an economy, they just account for how certain prices are set at a certain moment in time.

its like you're looking at a car and you explain everything by saying "this car operates by the conservation of energy". sure the conservation of energy plays a role, but you haven't even begun to look at the broader things one needs to understand to see why the car moves.

a lot of why marx is hard to read is he's not just explaining an approch, but he's very carefully trying to explain why ideas like "the supply of this is determined by the demand for it and also the supply of things to make it" don't get you almost anywhere at all.

you also have to understand that the labor theory of value isn't a unique marxian thing, but already rooted in classical political economy, including smith (though there's a particular and important treatment of it marx gives that's distinct from the predecessors).

> you can shock general equilibrium, make firms discover new prices etc, there is a whole literature on it. but it doesn't give you anything like marxism afaik

right, because there's no premise that there's even such a thing as a general equilibrium to shake -- prices, industries, production, employment are all in continuous and dynamic motion and interaction, constantly moving with regard to political, technological, social, broader economic developments.

this is one of the strangest articles i've encountered in a while. i've read it twice and i have no idea what point is being made:

https://lareviewofbooks.org/article/i-am-not-a-marxist/

Heads up: Verso is selling all things Marx w/ 50% off, as it's the bicentenary of the big man's birth.

they claim to be left-wing AND YET they’re SELLING marxist books

checkmate, pinkos!

*goes back to being slowly crushed by capitalism, dies*

You should've known better, bg. I'd like to say that I'll be right here waiting for you to get a clue, but I'll hazard a guess that it'll never happen. Sorry to be so harsh, but your words don't mean nothin'.

hey, the Man took 49.5% of my severance pay out in taxes.

Karl was right.

he was only right about 95% of everything, tbf