>"The price [of a commodity] then, is merely the money-name of the quantity of social labour realized in this commodity." -Karl Marx, Das Capital
Why does anybody still take Marxian economics seriously when its most essential text advances such a retarded argument about the origin of prices? Ever hear of supply and demand, senpai?
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I agree. Marxism is lame.
I don't know much about Marx and social labor, however it does seem like a good model for communism to use in determining prices, especially since communism doesn't have markets by definition (and thus no supply and demand). In a 'market' where demand is determined by the available supply, which is in turn determined by the government's choice in production, all that remains is the labor and material cost of creating the product.
Well the issue is that this is his theory about prices in a capitalist marketplace. Prices are "merely the money-name of the quantity of social labour realised in his commodity," and his explanation for good A's prices falling as the market becomes saturated with it is that "too great a portion of the total labour of the community has been expended in the form of [good A if the market cannot stomach the whole quanity.]" It doesn't make any sense once you consider supply and demand.
He also argues that "the price of uncultivated land... is without value, because no human labour has been incorporated in it." Which doesn't make any sense. If something has no value nobody is going to pay money for it lol.
Setting prices based purely on 'supply and demand' will destroy the ecosystem and spell the end of mankind.
A quick google contradicts you
firstprinciplesjournal.com
>from which Marx concludes that this value determines the prices of production. “The price is merely the money-name of the quantity of social labor realized in a commodity.”
The price of production, not of commodity, senpai. After that we get the surplus.
...
That's completely wrong though. He is very explicitly talking about market prices in this passage:
>If the community's want of linen, and such a want has a limit like every other want, should already be saturated by the products of rival weavers, our friend's product is superfluous, redundant, and completely useless... But suppose his product turn out a real use-value, and thereby attracts money? The question arises, how much will it attract, No doubt the answer is ///already anticipated in the price of the article,/// (makes no sense?) in the exponent of the magnitude of its value.. We suppose him to have spent the on his product only that amount of labour-time that is on an average socially necessary. The price, then, is merely the money-name of the quantity of social labour realized in his commodity."
well it does makes sense to me that a good's worth should decrease if more and more of it is supplied. However I do agree with you in that the worth of uncultivated land is greater than zero. I have no idea what the fuck Karlos was talking about when he said that.
Purchasing barren land is an investment (with risks), whereas with a commodity you get the value that was put into it beforehand. The land only pays off in the future, after it has been made valuable. You can also buy a stone and paint it with gold, doesn't mean the original stone represented any value worth mentioning.
Because commodity price = fix costs under perfect competition. I don't see the contradiction here. Supply and demand is only limited by marginal costs and tends towards them in a perfect market.
You two are thinking like capitalists. The concept of value being adumbrated is distinct from simple economic utility.
What ultimately causes supply and demand to change? Can there be separate commodities with the same basic supply and demand, yet differing prices? Marx doesn't claim a single commodity's price perfectly reflects its value in practice. He does take supply and demand, and other factors, into account. But for him, one price increasing beyond its value simply means another price decreasing somewhere else. Total prices only equal total value across the whole economy.
Some people have the mistake impression that the labor theory of value is some sort of substitute for the laws of supply and demand. This is not the case. All of the classical economists from Adam Smith to David Ricardo to Karl Marx were aware of the forces of supply and demand. Yet they didn’t think supply and demand were sufficient for a theory of value. Instead supply and demand were seen as the mechanism through which value operates.
For Marx, the theory of value is more than just a theory of prices. Price theory might help us make business decisions, but value theory is concerned with deeper social questions like “Why do the products of labor take the form of commodities with prices?” and “What sort of social relations between producers are necessary in order for this to happen?” In the process of answering such questions we can build a theory of the social relations of a capitalist society in all of its antagonism and dynamism.
Mainstream economic theory takes the opposite approach. It abstracts away from production relations, treating all economic phenomena as the product of individual psychology. It focuses on prices and not on value.
This makes a lot of sense, thank you for this post. I was under the impression that Adam Smith (I looked it up, apparently this is completely false) had come up with the idea of supply and demand and Marx was trying to refute him. Do you not think there are very large intellectual blindspots in Marx's Theory of Value? i.e. How/why do people often exchange money (the physical manifestation of value) for something Marx clearly defines as having no value? It seems to be a big hole in his argument.
>How/why do people often exchange money (the physical manifestation of value) for something Marx clearly defines as having no value?
Fetishes
>How/why do people often exchange money (the physical manifestation of value) for something Marx clearly defines as having no value? It seems to be a big hole in his argument.
It isn't because Value is a materialistic concept, it represents only the equivalent processes of production involved in a commodities creation.
People do not percieve the world in materialistic terms however and can subjectively decide to do as they wish with their money.
He was trying to determine why value is placed on goods the way that it is
>This is another "i am an idiot but i think my opinion is valid" thread
For Marx, land only has value owing to the productive labor it enables. Only a parcel of uncultivable land on an inaccessible mountaintop would have zero value. This is based on Marx's theory of rents. It's similar to how, in finance, the value of a share of equity is said to be the present discounted value of its future cash flows -- even if the share price seems to have a mind of its own.
>>"The price [of a commodity] then, is merely the money-name of the quantity of social labour realized in this commodity." -Karl Marx, Das Capital
I try to vizualize it for dummies
What
>had come up with the idea of supply and demand and Marx was trying to refute him.
Is the other way around, to discredit Marx detractors say that the surplus theory is useless, because it "cant predict prices", or whatever. But that wasn't Marx's point at all.
'supply and demand' is a myth.
Marxian Economics is taken seriously by some people for the same reason other people take Austrian Economics seriously
Because they are ideologues
No, that would be the neoliberals who run mainstream economics.
successful rulers don't believe in the ideologies they preach
This is bait. Marx never denied supply and demand. He just didn't fetishise it like the marginal utility crowd. >dude prices lmao
You guys are retards. He was talking about how uncultivated land cannot produce rent
Are u op? If so maybe know what you are talking about before you embarrass yourself. Mein gott
Supply and demand describes only a primitive market where i change my potato to bread with my fellow farmers.
Its a very naive theory
Marx understands value to mean labor crystalized in the physical form of a commodity. That quote is from the section where Marx talks about how money-price can decouple from actual value and hence it arises that things like integrity, honor, virgin soil, etc. which have no labor input can be priced.
You're also confusing use-value and exchange value (here just "value"). Use-value is purely private and exchange value purely social. Once an object becomes a commodity, it loses it's use-value and becomes an exchange value (e.g. 1 ton of iron has use only to the purchaser of the iron; to the seller it's only "use" is its exchangeability)