Capital Vol 1 Reading Group: Chapters 1-2

137 posts / 0 new
Last post
Spartacus's picture
Spartacus
Offline
Joined: 20-09-03
Sep 22 2008 12:31
Capital Vol 1 Reading Group: Chapters 1-2

Well it's the 22nd, the deadline for reading chapters 1 and 2, which i have done, and hopefully being the first to post is due to my timezone. we'll see anyway. if enough of us have, then that make the deadline for reading chapter 3 monday the 6th of october. can we keep any discussion of this deadline and other general stuff about the reading group in the original thread here? that should help keep things on track. if a new deadline is agreed i'll edit this post accordingly.

well, apart from the long bit of this equals this explaining the elementary commodity form, which i suppose was necessary to make it as clear an unequivocal as possible, i actually found it rather entertaining. i've taken notes as my memory is dodgy and i thought it might help me understand etc., so here is a brief summary of the main points as i understand them. [moved so as not to clutter so much]

that's all i've got time for at the moment. did i miss anything vital/misunderstand anything? it seems pretty clear, though obviously i don't express my self as well or a eloquently or go into as much detail since i'm not rewriting the book... i'll try to continue this tomorrow.

Steven.'s picture
Steven.
Offline
Joined: 27-06-06
Sep 22 2008 23:13

I've just resumed reading capital, so I'll try to contribute to this as well. I'll check where I am with the reading, but I think it is around here.

What you've got down looks like my take on it.

That analysis in many ways seems quite obvious when it is explained to you, so it's quite surprising that it was so tricky to figure out.

I did wonder, though, if there were exceptions to this general rule. But then I suppose depending on what you define as "labour" they can be explained. For example a certain type of old car could, due to some general trend, or it being in a film, or a celebrity driving it, could suddenly become much more in demand, and much more valuable.

Although of course the amount of labour congealed in the car would be the same. Unless of course you include as abstract labour all various social processes, from things like marketing (which would clearly add value) to more generalised things like the spreading by word of mouth of spontaneous trends and fads.

Any thoughts on this? Am I missing something?

Steven.'s picture
Steven.
Offline
Joined: 27-06-06
Sep 22 2008 23:21

(Also I've created an index for the reading group here:http://libcom.org/forums/theory/marxs-capital-vol-1-online-reading-group-22092008 )

安藤鈴
Offline
Joined: 17-09-08
Sep 23 2008 12:06

Hi comrade,

Steven. wrote:
I did wonder, though, if there were exceptions to this general rule. But then I suppose depending on what you define as "labour" they can be explained. For example a certain type of old car could, due to some general trend, or it being in a film, or a celebrity driving it, could suddenly become much more in demand, and much more valuable.

Demand and supply do not affect (effect?) value.

They may very well affect exchange value - Marx accounts for this well in Wage Labor & Capital. For example, overproduction, underproduction, increase in demand, competition between buyers and sellers etc etc.

The value of a commodity is equal to the amount of labor embodied in it - this does not change with a change in the demand of a commodity.

(Of course, demand may affect the value in an indirect manner - it may force the capitalists to adopt more productive measures to increase production, but how much someone wants a commodity does not affect its value. Either something has a use-value or it does not - we are not concerned with how we can measure the use-value of a commodity.)

Edit: So, we only consider 'demand' insofar as we consider use-value. The use-value of a tonne of manure is just as good as the use-value of a tonne of diamonds. The difference is, they contain differences in the quantity of labor (and its type, but Marx reduces it all to simple labor).

Quote:
Although of course the amount of labour congealed in the car would be the same.

Precisely.

Quote:
Unless of course you include as abstract labour all various social processes, from things like marketing (which would clearly add value) to more generalised things like the spreading by word of mouth of spontaneous trends and fads.

Marketing does not embody any labor in a commodity. Diamonds are not expensive because they are in great demand, they are expensive because they contain vast amounts of labor in obtaining and perfecting them.

Let's look at an another example; is the labor of a truck driver whom delivers the goods embodied in the value of a commodity?

Interestingly enough, Marx says yes!

Quote:
III. COSTS OF TRANSPORTATION
It is not necessary to go here into all the details of the costs of circulation, such as packing, sorting, etc.
The general law is that all costs of circulation, which arise only from changes in the forms of
commodities do not add to their value. They are merely expenses incurred in the realisation of the value
or in its conversion from one form into another. The capital spent to meet those costs (including the
labour done under its control) belongs among the faux frais of capitalist production. They must be
replaced from the surplus-product and constitute, as far as the entire capitalist class is concerned, a
deduction from the surplus-value or surplus-product, just as the time a labourer needs for the purchase of
his means of subsistence is lost time.
But the costs of transportation play a too important part to pass
them by without a few brief remarks.

Within the circuit of capital and the metamorphosis of commodities, which forms a part of the circuit, an
interchange of matter takes place in social labour. This interchange of matter may necessitate a change of
location of products, their real motion from one place to another. Still, circulation of commodities can
take place without physical motion by them, and there can be transportation of products without
circulation of commodities, and even without a direct exchange of products. A house sold by A to B does
not wander from one place to another, although it circulates as a commodity. Movable
commodity-values, such as cotton or pig iron, may lie in the same storage dump at a time when they are
passing through dozens of circulation processes, are bought and resold by speculators.[17] What really
does move here is the title of ownership in goods, not the goods themselves. On the other hand,
transportation played a prominent role in the land of the Incas, although the social product neither
circulated as a commodity nor was distributed by means of barter.

Consequently, although the transportation industry when based on capitalist production appears as a
cause of circulation costs, this special form of appearance does not alter the matter in the least.
Quantities of products are not increased by transportation. Nor, with a few exceptions, is the possible
alteration of their natural qualities, brought about by transportation, an intentional useful effect; it is
rather an unavoidable evil. But the use-value of things is materialised only in their consumption, and
their consumption may necessitate a change of location of these things, hence may require an additional
process of production, in the transport industry. The productive capital invested in this industry imparts
value to the transported products, partly by transferring value from the means of transportation, partly by
adding value through the labour performed in transport. This last-named increment of value consists, as it
does in all capitalist production, of a replacement of wages and of surplus-value.

Within each process of production, a great role is played by the change of location of the subject of
labour and the required instruments of labour and labour-power -- such as cotton trucked from the
carding to the spinning room or coal hoisted from the shaft to the surface. The transition of the finished
product as finished goods from one independent place of production to another located at a distance
shows the same phenomenon, only on a larger scale. The transport of products from one productive
establishment to another is furthermore followed by the passage of the finished products from the sphere
of production to that of consumption. The product is not ready for consumption until it has completed
these movements.

As was shown above, the general law of commodity production holds: The productivity of labour is
inversely proportional to the value created by it. This is true of the transport industry as well as of any
other. The smaller the amount of dead and living labour required for the transportation of commodities
over a certain distance, the greater the productive power of labour, and vice versa.[18]
The absolute magnitude of the value which transportation adds to the commodities stands in inverse
proportion to the productive power of the transport industry and in direct proportion to the distance
traveled, other conditions remaining the same.

The part of the value added to the prices of commodities by the costs of transportation, other conditions
remaining the same, is directly proportional to their cubic content and weight, and inversely proportional
to their value. But there are many modifying factors. Transportation requires, for instance, more or less
important precautionary measures, and therefore more or less expenditure of labour and instruments of
labour, depending on how fragile, perishable, explosive, etc., the articles are. Here the railway kings
show greater ingenuity in the invention of fantastic species than do botanists and zoologists. The
classification of gods on English railways, for example, fills volumes and, in principle, rests on the
general tendency to transform the diversified natural properties of goods into just as many ills of
transportation and routine pretexts for fraudulent charges. "Glass, which was formerly worth £11 per
crate, is now worth only £2 since the improvements which have taken place in manufactures, and since
the abolition of the duty; but the rate for carriage is the same as it was formerly, and higher than it was
previously, when carried by canal. Formerly, manufacturers inform me that they had glass and glass
wares for the plumbers' trade carried at about 10 s. per ton, within 50 miles of Birmingham. At the
present time, the rate to cover risk of breakage, amount ... The companies always resist any claim that is
made for breakages."[19] The fact that furthermore the part of the value added to an article by the costs
of transportation is inversely proportional to its value furnishes special grounds to the railway kings to
tax articles in direct proportion to their values. The complaints of the industrialists and merchants on this
score are found on every page of the testimony given in the report quoted.

The capitalist mode of production reduces the costs of transportation of the individual commodity by the
development of the means of transportation and communication, as well as by concentration -- increasing
scale -- of transportation. It increases that part of the living and materialised social labour which is
expended in the transport of commodities, firstly by converting the great majority of all products into
commodities, secondly, by substituting distant for local markets.

The circulation, i.e., the actual locomotion of commodities in space, resolves itself into the transport of
commodities. The transport industry forms on the one hand an independent branch of production and
thus a separate sphere of investment of productive capital.
On the other hand its distinguishing feature is
that it appears as a continuation of a process of production within the process of circulation and for the
process of circulation.

Capital, Volume 2, Chapter 6. He also comments on book-keeping too. Perhaps this will answer your queries in an indirect manner?

I also remember a quote by Marx which stated that something has to qualitatively change the nature of a commodity to change its value - e.g dye a jumper, knit a coat from wool etc. I need to run for work, so I am sorry if I cannot expand my thoughts further.

Rei.

john
Offline
Joined: 9-07-06
Sep 23 2008 12:30
安藤鈴 wrote:
Marketing does not embody any labor in a commodity. Diamonds are not expensive because they are in great demand, they are expensive because they contain vast amounts of labor in obtaining and perfecting them.

I think it's perfectly feasible to argue that marketing is a source of value - it changes the qualitative form of the product (conisidered broadly) and is also susceptible to the same pressures to reduce the socially necessary labour time through which to 'produce' it.

and people in marketing get exploited too.

darren p's picture
darren p
Offline
Joined: 5-07-06
Sep 23 2008 12:46
Steven. wrote:
I did wonder, though, if there were exceptions to this general rule. But then I suppose depending on what you define as "labour" they can be explained. For example a certain type of old car could, due to some general trend, or it being in a film, or a celebrity driving it, could suddenly become much more in demand, and much more valuable.

Although of course the amount of labour congealed in the car would be the same. Unless of course you include as abstract labour all various social processes, from things like marketing (which would clearly add value) to more generalised things like the spreading by word of mouth of spontaneous trends and fads.

Any thoughts on this? Am I missing something?

"Value" and "Price" are not the same thing. Some commodities sell for less than there value and some sell for more. Can't remember if uncle Karl covers this in chapter one (okay I admit I haven't re-read it yet!) but could be worth having a quick look at "Value, Price, Profit"

Spartacus's picture
Spartacus
Offline
Joined: 20-09-03
Sep 23 2008 13:37

the index is a good idea, i was going to suggest something along those lines if we got through the whole book and the discussion was worth keeping, but it's useful to have it there while we're doing it too.

with regard to exceptions, yes, as others have said price and value are different, though i have a feeling he's going to go into that at length further down the line - from what i remember of the last attempt at a reading group (which i didn't take part in but browsed through before suggesting this one) price and value are linked, but to what extent i'm willing to wait and see. i think in the case of your example, a since a trend is relatively short lived, the price would probably tend back to it's value over time. i was also going to suggest that other commodities of the same class would have more labour invested in them to compete, so the social average of labour embodied in their values would increase, but i think i'm getting mixed up there.

i'm inclined to agree that marketing does add value, since it does change use-value so is useful labour. marx says that use-value is the ability to satisfy a human want, however that want arises, and surely the desire for say an unbranded or minor brand trainer is qualitively different from the desire for say a nike trainer. the first the desire is mostly for footwear of a specific type, the second is desire for that AND desire for being fashion or aesthetics or whatever you want to call it. let's put it into the elementary form: x brandless trainer = x brandless trainer or y nike trainer = y nike trainer clearly has no real use for us, but say 1 nike trainer = 2 brandless trainers does, and makes sense because the brandless trainer does not satisfy my want for a nike one, so i can exchange them, thus they must be of different values. or have i got things arse about face?

anyway, i was going to post up my summary of the rest of the chapter, but maybe i'll keep that for tomorrow as i'm hungry.

john
Offline
Joined: 9-07-06
Sep 23 2008 13:43
Spartacus wrote:
i'm inclined to agree that marketing does add value, since it does change use-value so is useful labour. marx says that use-value is the ability to satisfy a human want, however that want arises, and surely the desire for say an unbranded or minor brand trainer is qualitively different from the desire for say a nike trainer. the first the desire is mostly for footwear of a specific type, the second is desire for that AND desire for being fashion or aesthetics or whatever you want to call it. let's put it into the elementary form: x brandless trainer = x brandless trainer or y nike trainer = y nike trainer clearly has no real use for us, but say 1 nike trainer = 2 brandless trainers does, and makes sense because the brandless trainer does not satisfy my want for a nike one, so i can exchange them, thus they must be of different values. or have i got things arse about face?

that sounds about right to me

darren p's picture
darren p
Offline
Joined: 5-07-06
Sep 23 2008 14:57
Spartacus wrote:
i'm inclined to agree that marketing does add value, since it does change use-value so is useful labour. marx says that use-value is the ability to satisfy a human want, however that want arises, and surely the desire for say an unbranded or minor brand trainer is qualitively different from the desire for say a nike trainer. the first the desire is mostly for footwear of a specific type, the second is desire for that AND desire for being fashion or aesthetics or whatever you want to call it. let's put it into the elementary form: x brandless trainer = x brandless trainer or y nike trainer = y nike trainer clearly has no real use for us, but say 1 nike trainer = 2 brandless trainers does, and makes sense because the brandless trainer does not satisfy my want for a nike one, so i can exchange them, thus they must be of different values. or have i got things arse about face?

Or doesn't marketing add price? Marketing is a commodity bought by the capitalists who are seeking to get a better price and market share. This is something to do with the "Fetishism of Commodities" which we will come to later.

A helpful(?) example to bear in mind:
In the strictly Marxian sense or at least as I understand it, a painting has no "value" but it has a "price". The labour theory of value only applies to commodities.

However a print of the same painting has both "value" and "price" since it can be reproduced.

Daniel B
Offline
Joined: 6-04-07
Sep 23 2008 14:59
Spartacus wrote:
i'm inclined to agree that marketing does add value, since it does change use-value so is useful labour. marx says that use-value is the ability to satisfy a human want, however that want arises, and surely the desire for say an unbranded or minor brand trainer is qualitively different from the desire for say a nike trainer. the first the desire is mostly for footwear of a specific type, the second is desire for that AND desire for being fashion or aesthetics or whatever you want to call it. let's put it into the elementary form: x brandless trainer = x brandless trainer or y nike trainer = y nike trainer clearly has no real use for us, but say 1 nike trainer = 2 brandless trainers does, and makes sense because the brandless trainer does not satisfy my want for a nike one, so i can exchange them, thus they must be of different values. or have i got things arse about face?

anyway, i was going to post up my summary of the rest of the chapter, but maybe i'll keep that for tomorrow as i'm hungry.

I think this is right but there's more to it. The Commodity which is a specific car immediately after it's material production, or when the car is actually formed, is a different commodity from the commodity later in time after marketing. Marketing is one form of abstract labour and is manifest in the commodity though it simply does not alter the bodily form (obviously, or it wouldn't be marketing). The first commodity, Car A (before marketing), represents less congealed labour than Car B (after marketing). I'm assuming this works based on the fact that regardless of the type of labour expended on a commodity, (in this case there are two different types) value is the manifestation of abstract labour. That's my two cents.

Nice notes by the way, very comprehensive.

Edit: Whilst I was writing my comment, darren p posted his. If this is the case then what I've said is crud and I've not read as far as he has.

darren p's picture
darren p
Offline
Joined: 5-07-06
Sep 23 2008 16:38
Marxists.org wrote:
Concrete labour is the labour different in kind, skill and intensity in every case, which gives to a commodity its specific qualities by which it satisfies human needs.

Abstract labour is the undifferentiated expenditure of human energy common to all forms of labour.

[..]

Before the development of the market, all labour is concrete labour; as the market develops, the abstract quantitative side of labour begins to develop and with the rise of manufacturing, predominates. This means that labour itself became more abstract, i.e., more uniform, lacking in skill or specific character, and the products of labour become increasingly uniform, what today is referred to as “MacDonalds culture”.

Daniel Brennan wrote:
I think this is right but there's more to it. The Commodity which is a specific car immediately after it's material production, or when the car is actually formed, is a different commodity from the commodity later in time after marketing. Marketing is one form of abstract labour and is manifest in the commodity though it simply does not alter the bodily form (obviously, or it wouldn't be marketing). The first commodity, Car A (before marketing), represents less congealed labour than Car B (after marketing). I'm assuming this works based on the fact that regardless of the type of labour expended on a commodity, (in this case there are two different types) value is the manifestation of abstract labour. That's my two cents.

I think you are confusing "value" with "price" here.

Marketing is not a part of the production of specific commodities but a commodity in itself. The capitalist is the one who purchases marketing commodities as I said before. "Price" is what the market can bear, or what consumers can be persuaded (through marketing) to pay. If a commodities "price" is more than it's "value" the capitalist makes a profit, if it is not then a loss is made.

Steven.'s picture
Steven.
Offline
Joined: 27-06-06
Sep 23 2008 17:17

Thanks for the comments everyone. Right I just hadn't got to price and value being different.

As others have said, I don't see how it can be said that marketing isn't part of the labour which goes into making commodities.

In a lot of commodities, the marketing is the single biggest expense of labour in production - in the pharmaceutical industry, for example. But then again, this doesn't really affect the use-value.

In other examples, it is clear that marketing alters the use-value. The use-value of branded trainers being "things that cover your feet and make you look 'cool'", say.

So are these two examples different? If I should just wait until reading more just tell me and I will...

Joseph Kay's picture
Joseph Kay
Offline
Joined: 14-03-06
Sep 23 2008 17:47
Steven. wrote:
in the pharmaceutical industry, for example. But then again, this doesn't really affect the use-value.

actually it would, due to the placebo effect being stronger with branded pharmaceuticals than unbranded, but this is a peculiar psychological quirk rather than a flaw in Marxian theory per se

Daniel B
Offline
Joined: 6-04-07
Sep 23 2008 18:22
darren p wrote:
I think you are confusing "value" with "price" here.

Marketing is not a part of the production of specific commodities but a commodity in itself. The capitalist is the one who purchases marketing commodities as I said before. "Price" is what the market can bear, or what consumers can be persuaded (through marketing) to pay. If a commodities "price" is more than it's "value" the capitalist makes a profit, if it is not then a loss is made.

Okay so when you buy a commodity that has been marketed, you are buying both the commodity and the marketing time invested?
If Marketing is a commodity in itself, doesn't that imply that the person 'doing marketing' is 'labouring' too or can a purely social interaction not embody real labour?

Dave B
Offline
Joined: 3-08-08
Sep 23 2008 18:35

I have just skimmed through some of these posts and there are already obviously some interesting points being raised.

I would just like to make a suggestion and that is if we are going to plod through this. There is a hazard that I anticipated that we may in our eagerness to follow up questions that are raised as we go along of ending up whizzing around all over all three volumes before we get past page 5.

However as we are doing it there has been raised the important question of supply and demand. I thought before reading capital that the supply and demand thing was an anathema to the labour theory of value however it is not the case as Karl fully embraces it.

However rather than saying that supply and demand sets the value or exchange value/price of things. He says that the law of supply and demand by the way it works resets or has a tendency to restore the exchange value or price of commodities to their value as determined by their labour content.

I think if I remember correctly this was a Adam Smith idea which he borrowed or accepted and I think Adam called it in that respect the natural price although I think the expression was in French.

A good and useful thought experiment model, which Karl uses to some extent, and I have found useful elsewhere is the hypothetical village community. In this situation everybody knows everybody else’s business and everybody is capable of multi-skilling.

Lets suppose that in this community that generally a commodity which takes 40 hours to make, its value, exchanges for an ounce of gold that also contains 40 hours of labour.

However there is a problem. In this community the table makers have to work 80 hours making tables to earn an ounce of gold. Thus the tables are selling below their ‘value’.

And coat makers only have to work 20 hours to earn an ounce of gold and thus coats are selling at above their value.

What should happen will be that some of the table makers will switch to making coats.

The supply of coats onto the market will increase and therefore the exchange value or price drop towards their value. And as there are that much less tables on the market their exchange value will increase towards their value as supply falls and effective demand increases.

The same thing happens in capitalism. If a capitalist gets in early and discovers a new product, like a microwave oven, he can in effect command a monopoly price. Or sell it for whatever he can get for it. The worker is out of the loop on this. The excess price over and above the cost price and a decent or average rate of profit goes to the capitalist as surplus profit. A formal Das Capital term that becomes quite important.

This will not go unnoticed by his brother capitalists and they will move in to that business, increasing supply and decreasing the exchange value until the value of that commodity falls to its proper value. Until that is the rate of profit in that industry reaches normal levels.

The reverse also applies in an industry with a below average rate of profit where the exchange value of their commodities will be below the value.

Those capitalists will bail out or stop reinvesting, perhaps to move into the microwave industry. Again lowering supply and increasing demand of that commodity until those that decided to stick with have their rate of profit and the exchange value of their commodity increase or restored to its value.

Detailed understanding of this has to wait until the rate of surplus value etc but the general idea is all that is required at the moment.

The marketing thing as in advertising etc is another interesting issue as this was not covered in Das Capital as such so we can have a free reign on it.

We are I think talking I expect about Nike tee shirts that sell for ten times more than they are ‘worth’.

Karl made quite clear with a bible example I think that there is no accounting for the reasons why people find things useful and his analysis is not interested in it.

In my opinion with a heavily marketed product it not only has the labour directly expended in making the tee shirt embodied in but it also has the labour expended in the advertising embodied in it as well. People are buying an image or life style in way. They are purchasing an add on use value and commodity and that expended labour is just as immanent and invisible, if not more so, as the labour that was required to make the physical article itself.

I think it is important to realise that a first Karl is just making a hypothesis, or a logical guess if you like, and he is going to embark on a project of hypothesis testing to see if it can explain things and predict them. To see if it stands up when dealt with in that way.

Anomalies are to be expected, like why according to Newton’s laws with his invisible elastic band of gravity, or Galileo, a feather doesn’t fall to the ground the ground at the same rate as a hammer.

However it took Newton’s laws which put man on the moon to put that anomaly to rest. Despite the bouncing feather thing, which has nothing to do weight but I presume the elasticity of the object and what it lands on.

I couldn’t comment on the elasticity of the moon’s surface but I am sure a feather is more elastic or bendy than a hammer.

http://www.youtube.com/watch?v=dM0FDGOsslU

darren p's picture
darren p
Offline
Joined: 5-07-06
Sep 23 2008 20:03

After writing all that I got a little confused myself...

Marx in "value, price and profit wrote:
Price, taken by itself, is nothing but the monetary expression of value. The values of all commodities of the country, for example, are expressed in gold prices, while on the Continent they are mainly expressed in silver prices. The value of gold or silver, like that of all other commodities is regulated by the quantity of labour necessary for getting them. [..]

So far the market price of a commodity coincides with its value. On the other hand, the oscillations of market prices, rising now over, sinking now under the value or natural price, depend upon the fluctuations of supply and demand. The deviations of market prices from values are continual, but as Adam Smith says:

"The natural price is the central price to which the prices of commodities are continually gravitating. Different accidents may sometimes keep them suspended a good deal above it, and sometimes force them down even somewhat below it. But whatever may be the obstacles which hinder them from settling in this center of repose and continuance, they are constantly tending towards it."

I cannot now sift this matter. It suffices to say the if supply and demand equilibrate each other, the market prices of commodities will correspond with their natural prices, that is to say with their values, as determined by the respective quantities of labour required for their production. But supply and demand must constantly tend to equilibrate each other, although they do so only by compensating one fluctuation by another, a rise by a fall, and vice versa. [..]

If the, speaking broadly, and embracing somewhat longer periods, all descriptions of commodities sell at their respective values, it is nonsense to suppose that profit, not in individual cases; but that the constant and usual profits of different trades spring from the prices of commodities, or selling them at a price over and above their value. The absurdity of this notion becomes evident if it is generalized. What a man would constantly win as a seller he would constantly lose as a purchaser. It would not do to say that there are men who are buyers without being sellers, or consumers without being producers. What these people pay to the producers, they must first get from them for nothing. If a man first takes your money and afterwards returns that money in buying your commodities, you will never enrich yourselves by selling your commodities too dear to that same man. This sort of transaction might diminish a loss, but would never help in realizing a profit. To explain, therefore, the general nature of profits, you must start from the theorem that, on an average, commodities are sold at their real values, and that profits are derived from selling them at their values, that is, in proportion to the quantity of labour realized in them. If you cannot explain profit upon this supposition, you cannot explain it at all. This seems paradox and contrary to every-day observation. It is also paradox that the earth moves round the sun, and that water consists of two highly inflammable gases. Scientific truth is always paradox, if judged by every-day experience, which catches only the delusive appearance of things.

As far as I understand "Price" is (exchange) value realised in money. Value is always hypothetical until it is realised in monetary exchange. Value=Price only potentially.

Steven. wrote:
As others have said, I don't see how it can be said that marketing isn't part of the labour which goes into making commodities.

Interesting points here. However is marketing a cost of production or a cost of of circulation? I would say the later. Which is why there are no specific references in vol 1.

Marketing does create (pseudo) use values, I agree though. A person my choose to buy brand x rather than brand y because brand x is associated with a particular identity position. Think of the different images associated with "BMW", "Burberry", "Crass" records etc.. Althusser's work on interpellation is probably relevant here - though I haven't read it!

darren p's picture
darren p
Offline
Joined: 5-07-06
Sep 23 2008 19:59
Daniel Brennan wrote:
Okay so when you buy a commodity that has been marketed, you are buying both the commodity and the marketing time invested?

See my above post and Dave B's in reference to this. Maybe you are not only buying the commodity but also the image that has been created by the marketing.

Daniel Brennan wrote:
If Marketing is a commodity in itself, doesn't that imply that the person 'doing marketing' is 'labouring' too or can a purely social interaction not embody real labour?

"Marketing" is labour absolutely. Though I would argue it is not a cost of production - which we are looking at now - but a cost of circulation. Which doesn't appear until vol II.

Though I have to correct myself from a previous post - the capitalist will still make a profit if "price" is equal to "value", we will see in Chapter 19.

Can any better read comrades tell me if Marx mentions marketing and advertising in any volume of Capital or the Grundrisse maybe?

Dave B
Offline
Joined: 3-08-08
Sep 23 2008 19:41

We really are moving ahead of ourselves with the selling thing.

It is dealt with under Merchants capital etc in Volume III.

In brief the cost of just ‘selling’ a product comes out of the surplus value. By selling Karl did not mean advertising which he never even mentioned once I think. So by selling he means what the capitalists has to shell out, to pay people I suppose, to actually sell it.

The capitalist could I suppose just set up his factory shop and pay people out his surplus value to sell the stuff to the end user, that’s important, that is if he didn’t do it himself. Anyway it is his problem.

Obviously in reality he sells his commodity to merchants or shopkeepers who then go on to sell it to an end user.

What happens here is manufacturer sells his commodity to the merchant at below its value and proper or full exchange value/price, or if you like the retail price. But above what it has cost him to produce it or the commodities cost price, so the manufacturer still keeps a portion of ‘his’ surplus value.

The portion of ‘his’, the manufacturing capitalist’s surplus value that passes to the merchant is used to pay the merchants employees who add no value to the commodity. As well as providing the merchant with a fair rate of profit on the capital that he has permanently in his business or his stock.

This was a complex issue even for them and there was I seem to remember an interesting exchange of letters between them on it. Obviously before the correct version was written down Karl had made a mess of it and Fred sorted it out for the version that went into Volume III.

Nothing is ever quite straightforward and what can happen is that merchant can become the defacto employer. The following I think has parallels with the present position of small farmers to the supermarkets;

Capital Vol. III Part IV
Conversion of Commodity-Capital and Money-Capital into Commercial
Capital and Money-Dealing Capital (Merchant's Capital)

Chapter 20. Historical Facts about Merchant's Capital

Quote:
"The same conditions exist in somewhat modified form in part of the
London handicraft furniture industry. It is practised notably in the
Tower Hamlets on a very large scale. The whole production is divided
into very numerous separate branches of business independent of one
another. One establishment makes only chairs, another only tables, a
third only bureaus, etc. But these establishments themselves are run
more or less like handicrafts by a single minor master and a few
journeymen.

Nevertheless, production is too large to work directly for private
persons. The buyers are the owners of furniture stores. On Saturdays
the master visits them and sells his product, the transaction being
closed with as much haggling as in a pawnshop over a loan. The
masters depend on this weekly sale, if for no other reason than to be
able to buy raw materials for the following week and to pay out
wages. Under these circumstances, they are really only middlemen
between the merchant and their own labourers. The merchant is the
actual capitalist who pockets the lion's share of the surplus-value."

http://www.marxists.org/archive/marx/works/1894-c3/ch20.htm

darren p's picture
darren p
Offline
Joined: 5-07-06
Sep 23 2008 20:02

Sorry for the multiple posts but I think I've cracked it!

Advertising doesn't add value to a commodity because of the extra labour-time crystallized in it. Value is always determined by what is socially necessary. We do not pay more because of the extra expense of marketing. Who thinks simply "wow, brand x spent 6b trillion on their advertising campaign so I'll go for that, rather than brand y who didn't"?.

Advertising only adds value to the extent that is able to add (pseudo) use-value (and so exchange-value). The use value may be (only the appearance of) luxury, sophistication, reliability or just "coolness" whatever, but marketing only adds value to the extent in which it succeeds in doing this.

So advertising adds value by enriching use-value not because of the increase of labour-time spent on the commodity. Remember prices always reflect the socially necessary average.

The capitalist is the one who buys the commodity "marketing" with there being no guarantee that it will increase "price". A commodity that has had a lot of money spent on an unsuccessful advertising campaign will be worth no more than one which has not been marketed.

These gains are different from the gains made through improving production processes so I would say advertising is a process outside of production per se.

That make sense, or am I going around in circles?

Edit: Whilst I was writing this Dave posted his message which in part answers some of this...

Dave B
Offline
Joined: 3-08-08
Sep 23 2008 20:15

Some commodities or use values don’t have to have material existence, like a live performance play for instance where the living labour never gets a chance to embody itself in anything concrete apart from perhaps in your head or consciousness.

I think the peculiarity of this situation just stems or is a reflex of the absurdity of paying for ‘image’.

I have actually chewed this one over before and it is a weird one, it reminds me a bit of the Phillip K Dick short story ‘We Remember It For You Wholesale’ or the film Total recall.

Daniel B
Offline
Joined: 6-04-07
Sep 23 2008 20:25

I think we need to have some faith in 'uncle Karl'. We first-time readers were warned, after all, to bear with it and more becomes clear later.

That being said I do want to ask a question for those having read Capital already. In places Marx is obviously being literal rather than figurative. I'm particularly interested in whether his theory of the development of erm... trading (right term to use?) is historically demonstrable. Will he make that clear later or should I look elsewhere? If elsewhere does anyone have any suggestions?

Round of applause to darren and Dave who seem to be better read but are sticking around to help us out all the same.

darren p's picture
darren p
Offline
Joined: 5-07-06
Sep 23 2008 20:51
Dave B wrote:
I think the peculiarity of this situation just stems or is a reflex of the absurdity of paying for ‘image’.

Maybe I'll give Debord a re-read, or Vaneigem - though isn't his theory of roles ripped straight from Goffman's "The Presentation of Self in Everyday Life"? Don't know as I've never read it.

Much of value in Althusser anyone?

Daniel Brennan wrote:
I'm particularly interested in whether his theory of the development of erm... trading (right term to use?) is historically demonstrable. Will he make that clear later or should I look elsewhere? If elsewhere does anyone have any suggestions?

Trading doesn't really come into it until Vol II and III, though I've only flicked through these so far.

Dave B
Offline
Joined: 3-08-08
Sep 23 2008 21:09
Daniel Brennan wrote:
I think we need to have some faith in 'uncle Karl'. We first-time readers were warned, after all, to bear with it and more becomes clear later.

That being said I do want to ask a question for those having read Capital already. In places Marx is obviously being literal rather than figurative. I'm particularly interested in whether his theory of the development of erm... trading (right term to use?) is historically demonstrable. Will he make that clear later or should I look elsewhere? If elsewhere does anyone have any suggestions?

.

He probably starts to reality test his theory and provide supportive evidence in chapter 2. A lot of this, going from memory, is in the footnotes which should not be overlooked at all I think.

Fred does a reasonable historical overview on trade which is in a way is synonymous with ‘commodity’ or at least related to it, in the supplement in Volume III.

The relevant bit starts with;

Quote:
‘We all know that at the beginning of society, products are consumed by the producers themselves, and ‘

http://www.marxists.org/archive/marx/works/1894-c3/supp.htm#law

Daniel B
Offline
Joined: 6-04-07
Sep 23 2008 21:19

Okay tyvm

darren p's picture
darren p
Offline
Joined: 5-07-06
Sep 23 2008 22:00

As I'm a visual learner I've drawn a nice diagram:

However the key to profit is NOT surplus value as we shall find out later..

Felix Frost's picture
Felix Frost
Offline
Joined: 30-12-05
Sep 23 2008 23:07

Sorry darren, but you've got it quite wrong: surplus-value has nothing to do with the difference between price and value - it is the part of the value that goes to the capitalist, after the worker has gotten his share. And it actually IS the key to profit.

When reading Vol I, you should just assume that value = average price. (It's actually more complicated than that, but Marx doesn't go into that until Vol II and III.)

jonnylocks
Offline
Joined: 13-07-07
Sep 23 2008 23:42

what's with the 'psuedo' use-value talk? isn't this making extraneous judgments on our part?

Marx says clearly:

Marx wrote:
The nature of such wants, whether, for instance, they spring from the stomach or from fancy, makes no difference.

So what gives?

I know he talks about "socially necessary labor time".. but he's not saying "socially necessary use value".

A commodity is just something wanted and exchangeable.

BillJ
Offline
Joined: 28-06-08
Sep 24 2008 01:38
darren p wrote:
As I'm a visual learner I've drawn a nice diagram:

However the key to profit is NOT surplus value as we shall find out later..

Price is not value + surplus value. Read Vol III for that. The surplus value produced during production becomes a part of the commodities' value, and, as a rule, prices and values do not coincide (except on a total level).

Value is determined by socially necessary labor time, they are not the same thing.

A commodity is a use-value and a value, exchange-value is how this value is expressed.

And yes, the key to profit is surplus value (assuming we mean the same thing by "key")-- what else?

BillJ
Offline
Joined: 28-06-08
Sep 24 2008 03:09

P.S. Surplus value exists unless a capitalist pays the wage-laborer the full value that his (socially necessary) labor-time has produced. It has nothing to do with whether or not price falls above or below value.

安藤鈴
Offline
Joined: 17-09-08
Sep 24 2008 03:52

Hi Comrade,

darren p wrote:
Marketing is not a part of the production of specific commodities but a commodity in itself. The capitalist is the one who purchases marketing commodities as I said before. "Price" is what the market can bear, or what consumers can be persuaded (through marketing) to pay. If a commodities "price" is more than it's "value" the capitalist makes a profit, if it is not then a loss is made.

This is incorrect.

A capitalist can sell commodities at value and make a profit.

I'll give an example.

A worker makes 10 pots out of 10 kilograms of metal in 6 hours.

Let's say that the metal costs $10.

The worker is paid $2 - this is at the very least the minimum required to keep the worker alive & producing effectively.

Let's say that the worker consumes 1 hammer in the process of making these 10 pots, at a cost of $1 per hammer.

What would be the value of these pots produced? Well, the cost of the metal $10 + the cost of the labour power $2 + the cost of the hammer $1 = $13

The capitalist has not broken even!

But, he gets the worker to continue working another 6 hours.

The same cost of metal $10 + the cost of the hammer $1 =11.

Where's the wage of the laborer gone?

He's already been paid!

So, at the end of the day, the worker has produced 20 pots at a cost to the capitalist of $13 + 11 = $24.

YET, the value of the goods is actually worth $26.

Why? Because the value of labor and the value which it creates are two different things.

The value of the labor (i.e the wage was $2). The worker was paid this, but continued working.

Yet just because he was not being paid for this 'additional time' does not mean that he was not creating value!

He still was, and therein lies the capitalist's profit.

Here is Marx's same explanation:

Quote:
Let us examine the matter more closely. The value of a day's labour-power amounts to 3 shillings,
because on our assumption half a day's labour is embodied in that quantity of labour-power, i.e., because
the means of subsistence that are daily required for the production of labour-power, cost half a day's
labour. But the past labour that is embodied in the labour-power, and the living labour that it can call into
action; the daily cost of maintaining it, and its daily expenditure in work, are two totally different things.
The former determines the exchange-value of the labour-power, the latter is its use-value. The fact that
half a day's labour is necessary to keep the labourer alive during 24 hours, does not in any way prevent
him from working a whole day. Therefore, the value of labour-power, and the value which that
labour-power creates in the labour-process, are two entirely different magnitudes; and this difference of
the two values was what the capitalist had in view, when he was purchasing the labour-power. The useful
qualities that labour-power possesses, and by virtue of which it makes yarn or boots, were to him nothing
more than a conditio sine qua non; for in order to create value, labour must be expended in a useful

manner. What really influenced him was the specific use-value which this commodity possesses of being
a source not only of value, but of more value than it has itself. This is the special service that the
capitalist expects from labour-power, and in this transaction he acts in accordance with the "eternal laws"
of the exchange of commodities. The seller of labour-power, like the seller of any other commodity,
realises its exchange-value, and parts with its use-value. He cannot take the one without giving the other.
The use-value of labour-power, or in other words, labour, belongs just as little to its seller, as the
use-value of oil after it has been sold belongs to the dealer who has sold it. The owner of the money has
paid the value of a day's labour-power; his, therefore, is the use of it for a day; a day's labour belongs to
him. The circumstance, that on the one hand the daily sustenance of labour-power costs only half a day's
labour, while on the other hand the very same labour-power can work during a whole day, that
consequently the value which its use during one day creates, is double what he pays for that use, this
circumstance is, without doubt, a piece of good luck for the buyer, but by no means an injury to the
seller.

Our capitalist foresaw this state of things, and that was the cause of his laughter. The labourer therefore
finds, in the workshop, the means of production necessary for working, not only during six, but during
twelve hours. Just as during the six hours' process our 10 lbs. of cotton absorbed six hours' labour, and
became 10 lbs. of yarn, so now, 20 lbs. of cotton will absorb 12 hours' labour and be changed into 20 lbs.
of yarn. Let us now examine the product of this prolonged process. There is now materialised in this 20
lbs. of yarn the labour of five days, of which four days are due to the cotton and the lost steel of the
spindle, the remaining day having been absorbed by the cotton during the spinning process. Expressed in
gold, the labour of five days is thirty shillings. This is therefore the price of the 20 lbs. of yarn, giving, as
before, eighteenpence as the price of a pound. But the sum of the values of the commodities that entered
into the process amounts to 27 shillings. The value of the yarn is 30 shillings. Therefore the value of the
product is 1/9 greater than the value advanced for its production; 27 shillings have been transformed into
30 shillings; a surplus-value of 3 shillings has been created. The trick has at last succeeded; money has
been converted into capital.

Every condition of the problem is satisfied, while the laws that regulate the exchange of commodities,
have been in no way violated. Equivalent has been exchanged for equivalent. For the capitalist as buyer
paid for each commodity, for the cotton, the spindle and the labour-power, its full value. He then did
what is done by every purchaser of commodities; he consumed their use-value. The consumption of the
labour-power, which was also the process of producing commodities, resulted in 20 lbs. of yarn, having a
value of 30 shillings. The capitalist, formerly a buyer, now returns to market as a seller, of commodities.
He sells his yarn at eighteenpence a pound, which is its exact value. Yet for all that he withdraws 3
shillings more from circulation than he originally threw into it. This metamorphosis, this conversion of
money into capital, takes place both within the sphere of circulation and also outside it; within the
circulation, because conditioned by the purchase of the labour-power in the market; outside the
circulation, because what is done within it is only a stepping-stone to the production of surplus-value, a
process which is entirely confined to the sphere of production.
Thus "tout est pour le mieux dans le
meflleur des mondes possibles."

By turning his money into commodities that serve as the material elements of a new product, and as
factors in the labour-process, by incorporating living labour with their dead substance, the capitalist at
the same time converts value, i.e., past, materialised, and dead labour into capital, into value big with
value, a live monster that is fruitful and multiplies.

If we now compare the two processes of producing value and of creating surplus-value, we see that the
latter is nothing but the continuation of the former beyond a definite point. If on the one hand the process
be not carried beyond the point, where the value paid by the capitalist for the labour-power is replaced by
an exact equivalent, it is simply a process of producing value; if, on the other hand, it be continued
beyond that point, it becomes a process of creating surplus-value.

If we proceed further, and compare the process of producing value with the labour-process, pure and
simple, we find that the latter consists of the useful labour, the work, that produces use-values. Here we
contemplate the labour as producing a particular article; we view it under its qualitative aspect alone,
with regard to its end and aim. But viewed as a value-creating process, the same labour-process presents
itself under its quantitative aspect alone. Here it is a question merely of the time occupied by the labourer
in doing the work; of the period during which the labour-power is usefully expended.

Here, the commodities that take part in the process, do not count any longer as necessary adjuncts of labour-power
in the production of a definite, useful object. They count merely as depositories of so much absorbed or
materialised labour; that labour, whether previously embodied in the means of production, or
incorporated in them for the first time during the process by the action of labour-power, counts in either
case only according to its duration; it amounts to so many hours or days as the case may be.
Moreover, only so much of the time spent in the production of any article is counted, as, under the given
social conditions, is necessary. The consequences of this are various. In the first place, it becomes
necessary that the labour should be carried on under normal conditions. If a self-acting mule is the
implement in general use for spinning, it would be absurd to supply the spinner with a distaff and
spinning wheel. The cotton too must not be such rubbish as to cause extra waste in being worked, but
must be of suitable quality. Otherwise the spinner would be found to spend more time in producing a
pound of yarn than is socially necessary, in which case the excess of time would create neither value nor
money.

But whether the material factors of the process are of normal quality or not, depends not upon the
labourer, but entirely upon the capitalist. Then again, the labour-power itself must be of average efficacy.
In the trade in which it is being employed, it must possess the average skill, handiness and quickness
prevalent in that trade, and our capitalist took good care to buy labour-power of such normal goodness.
This power must be applied with the average amount of exertion and with the usual degree of intensity;
and the capitalist is as careful to see that this is done, as that his workmen are not idle for a single
moment. He has bought, the use of the labour-power for a definite period, and he insists upon his rights.
He has no intention of being robbed. Lastly, and for this purpose our friend has a penal code of his own,
all wasteful consumption of raw material or instruments of labour is strictly forbidden, because what is
so wasted, represents labour superfluously expended, labour that does not count in the product or enter
into its value.

We now see, that the difference between labour, considered on the one hand as producing utilities, and
on the other hand, as creating value, a difference which we discovered by our analysis of a commodity,
resolves itself into a distinction between two aspects of the process of production.
The process of production, considered on the one hand as the unity of the labour-process and the process
of creating value, is production of commodities; considered on the other hand as the unity of the
labour-process and the process of producing surplus-value, it is the capitalist process of production, or
capitalist production of commodities.

Capital Vol. I — Chapter Seven

***

Price and value are of course two different things, and price does not always = to value.

But it does 'revolve' around it.

I'll give an example.

Say one capitalist finds a new method to produce these pots. He can now produce 20 pots in half the time.

Assuming that the machinery cost the same as the hammer, and was consumed in the same amount of time (I say this for the sake of simpicity) the amount of labour in the pots would be half what it was previously.

Does this mean that the capitalist would instantly halve the prices?

That would be an optimistic assumption about the nature of capitalists to say the least.

No, the capitalist would sell it not at halve the price previously, but lower to attack a competitor's market.

However, this would also mean that he would be gaining an extra profit - since he would be selling it not at the exact value, but slightly higher.

Of course, when the opposing capitalist gets his hands on this new technology the race will begin again, and the price will be drawn back down to the value.

(Of course, the capitalists can collude, but we will exclude this possibility).

So, here we have one example of how price does not always equal value, but nevertheless revolves around it.

And no sign of 'supply and demand' anywhere.

Rei

安藤鈴
Offline
Joined: 17-09-08
Sep 24 2008 04:12
jonnylocks wrote:
what's with the 'psuedo' use-value talk? isn't this making extraneous judgments on our part?

Marx says clearly:

Marx wrote:
The nature of such wants, whether, for instance, they spring from the stomach or from fancy, makes no difference.

So what gives?

I know he talks about "socially necessary labor time".. but he's not saying "socially necessary use value".

A commodity is just something wanted and exchangeable.

Precisely.

Use-value is not something in differing degrees of intensity.

Water is extremely useful, but has little value.

Diamonds are fairly useless, but have vast amounts of value.

Trying to find the value of something by reference to the inherent properties in a commodity is the task of bourgeoisie economists who haven't attended a basic mathematics course.

Want, or utility, is a subjective thing. By its very nature we cannot measure it - my above example in itself is subjective - diamonds may have a vast utility in all sorts of electronic matters.

What we can determine is whether something has a social use-value. If it sells on the market then it has a use-value and we shouldn't be more concerned than that.

If it doesn't have a use-value, then the labor contained in it is useless.

Think of it as a boolean; it is either useless (0) or useful (1).

And even if it useful, then the value in it is still restricted by the socially necessary labor embodied in it.

Merely because I spent 40 hours creating a spoon which would take, on average, 10 minutes to create, does not mean that my spoon (if otherwise identical to the other spoon) was worth several hundred times or whatever more...

I remember some 'expert' trying to convince me that the LTV does not 'work' since it (apparently) argues that if I found a diamond next to a rock, then the diamond would be worth the same as a rock.

On average, of course, one does not find diamonds sitting next to rocks... grin

Rei.