Labor Theory of Value -- Richard Wolff

[@ericmoore2236]

I never thought I would be watching an economist talk about economic theories but I am absolutely hooked thank you Professor Wolff.

[@brianmacker1288]

You've picked the wrong teacher. He lied when he claimed that in the US the utility theory of value is correct. No. The subjective theory of value is both taught and is correct. en.wikipedia.org/wiki/Subjective_theory_of_value

[@brianmacker1288]

Wolff is also a Marxist, and Marx was an economic quack whose theories have resulted in the murder of over 100 million people and the opression of billions more in Marxist dictatorships.

[@mssande211]

FOR THE LOVE OF GOD! Thank you! I spent years studying to get my Econ degree, and never found a single definition of "utility" that makes sense.

[@mssande211]

Barskor1 correct.

[@seto007]

Jesus, this is such a gross mischaracterization of the opposition. I genuinely don't understand if you guys understand the alternative to the labor theory of value. If you have an economics degree, it even more so blows my mind that you don't understand it. The labor theory of value is an intrinsic feeling of value. This means that it is based off of a fundamental belief that is intrinsic, and thus unjustified: the belief that all value is derived from labor is an intrinsic, axiomatic belief. The oppositional viewpoint is a part of the subjective theory of value, and is more specifically referred to as Marginalism, not the Utility Theory of Value. Marginal Utility is defined as the additional satisfaction a consumer gains from consuming one more unit of a good or service. Marginal Utility is an important economic concept because economists use it to determine how much of an item a consumer will buy. When you understand this, you can then get into the other variable that determines prices: supply. Supply and Demand assumes that things we want and need are scarce, meaning that there is not an abundancy of the commodities, resources and services we need to fulfill our utility desires. This includes things like video games, land, and labor. The labor theory of value is a cute concept, but it's axioms, those being that all value is intrinsic, and that intrinsic value is based on the labor put into that objective, is a theory that requires far more justification, and far more evidence, than the subjective theory of value, which states that different people value different things, and that they are willing to pay a specific amount for something based on how much they want it. Beyond that, this guy's analysis of "price", and why he doesn't care about it, is laughable. Do consumers and poor people not care about the "price" of food? Because those people aren't necessarily "Capitalist" in either of the senses he means by that. Also, Adam Smith is not relevant to Modern Economic thought. When you take an Economics class, you don't learn about Adam Smith, just like how when you take a quantum physics class, you don't learn about Einstein, Isaac Neuton, or Galileo.

[@scottkuhn4026]

The Rustiest Venture actually Marx understands supply and demand. Why is a intrinsic belief unjustified? Value does not exist as a physical attribute but isn't that also unjustified? utility theory of value sounds crazy. How can you price an object? Or how would you determine the value of cryptocurrency? I'm assuming that you have read Marx.

[@antipositivism3128]

@@scottkuhn4026 Why can you not price an object

[@bucketslash11]

@@seto007 i see you've never heard of use-value, exchange-value and fictitious capital all of which would explain cryptocurrency and speculation

[@bm-br3go]

Edit: For anyone still seeing this I did get things wrong. Mainly, value is an inherent property determined by labor time. Value does NOT necessarily correspond to exchange ratios of actual commodities. Rather, value is a governing property. The tendency is more labor = higher price, but it is not deterministic. What Marx does in volume 1 is show how this tendency operates by assuming that prices = values. He later justifies this assumption in volume 3 by showing how values can be transformed into prices, which is still a controversial topic (and note that these are prices of production, not necessarily market prices). I'm going to try and give a bit more of a rigorous analysis of the LVT. Here goes: Price and value are two different things. Marx breaks down value into two parts, use value and exchange value. Use value is a sort of boolean value (that is, it only has two states it can take on). In other words, either something has a use, or it doesnt. If it does, it's a commodity and can be exchanged, if it doesnt, it isnt and it cant be. Exchange value is a quantitative property of a commodity that tells us how different commodities are related to one another (that is, in what proportion they can be exchanged for one another). The labor theory of value is the idea that this exchange value, in it's most abstract form, is determined by the average amount of labor required to produce that commodity. Marx has justifications for assuming this, but let me bring up one in particular. The price of a commodity is determined by supply, demand, and competition. This should be common knowledge. And of course these prices will fluctuate up and down. But if we look at the sales of one commodity over a long period of time and take the average price, why is that price what it is? Well, when producers can sell their commodities for more than what it costs to make it, competition drives the price down. And, when these producers have to sell their commodities for less than the cost of production, the competition will be less, therefore driving the price up. So this average will conform to the cost of production. In other words, the proportion in which a given commodity can be exchanged with the universal commodity (money) is determined by the production cost. This means exchange value is determined by production cost (because money is a universal measure of exchange value). So, raw materials and labor determine exchange value. This seems fine, until we realize that raw materials are commodities in and of themselves. In order to avoid an infinite regress, we must have that some raw materials do not require labor to produce, which is of course not a problem (these are materials created naturally). Regardless, they still require labor to be brought to the market (that is, labor must be expended to realize their value). Thus, the exchange value of any given commodity is determined by the hidden (or congealed) amount of labor expended to realize the value of the raw materials, plus the amount of (coagulated) labor expended to turn the raw materials into a new commodity. So, the exchange value of a commodity is solely determined by the amount of aggregate labor that goes into its production. Let me know if I've gotten anything wrong in my analysis. I'm not an expert in economics just a student who's trying to learn more.

[@shubhamwr]

U r correct! This is something marginalist should read

[@dyssemiamoeba718]

Look up academic agent's masters of austrian economics playlist to find similiar analysis

[@bing4126]

so your critique of LVT is "natural resources tho" . wow , marx was a real idiot to forget about those.

[@shubhamwr]

@@bing4126 Marx didn't forget about them.

[@tomrobertson6747]

I think you have it just right, assuming you include the labor that created capital. Communists mysteriously seem to think that only current labor has value and that the labor that created capital is too old to be valuable.

[@drkwrl]

look at Kevin Carson's commentary on LTV for a really clever integration of the ideas of LTV between these different schools of thought

[@hansmuller4338]

If you look at the theory of utility through Marx's theory, the idea to measure utility quantitatively is absurd. For Marx utility was a qualitative thing. Maybe go a little into Hegel, because the quality/quantity thing stems from Hegel and is quite important.

[@brianmacker1288]

No one teaches the utility theory of value as valid in the US. He was straight up lying.

[@Huy-G-Le]

@@brianmacker1288 No teacher thought Labor theory actually.

[@davec-1378]

The biggest disconnect I've seen in the discussion between capitalists and Marx's Theory is the misunderstanding of the term "value" and how those that are not familiar with Marx equivicate the term. In Marx, Value is NOT meant to represent a subjective assessment towards an object that reflects desires or needs but rather it is a scientific label he places on a "Theoretical Unobservable" that represents the average socially neccessary labor time required to produce that item. The best analogy I'm aware of is what an Electron is to the Atomic Theory of Matter. The label "electron" represents an theoretical entity we do not see first hand, we postulate it exists to be able to create a theory around that potential existence. IF the electron exists we should expect to see x, y and z. We then create testing to attempt to falsify this hypothesis. In the same manner IF "value" exists in a commodity we should expect to see x, y and z observable affects. We don't see electrons just like we don't see "value". They are both Theoretical Unobservables that are postulated in a scientific theory to explain the phenomena we DO observe. Anyone speaking of "Value" in any other way is NOT addressing the theory.

[@bjrnhagen4484]

Yeah, Marx the muscle mystic.

[@stateofthenihil8352]

Nonsense. A theoretical unobservable is not necessarily a desirable thing for any theory. This unobservable ought to be cut out, wherever possible, as it is not independently verifiable. The only reason the atomic theory has theoretical unobservables (all of the subatomic particles, not just electrons) is because there is no other theory with equal explanatory power that avoids making such unverifiable assumptions. This, however, is not the case for the labor theory of value. We do have a theory that fits the data and simultaneously avoids making such an assumption. As such, the epistemic value of parsimony suggests that the alternative choice be taken. Another point is the fact that this theoretical unobservable posited by the labor theory of value is anti-materialist. I'm not saying materialism must be true, but that Marxism is materialist, so some sort of reconciliation must be made. Your statement, "We don't see electrons just like we don't see 'value'" is blatantly false. The reason we can't observe electrons (or any subatomic particle) is because they are small. They are still a part of the material world; they make up matter. How does this apply to the real value that is somehow independent of "desires or needs?" The labor theory of value demands acknowledgement of objective values; how are objective values part of the material world? Claiming that they are a theoretical unobservable is not a justification since I can simply dismiss the assumption altogether and stick with the subjective theory of value. Assorted comments: "Value is NOT meant to represent a subjective assessment towards an object that reflects desires or needs but rather it is a scientific label" I'm not sure, but are you implying that subjective assessments of an object can't be scientific? Also, scientific terms refer to things in reality. If you are a Marxist, then you're a materialist. And so any scientific term must reference something material. "a scientific label he places on a "Theoretical Unobservable" that represents the average socially neccessary labor time required to produce that item." The wording here is confusing. What is being represented is the real value of an item, not the socially necessary labor time. The real value is the theoretical unobservable; the socially necessary labor time is observable. The socially necessary labor time is supposed to be what gives the item its value; they are not the same thing.

[@Iandar1]

StateoftheNihil well I have a problem as STEM major to your response, what your saying can easily be applied to atomic theory since it is too based on a theoritic unobservable while we can experimentally find out they exist we can just do the same for the labor theory of value which from what I can see consistently (from what I read from academic journals) proven to be right.

[@stateofthenihil8352]

@Jay Blake "the problem here is an N=1 kind of . . . Bourgeoisie, with the z being socialism or barbarism." The subjective theory of value makes predictions of price changes just fine. As for these other predictions, they haven't happened and are evidence against the theory. Continually kicking the can down the road, suggesting that it might happen in the future, makes the prediction unfalsifiable. The rest of that comment, I just . . . Lol. Capitalists are not the only one's committing atrocities. DOTP will do nothing to alleviate those behaviors. Why would it? People won't just behave better outside of capitalism.

[@stateofthenihil8352]

​@@Iandar1 You did not pay attention to anything I talked about in my comment. I explicitly argue why the LTV and atomic theory are not comparable.

[@MrDXRamirez]

Just reading the comments, some are good not all are atrocious distortions but! A Loooooooooong waaaaay tooooo goooo on theory, folks. Get back into the literature, be honest with the material and yourself with it. Reading Marx takes a definite skill most people do not have and too many are caught up with minutia to be patient enough to work methodically through the material. I know I am one of them.

[@waynehockey22]

Value comes from demand. Utility is an aspect of demand. But value and prices come from individual preferences, resulting in demand. If things are demanded, the suppliers and the consumers will come up with a market price.

[@raymondhartmeijer9300]

sure, but what if the demand and supply are in equilibrium ? it's not like shoes are in less demand than T-shirts for example, so the Labour Theory of Value helps explain why it is that shoes cost more than shirts even at the point of equilibrium

[@thebossmana]

@@raymondhartmeijer9300 why are New Balance worth 1/10th of a new pair of Nike if they take the same amount of labor

[@xiMaFaNb01x]

So essentially he is saying that Marx *defined* value as the amount of labor required for a product, and therefore the amount of labor required for a product is its value Revolutionary!! -_-

[@antonkokic]

haha yeah I came here open minded to be proven something - just went dissapointed

[@moscamuerta]

Yeah the revolutionary part is saying something so obvious yet so contradictory to how things are actually run in society

[@Ronni3no2]

It's a name he used for a concept. Just because you use the same word to mean something else doesn't mean his use isn't just as valid and it certainly doesn't invalidate the theory. It's like being perplexed by the fact that physicists defined *work* as the product of force magnitude and length of path. -_-

[@Hi.Jay.Low25]

I love professor Wolff, but it saddens me that he doesn't mention Ibn Khaldun and his contribution to LTV

[@Huy-G-Le]

If he bring up a middle eastern, what do you think his audience? American are very racist. This is why they hate LTV, because it's deem the labors of people from darker background, let say, equal to white people.

[@ivor8715]

As of recently I started learning more about marxism and economics. I noticed one problem which I can not explain to myself with the labour theory of value: Marx says that profit is made by exploiting the worker for the surplus value he produces. He also says that there is an equalizing rate of profit (not sure if that is the exact language he uses, but I remember this from either "Value, Price and profit" or "Wage labour and capital", I don't know exactly which one). Now, if there is an equalizing rate of profit, wouldn't it make sense that commodities which have 90% fixed capital cost and 10% labour cost have an equal price to commodities which have 10% fixed capital cost and 90% labour cost? But if this is so, wouldn't it be true that the first product would be priced above its value? If you know the answer to this, please tell me or just tell me what to read if Marx or any other economist ever wrote about this

[@pure_the0ry]

I’m convinced of the LTV despite Richard Wolff’s defense of it. I don’t know what happened, he was way more rigorous in his early writing

[@marifkhan7054]

Sir. What are the similarities and differences among adam smith, david ricardo and marx Labour theory of value. Can you elaborate it please?

[@davidmcmillan4183]

There's obviously not one unitary explanation for the value of something. People value things for different reasons. I might value an essay I wrote for the labor I put into it, a piece of art hanging on my wall for its beauty, and my washing machine for its utility. The desire to find a "theory of value" is a boneheaded academic move to justify a certain economic ideology by arguing that it best comports with the way humans assign value imo.

[@davec-1378]

You are equivicating on what Marx means by value and how others use the term. See my comment above for an explanation

[@markswaggerty4958]

His brief explanation of utility seems way more logical the the labor one

[@davidmb1595]

Well, if you don't know anything about economics, I suppose that might be the case

[@01Tanthallas]

Mark Swaggerty I can see that if you have very limited brain function

[@immattlaramee]

Thanks for sharing. Do you have a link to the full talk?

[@aneesniazi7918]

Look up " Richard Wolff - Talks at Google ".

[@fruityparameq]

Anees Niazi ty

[@Oldscale]

How do you get from labor theory of value to worker exploration if the value described by the labor theory of value is seperate from exchange value very confused by the whole thing.

[@blunderhappy8962]

So, the exploitation comes from you selling your labor-power. Your labor-power produces more value than the exchange-value(wage) your boss pays you. The use value of labor power is unique, because it is a "source of value", which is bought for less than it produces in terms of absolute value. The exchange-value of labor is just determined by what is needed to make sure the worker is ready to go back to work the next day. The rest of the value one produces at work is taken by the capitalist.

[@ExPwner]

@@blunderhappy8962 no it doesn’t “produce more value” than you get paid for it. You value the wage more than the work. The employer values the work more than the wage. There is no objective amount of “value produced by labor.” This attempt to turn value into math conflates present value with future value which does not work this way. See Bohm Bawerk.

[@ryandepp7640]

Marx explained at the beginning of Volume I of 'Capital' that objects do indeed have a "use-value" i.e. utility so I don't know what to think of the utility theory of value (or as I know it: marginal utility theory"). However I disagree with it because value stems from labor, use-values are a mere byproduct of labor making value, not the root cause of value.

[@MrCrashDavi]

17th/18th century conceptions of utility are different from modern neoclassical ones, be careful when equating the two.

[@L4SERB0Y]

I think you have conflated three things. 1. The thing itself is the solution to a problem or a need (ie Bread answers the need of hunger) 2. The Labour is the mechanism of the making of the thing (The baker brings the bread into being) 3. The utility of the bread determines it's value (If bread is overproduced it's value will fall as it goes mouldy before anyone wants it. If it is scarce people will pay a high price) So the thing is a product of a need and the solution. The value is a reflection of how useful and in demand the thing is. This is true in a Marxist state whether Marx admits it or not, that is why black markets appear in controlled economies, because you cannot philosophise away the real value of a thing.

[@miker2157]

Smith, Ricardo AND Marx were incorrect in their cost and labor theory of value and price. Value is subjective and exists on a marginal frame work of ordinal evaluation. The price of goods of higher order are dependent on the subjective marginal valuation of consumers goods.

[@gregpaul2514]

The Subjective/Objective dichotomy is a false one. Marxism makes no assumption of being a "purely objective" theory of value. The subjective theory of value is simply based on the idea that when people make decisions they multiply the probability of each alternative by its subjective utility and choose the alternative with the highest expected utility. Certain facts about the properties of people's preferences are also assumed. This allows economists to create indifference curves, demand curves, etc. Behavioral economists (especially Kahneman, Tversky, and Thaler) have found many "anomalies" of human decision-making which don't fit well with this theory. It also neglects class analysis and is unable to explain the falling rate of profit, the impoverishment of workers, conflict over the length of the working day, conflict over the intensity of labor, recurring depressions, increasing concentration of capital, proletarianization of the labor force, and the necessity of money, whereas Marxism can explain all of these.

[@miker2157]

@@gregpaul2514 The subjective theory of value is not based on "probability of utility", unless that is your way of saying that humans will choose an action that they believe will yield the greatest amount of utility, i.e- the end they seek the most (I apologize if that is what you meant). Subjective value theory is based on subjective ends sought. Individuals have different ends from each other (even the same individual has different ends at different points in time and economizes as such). By purposive action, humans attempt to understand the world and the objects or commodities around them as a means to achieve their ends, to gain "profit", a state of existence more satisfactory to their current state. The idea of "anomalies" in human decision-making is erroneous. "Rational" behavior in itself is subjective and dependent on knowledge of means to achieve ends. Two men who wish to enhance their yield of crops, will act in the way they believe is the best means to their ends. That one man chooses to use fertilizer and the other man chooses to do a rain dance, says nothing about an irrational or anomalous action to achieve their ends. They have both acted purposefully and rationally. 1. As for class analysis, egalitarianism is not the concern of economics. Any economic theory based on methodological individualism, private property, cooperation and mutual exchange is only concerned with "Class" in so much as it is a result of violence, compulsion and coercion by the State. Polylogism is rejected in terms of class consciousness. 2. The "Falling Rate of Profit" is a fundamental confusion at the heart of the labor theory of value. TTOTROPTF is based on the idea that surplus labor is the only source of "profit" to a firm. By investing in constant capital, (instead of variable capital) the firm's profits will of course decline. Bohm-Bawerk believed that Marx confused profit w/ interest. The reason goods sell for more than the worker's remuneration is because of interest. The capitalist is forwarding present goods to the worker in exchange for labor representing the price of future goods. Because time is a factor in production and consumption, there is always a discount on the same good in the future vs. the present. Interest is the price of time. The accumulation of capital goods has caused the rate of interest to fall, not the rate of profit. Time preference is lower when capital has produced more goods to be consumed in the present or near present. 3. I'm going to skip over your "labor points" in that all over the world (but at different rates) the worker has seen a rise in their standard of living and the length of the work day has decreased because of capital investment in labor saving tech, and I would argue that this has reduced the intensity of labor for millions of people, if not hundreds of millions. 4. Recurring depressions are caused by mal-investment made systemic by central banks and government fixes such as price controls, minimum wages, subsidies to corporations, and inflation through fiat money printing, deforming the market's ability to allocate resources to the most demanded steams. 5. Concentration of Capital occurs when central banks print money and the firms that have quickest access to this money do not experience the inflationary effects of the change in the money relation like savers and people on a fixed income. Inflation moves at different rates at different points in the economy. The politically well connected make profits from the new money while the rest experience a rise in prices. 6. I don't know what "proletarianization of the labor force" means. 7. Money is a commodity and a medium of exchange. It is needed to act as a means for which individuals and entrepreneurs can engage in economic calculation. Prices are the only means at the disposal of actors in the market to make economic decisions in relation to their individual, ordinal value schedules. PS. I have only read VOL I of Das Kapital, so if I have mischaracterized or not understood later insights by Marx, I apologize. But I would also say that any later insights Marx may have had were in light of the Marginalist Revolution of the 1870's.

[@ExPwner]

@@gregpaul2514 workers aren't getting more impoverished but richer. Marxism isn't "explaining" anything. It's just wrong.

[@duncannortier7079]

I fucking love this guy

[@hugesinker]

This is about as useful as a "Mass Theory of Value". Every product has some congealed mass associated with it, both directly and in its production-- so lets just associate this mass with value by definition, and consider price entirely separate. So, if someone trades a pound of gold for a ton of lead, it's because the person trading away the gold is stealing the excess mass and exploiting the person who traded away the lead. If you can see the problems with that, you can see many of the problems with the Labor Theory of Value too. Funny how Wolff's complaint about the Utility Theory of Value is that it is dynamic and difficult to calculate. That is a textbook-fallacious appeal to simplicity. There's also all this rhetoric about how his theory was overturned because economists just had some sort of personal grudge against Marx. No, it's because Marx was wrong about value, just like Adam Smith was (though Smith's theory was the Cost Theory of Value, which is different-- and at least Smith understood that his theory was incomplete.)

[@thefinnishsocialist4816]

Well since labor holds no value to you, why don't you work for me for free?

[@hugesinker]

As far as I am aware, no one claims that labor has no value. The value of labor is subjective. It depends on a host of other factors and properties-- just like mass, just like everything else.

[@beatles123]

@@hugesinker Historically people DO hold grudges against Marx. Several ideologies sprung up to directly counter his or discredit his denouncing of Capitalism (Which is only proving more correct to be called out as opp as time goes on.) Further, it is pretty well documented that Marx was quite aware he didnt have all the answers, so you using Smith as a gaslight doesn't help you.

[@hugesinker]

@@beatles123 About ever prediction he made has been shown to be wrong. His most critical failure was to underestimate labor unions. I don't think you're using the term 'gaslight' correctly.

[@Oldscale]

I think this is where I'm at right now, it seems by Marxists own opinion that labor theory of value does not = price. So if thats the case then how can you say a worker is getting exploited when an item is exchanged by a capitalist for capital? Part of price comes from the eye of the beholder. If I bribe a purchasing agent of another company to disproportionately buy more of my goods and services does that not increase price while keeping labor the same. I suppose there's value in the labor of bribery itself but let's say without bribery the product and service is worthless. Does that now mean that the labor that goes into bribery is worth more than the services of all my employees combined? Surely no? I dont reject what there saying labor is part of value just making the next step and explaining that profit = rate of worker exploration is where I am having trouble. This is all very confusing.

[@GoldilocksAI]

Why is the Mona Lisa painting and other famous art so valuable?

[@MacrobianNomad]

Use Value vs Exchange Value

[@pauladams1814]

It's the old question should the economy work for a few or the many.

[@brettknoss486]

Should it be planned by the few, or the many?

[@Iandar1]

gespilk get out of here LARP’er

[@Iandar1]

brett knoss in the Soviet Union while planning workers opinions and perspectives where taken into account PRC did this on a larger scale.

[@darthutah6649]

Both Adam Smith and David Ricardo talked about the labor theory of value but both said that it only holds true for primitive societies. What they really talked about is the cost theory of value (the theory that goods and services are worth how much resources went into producing them). Ricardo was moreso a proponent of the labor theory than Smith but even he saw its problems. The problem with the cost theory of value is that it only looks at the supply side of goods and services whilst ignoring the demand side. For example, a house in San Francisco may not be more difficult to build than a house in Phoenix but it's going to be more expensive. If two goods are just as easy to produce but good A is in higher demand, that good will be more expensive. The labor theory is arguably even more simplistic, only looking at labor costs and throwing capital out of the window.

[@nadimmahjoub]

This is an example of not reading a theory. Marx’s analysis has to be read as a whole, not as parts. Labour, value, surplus-value, exchange value, fixed capital and variable capital, etc. form a one body and they have to be read in their interconnectedness. In that way they body of ideas make sense in the real world. That’s what I understood when I read Capital vol 1.

[@nadimmahjoub]

@Darth, Is Adam Smith below speaking about primitive societies? “The value of any commodity, therefore, to the person who possesses it, and who means not to use or consume it himself, but to exchange it for other commodities, is equal to the quantity of labour which it enables him to purchase or command. Labour, therefore, is the real measure of the exchangeable value of all commodities. “The real price of everything, what everything really costs to the man who wants to acquire it, is the toil and trouble of acquiring 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 which it can impose upon other people.” [Wealth of Nations, Chapter 5]

[@MM-du7je]

Ricardo splits goods into two categories, reproducible and non-reproducible. Non-reproducible goods, like a genuine Van Gogh painting, or a plot of land in San Francisco, or zoned housing are not necessarily subject to the cost theory of value since they're non-reproducible (physical, social constraints). Reproducible goods, the most common sort are absolutely subject to it.

[@larrysheetmetal]

SO IF government just reduced the amount of things Workers can use when filing taxes ,How much will firms like HR Block and Jackson Hewlett, Etc. lose , When workers figure out they don't need to pay to have their taxes filed.,because they can't save you any more money than filling out the EZ 1040 form ?

[@brettknoss486]

Yes, utility is difficult to measure, especially when you consider marginal utility. However, the theory is generally known as the Subjective Theory of Value. This is because it's based on the idea, that the value of a good or service is the result of what someone is willing to pay, regardless of what it cost to produce. It also means that many factors of a subjective nature influence what consumers are willing to pay, and so profit exists when the willingness to pay, is greater than the cost of production.

[@brettknoss486]

gespilk exactly

[@LaureanoLuna]

Obviously, it is not that commodities are valuable because they incorporate labor but rather that they incorporate labor because they are valuable. And obviously, they are valuable because they provide utility.

[@tad3900]

Who establishes value?

[@GMMDMMG]

@Mark yeah. And the subjective fact as phenomenon is exactly what determines price, decentralized and plural in form.

[@tigerstyle4505]

My current area has allocated most of it's labor to the food service industry, especially fast food. Not good. Marx was not perfect. His theory and predictions have been shown to need adjustment due to incorrect assumptions by M&E or the changing times and economic landscape. But people have been doing that since before he even died. Yes, there is a portion of the Marxist population that use "revisionist" as a derogatory term. But Marx and Engels both took issue with people calling themselves "Marxists" to begin with and relying on one part of his writings while ignoring others, placing their work above all else and people misinterpreting the work. They were interested in creating a scientific critique of capitalism and understanding of the larger world. The scientific aspect ends when we rely on special pleading and pretzel bending interpretations to make the writings stand as they are without revision and update to withstand justified critique. Something Marx and Engels made pretty goddamn clear they didn't see as a good thing and hoped not to happen yet many Marxists do just that, almost religiously and it does a great disservice to the body of work and all of the work done by others in that vein.

[@beatles123]

Thing is, he got enough right that it's clear he deserves to be the benchmark for things. Much like Darwin popularized evolution. More people NEED to adopt his views as a starting point, but instead we, in a capitalist society, shun him as mad.

[@cracacola]

No 1 is perfect

[@generalsalami8875]

Value by definition is subjective. You don't need labor for something to have utility or be demanded.

[@drewsimoncomedy]

Value is subjective

[@ew1572]

Nah dog

[@drewsimoncomedy]

@@ew1572 yeah it is

[@nadimmahjoub]

@Drew The concept of value you, or ordinary people, have in mind is not the one Marx, Smith, Ricardo and Wolff are speaking about. There are many places on the Internet (e.g. the encyclopaedia on marxists.org or wikipedia) which provide a definition. It’s a socio-economic concept with political implications. Bourgeois economists and Marxists argue about because of ideology.

[@physiocrat7143]

Value can be measured when and where an exchange takes place.

[@313Nadir]

So how do you value the labor ?

[@hansmuller4338]

In time, quantitatively. Socially necessary labor time

[@hansmuller4338]

it's all in the first chapter of das kapital. read it, it's not that long

[@nadimmahjoub]

@Mark. Not at all. You are the one assuming. Marx in Capital vol. 1 never assumed what you saying. In fact that was not his subject at all.

[@nadimmahjoub]

@Nadi The value of labour-power is the value of the means of subsistence necessary for the maintenance of the labourer.

[@Alloballo123]

Marx put it explicitly in his talk -- value, price, profit: the value of someone's ability to labor (our labor power) is determined by the socially average labor time necessary to produce the laborer. In other words, the average time it takes to produce and sustain a life. Now you can see the complications, how do we decide what's required to sustain an average life? Am I going to eat spam my entire life? Or duck? Drink beer or wine? Our versions of what kind of a life is worth living, and the time required to produce that kind of life, will differ: that is, they are culturally and historically variable as marx noted. An owner of a company will likely want to define his workers life as the bare minimum necessary to stay alive and keep coming back to work. But that's likely not my version of a life worth living, so a struggle emerges between my definition of life and my employers. Hence, in the final iteration, the value of labor is determined by a struggle between classes: workers fighting capitalists over their standard of living. Think about it like this: how is the cost of your labor determined? You enter into a struggle with your employer -- called contract negotiations -- where you try and put a price on the kind of life you're willing to live in return for the kind of work you're asked to do. You might google "average salary" for that job, to give you some range, or you might say "screw it, I'm fighting for a number that'll let me drink wine every night cause otherwise life isn't worth living." That is a microcosm of how the value of labor is determined: through struggle.

[@martonk]

The lack of cardinality in the marginal utility analasys is not a sufficient criticism of it. Despite it clearly not being measurable, the whole point of Utility is ordinalism, not cardinalism (that it ranks certain commodoties), and for a consumer choice theory that is abundantly sufficient. The difference between the two value theories that the one defended here supposes that we live to work, while the other understands, that we work to live. Also, every educated libertarian knows well that Smith and Ricardo were setting up the path for Marx (see on this point Murray Rothbard's criticism of Smith)

[@truanarchy6315]

Fuck ricardo, what about Böhm-Bawerk and Menger?

[@ExPwner]

Shh they can’t handle that

[@soulfuzz368]

Economic theories are all pretty overrated

[@chrismathewsjr]

wished upon my pillow last night that i would wake up as stupid as you

[@MM-du7je]

@@chrismathewsjr no need to wish

[@brad5696]

Assuming that LTV is correct here, how does it account for the predictive power of marginalism? If LTV is like the general theory of relativity and Marginalism is like Newtonian mechanics, then in this frame how would Newtons laws(Marginalisms accurate predictions). I use the physics analogy since marxism is apparently a science.

[@01Tanthallas]

Brad marginalism has had zero empirical predictive power

[@brad5696]

@@01Tanthallas You have not studied modern econ then im guessing?

[@01Tanthallas]

Brad mathematics and economics degrees, with a focus on economic history and history of economic thought

[@01Tanthallas]

Brad supply and demand, or demand and inverse demand, are not empirically testable or predictive of price. They give a set of conditions necessary for price to increase or decrease, given a set amount of resources and a particular set of distributive variables

[@brad5696]

@@01Tanthallas You may want to get your money back then because either you werent paying attention in class or you went on a bullshit course.

[@nanoaged1]

Definition of an economic bitch-slap! #Damn

[@oraz.]

Isn't the allocation of labor itself a measure of utility?

[@gauravshah4857]

It is.

[@tasmiraziz5260]

If you follow Adam Smith then yes because Adam Smith stated that exchange in an economy happens on the basis of how much labor one could control as per the item being exchanged. So when you choose to buy something you are really exchanging the labor you allocated to attain money for something else that is a representation of a certain amount of labour that went into it. Marx however wasn't interested in this.

[@SomeAHole]

@@tasmiraziz5260 Marx was interested in this and wrote about the Money-Commodity-Money exchange in chapter three of Capital. Unless I am misunderstanding your comment.

[@damnguen1726]

I would say it is the price that allocate resources around

[@asking4afriend311]

The labor theory value is a possibility but not a necessity. Does it hold when there is no labor; when all production is automated? I don’t think it holds.

[@Bermeslivre]

Who built those machines?

[@asking4afriend311]

Pedro Montoto García other machines. ALL production can eventually be automated.

[@Bermeslivre]

@@asking4afriend311 Not really. All the machines have a source in human labor, their materials, their design and so on. They couldn't possibly be created without human labor in some part of the chain. Even if that were true labor is not necessarily human, the only source of value is labor.

[@asking4afriend311]

@@Bermeslivre It's just not valid to claim it's "not possible" for machines to self replicate. Artificial intelligence voids that premise. And I think your are changing Marx's concept of labor to include what machines do as labor.

[@Bermeslivre]

@@asking4afriend311 Not at all. Even if machines self replicated human labor was present at some point. That is self evident. Marx included from the start machines as a force multiplier on what human labor can do.

[@vectorhacker-r2]

The main problem with the labor theory of value is that it denies how supply and demand affect the value of something. Supply and demand.

[@vatyin7763]

Please READ FUCKING MARX. OR WATCH THE VIDEO. Literally the first thing he says is that value and price are different. Read the first few chapters of wage labour and capital by marx. He believes in supply and demand. This is the kind of cancer you get when you just listen to right wingers and dont actually engage with marx's literature

[@PCFLSZ]

@@vatyin7763 Since price and value are different, how can there be a claim that surplus value is stolen from workers?

[@vatyin7763]

​@@PCFLSZ Please read marx, just one, maybe wage labour and capital i dont care. your wage is a fixed price on you labour power that has no relation to the product you produced. It cant be call of the labour you invested, because if so, how come the apple farmers get paid the same if there apple gets bought, or rots on a store shelf? Your wage is not the value you put in, it represents your minimum need in realtion to the market of labour power. If that confuses you, READ FUCKING MARX

[@PCFLSZ]

@@vatyin7763 My question was fairly straightforward. If prove and value are different, how does Wolff claim in every other video that profits are actually stolen labor. The example he uses over and over is taking the sales price and subtracting the cost of materials and labor and declaring the difference as the amount stolen. Marx referred to this difference as the transformation problem which he never solved and Wolff dismisses as uninteresting. Why can't the claim be made that the transformation problem represents an as of yet unidentified source of value creation contributed by the capitalist employer?

[@vatyin7763]

@@PCFLSZ Put like this, when a business isnt doing well, the CEO still makes money. The base of the cpaitalists income is non variable and the vary of exchange value of his product will just make that even more or less

[@tekkjrgamer2294]

Just a bunch of people over thinking the fuck out of this. It's the same damn thing.

[@StealthyCowbell]

Value is a subjective measure that each of us determines independently. Price is the market's best estimate of the average consumer's idea of value for each good/service. Value does not come directly from labor. If you hired someone to dig an egress window ditch for you, and they showed up with a spoon and started digging, and it took them 12 days to finish, would you be inclined to pay them more than a man who came in with a backhoe and dug it in 12 minutes? No. The outcome was the same in each scenario. The value is in having the hole dug. The amount of labor required is irrelevant. That being said, value is not derived from price either. Price is what you pay, value is what you get.

[@lostinthedark7001]

Marx actually addresses this in Das Kapital, he says that a job done in 2 hours when it should only take 1 has only produced 1 hour of labor value. Similarly, labor done that provides no utility cannot produce value

[@MrDoomedtofail]

You're ignoring all of the labour that went in to creating a backhoe. Backhoes don't magically appear out of nowhere. How many days does it take to manufacture all the parts for a backhoe, put it together and ship it? You need to look at things in their totality, not just as a random series of disconnected transactions or exchanges. The backhoe provides more value than someone with a spoon in line with the amount of valuable labour that went in to producing it. Likewise, someone with a spoon would be more valuable than someone destroying their fingernails trying to scratch up the ground for months on end.

[@TheOrdener]

So the neo classical economists forgot that Ricardo in Smith originated the labor theory of value? Is this guy serious?

[@ExPwner]

They didn’t

[@nickfisher9334]

Well, I have a moderate enjoyment of ice cream, and given I make a little over minimum wage, if I budget, I reckon I would spend about 2 dollars, maybe slightly more if it were really good. If 90% of the ice-cream mans customers feel the same way, and wont pay over $3, then boom. That's the products value.

[@raymondhartmeijer9300]

That's because you've grown up in a capitalist economy where every commodity has a price tag.. what if a certain country felt that water, for example, should be a free good to the population. Does this mean water has no value ? ofcourse not, water is extremely valueable for lots of things

[@shubhamwr]

And here's another boom. Ice cream vendor don't ask u "how much satisfaction will u get after u eat ice cream, so that I can set a price for u". It's price is already determined. People usually get high level of satisfaction from expensive things, as they make them to " Feel" Rich. Like diamonds. Rich people, who have stored tons of diamonds in their homes should have very less marginal utility for diamonds and hence they must get diamonds at very cheap price. Does this happens? No! Because it's value is same for everyone. If productivity of diamond processing increase, it's value will fall. If it becomes possible to manufacture diamonds from carbon at much less labor, then it's value will even fall below that of brick. And hence satisfaction u get from it. Value determines marginal utility and not vice versa

[@xiMaFaNb01x]

They have an idea of what they can charge based on both what they would pay for it and what the market price is for ice cream. To claim these decisions are made in a vacuum is...silly, at best

[@PCFLSZ]

@@raymondhartmeijer9300 The water wouldn't be free, the cost would be shifted to taxpayers.

[@slipshodglasses2769]

It really got me excited when the guy asks the question but it is kind of disappointing that the professor, instead of answering the question, kind of deflected the flaw of labor theory of value and went on with how people discredited a theory with an ulterior motive. Whether the theory is a work of Marx or not, it is flawed that it presupposes that the society allocate its resources in the most efficient way and therefore the resulting labor for each product accurately denote its value. This assumption is a big problem especially in context of socialism and communism because this form of government (like U.S.S.R and old China) is good at achieving one purpose (like a big, strong army) but really really bad at achieving overall economic efficiency and prosperity; even a free market does not guarantee most efficient allocation of resources from time to time because of various externality and etc. On the other hand, the "utility" usually use price as a unit to represent value/happiness. Despite its flaws, it does make sense to many since the total amount of goods produced equal to a total amount of dollar value and that total GDP is then divided to each individual who subsequently spend their wages on a combination of goods and services that generate their maximum utility/happiness. By aggregating individual utility of the entire economy, you get the total utility generated in an economy. This is my understanding of utility and the point is there does not seem to be any devastating flaw of theory as opposed to the labor theory of value though I would very much like to be corrected by the more knowledgeable here. I wish Professor Wolff can make more video on how U.S. achieve socialism when almost all past adopters have failed. What has changed in the world economy and what makes U.S. different from others that will enable U.S. to be a successful adopter.

[@Ronni3no2]

His point is merely that there are many other useful things that can be deduced from applying the Marxist analysis, which do not require computing labour times (things like general societal trends, let's say). However, your question is perfectly fair. How _do_ you achieve the most efficient allocation of labour? There are two approaches to that: 1) Let people be free and let the chips fall where they may. E.g. if the railroad workers physically cannot work without having access to resource X (say food and tools) then those must be provided to them; that much is obvious. However, if they refuse to work full time unless they also have access to music, theatre, hospitals, schools, clean streets, churches then those also need to be provided. Whatever it takes to convince people to work is socially necessary. 2) Run the math on a computer, based on input-output tables and allocate as the computer says. 3) Some combination of the two. The devastating flaw is in the part where you say "By aggregating individual utility of the entire economy". No one knows individual utilities, and I am not aware of a way of aggregating them.

[@rainerlippert]

There is something wrong with the Labor Theory of Value. Especially the surplus value cannot be produced so the value cannot be produced because the surplus value is part of the value. What really is wrong with the LTV and how the value will be created in reality you can see I brint into the discussion there: kzbin.info/www/bejne/aXirpqeKYp2VosU . Best regards - Rainer

[@vatyin7763]

SUrplus value is money made by the labourer taken by the capitalist. It is value, but it isnt the capitalist taking it that gives it that. It is the labour that creates the surplus value that is taken by the capitalist. I hope im not mischaracterising

[@rainerlippert]

​@@vatyin7763 Hi Vatyin, surplus value cannot be produced! The entrepreneur incurs costs with the production of goods: machines, auxiliary materials, raw materials, assemblies, buildings, electricity, water, communication, etc. - at Marx c - constant capital. He needs workers that he has to pay - he pays the value of the workers, i.e. the means of subsistence they need to live (food, housing, woman time, travel, health costs, etc. - in Marx v, the variable capital. The entrepreneur hopes that he can earn more with the sale of the work products than he has spent on their production, i.e. he wants to earn more than he had in terms of costs c + v. If he would have the surplus value produced, he would no longer need to sell the work products, because he would have achieved his goal of receiving the surplus value with the production process. Within his company, he cannot produce the surplus value, but only add an expected surplus value to the costs c + v. His workforce can only produce the conditions for buyers to pay surplus value and this should be done as well as possible. With c|costs; replacement expected + v|costs; replacement expected + s|expected he will not get any value the value, but only an expected value that contains an expected surplus value. This expected value is linked to the initially only potential goods as an offer price and made visible to others. If he cannot sell such a work product, then he does not get any surplus value for it and he does not get reimbursed for the costs. If he can sell the product of work, it becomes a commodity when it is sold and the work will be classified as labor. In this case the workforce can be titled as labor force - labor as socially useful work, the work results will become use values for others through exchange. Usually, when selling, he gets completely reimbursed for costs c and v and a little more, the surplus value - the buyers have to pay the surplus value. From this it can be calculated in retrospect (!) how much unpaid working time the workers have done. If he cannot sell a product, he does not receive any surplus value for this and consequently there is no surplus value for this product.

[@vatyin7763]

@@rainerlippert the capitalist pays for the *labor power* not the labor. you aren't paid based of off how many chairs you make in an hour, you are paid a still amount hourly/weekly/monthly to let out your working capacity over a period of time. this proves there is no correlation between the wage and the product produced. A man who picks an apple will get the same wage if a quarter of the apples never make it onto the shelves. labor power is a commodity, just like the loom and the hammer, and is an instrument in production. the excess created by the worker is stolen by the capitalist, as the wage doesn't reflect output, there has to be a difference between output and wage, that difference is pocketed by the capitalist

[@rainerlippert]

@@vatyin7763 You should read before answering! I have written "He needs workers that he has to pay - he pays the value of the workers ...! If the worker becom labor power will bedeclared later - i have written it too.

[@vatyin7763]

@@rainerlippert what? your sentence is grammatically incoherent I don't know wtf your talking about. i pointed out that there has to be a difference between what the laborer is paid, and what value he creates. if you need to make your point again in a less moronic way

[@fedest]

Such an arrogant response to the question, yet such an empty one... Here is what I get from his response: - Value (as defined by LVT) is not used to allocate labour (nor other resources). Societies must make those decision consciosly or unconsciously, he indicates. So, using other means. - Value is no related to prices, and furthermore, he doesn't even care about prices. He is only concerned about value. - LVT is superior to Utility and other theories of value, in his view, because he finds utility too difficult/imposible to measure; and accumulated labour seems easier to grasp. So here is what I would ask as a follow-up, to him, or anyone willing to answer me with more depth: - What's the point anyways (besides serving as a framework for claiming exploitation) of defining value in such a way, and calculating it, if it wont help in deciding for the allocation of resources and labour, nor in defining prices, nor in guiding consumption, etc? - If LVT is superior because the labour value is easier to grasp and to meassure than, say, utility, then why not take things further, and accept my even superior theory, in which value is defined as the weight in Pounds or in Kg of a product?? It's deffinitely easier to grasp and to calculate than labour (it requires no adjustment based on current level technology -that changes so rapidly in current times-, nor averaging the productivity of different workers, for example). And since we don't require that value has any relation to price, nor that it is used to decide how resources and labour should be allocated to produce different products, it won't matter than an ipad and a sweater have very different prices and are produced and consumed at very different rates; they weight the same, so they have the same value according to my, just as useless, but superior, product-weight-value-theory!! 🤓

[@miker2157]

Being interested in why prices are what they are is the only reason to study economics. But if you support TLV I can understand why prices are confusing.

[@donha475]

Subjective theory of value is objective from the point of view of every individual... knowing thier own mind and preferences. Labour theory of value is objectively wrong and not how things are priced at all!

[@davidmb1595]

You understand that "price" and "value" are not the same things, right?

[@a_betancourth]

it´s called labour theory of value, not labour theory of price

[@donha475]

yeah I know it's called labour theory of value... thanks buddy. Things are valued subjectively not based on weird notions of adding up how much "effort" / "labour" went into it... god so retarded. We put this behind us over 50 years ago!

[@davidmb1595]

Kiwi AustEcon actually, the marxist theory of value does take into consideration the subjective pricing of stuff in social relations, those are market relations and Marx knows about them. If you've ever read Marx, you'd know that in reality he talks about how markets can be overcome, thus moving forward from subjective value, which is just totally doable.

[@donha475]

@@davidmb1595 lmao... wow. I feel sorry for you. Going through life with these fucked up ideas.. must suck to be you. Walking around just loathing respectable business owners and all the really productive useful ppl... sucks to be you.

[@brennanmason1973]

If I spend all day making Haitian mud cookies, thats a lot of work but it’s completely useless. This is a bunch of crap

[@rainerlippert]

Dear Professor Wolff, in your video, you refer to the work contained in produced objects. But this work does not contribute directly to value creation: If I take wires, circuits, switches, etc. in a company during my working hours and put together anything that does not make sense, then the company I do this work for will not be able to sell that work product. The work expended on this work product is not considered socially useful and thus qualified as non-value-adding. Only the assessment of the work results in the market can lead to a value relationship. Equivalent to 1,000 regularly manufactured products are considered, of which only 500 can be sold. The work that was spent on the 500 products sold was socially useful and thus "value-creating work" (exactly: the foundations resp. prerequisites for a value relationship were created). The work for the 500 unsold products was not socially useful and therefore not value-building. The assessment of what is socially useful cannot be produced, which is hit by buyers in the market. Thus, the assignment of value to the produced objects takes place only on the market, or just not. Value is a social relationship that is formed and works between people (who act as individuals or in the name of institutions). Such a ratio can not be installed anywhere, it is assigned.This is equivalent to the property to see: Property is also a social relationship and is only (!) Assigned to the social level and nowhere as such incorporated. When the owner changes, only a reassignment takes place on the social level. Equivalent to the value, the new value and the aging of products - some "lose value", others win. Only reference points are produced, this means the possible prerequisites for value relationships. Only after the work results have been assessed value relationships are formed, not only on the basis of the work done, but above all in relation to the work results. Kind regards Rainer Lippert

[@rainerlippert]

@bad person To my opinion on communism / socialism i say the following: The value theory relates to capitalism and socialism. Socialism and communism are both kinds of dictatorships. This is because both of theme base on ideology. When the followers of these theories come to the power in the society they will fight stronger against all their enemies than before because they will be worry about loss of Power. This shows the Socialist World System and the current socialist countries too. This will be shown in Germany now: You don't have sole power yet but legally won election results have them undone, when the results are not in their interests. They they currently dictate the public media - together with the left oriented government.

[@rainerlippert]

@bad person If this question were easy to answer, there would be much less controversy. Capitalism with one against each other rather than cooperation should certainly not be human perspective, that would be depressing. The socialist world system has shown that national and international cooperation is possible instead of fighting against each other. All of these collaborations were not so well developed that they were competitive against capitalism with fierce competition. In my view, however, it was shown that it is in principle possible to operate cooperatively. In my view, the main reason why the socialist system collapsed was the faulty economic policy. This probably does not concern the cooperation, but it was the failure to pay attention to the market and the faulty money emission policy. The weak economic performance led to stronger internal repression. There is more to be said. In Germany the book “Postmonetary Thinking - Opening a Dialogue”, Springer publisher, was published last year, designed by the project group “Society after Money” at the University of Bonn, Germany. I wrote a detailed review of this book. The response from this project group was "The dialogue is over!". This book was financed with tax money and with funds from the VW Foundation. But this kind of acting on the basis of an exaggerated ideology is typical of the socialist / communist groups. I have previously experienced this in blogs (Karl Marx Forum), at conferences (Marx is must Conference 2018, Socialism Days 2019) and in public lectures at universities (Magdeburg, Berlin, Zurich (Switzerland)). They are already dictatorships before they are in power alone. Not a single socialist / communist group implements mechanisms against dictatorship in society in its own organization. Inside, they are still relatively democratic, at least before taking power alone. Society needs to be changed by the majority, not by elite groups that are no longer connected to working people. That should and must be possible. However, the possible paths must first be discussed widely. Certainly it will also start with elite groups, but if it stays with it, one would have to think about what is going wrong.

[@rainerlippert]

@bad person You are welcome! But these are my current ideas. This may not be the case. That has to be discussed first.

[@clarestucki5151]

The labor theory of value pretends that all the value stems from the physical labor. It ignores the fact that capital and entrepreneurial/managerial talent are FAR more productive than unskilled labor.

[@NoahBodze]

Or that productivity comes from innovations extant the laborer.

[@Ronni3no2]

@@NoahBodze By no measure is that ignored; it's one of the key parts of the analysis.

[@Ronni3no2]

> _The labor theory of value pretends that all the value stems from the physical labor._ It does not do that at all. There is a distinction made between productive and unproductive labour, but labour is either socially necessary to reproduce something or it isn't; LTV deals with socially necessary labour, not "physical labour".

[@harrybudgeiv349]

So there's no point in caring about LTV because it doesn't have concrete numbers

[@beatles123]

You dont need to over-complicate it. If You make something, you put in the labor and therefore you want to keep the maximum of whatever value it generates. The price matters not.

[@L4SERB0Y]

This guy is so deluded he does correctly observe that ice creams have more value when the weather is hot (utility value) and then dismisses because it's too difficult. He does exactly what Marx does; he oversimplifies everything and then presents it as profound. It's not profound, it's oversimplified. Also like Marx he ignores risk, investment and creativity as if they have no value. The Labour theory of value is PART of the value of a thing, but only a part.

[@jordanthomas4379]

2:10 - wow, what a way to quickly gloss over many tens of millions of murders.

[@eminkirac4712]

Ratio

[@Guizambaldi]

What a bullshit. If you are not concerned with prices, how do you understand the price of labor and the price of capital? Isnt it what you are interested?

[@raymondhartmeijer9300]

The 'price' of capital ? Capital can be all sorts of things, at one point it's money, it can be labourpower, commodities, machines etc, as long as it's busy making profits

[@Swing_park]

Guy goes on and gives a 5 minute speech that is equivalent to intellectual garbage without answering the question even one bit.

[@doctorhankjr5126]

This labor theory of value is the only reason why capitalism will be abolished. Since all value comes from living labor transforming products or nature, the more that google or other monopolies grow their products have less and less live labor in proportion to dead labor. Ergo crisis is the fundamental nature of capitalism. One day there will be a great and universal/ international refusal and strike. Since wealthy folks have assets in hold and violence, one can't expect them to just give up as workers build the first true utopia. Sadly they will have to be armed in order to defend the new life of "To each according to need and from each according to ability."

[@dudeatx]

Exactly how do you reckon you are going to force those with abilities to work extra to pay for those whose needs are greater? Whip them harder? Suddenly you will find that everyone has "needs". That's why the soviet system failed - the popular joke was "We pretend to work - they pretend to pay us". Sad but true, if you want any society to work you'd better get the wealth creators onboard - without them it's back to the dark ages.

[@shubhamwr]

@@dudeatx soviet system failed because it violated each and every most important laws given by Marx to establish communism. If want to see what communism means then see Paris commune or revolutionary Catalonia. And also see how bourgeoisie used arms to supress workers, killing 25k workers just because they took their future in their own hands. Also these bourgeoisie didn't stop there. To kill this new society they even dared to take help from Prussians, with whom they had war just 3 months before in which Prussians had brutally fucked French and had siege over Paris.

[@dudeatx]

@@shubhamwr You didn't answer my question - I earn 5 times more than an unskilled worker - how are you going to make me pay for them? Why wouldn't I just say fuck it and become someone "in need" too? What incentive do I have to continue to be one of "the able"?

[@shubhamwr]

@Blackstone it actually does

[@shubhamwr]

@UChj1hy09cKxSoXKRWUZc-RA which "products"? Can u explain. Don't tell me forest and land and shit. They r price tags, not values. Just like there r perverts in dirty countries which sell their own daughters for prostitution. This is not " Value" But what Marx called it as "commodity fetishism". So he knew about those things as well. If any person or government is not owner of forest and land thrn anyone can come there and occupy it for free and develop it. More land is capable of absorbing labour, more valuable it is but this is not again " Value".

[@kylem2560]

Let's talk about the "shit market." If I go to Mastro's steakhouse and spend $100 on nutrients required to defecate, and someone else goes to Ralph's to purchase $2 in canned beans to take their shit, we have an issue. Assuming both parties labor with gastrointestinal issues from digestion equally, what should the price of shit be, $2 or $100? What if no one is in the market for shit? There is a shit supply with zero demand. How do we derive value?

[@kanalarchis]

He's a very talented voice actor and performer. A great propagandist. He mocks his enemies with theatrical virtuosity. Not one thing he says is soundly defended, rarely something is accurate, most of it is half-truths or even falsities (see other videos of him as I have... aplenty.) But who cares! When he speaks, you can see the envy dripping from his lips, and if you're already a marxist you can take communion in it, to quench your thirst for shared resentment. Yeah... resentment is the word here. Oh, the loads of resentment that have been brewing in his poisoned heart for years and years. A resentment that has been passing down from generation to generation, from underachiever to underachiever, from aspiring looter to aspiring looter. I worry for the health of the maggots that will attempt to consume his corpse one day.

[@toxendon]

Great, politically substantive argument!

[@mrbeancounter90]

I really dislike this. The theatrics (and he has a great actors voice and delivery). His approach that only the enlightened will agree with him, from the question that is put to him to the sneering and patronising comments ("this may come as a shock to some of you", "do the work, you'll learn").The mocking voices. The casual dismissal that prices do not matter. He doesn't finish his ice cream question - perhaps because trying to sell an ice cream on the coldest day of the year may be different to selling it on the hottest day of the year - prices transmit the information that demand may be different on those two days.. Still the audience laughed.

[@Jahbriden]

The point here is exactly that the price on ice cream doesn't change, whatever the temperature outside is. You can keep it in a fridge and eat later, why would the price change? It wouldn't really, because value of a commodity is based on the social necessary labor, meaning the minimum wage the enterprise must pay its workers for them to survive and continue producing commodities also sets the minimum price of these commodities. You can't sell ice cream below the price you paid workers for their time to produce it, and that combines the whole process of production. So ultimately capitalists can set any price above this limit

[@mrbeancounter90]

@@Jahbriden No, if you are selling it the sales price does change. If you try sell it on a hot day, the sales price is high. Sell it in nice restaurant, sales price is high Let it melt and the sales price is zero The cost does not change. The cost is what you paid someone else for it (or what you paid someone for the materials for it) It can be more, same or less than the sales price.

[@Ronni3no2]

@@mrbeancounter90 > _sell it on a hot day, the sales price is high._ Competition exists on hot days too. > _Sell it in nice restaurant, sales price is high_ Different commodity with a different price. > _Let it melt and the sales price is zero_ Different commodity with a different price.

[@gtothereal]

Utility is not the mainstream perspective. Subjective value is the mainstream perspective. Richard Wolff seems like a hack

[@ExPwner]

He is a hack.

[@jordanthomas4379]

Labor Theory of Value is a moronic lie, value is subjective, it is a matter of negotiation between seller and buyer.

[@Alloballo123]

They are not opposed in the way you're thinkjng. So if we say that the price of a commodity is determined by how much someone wants it, how much someone wants something is determined by how much trouble it is to get that thing (labor). If it was really easy to get the things we wanted we wouldn't pay a high price for them cause we could get them ourselves. Therefore the price of a commodity, though it fluctuates on the basis of supply and demand, competition, etc. is determined by something more fundamental: the value of the labor that went into making it. How is the value of labor determined? As adam smith noted, the "toil and trouble" it takes to get it (i.e. labor). The more toil and trouble, the higher it's price. Now you might say: if something is hard to make it doesn't mean it's expensive, because someone has to want it, and if no one wants it, then it doesn't matter how hard it is to make or get, it's worthless -- and you'd be right. Marx said for something to even be a commodity it has to have a use, or utility (I want this...), If it doesn't, it's not a commodity. But if someone does want it, how do we determine it's value? By the toil and trouble it costs to make it. What is the cost? The cost of the worker's life -- food, shelter, clothing, etc that the worker deems necessary. But wait, the worker doesn't just decide what's necessary for them, they negotiate that value with the owner/employer. Except, the owner or employer always wants to value workers labor at lowest possible rate that allows them to maximize profit. Hence, their interests are not aligned, and a struggle emerges. That's why Marx called this "negotiation" class struggle, because it's a fight.

[@lambdillion4610]

@@Alloballo123 based

[@bluewater454]

Actually, I can easily quantify the "utility theory of value". It is the price consumers are willing to pay as an aggregate for any product or service. If the average price people are willing to pay for a large ice cream cone is $3.90, then that is the utility value. As you go above that price, fewer people are willing to pay, causing them to look for a lower price for the same product - thus keeping the price down to the theoretical average of $3.90. The consumers as a whole tell the market how to price. I dont see the labor theory of value as being contradictory. It is simply a part of the production cost for a product. It is rather a counter-balance to utility value. The capitalist is, in essence, selling the labor of his employees to the consumer. If the consumers had their way, the price of an ice cream cone would be free. If the laborers had their way, the price would be $100.00, allowing them a much higher salary. No laborer is going to work for free, and no consumer is going to pay $100 for an ice cream cone. The true value is the balance between what the capitalist is able to sell the labor of his workers for, and what the consumer is willing to pay for it.

[@jsbart96]

bluewater454 I guess that’s true in a perfect world of maybe an econ textbook. It assumes to much, like a ‘free’ market and rational consumers making rational choices

[@bluewater454]

@@jsbart96 It has nothing to do with rational or irrational choices, or whether conditions are "perfect" or imperfect. It is simply a matter of the difference between what people are willing to pay for a product, and what the producer is willing to sell it for. There can be a hundred variables that determine why a buyer buys, or why a seller sells. All irrelevant. The only thing that matters is that they reach an agreement on the value. That is what determins the "utility" value of a product.

[@bm-br3go]

@@bluewater454 Arent you ignoring competition here though? I mean if $3.90 were the cost you were selling at, I would sell at $3.80 so long as that's not below the cost of production, regardless of what the consumer is willing to pay.

[@bluewater454]

@@bm-br3go I'm not ignoring anything. Competitive pricing helps to determine what a consumer is willing to pay, and it always works to the benefit of the consumer. The more competition there is to sell a product, the more choices a consumer has. Another factor would be if the state steps in and tries to control prices to keep them artificially high or low, but that is another discussion.

[@bm-br3go]

@@bluewater454 How does competition help determine what a consumer is willing to pay, exactly? EDIT: I realized we may be talking about different things. When I said competition I exclusively meant competition between producers (which was wrong of me to imply). I realize that competition between consumers helps determine what the consumer is willing to pay, however competition between producers does not (at least I dont think) determine what consumers are willing to pay, but rather at what price producers are willing to sell.

[@jaysun2402]

Yikes. Utility is an ordinal concept, not a nominal concept. It is measured in terms of people's demonstrated preference. Marx's value is entirely esoteric and impossible to measure or order.

[@Ronni3no2]

> _It is measured in terms of people's demonstrated preference._ Whereas this is plain old circular reasoning. X explains Y explains X.

[@brad5696]

Apparrantly Richard Wolff doesn't understand why prices are so important.

[@billyoldman9209]

To be fair, labor cannot be measured either, thus the labor theory of value cannot account for prices either, and consequently the whole theory is logically false. You can't explain a quantity (money price) with an unqantifiable abstraction (labor). In my opinion Marx was also trapped by a petit bourgeois moral system, that idolized work, and maybe that's why he didn't bother defining labor in an exact manner (which is impossible anyway). Instead he just took it for granted. I really recommend a recent alternative theory called CasP (Capital as Power) which attempts to explain capitalism while avoiding such pitfalls: bnarchives.yorku.ca/259/

[@pztfootball8719]

Billy OldMan Productivity of labour, and amount of labour (in the form of workers) is very easily measurable. You also missed his first point as to how price and value are different things.

[@billyoldman9209]

That only works when everyone does the same exact work at the same exact speed and in the same exact manner. Unless those are guaranteed, the whole calculus becomes an abusive illusion. And reducing "hours of skilled labor" to "hours of unskilled labor" or adding up the labor time of training skilled labor doesn't change the problem.

[@pztfootball8719]

Billy OldMan when the department of labour forms statistics on productivity of work and hours worked, they're able to do so despite people working different jobs and having different skill levels. What's the difference?

[@billyoldman9209]

Each type of work is qualitatively different, and you can only aggregate identical or at least interchangable things. Think of the "common denominator". I mean if you add up 2 bananas and 3 apples, you get the same, and not 5 watermelons. Or what does it mean that you add up 2 hours of massaging and 3 hours of operating a construction crane? What you get at best is a rough average on how much profit masseurs and crane operators make for their capitalist masters. But if you need to know profit to calculate value, and in turn you explain profit with value, then you have a circular argument! (Main point of economic theory being to be able to account for profit.) So i think orthodox Marxists are searching at the wrong place. It is society as a whole that defines which "things" are valuable and which are not, what kind of activities count as work, or even what work is in the first place. And these significations and their content, their relations to each other are constantly changing, even if seemingly very slowly.

[@billyoldman9209]

Even if we accept work hours as a perfect measure of labor, throughout that essay (thx for link) any definition of value presupposes the existence of observed prices, so the fact that something has a price IMPLIES it has value, which supposedly comes from labor. To me this backward reasoning is not very convincing, since without a price, we cannot say anything about value, and without value, we can't say anything about labor either. And I don't have any problem with the PRACTICAL benefits of measuring labor in work hours, I'm sure it's useful in calculations, nor am I downplaying the importance of Marx in the world of thought, but the philosophy behind the whole Labor Theory of Value is built on outdated concepts (stemming from a positivist bourgeois worldview) and has some logical stunts in it, that's all I'm saying.