Labour Theory of Value

Disclaimer & Introduction

The following notes represent my current understanding of Karl Marx’s value theory, compiled from my readings of Capital and related texts.

PART I — THE LAW OF VALUE AND THE DYNAMICS OF CAPITALIST PRODUCTION

Chapter 1. The Fundamental Law of Value

1. The value of a commodity is determined by the quantity of labour socially necessary to produce it.
2. Socially necessary labour-time is the labour-time required to produce any use-value under the conditions of production normal for a given society, and with the average degree of skill and intensity of labour.
3. The value of a commodity is determined by the socially necessary labour-time required for its production — not by the labour that this or that individual may expend upon it.
4. The value of a commodity is the objectified labour-time contained in it.

Chapter 2. Social Value and Individual Value

1. The real value of a commodity is not its individual value, but its social value; that is, the real value is not measured by the labour-time that the article in each individual case costs the producer, but by the labour-time socially required for its production.
2. Each individual commodity, in which equal quantities of labour are embodied, has the same value. But the labour-time that forms the substance of value is the labour-time socially necessary, not the time that the article actually cost the producer.
3. The labour-time that an individual worker may expend upon a thing does not determine its value, if this labour is not necessary under the given social conditions.
4. If an individual worker were to take more time than is socially required, the excess labour would not count as value.
5. Only labour-time that is socially necessary counts in the creation of value. The excess labour-time expended by the individual producer creates no value.
6. Commodities do not exchange according to the labour-time that each particular producer has spent, but according to the socially average labour-time.

Chapter 3. The Consequences of Inefficiency

1. Whether a commodity is the product of more or less labour-time than is socially necessary determines whether its individual value is above or below the social value at which it is sold.
2. If a commodity is the product of labour that is inefficient, it contains more than the socially necessary labour-time. It has therefore a greater individual value, but it does not obtain this value in exchange.

Chapter 4. Competition as the Enforcer of Socially Necessary Labour-Time

1. The struggle of competition constantly strives to reduce the value of commodities to the socially necessary labour-time.
2. Competition compels the individual capitalist to cheapen his commodities, to reduce their value by reducing the labour-time socially necessary for their production.
3. The individual capitalist strives to reduce the individual value of his commodity below its social value…But this social value is determined by the socially necessary labour-time.

Chapter 5. Innovation and Extra Surplus-Value

1. If he succeeds in reducing the labour-time required for production below the social average, his commodity has a lower individual value, but it sells at the social value.
2. Hence, the capitalist who applies the improved method of production appropriates to surplus-labour a greater portion of the working day than the other capitalists in the same trade.

Chapter 6. Technological Change and the Movement of Social Value

1. To the extent that the use of machinery becomes general, the value of commodities falls and with it the socially necessary labour-time. The individual producer must introduce the new methods or be driven from the field by competition.
2. Every change in the productive power of labour affects the value of commodities. Labour-time counts only to the extent that it is socially necessary.
3. If the time socially necessary for their production be reduced, the value of the commodities falls, although the labour-time actually expended by the individual producers may remain unchanged.
4. If the labour-time socially required is reduced, the value of the commodities falls, whatever the labour-time of the individual producer may be.

PART II — VALUE AND THE MONEY-FORM

Chapter 7. The Basis of Price in Value

1. Value is determined by labour-time; price is this value transformed into money.
2. Price is the money-name of the labour realized in a commodity.
3. The value of a commodity does not depend upon money, but money depends upon value.
4. The price, or money-form of commodities, is the expression of their value.
5. The value of commodities, measured in money, appears as their price.
6. The price of a commodity therefore expresses its value in money.

Chapter 8. The Divergence of Price from Value

1. Value is the basis of price.
2. The price of a commodity is not equal to its value. It can rise above or fall below its value.
3. The possibility of a quantitative incongruity between price and value is inherent in the price-form itself.

Chapter 9. Value as Regulator of Market Prices

1. Price may rise above or fall below value, but value determines the centre of gravity around which prices revolve.
2. The value forms the centre of gravity of the constant oscillations of market-prices.
3. Market-price stands now above, now below value, but value remains governing in the long run.
4. The continual oscillations of market-prices are only the fluctuations around the value of the commodity.
5. The continual rise and fall of market-prices is caused by the variations of supply and demand, but supply and demand themselves bring prices back to the value.
6. The values of commodities and their prices are numerically different and may diverge.
7. Commodities may be sold at prices deviating from their values, but these deviations balance each other.

Chapter 10. Transformation into Prices of Production

1. The transformation of values into prices of production does not abolish the law of value.
2. Market-prices oscillate around prices of production, and these again around values.
3. The value of commodities determines the average prices, although prices do not directly coincide with values.

PART III — LABOUR-POWER: THE SPECIAL COMMODITY

Chapter 11. Labour-Power as a Commodity

1. Labour-power can appear on the market only when it is offered for sale or sold as a commodity.
2. The worker must be free to dispose of his labour-power as his own commodity.
3. The possessor of labour-power must be compelled to offer for sale that very labour-power which exists only in his living self.

Chapter 12. The Value of Labour-Power

1. Labour-power, like every other commodity, has a value.
2. The value of labour-power is determined by the labour-time necessary for the production and reproduction of this specific commodity.
3. The value of labour-power is determined by the value of the means of subsistence necessary for the maintenance of the worker.
4. The labour-time necessary to produce the means of subsistence determines the value of labour-power.
5. The number and extent of the worker’s necessary wants are themselves historically developed.
6. The value of labour-power is conditioned by the customary standard of life in a given country and epoch.

Chapter 13. The Use-Value of Labour-Power

1. The use-value of labour-power is labour itself.
2. Labour creates value.
3. The use-value of labour-power consists in the fact that it creates value and a value greater than it costs.
4. The value of labour-power and the value which labour creates are two entirely different magnitudes.
5. The consumption of labour-power is the production of surplus-value.

Chapter 14. Necessary Labour, Surplus Labour, and Exploitation

1. During one portion of the working day the worker produces merely the value of his labour-power; during the remaining portion he produces surplus-value.
2. The difference between the value created by the worker and the value of labour-power is surplus-labour appropriated by the capitalist.
3. The secret of the self-expansion of capital is that labour-power is a commodity whose use-value is a source of value.

Chapter 15. The Wage Form and the Concealment of Exploitation

1. What the capitalist buys is not labour but labour-power.
2. The wage-form extinguishes every trace of the division of the working day into necessary labour and surplus labour.
3. The wage appears as the value or price of labour itself, although in fact it is only the price of labour-power.

PART IV — NATIONAL DIFFERENCES IN WAGES

Chapter 16. Determinants of National Differences in the Value of Labour-Power

1. The average level of wages in different countries depends, apart from other circumstances, upon the productiveness of national labour.
2. The value of labour-power depends upon conditions of production which differ from country to country.
3. The quantity of the means of subsistence which enter into the value of labour-power differs from country to country, and the labour-time required to produce these means of subsistence differs accordingly.
4. The national differences in the value of the means of subsistence determine national differences in the value of labour-power.
5. The average needs of the labourer differ in different countries and epochs.
6. The habits and requirements of workers differ from nation to nation and enter into the determination of the value of labour-power.

Chapter 17. Why Money-Wages Vary Across Nations

1. Wages vary from country to country according to the productivity of labour and the cost of the necessaries of life.
2. Wages vary according to the amount of necessary means of subsistence and the degree of development of productive forces.
3. The value of labour-power may be the same in different countries while money-wages differ.
4. The value of labour-power may be the same in England and France, yet the English labourer may receive higher wages.
5. Time-wages vary from country to country, even if the value of labour-power is the same.
6. National wage differences are not proportional to national differences in the value of labour-power.
7. This difference arises because the productive power of labour is greater in England.
8. Differences between national wages depend, among other things, on the division of the day into necessary and surplus labour.
9. The English worker receives higher wages than the Continental worker, but this corresponds to the greater intensity of English labour.
10. High wages in a country do not indicate less exploitation.
11. The rate of surplus-value may be higher where wages are higher, because of the greater productivity and intensity of labour.

-to be continued-