AskProfWolff: What is the Labour Theory of Value? 

Man, your comment actually opened a new percpective for me. Thank you so much.

Marx's theory accomodates for profiteering at the expense of consumers. It is possible that the labourer is payed fairly but the capitalist charges an exorbitant price, and since they control the supply, consumers have no choice but to bite the bullet. Either way this points to a system where workers and/or consumers are being taken advantage of to extract excess profit for the owners of production, the 'surplus' can come from either side of the market. This is my reading of Marx (and many of my professors as well) anyway.

@@neilcullen8055 The problem with the consumer profiteering theory is that sellers can ask whatever they want for their product, the buyer individually decides if the transaction is worthwhile. If a seller asks too much, the buyer can take his transactions to a lower cost competitor, switch to a lower cost alternative or simply do without.

@@PCFLSZ yes that is how the free market is meant to work. the problem is that it doesn’t work that way. the idea of consumers “voting with their dollar” is a fallacy. without proper regulatory policy and anti-trust laws, monopolies and oligopolies have formed, under these situations they completely control the supply of particular goods, sometimes essential ones. you can see how this is dangerous. when they control supply they can cut quality and hike price and since consumers have no other substitutes - they are forced to pay higher prices than what they truly value the goods at since they cannot “go without” things like food or shelter. i could go into value theory and how equating price with value results in various mania such as consumer culture and commodification of human needs but that might get convoluted. the overall point is this: Yes, a free market would work in such a way, however, no such free market exists. The invisible hand is a myth and the only way to cultivate a truly free market is to regulate it. Not sure if you’ve taken any economics or business ethics but in order for a free market to work there are a few requirements (which often require regulation to uphold) such as no barriers to entry, and free competition. Monopolistic corporate consolidation undermines those those requirements immediately. lmk if you understand what i’m getting at and i can refer you to a great congressional testimony from a Ph.D economist which talks about profiteering in much more depth and utilizes plenty of case studies to prove the point :)

@@bobhauk3976 your take is very comedic. do your homework

There is not a different between price and value in the context of economics. Wolff is completely wrong.

Robert Ponder Suck it liberal

@Derrick - here's a short video by Prof. Wolff, about price vs value - but it really is hard to follow.... ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-flFyaguUqIo.html

Jpom22 There is no "surplus value". U are confused. What u are calling surplus value is privatized economic rent. Put down the Marx, pick up the Henry George.

Jpom22 And yes, it's true, labor theory of value is hard to follow, because it's wrong. U pay 5 dollars at the movies for the same popcorn that u get in the grocery store for 2 dollars yet no more labor was added... because value is subjective. Its common sense.

If the "entrepreneur" has truly contributed to creating a commodity then they are entitled to compensation for the value they created. This isn't surplus, it's fair compensation. The problem of worker exploitation is not that a manager or innovator takes a share of the profit, it is that the owner takes all profit at the expense of the workers.

@@Waterseeker_ "The problem of worker exploitation is not that a manager or innovator takes a share of the profit, it is that the owner takes all profit at the expense of the workers." But it's not at the expense of workers. The workers wouldn't have the job at all if the entrepreneur didn't take the risks and organise the production. The claim is that the labourers create the value, but if they are not the only thing necessary to create the product they don't create all the value. As an analogy, suppose that workers build a railway to carry iron ore to a steelworks. Logically their labour was necessary for the steelworks to operate and the workers at the smelter didn't create the steel alone. Logically therefore the rail-workers should be paid for their contribution. Now suppose that the steelworks would never have been built unless someone paid the workers up front to build the steelworks and operate in return for the eventual production of that steelworks. Most workers are not prepared to build or operate a factory on the promise of a share in the production/profits. Of course there are exceptions but many prefer a fixed and certain wage. If workers can't be found to create the goods in a cooperative then an entrepreneur is necessary to production. Given this why should they not get all the profits? After all the workers are being given the value of their labour because otherwise they'd sell it somewhere else. So anything left after that is not taken from labourers is it?

@@Waterseeker_ wages are a profit as well off your labour.

And what happens when the "employer" creates a company, buy all the stuff, pays salaries for a year or 2, and then the company does not make any profit because the products that the company is making, by the employer fault, are crap and don't get sold. What happens in this case? Well, the workers got their salaries for a year and then get fired because the company goes bankrupt. This is bad, of course. And the employer looses all his money. So for the whole year the employer not only paid all those salaries, machinery, licenses, studies and so on but also never received one $. So, in my humble view, the employer must get "compensations" for all the risks he is taking.

@@newperve That assumes both that owners must take this risk and that owners are nessecary in starting a business, both of which aren't true

Marx doesn't disagree at all.

@@james1098778910 Well Marx also isn't a deity, he was just professing a garbled version of Ricardianism which has long since been obstructed in many of his main points by newer and more refined economic theory. Wolff isn't an economist, he takes after old ideas and discredits the detractors from his own spurious doctrines by simply ignoring the economists. Marx bases his entire theory off the labour theory of value which is fallacious.

@@james1098778910 point me to where I can find Wolff talking about this.

@@hermitthefrog468 reducing marx to ricardo - and especially his theory of value to ricardo's - is quite wrong. Marx value theory is deeply insightful and quite correct.

@@hermitthefrog468 i didn't say wolff talks about anything. I have no idea what wolff talks or writes about.

Look up "Marx's Concept of Intrinsic Value" by Andrew Kliman. Medium length article which provides a clear explanation of how vol 1 chapter 1 is not an attempt at constructing a price theory.

it is connected with price but it is not price, price oscillates around value

Glad I'm not crazy or stupid, because that's exactly what I remember too, and why I had to stop reading the book.

Exactly

That's correct

Precise

This is actually incorrect. Conventional economics is politically neutral, it includes labor (and varying types of labor) as "commodities" and tracks them the same way. This is why you can go to wage sights and review stats about average wages in occupations. Very helpful in learning to negotiate your personal contracts to know what 'what you can do' is worth on the open market. Turns out you can compare that to your chances without making a contract (hiring agreement) by making your own business!

Yes, you can just pull a business out of your ass when you work a 40 hour week and make just enough to cover basic expenses! Or we could have a system that doesn’t give you the illusionary choice of where you work for (cuz it doesn’t make a difference), and then yells at you to make a business when you realize that it doesn’t make a difference

Bingo. And Marxists delusionally believe they ought to be able to force people, literally physically force people to comply with their demands of whatever they say something is worth.

Really? Why do cars cost more than pencils? I have 3 cars already, so i dont value a 4th car that much. Why cant i go to the auto shop and tell them I'll give you 50 bucks for that sedan?

@@Mark-zk3gu Because some one else will give them more for the sedan that is how markets work.

@@georgewilliams7301 yeah but why? That's the difference between you and the ability to think critically. Things don't work just because they work. There is a reason behind it. I'm sure you can find someone willing to buy a pencil for $500 somewhere in the market. So why is the market value of a box of pencils less than $10? The answer is because it takes significantly more socially necessary labour time to produce a sedan than it does a pencil. So a sedan will always have a higher value than a pencil, if supply and demand are in equilibrium for both.

@@Mark-zk3gu First off you need to understand that a market is just a bunch of individuals making subjective value judgments and what you are calling “socially necessary labor time” is just a stupid way of expressing labor cost in production seeing it allude to something greater than it is and doesn’t address the second hand and art markets.

That's what I read. But truth is, prices should approach labor - value, they do in general, but sometimes they don't. And that's bubble and speculation. I think labor-value theory is correct, but I have a problem with land. Land has value, even if no one touched it. How labor-value theory applies with land?

@@lisakeitel3957 Easy. In the production process M-C-P-C'-M', only labor creates value by transforming C to C'. Hence, the Labor Theory of Value is more concerned about how is value created, not whether something has value or not. Natural resources like land has a value, but it doesn't mean that they create value.

@@lisakeitel3957 Well, if you take the Post-Keynesian price theory, prices should reflect the costs of production and a mark-up. The costs of production include labor costs, and the mark-up part depends on the firm's market power. So, the only way for your scenario to happen - "prices should approach labor value" - is when the mark-up part approaches zero, which is really not what a monetary production economy as in capitalism is about.

@@vincenttheo8841 hum. I see.

@@vincenttheo8841 yeah, because they love to speculate and overprice, but that's another thing.

He refuses to deal with it because it proves him wrong

Totally agree, I don't understand how anybody believes LTV. Human labor is not the only source of value creation. Can anybody say that machines and animals create no value at all, when machinery increases labor productivity, the increase in productivity is the value created by capital. When cattle toils the field, has no value been created because no human labor was involved? If you say the farmer has created value because he raised and fed the cattle, would you also say a slavemaster who raised and fed their slave creates the value of the slave's labor? To marxists the idea "human labor creates all value" is a priori, it's never proven.

You guys are asking questions because obviously you have not read Capital vol 1. As Marx already countered this argument in this work. Ofcourse labour is not literally in the commodity. It is only there in an abstract way, it is a social relation, not a "thing". Surplus Value is defined as any value creation that exceeds the wage of the worker, but only when that is materialised via the market. So it is a rate of return on the investment that the capitalist can't know in detail in advance. It is clear that if a worker gets 10 per hour, but manages to produce 50 per hour in value on average, that returns to the capitalist, he has produced surplus value. If it wouldn't work like this, the capitalist system as we know it can't function. Machinery indeed increases productivity, so they are a source of surplus value, as per worker-hour, more stuff can be produced, while the worker perhaps gets the same wages as before. The Earth is also a source of value, not just labour. This is also in Capital vol 1

i think you're talking price instead of value

@@mat_max no, I'm talking value

That was the goal lol

join a party

By definition, no one will profit from their risk of investing in your business. So no.

I guess this is a perfect example of why these type of companies are so rare. If you really want to go down this road, my guess is that you have to get some agreement between all partners (or shareholders). But, at first glance, creating a company with partners that have little on job experience...well...its a risk to be sure.

@@manuelcoutinho9426 What do you think of making an "employee" a co-op partner after four years? That's the same amount of time it takes to get a useless college degree but instead of getting a piece of paper, you become of full partner of a company at the end of four years ... and with no debt!

@@curanderos I'm 100% onboard with any kind of agreement both parties agree with. That said, if the employee during those 4 years earned a fixed and fair wage and did not invest in the company (in money or time), then I don't think it is fair to give him a share of the company. But since this is just an abstract company I can't be sure. In your case you say the employee has no college degree so he must learn on the job. In this case, it seems that you will spend a lot of time explaining things to him. So during these explanations you and him will not produce anything of value to the company. Just something to keep in mind. I can give you an example. Some years ago I went on an interview for a startup. These 2 guys were offering me several deals. One is the typical fixed "high" salary. Another is a fixed medium salary and a small % of the company, for example, 0.001% per each hour I worked in the company. The third was even no salary and a higher %. (but I had already a college degree and more than 10 years of work experience)

Elaborate?

i believe he already has been on the jimmy dore show

fred6319 nope

he was interviewed by Cenk on TYT Interviews

jimmy dore is something of a hack it wouldnt be good to endorse his style of journalism

ac1dP1nk a lot of people would disagree with that statement.

The organizers are generally employees themselves.

It sounds like you are describing a manager which is a labor that adds value. None of that necessitates an ownership class separate from the rest of the laborers.

@@stevenclark5173 Even so, ownership constitutes labor, risk and constant effort. To not factor that in is simply insane in my view. 3 years with no pay and leveraging your house and risk of losing everything to get a product to market to be able to afford labor needs to be accounted for.

​@@stevenclark5173 it necessitates a managerial class does it not? A managerial revolution one might say.

@@poopypawl Ownership does absolutely not constitute labor. The only thing a capitalist risks is becoming a (much dreaded) worker. Look, i didnt think this needed to be said but here goes: your local average Joe starting a business is not a capitalist and he is far from being the problem. The ACTUAL capitalists do not need to leverage their houses, neither do they need to take loans. Most of them start off with an inheritance, or like Gates, who started off with a family of bankers and lawyers. The richest people on earth did barely any work to get there. They just bought other peoples ideas. Monopoly capital is the real problem, and that cannot be done away with unless we completely restructure society. These rich ass motherfuckers who don't give a fuck about the poor or the disenfranchised already own half of the earth, and they still want more. This is what capitalism is. Capitalism isn't when your buddy starts a local business brewing ale or something. Capitalism is the centralization of capital, based on the private ownership of the means of production, around a few wealthy people. Through this centralization the wealthy not only own all the wealth, but they also own all the institutions and have the government in their backpocket.

" of equal value " Defined by who? "had to come about from some manual labor performed hence you have the labor theory of value. " But it also had to have capital being utilized, so the LTV is invalid.

@@newperve The origin of any capital whether it is machine capital or information capital, it all has to originate from labor. Money isn't paid to a machine for instance. Money is paid to a person who can make use of that money after they've performed the promised service for their employer. Money isn't a physical resource like energy, It is a political / financial device

@@technatezin But labor isn't the only thing. Willingness to risk capital is also necessary for production. So labor isn't the only source of value.

This is hilarious. Wolff just told you to not confuse price with value yet here you are doing just that. The labour theory of value stipulates that the value of a commodity is given by the socially necessary labour time required to produce it. Because it takes significantly more time to manufacture a car than a pencil, a car will always have more intrinsic value than a pencil. It has nothing to do with cost or price. To illustrate further using an extreme example, a situation occurs when there is only one pencil left in the whole world The price of that pencil could skyrocket to a price even greater than a car, but this ISN'T because the pencil suddenly has more value. It's due to market forces causing the PRICE to go up.

Socially necessary labour time? U don't know what the value or cost of that is...... I could spend a year building a wall... or a week.... price mechanisms stop me taking the piss

@@Mark-zk3gu anyway like I said it's to simplistic for a complex situation like I've stated

@@maguirefire3190 socially necessary labour time means the average labour time it takes to build something. It doesn't matter if it takes you 10 years to build something it takes the average labourer to do in 1 week. The 1 week is the important part. Anything with use value that takes 1 week to make has lower value than something that takes 2 weeks, etc.

He’s drawing a comparison that I think is helpful in that it can shake some people out of their unthinking/unquestioning view of capitalist hierarchy in the workplace. Also - you seem to miss that work is coercive under our system.

Heres the thing, to focus on one if your points, in which system are you not expected to work in order to provide for yourself? Like which economic model allows for most people to not work? And if most people are not working to support themselves, who is morally obliged to work so they don't have to. To say working under capitalism is coercion is not being genuine and is just an outright lie. Because we all have to work anyways. That's not a product of capitalism. All capitalism does is allow you to directly benefit from your work. If if the work your doing is worth more you get paid more. Its that simple. I could explain more but I'll stop right there.

Tia Chung -Social Security for disability and dependents like widows are examples of people not needing to “work” (in the sense you’re referring to) to provide for themself. These cases exist under our current system, though I’m sure the most hardline conservatives would probably like to do away with them. Barring these exceptions, work *is* coercive because you’ll essentially starve if you refuse (if you’re born into the lower classes). I never suggested a system under which most people don’t need to work at all (though we’re ominously told automation is going to take many of our jobs away, so be grateful for that pittance wage you make now - hmm…), but if workers were able to keep the entirety of the fruits of their labor, I imagine the majority could work considerably *less* hours, or choose to work full-time and retire much earlier than average with a solid nest egg. Rather, we have capitalists (the ownership class) siphoning off a large portion of the value, which forces those who weren’t fortunate enough to be born rich or fortunate enough to otherwise luck into riches, to work 40 or more hours/week for the majority of their prime years in order to afford shelter, medical care, food, etc. You say we all have to work anyways. This isn’t true for the ownership class. If I start out with $500k capital and invest it in the S&P index (i.e., do nothing but let $ sit), I’ll more than double that amount in a decade while others toil for $40,000/year. Sound fair?

@@user-dr5me1xt4y Okay you made some good points but I still think your missing the key. Work in not coercive in America because their are people who do not work and they do not starve. So that is just false. You are also forgetting about the fact that 88% of millionaires are self made. 72% of billionaires are self made. And even after that they after 3 generations the money is usually gone. Its something like 90%. So, open your eyes anyone can become a millionaire. You just need to learn, make smart decisions and work hard over a long period of time. Now is the best time in history in the best country in history to make that a reality. And as far as the 40 hour work week. IMO that was a mistake. I did the math if we changed it back to a 60 hour work week and taxed the new money for the 155 million workers do you know how much we would bring in with taxes, considering that each person worked a job at 9$ an hour? 12,555,000,000. We could use that money for good. While adding more value to society and creating a greater output. While also simultaneously giving every American an extra 9,000-10,000$ a year boost in income. While they would still have 5 hours a day for family and the weekends off. Also what I mean by working 12 hours a day is if people worked for themselves for 4 hours a day to gain experience until they could work for themselves full time. I'm not condoning working at the job you hate more. And do I think it fair that someone has advantages over me and I have to work for mine? Yes, absolutely I do. And to be honest our jobs will never be fully automated. Its like as technology advances new jobs are created to maintain and invent more. We will always need manual labor. Like for example they are saying paralegals will no longer be needed but I've been in the court system and I don't see how that is realistic given that cases tend to be so unique. So I'm not worried about that. Will it kill some job probably but it will create some jobs too. Social Security was never intended for people with disabilities, and this is the problem. That's why it is drained now. It was supposed to be for working people. If you want to help people with disabilities then create a separate fund and call it that. Or create a community where they all go to live until they die. And I see no reason why a widow can't work. In my family we work until we die. Even if the people in my family retire they still find a job, well into their 80's.

Tia Chung -Anyone can technically become a millionaire, but the odds are pretty low and getting worse. U.S. Millennials (this includes people as old as 40 now) hold less than 5% of all wealth, whereas Baby Boomers at the same age held 21%. Isn’t that interesting? A little alarming? Sadly you have it backwards: it’s the *worst* time to try to build wealth here if you’re starting from the bottom. We don’t need to further tax workers. We need to tax corporations that offshore their money. There are plenty of resources to give people the basics for survival. Look around you, we’re living in abundance. Our government has simply allocated resources in a terrible way. Case in point is the military budget. It’s great if you want to work into your 80s, and I’d love to continue to have meaningful work opportunities throughout my life if I want them, but I’m optimistic for a better possible future.

We can't until after we attempt to produce.

@@newperve After you produce a product, then how do you tell?

@@MagicBrianTricks Through demand. Digging dirt for no reason may be worth a lot because of the labor put into it, but because nobody would demand digged holes or dirt more than something which we consider more valuable, then that is essentially unnecessary. Of course we can visualize the alternative where people do want dirt, but the point still stands.

@@dudicorn6503 In marxist thought, "demand" influences the market price of a commodity not its value.

He also has no answer for HOW socially necessary something is. Which defeats the entire purpose and gets back to the fact that value is subjective, not something that only comes from labor.

well, a tree has to be chopped and transported to a factory if you want wood. So that's labour, the wood arriving in the factory would embody the labour already done. But a track of unworked land is in essence without value. By working on it, planting seeds etc, it gains a certain value

I mentioned it on one of their live-streams and they said they are working on it. So hopefully he will be on there in the near future. 👍

a company has 10 employees and makes 1000 cars per year. Selling them for a total of 1.000.000$. Nos you could say every employee gets paid 10.000$ a year, because thats how much value they created. But, every employee only gets paid 8.000$ and the factory owner (employer) gets paid 200.000$. That 200.000$ is the surplus value

@Elias Håkansson I agree, it was just a simple example to explain the surplus value

@@thomasawdffaw123 But it doesn't matter what the car sells for. The selling price of the car is dependent on supply and demand, which is subjectively determined

@@hqlife5128 yes, that is the difference between price and value. For the sake of this example I was assuming the value would match the price in this case

@@thomasawdffaw123 the employees did not create all of that value. This conflates cost with value.

Lol Marxists argue in circles on this one.

@@ExPwner it's very easy actually. You subtract the value of the inputs from the value of the output.

@@james1098778910 No, it's not, because value is subjective. The value of the inputs isn't the same as their costs, which is what Marxists get wrong. They treat the value of nonlabor inputs as if they are costs while asserting that the value of labor is different from its costs. It's entirely incoherent.

@@ExPwner I know of no marxist who thinks values and prices are the same thing. Marx made it abundantly clear that they are not. You cannot argue against marx' conception of surplus. It's literally a definition. Definitions aren't right or wrong.

@@james1098778910 "I know of no marxist who thinks values and prices are the same thing." I believe you on that. "You cannot argue against marx' conception of surplus." Yes, you can. It's not a "definition" or a priori truth. Labor is not producing all of the value added in production. Read Bohm Bawerk.

Ok? Hes not saying you are being held hostage? But the surplus that is being exploited from the worker is still the same

​​@@Cage66666 then the employee is free to start a business and do his own "exploiting"

@@sparkyfister if that were true then everyone would own a factory or company but coincidentally everyone who owns a megacorp comes from moderate wealth, so unless your father owns a emerald mine or has 300k to invest in your business you can forget about becoming a multi billionaire, not to mention if everyone were to become the exploiter then who would they exploit? Only a lucky few are able to go from moderate wealth to rich a working class person has no chance to become a exploiter.

@@Cage66666 you're saying it's not true??? People cannot start their own businesses?

@@sparkyfister not realistically most people have jobs and responsibilities to their families, they cannot afford to quit their jobs and start a business and most likely they will fail since 9 out 10 startups fail

Ofc they are exploiting the workers. The problem with communists and socialists is that they are all liars. They never actually wants to liberate anyone. They only want to remove the current order so they can put themselves in power. No communist state has ever produced a paradise for the worker. They are in fact even more strict on that you have to work, even to the point they basically outlaw it.

1. If you were hired to perform a cleaning service or mining job and you spent 5 hours piling dirt, then yes, YOUR LABOUR is worth compensation. The dirt you piled up, if it's of any use to somebody (as fertilizer or construction material or whatever purpose) has what's called a USE VALUE (as opposed to EXCHANGE VALUE, when it is sold as a commodity in the market). 2. The diamond in itself has value, as its known property of hardness is useful for making precision tools. (Notice here that I focus on Use Value instead of the diamond's overinflated Exchange Value as jewelry.) Nature IS a source of value, Marx made this point abundantly clear when he criticised the Lasallean socialists in Critique of the Gotha Programme. 3. It's always misunderstood when discussing the LTV that ultimately, people are concerned about the PRICE of something when the commodity is ready for exchange in the market. Marx wanted to focus instead on the relationships going on within the production process. Wolff already said it IS NOT the Labour Theory of Price. Society can produce to satisfy the NEEDS of everyone in society, without the profit-seeking imperative in capitalism.

@@happy-go-commie 1.) You aren't getting payed for the pile of dirt, you're getting payed for digging something up. And your salery depends on how many people could've done that same job and how valuable people think that work is. 2.) So value isn't dependend on labor. Got it. 3.) No, they literally can't. Profit is the measure by which you can see if anyone actually wants your stuff. Tell me another way of doing that.

1. I put YOUR LABOUR in all caps, somehow you still missed the point. And no, your argument only applies when you consider only the current dominant mode of production. By your logic, what's stopping any capitalist from getting cheap labour elsewhere? Then the price of labour keeps changing in your market due to an ever-growing impoverished sector of the workforce. 2. You are again demonstrating your lack of reading comprehension. When Marx said NATURE IS A SOURCE OF VALUE, he did not say it is the sole source of value. You twist words to suit your flimsy argument without understanding the context of what was said. 3. The tired, old, "You can't operate on a loss" argument that neglects to factor in the nanny state operating at a loss and absorbing much of the initial startup costs to subsidize the major capitalist enterprises. And no, don't bring up your shitty Silicon Valley garage startup as an example. I'm talking about conglomerates and virtual monopolies like Amazon getting unbelievable tax breaks in cities to put up their next warehouse.

@@ancapcitizen8266 and just again on your point #3, you can provide for the needs of society without profiteering. Societies like this have existed for thousands of years of human history, before the concept of private ownership of the means of production came into being around the late Neolithic period. Humans have existed and thrived for far longer in our history without the concept of profiteering and instead co-existing in mutual cooperation. What Marx and Engels called Primitive Communism. Again, don't twist words to imply that I want to go back to primitive society. It's merely to point out that YOUR profit-seeking argument has always been false.

@@happy-go-commie Private-ownership wasn't invented, it always was. It's human-nature. Thanks to dialectics, people today think that the concept of "that's mine" had to be invented and that the idea of "let's all make a hyper-complicated society that can only exist if literally everyone in society is 100% honest at every point in time and also nigh-omniscient concerning every single part of society down to the inner-workings of everyone's mind" is somehow closer to human nature. The profit-argument is always correct and has always been correct, you cannot find a single instance in which it has ever been wrong. I can confidently say this because up until now, you've only said: "There've been societies, you're wrong." Also Marx was wrong when he talked about primitive-communism just like when he was wrong about Judaism and Capitalism being the same thing. Although the word "primitive" is certainly fitting when talking about Communism in practise.

When something doesn’t work the best methods is to go on a similar but off question monologue to confuse and hopefully have them agree with you without actually answering there questions.

I kinda got it, what makes something valuable is it's perceived usefulness to the running of society. Food, clothes, shelter etc.

You should email or tweet these questions to Wolff, I’m curious how he would respond

The other thing I find funny is the little word trick thrown into the definition. You notice that they always the labor theory of value only applies to “commodities”? They do this because they know by using this premise, they can just accept from the beginning that whatever the laborer is producing has and always will be in demand. This takes out the fact that some founder or “capitalist” had to come along and take on a ton of risk to pursue an idea they believe had demand to consumers, but in reality they couldn’t be certain. That’s where the justification for surplus comes in as well. The capitalists invests their time value to build the infrastructure capable of producing something they believe has utility and will possess demand, but take on a TON of risk do to the potential that it doesn’t have the demand they think and ultimately fails. All of communism and socialism tends to rely on looking at the hyper successful capitalists and effectively bypassing the idea that the reason the capitalist is justified in taking profits is due to time value and risk premiums.

The capitalist cannot provide infrastructure or resources, all he does is fund the project. Workers build the infrastructure and mine the resources. The funding is created through the profit from earlier ventures in which workers were able to generate a profit with their efforts. There is no commodity that isn’t generated without labor, without a commodity a profit cannot be generated. Without a profit, no capital can be horded. Without the capital, no new venture can be perused. It is a chicken and egg question. Did labor exist before capital? Yes! It did! Capital is a product of excess labor! So therefore, the social conditions in which we live in, one class provides labor, another provides capital, but capital is a byproduct of excess labor! So it would be logical to say that the capitalist class is able to pay for business ventures through capital they didn’t have a hand in creating!

@@GSteneman capital is impossible to generate without surplus labor value, very rarely are capitalist ventures started without previous capital investment or the aid of financiers who engage in capital investment. Since all capital is the hoarding of surplus labor value it is safe to say that somebody else’s effort was either directly or indirectly involved in generating the financing required to start any new business venture regardless of whether that venture is profitable or not.In the end of the day, they didn’t risk as much as you claim because most of the capital would have been generated through someone else’s labor and not their own. There could be exceptions, but in most successful businesses, it’s because they were funded properly and were able to exploit labor markets in order to maximize profits.

@@raqueljacobs1542 "The funding is created through the profit from earlier ventures" No it isn't. Capitalists don't exist in perpetuity. They get their funding from savings. Capital isn't "hoarded" either. Quit spamming propaganda. Capital is not "excess labor" being stolen from the workers.

@@ExPwner than what is it

Listen to this in which Wolff explains Marx's Labour exploitation theory (in under four minutes) ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE--XED2nmCFNk.html

Cockshott did not in any way empirically prove the LTV. He has been refuted even in the comments.

Well that's just the problem, isn't it? Logically speaking, if we all had access to every aspect of our economy, we would all want to be in the capitalist class, however the vast majority of us do not have the option to own Walmart or PepsiCo, our choice isn't between working or owning, it's between working or starving.

@@kapitankapital6580 No, the vast majority of us do not want be capitalists, due to our differences in time preferences. Not to mention, nobody has access to the means of production by default. They all started somewhere, usually with an idea. To say that labor only create value, according to Marx's absolutist labor theory, is to say it is hands who create art, and not the artist's mind.

@@bjrnhagen4484 I'll deal with this in two parts. Firstly, the myth that capitalists work harder or are all self made. This is simply untrue. For the first part of this argument, you are making the entirely incorrect assumption that all economic activities earn pretty much the same per hour. In reality, a capitalist may only have to work for a few hours every day (browsing stocks or going to board meetings) while earning incomprehensibly large sums of money, while somebody working several part time jobs in order to make enough to survive will be working nearly every hour they possibly can simply because that's what they need to do to have enough to survive. If this idea that income honestly reflected time priorities was true, then CEOs and owners of large firms that earn hundreds of thousands of times the amount of money that the average worker does should be working far more, when they are not. The CEO of Sainsbury's earned nearly £4 million this year, a warehouse worker for Sainsbury's would earn, if working full time five days a week for 52 weeks a year , ~£16,000 a year. If the CEO's additional income just comes from working more hours, then he should be working 2000 hours a day. I'd say that's unlikely, wouldn't you? Secondly, the idea that all capitalists are self made. In reality, the wealthier your background is, the wealthier you will be, statistically speaking. I refer you to the graph in this article relating to parental income and income at age 30: fivethirtyeight.com/features/rich-kids-stay-rich-poor-kids-stay-poor/ I'd especially like to point out the exponential increase in wealth at age 30 for those from the very richest backgrounds. Now, onto your second point. You say that ideas create value, which is sort of true, but not in the way you think. Mental labour, that is, using your mind to produce a commodity, is a form of labour and thus generates value. It's clear that the value of, say, a book is partially created by the author, and the labour that went into writing the book would likely fall under the category of mental labour. However, the idea that coming up with an idea about a business somehow generates value is incorrect, my idea to set up a lemonade stand on a sunny day is not generating any value, rather, the value comes from the labour that went into making the lemonade (including the "dead" labour present in the ingredients, so the labour of the fruit picker, the farmer, the transporter etc) and the labour of selling it. The idea for the business is simply an idea of how to apply my resources to create that value, it in of itself does not generate value. Of course, it is still an important part of the process, and you may believe that it deserves some form of compensation, but that's your subjective moral decision, not an objective analysis of value. The source of the value remains the same, even if the distribution of its fruit changes.

@@kapitankapital6580 There is an epistemological gap here. You come from a point of materialistic determinism. I disagree with your whole post :) It is man's mind that create wealth. It is the business-idea that is productive. It is ideas that guide labor. Without ideas labor don't know what to do. Labor is blind - just like an ox in front of a plow. Furthermore, to elaborate on plowing, the worker behind the plow is again guided by someone who has ideas about where to plow, how much, how deep, what to plant, etc, or even if we should plow at all - maybe making a golf field is a better idea. Speaking about plows. For instance: The carpenter who makes the plow, is more productive than the farmer who must go behind the plow. Because the carpenter have made both the ox and the farmer more productive, and while the farmer, and the ox, has to go out and plow the field, the carpenter has made 10 more plows, and thus made 10 more farmers productive. Finally, the guy that came up with the idea of a plow, is the most productive of them all. He made all the carpenters more productive, which in turn made all the farmers more productive. And again, those who are least productive are the ones who must go and plow the field. This is not about time used, nor calories burned, it is about productivity in its broadest sense, and how ideas manifest themselves in reality. To view all this from a strictly muscular input is too narrow, and a pure materialistic perspective.

@@bjrnhagen4484 I'm a passionate materialist, so it's unlikely that we will come to an agreement here. Never the less, I'll make my case. Let us work with the plow example that you so eloquently established. The plow in this scenario is what we call a capital good, that is, it serves both as a commodity and a means of production. In so far as it is a commodity, it is the product of the labour of the carpenter, it embodies in it all of the labour that has been expended in its production. That manifests itself, with some variation due to the particular market circumstances at the time, in the price of the plow bought by the farmer. The plow also acts as a means of production, that is, it facilitates the labour of the farmhand who ploughs the field. The purpose of the means of production is, as you say, making the labourer more productive or, as Marx would describe it, reducing the necessary labour time of the worker. This, in the short run, makes the farmer more money, as the farmhand is generating more value for his time, that is, his labour time is lower than the socially necessary labour time for such work; however as more and more farmers use the new plough, the socially necessary labour time will fall to meet the new level. This leads to the falling rate of profit under capitalism, but I'm getting side tracked. Although the plough facilitates more efficient labour, it itself does not perform labour. Thus the carpenter has no claim to the labour of the farmhand. Of course, being a capital good, the value embodied in a plough comes from the value it helps the labourer create, but that is not the same thing as it itself performing labour or creating value. Likewise, the inventor of the plough creates a commodity, the idea of the plough, but once it is sold he cannot claim ownership of the labour of the carpenter or the farmhand. Moreover, inventions under capitalism are an interesting phenomenon. It should be noted that, in a completely free market with no state intervention, inventions are a public good, that is, they can be consumed by anybody without it affecting somebody else's ability to consume it and the producer cannot stop people from consuming it. Logically speaking, this should mean they cannot sell it and thus invention shouldn't exist as a commodity. However, due to intellectual property law, ideas can be bought and owned, and others can be excluded from using it, through the power of the state. As such, we have one of two phenomena, either the inventor uses it to set up a business with a competitive edge and exploit a level of monopolistic power granted to him by the state intervention, or he sells it to a company that does the same thing. Under modern capitalism, the latter is far more common than the former. For example, while Mark Zuckerberg may have invented Facebook, and become a capitalist off of this invention, many of the other inventions that Facebook uses were created by people either employed by Zuckerberg or who sold their ideas to him. This makes them intellectual proletariat, or intelligentsia, and the previously described relations of labour apply here as well. As I said, I am a materialist, and I only believe in that which I can prove to exist. All of this talk about blind oxen is very pretty, but amounts in my opinion to hot air; it is labour that creates value, and labour alone, in a capitalist economy.

easy: offer vs demand

It was horrible. A simple minded and foolish, useless theory that is used to lie about "exploited labor."

@@SnakeWasRight Such a ballsy claim as shorn of all logic and empirical evidence. I admire your gusto if not your ignorance.

@@sail2byzantium hahahahaha the empirical evidence is that literally everything based on the LTV utterly fails without exception. The logic proving your insanely illogical concept definitely wrong in every conceivable manner is even simpler. The labor theory of value is a failed theory of value because it cannot describe value, as it doesn't matter how many manhours it takes to produce a thing, if no one wants it, it is worthless. And no, I'm not talking about price. Your economic concept ignores demand. Thus it is no theory of value at all. You might be saying "but this is just the Martian concept of value!" Which makes you and marx liars and peddlers of fallacies, specifically the equivocation fallacy. What this does is equivocates the meaning of value in order to sound economic and profound, but it really lacks all utility. To say that a work of fine art with the same socially necessary man-hours as a pile of putrid mud, that they have the same value, as your bunk "theory" demands, is pure lunacy. Your theory gives us meaningless and useless results. Unless of course, you use it to pose the whiny self entitled delusional lie that "excess" labor value is "stolen" by employers. Sure, when you ignore half of all economic value, demand, and half the labor supply side, upper management and capital investment, you'll get a lopsided sum. But that's the point. It isn't used to make an honest or useful assessment of reality, it is a blatantly fallacious and manipulative tool of rhetoric which ignores tons of basic economic variables, in favor of fudging the results toward a foregone conclusion. It is bunk. It's pseudoscience. Wolff is a liar and a hack. I used to be a fervent communist but when I started to actually look into the actual concepts behind it, I could no longer justify my belief in that religion.

It is very frustrating to try to explain a nonsense :)

@@vojtasks The nonsense is all yours.

> _A chef can take valuable materials and burn them to a crisp and end up with a worthless pile of charred ash._ There is no market for charred ash. We are talking about commodities in a market and socially useful goods. > _Beyond this is the hidden claim that the allocation of capital involves no labor._ It involves no productive labour and in many cases it is dubious that it involves any socially useful labour.

A particular item doesn't have to sell for it to be considered socially useful. The fact that there is already a market for it and other items like it are being sold suffices. Since value is already dealing with averages, why would it differ from the "expected value of value" in a free market?

@@Ronni3no2 A work product must be sold if it is to be considered socially useful: If an entrepreneur has 1,000 pieces of the type Product A produced, but can only sell 500 of them, values are made only in relation to the 500 units sold. For the remaining 500 units, surplus values and the (total) value remain expected values. Although the entrepreneur can imagine surplus values and values for the 500 unsold products, in practice they do not benefit him at the social level, as he cannot buy anything from them - he can only succeed in his ideal ideas. According to Marx, a product becomes socially useful when it becomes a concrete use value for another from the abstract use value for the manufacturer. This is done through sales at the social level. If a work product is not sold, it remains the property of the manufacturer, thus does not reach the social level as an exchange object, does not become the use value for others, since no value relationship is established in relation to the unsold product. The work devoted to the unsold product was not socially(!) useful, the result of the work remains the property of the entrepreneur. Economics deals with values and exchanges between people. Ideal values in property are studied by other sciences. From my point of view the main problem in this area is, that Marx has not described such situations. His value formula can be used if the entrepreneur sells all products with the expected surplus value. In this case, the surplus value can also be added to the cost of production (purely mathematically, not even then in terms of importance), since the replacement of expenditure is the same as the expenses and the real surplus value does not deviate from the expected ones. Supplement: If unsold work products were to lead to real added value and values, no entrepreneur would have to accept bankruptcy: he would only have to sell one product, could continue to produce millions, even if no one would buy them - he would dignity for those products who did not sold receive value and value. The motive power that led to the development of value was not that of consuming a lot of raw materials and other materials, employing many workers and expecting many high added value. Kind regards - Rainer

@@rainerlippert we dont need the employer we only need the working class.

@@mrpoliticalguy5602 It's your dream! Without entrepreneurs you get nothing and then you could not redistribute anything!

You are correct. Wolff is a moron.

Why would ALL surplus go to the worker. The exploitation comes from the owner taking from the surplus not reinvesting part of the surplus.

@@stevenclark5173 Part of the surplus is invested in payroll. Part is invested in the business. The company owner gets paid like everyone else. Part of the surplus is saved for times when business may get slow. Businesses that saved were happy they did when Covid 19 hit.

What it is you can find there: ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-3GHutT-8blc.html The classical interpretation of the Labor Theory of Value contains some flaws. With an updated variant, all value formation can be explained and it is shown that the value is not a singularity, but a relationship between people.Workers, human, mechanical and in part nature, can only create conditions for value relationships, but not values.

Please, tell me where it supposed fails.

@@alexsch2514 if I paint a picture with same labour as a well known artist under ltv both should be same price! its subjective. Beauty is in the eyes of the beholder not because someone took longer at university to to produce crap art.

@@BinanceUSD 1) the artist put more time into training his skills and marketing his art, 2) the socially necessary time to paint a picture is the average time it takes everyone to paint the picture. If both you and the artist paint a picture four four hours then the comparison to what the average person could produce is what determines value. The artist in his four hours produces something the average person would need maybe even 100 hours for. I am exceptionally bad at art, thus my art would only have an equivalent labour of one hours while I personally spend four hours of labour on it 3) both supply and demand, which is the expression of general market value in stv, are forms of labour. If there is low supply then it takes more labour to acquire it. If there is more demand then it either saves the average person a ton of labour of their own or it is because of marketing labour. 4) the ltv never suggests it is an exact tool of measuring exchange value. It just says that if you have a change in exchange value then it is because of labor time applied to it.

@@alexsch2514 but your making the assumption that the artist who has spent years will always be worth more than the new guy which is not true some new rookie artist could get rich for not much very fast. if based on just on labour this is mistaken . Only Subjective value answer this point not labour value. Why a newbie artist's work could be worth more then someone who has been doing art for a life time living on very little earnings. How would a auction house know which artist has done more! It would not know just if it likes the work. Which is stv! Beauty is in the eyes of the beholden

@@alexsch2514 diamond-water paradox. Scenario 1: Plentiful water and normal lifestyle. X amount of "socially necessary labor time" for water and Y amount of "socially necessary labor time" for diamonds. Diamonds are much more valued by people and they would happily trade lots of water for one diamond. Scenario 2: Scarce water and drought. Same amounts of "socially necessary labor time" for the water and the diamonds. Water is much more valued by people and they would trade all of their diamonds for small amounts of water.

lol the people on the assembly line making the phones are proletariats and workers just like the people in the marketing team. the argument is to be against an owner class that does not do labor, that simply has the capital to hire labor which generates the phones and the marketing for the phones ect. yet this class of shareholders and "owners" get all the surplus value, value that should rightfully be paid to the workers. "and you are forgetting that under marxist rule no one has the ability to make contracts with each other" oh wait nevermind i didn't realize you were just a literal retard. The point of marxism is to give workers democratic ownership over their own means of production, the fact you think that for a society to function you need a contract where someone is extracting his own personal insane amounts of profit laborers is stupid as fuck. how about you learn what marxism even is before criticizing something you don't understand. ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-6P97r9Ci5Kg.html a worker owned company would invest in its own company more so

@@modshroom EVERYONE in a business does labour, even the owners. The idea that they just play golf all day and rake in cash, then fill a pool with it and swim around all day is an idiot's conception of how the world works. You never even touched the idea that the people with the brains need control of the money so that the business does as well as possible, and you never explained how marxism respects people's rights to make their own contracts with each other. You call me a retard, but then you argue in favour of giving ACTUAL BONA FIDE RETARDS control over massive companies AS THOUGH THAT WOULD RESULT IN ANYTHING BUT COMPLETE COLLAPSE OF THE COMPANY!

> _You never even touched the idea that the people with the brains need control of the money so that the business does as well as possible_ We will do that when you touch the idea that the people with the brains need to control the country and we need to revoke everyone's right to vote to make sure the country does as well as possible.

@@plaguedoct0r And you thought arguing with commies was a good idea? :-D

There's no point. Now the next obvious question is: Why would we let the employer make such a decision in the first place? Why would a tiny minority of unelected people get to decide if something is or isn't produced, when and where it is produced, how it is produced etc?

@@Ronni3no2 "elected" is poorly used word. We are talking someones business. Democracy is critiqued by both sides when it does not suit them. i.e. Brexit. Also, the average worker does not have information about distributioon, marketing, sales, finances, ect, ect. This idea that workers know as much as the owner is not true. That only applies to factories, and other orthodox jobs.

@@basedlibertarianz910 So what? Once upon a time, we would talk about someone's kingdom, someone's city, someone's crown. Why should a society organize itself like that? The average voter also does not have the information about distribution, marketing, sales, finances, etc. So why did we let them vote on the Brexit question? They don't know as much as the bankers and the economists. So let's abolish democracy altogether. People are just not informed.

@@Ronni3no2 Of course democracy is a right, but it has limitations.

@@basedlibertarianz910 OK, so if democracy is a right, why don't we decide democratically if something is or isn't produced and if it is, how, when and where? What's so special about this particular question that it should not be decided democratically?

There's the mainstream neoclassical explanation, and the more heterodox Sraffian model and the Post-Keynesian price theory.

subjective theory of value

Exchange value is correlated to labor value but it is not a matter of causation. Nobody wants to buy something that’s poorly made. No employer wants to hire an unproductive employee. Labor is a feature of products, no economy is possible without labor.

The labor value is the time it takes for the average worker to make a commodity with the best technology available at the time.

@@raqueljacobs1542 ok how do we determine that value if we can assume that’s no one wants to buy a poor made product and not all works create the same quality products. Also this doesn’t really answer how you arrive a the value of labor

@@raqueljacobs1542 How does someone apply the LTV to services? 80 percent of our economy is a service economy

@@Teej_0 the value of labor is that everything of value has a common denominator of labor. Because something is only valuable if someone has worked on it. If nobody does anything to it, it isn’t valuable. The value is the average number of socially necessary labor hours put into it using the best techniques and most current technology to produce it.

You clearly don't understand what you are talking about here. For one, the reference to slavery was specifically regarding class dialectics. Every economic system throughout human history could be expressed with this dialectic of Master and Slave. In ancient times it literally was Master and Slave. Then in Medieval times it was a dialectic between Lord and Serf. Mind you, these dichotomies don't literally mean that everyone was a lord or a serf, but that for the most part people fit into these broad categories. The dialectic between Lord and Serf eventually collapsed, like all economic systems, and gave rise to Capitalism where it is a dialectic between boss and worker. We have no reason to assume, straight out of the gate, that a Capitalist (i.e a holder of Capital) got it through "hard work". They could have easily gotten it through inheritance or through any such endeavor that would not have required work. As for your hourly wage, it is totally arbitrary. It isn't based on market forces. Ultimately what you are paid has more to do with what the employer feels they can get away with paying you. There is another Prof. Richard Wolff video where there is lengthy discussion about how profit is theft from workers. Imagine this scenario: you are a worker making chairs. You are provided, by your employer in this scenario, the materials and tools required to make the chair. All the materials, tools, etc., are embodied labor. Someone else made those, acquired those, gathered those, etc. To make the chair, you must transform (in a sense) the embodied labor into the chair. You do this with your living labor. Your living labor is the work that has to be done to transform the materials with the tools into the chair. If the total value of the embodied labor was 100, and the total value of your living labor was 100, then we should assume that at the very least the chair should be worth 200. 1 + 1 still equals 2. The employer takes the finished product, and we'll assume that it is sold at its value of 200. From that 200, he takes 100 and puts it into getting more embodied labor, and the other 100... Well, surely you see the problem here. If he gives you, the worker, 100, then he will have nothing for himself. So the employer has to at the very least not give you the entire value of your living labor. So maybe he gives you only 50 and keeps the other 50 himself. Gee, that sucks. The 50 he keeps is none of your concern, despite the fact that money had to be taken out of your pocket for him to have it. In any other circumstance, this would be called theft. Under Capitalism, it is called "profit." Now, this is not the only instance in which profit can be made. It could very easily be made off of the consumers too by charging a greater amount than the actual value of the product. But the worker is also consistently getting ripped off. Now, this part about voluntarily choosing to work is all well and nice but you can't simply elect to not work. Even with public assistance programs, you couldn't live without working. It would not be a life. You would be miserable and in all likelihood be unable to pay rent. Most people work because the alternative entails suffering. If you are going to talk about Bill Gates, you should realize that much of his enormous wealth is generated from patents. Sure, Windows is the dominant PC operating system on the planet. I, myself, am using it as we speak, but we have no reason to believe that what he was doing had genuinely been an innovation. He, personally, did not contribute to the overall design or to the overwhelming bulk of the programming that consists of millions, if not billions, of lines of code. When MS-DOS first came into existence, it wasn't even a totally original product. There were DOS operating systems before it, most notably QDOS that it borrowed quite a lot from. His product didn't get as popular as it did because it was genuinely better: it got to the heights that it did because of highly anti-competitive practices (only some of which he was investigated for) and getting into bed with OEMs. Free-markets are not free. The free-market only sees to it that employers don't have to be socially responsible. It does not help the workers. I don't know how you can make the claim that world poverty has been cut in half in the last fifteen years when we are facing the greatest disparity between rich and poor since the Gilded Age. Your last statement is written in a manner that would suggest this is the first video by Dr. Richard D. Wolff you have ever watched. He does not advocate for State Socialism. He advocates, pretty openly, for workers to directly own the means of production, not for the state to do it. Get your facts right, and then distort them how you please.

It explains how labor is the key element in producing commodities that have value. No commodity is produced without labor, therefore the key element that makes a product more than the sum of its parts has to be the amount and quality of labor that went into it. That being said prices are a more volatile aspect of products that can be divorced from the value endowed to a product by the sum of its materials and the labor expressed in it. A good example would be the antique market. The exchange value of an antique is relatively divorced from its labor value because its exchange value has increased regardless of no extra labor being expended to it and its usefulness being decreased relative to its age. Think of labor value as a correlated aspect of a commodity that is a contributing factor to it’s exchange value but not a ultimate determiner of its end price. The key factor is... without labor power, commodities would not exist. A non- existent commodity has no value.

@@raqueljacobs1542 Thanks for your response, it cleared things up a bit for me. I have one question though: what about commodities that require no labor at all? For instance, nature will produce fruit from trees, and these can have exchange value even though no (human) labor went into producing them. Does this mean that some goods can have exchange value without labor value?

@@berntengdahl1519 agricultural commodities and raw materials have labor value. That labor value is connected to the labor required to extract them. If a tree has apples, someone has to get on a ladder and pick them. They automatically lose their value if no labor is added to them. The apple is not valuable while it is still connected to a tree. Found wealth is also an interesting subject because found wealth represents wealth that normally would have required a lot of labor to produce but in this situation it is happened upon. The stereotypical hypothetical is that someone finds a diamond.But the value of the diamond is represented by the labor it normally takes to find and extract one not the circumstances in which it was found. If people stopped looking for diamonds and expending time and energy to extract them they would immediately be valueless.

@@berntengdahl1519 Just my 2 cents: As Raquel said, "It explains how labor is the key element in producing commodities that have value". Keyword here being "key element". What I mean is that the labor theory of value only assumes that any product value is determine SOLELY by the labor it took to make it. If this is not obviously severely incomplete, I really suggest you work in some company. The risk the company owner takes on is a huge part of the value of the product. For example, suppose you have a brilliant idea for a never seen before product and you expect to earn millions. So you go to a bank, ask for a 1M$ in loans, give your house as collateral, your parents as guarantor, you startup the company, buy machinery, PCs, pay salaries for a year and then it turns out nobody wants your product. You end up loosing your house, your parents house and so on and you never made a dime. So apart from your brilliant idea, you also put the risk. So the labor theory of value is hugely incomplete. It only paints the partial picture that Marx wanted to paint.

No. The labor theory of value claims that all value comes from labor. According to Marx, all goods exchange at a certain rate relative to each other and the common denominator of those is labor. This is of course complete bunk, but it has nothing to do with supply and demand. His concept of “socially necessary labor time” revolves around how much labor goes into it rather than how much supply or demand there is for the product.

@@ExPwner Well hello there again :D

@@ManDrinkingMilk hi! Hope you are doing well.

@@ExPwner Hope u are too

@@ManDrinkingMilk yeah, living the dream!

Yes, because subjectivity can only explain exchange value. It doesn’t consider usefulness or the amount of effort expended in creating the commodity. By only addressing one form of value it dumbs down the definition to the point where one can’t discern the difference between goods made for consumption and commodities. This distinction is important to understanding Marx’s world view.

@@raqueljacobs1542 wrong. All value is subjective.

The alternative is that the employer makes no profit. Do you honestly think any employers out there would hire a bunch of workers and then pay them all the profit the company makes and keep none for themselves?

@@cyberingcatgirls7069 no it isn’t. The alternative is that profit does not come from labor. You just engaged in circular logic.

@@ExPwner Please explain where the profit comes from in your alternative model then.

@@cyberingcatgirls7069 time value of money. Wages are the compensation for labor. Other expenses correspond with compensation for raw materials. Profits correspond with compensation for contribution of capital.

@@ExPwner Oscar Sanz asked, "how do you arrive to the conclusion that what the laborer produces is necessarily more than what he receives on compensation?" His implication is that it's possible that the laborer does NOT produce more than what he receives in compensation. In other words, the business breaks even and the employer earns nothing, or, if Oscar is taken literally and is not even accounting for the costs of raw materials, energy, land, etc, then the business actually LOSES money. My question, again, is, how does the employer DIRECTLY profit in these cases? Note that this is the labor theory of VALUE, not the labor theory of MONEY. The worker could be paid in oranges, bullets, or livestock. Currency is an additional variable here that is not necessary to the equation but only to complicate and/or avoid answering the question. We are looking specifically at what the worker produces, what the employer pays, what the employer sells it for, and the difference between those amounts. Your reply is a non sequitur.

The exploitation theory branches off of the LTV.

Investment is money ,that is a form of value , where did thay money come from ; previous profits or loans that are backed by promises on realized profits in the future. That js not an answer you are providing. The only thing you are imlplicitly saying is that the conditions for capitalism are that most people people have only their labor capacity to sell in order to survive , while others buy with their accumulated money means of production and previously mentioned labor capacity to use it as collectively as capital : ie to make more money and then reinvest etc. If you do not understand the question, you can not answer the question and you start mumbling nonsense about investment creating value by itself. How ; by financing productive activity. Thats where value is created. I am not a Marxist, i do mot buy that only labor creates new value ,but the neoclassical arguement of subjective value is just lame .

This is a 6 minute video meant to give a very brief cursory overview of a topic.

​@@Philitron128 I understand that but it's critical to mention excange, consumer and trade value as individual things

Are you saying that all small business and self employed individuals are imperialists?

We know that but the question is what way? That's the response Prof. Wolff has given so precisely. By generalizing it, you've missed the point.

"Again value is labor but labor can have no value but Marx never wasted time with labor that has no value like making mudpies. " So then how do you deal with the labour expended that failed to produce value? If a worker tries to produce value and fails, what happens? Does he starve under Marx's system? His labour wasn't socially necessary was it?

@@newperve even socially unnecessary labor has value , it just doesn’t prompt economic exchange. If nobody likes my art except for me, it still has intrinsic value. That doesn’t mean it has exchange value.

@@raqueljacobs1542 Not according to Marx. According to Marx if it's not necessary it has no value, and it's not even labor. Read the book.

@@raqueljacobs1542 Also you totally dodged the question. What happens when someone expends labor intended to be valuable but which fails to produce value?

@@newperve all labor intrinsically has value , if you labored and didn’t create value, for yourself or others then obviously, you learned from the experience and the labor created value for yourself in understanding what not to do with your labor.