Measuring exploitation

Bruce Cronin b.cronin at auckland.ac.nz
Thu May 16 13:34:46 MDT 1996


Doug Henwood wrote:

>The World Bank publishes a wages as percent of value added in >manufacturing for lots of countries over 20-30 years in its annual World >Tables. They are in a downtrend in most of the countries I've looked at, with >the prominent exception of S Korea. Here are the numbers from World >Tables 1994:

Moseley, Shaik and Tonak etc. point out that wages as a share of value added understates the degree of exploitation, as 'wages' includes payments to unproductive workers such as supervisors and managers. 

The category remainder of 'value added' after the deduction of 'wages' also bears little relation to the concept of surplus value as it excludes flows of surplus value classed as 'intermediate production' such as financial transactions.

Therefore the ratio of wages to value-added is not an indicator of exploitation, but rather reflects a distributional struggle over the results of the process of production. It is therefore not surprising that Korea should experience an increase in the wage share of value added because the workers have been increasingly successful in the distributional struggle.

Bruce Cronin


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