[Marxism] Marx's formulation of the law of value in capitalist society

Jurriaan Bendien bendien at tomaatnet.nl
Tue Feb 24 03:32:37 MST 2004

Just leafing through Marx's Capital for another query, I found this succinct
statement of the basic meaning of the societal law of value in its
capitalistic expression (in the chapter on the concept of relative

"The law of the determination (Bestimmung) of value by work-time, a law
which brings under its sway the individual capitalist who applies the new
method of production, by compelling him to sell his goods under their social
value, this same law, acting as a coercive law of competition, forces his
competitors to adopt the new method. (...) The value of commodities is in
inverse ratio to the productiveness of work. And so too, is the value of the
commodity labor-power, because it is determined by the values of
commodities. Relative surplus-value is, on the contrary, directly
proportional to the productive power of work" (Progress edition, p. 302,
translation corrected).

That is really the essence of the whole theoretical problem. Heinz-Dieter
Meier ("Die Quelle des Extramehrwerts: Werttransfer vom unproduktiveren
Kapital oder vom produktiveren Kapital selbst ?") also cited this passage:

"The exceptionally productive work operates as intensified work; it creates
in equal intervals of time higher values than the socially average output of
the same kind. (...) Hence the capitalist who applies the improved method of
production, appropriates a larger part of work days for the surplus-labour
than the other capitalists in the same branch of production." (p. 302,
translation corrected)

Meier comments: "This explains unambiguously, that the extra-surplus-value
(i.e. the surplus profit - JB) is produced by capitalists operating with
superior productive capacity themselves, and does not somehow originate
through a transfer of volumes of surplus-value produced by other
capitalists. The work time, which the least productive private producers in
this branch perform in excess of the economically necessary worktime, does
not count as economic, therefore does not form value which in other branches
 (really to other capitalists in the same branch) can be siphoned off."

This is just to say that the "pooling metaphor" used by Marxists confounded
by the transformation problem, however attractive it may sound, cannot be
said to correctly describe the basic economic dynamic of the law of value
within branches of production.

Meier then attributes the determination of the surplus-profit
(extra-Mehrwert) to increased productivity and an increase in the rate of
exploitation. This is true in the last instance, but it ignores the
mediation of circulation processes (monetary phenomena, credit, all sorts of
exchange relations). Transfers of surplus-value (implying unequal exchange)
occur precisely in the mediation (linkage) of production processes and
circulation processes.

I hope to explicate this more point precisely with some empirical
illustrations in future, in Part 10 of my draft of "The "transformation
problem" and the Marxian law of value". I haven't had the recourse to work
on that yet.

For the Weberians, postmodernists and people like that, the law of value
doesn't really apply of course, we are all either living in a euphoric
paradise or else the iron cage of the future, but for Marx it was only a
question of specifying scientifically the modus operandi and the limits of
application of the law of value.

The whole bourgeois controversy about this just devolves on the verity that
you can have exchange without production, but that is just to say that,
within certain limits, you can have capital accumulation without real
economic growth (i.e. jobless growth or growth recessions). The ideological
justification you then obtain is that using money is "efficient and
effective to allocate resources", which is of course true within certain
limits, and it is precisely these limits which are important.

Ultimately however, bargaining position in the marketplace is based on the
productivity of exploitable work effort It is merely the manipulation of
money and credit, i.e. the relative autonomisation of these, in relation to
the sphere of production (which has its corollary in the separation of
ownership and control of productive assets), plus the military defence of
market power, which gives rise to this verity of exchange without
production. The economic limits of militarisation are of course set by the
magnitude of the  fraction of the surplus-product which it consumes.

The economic analysis of the social reproduction process reveals that the
effects of militarisation are contradictory: beyond a certain point,
militarisation cannot increase economic growth, but brakes it. In that case,
the economic function of military wars (utilisation of the military
apparatus) is to stimulate the general conditions for  economic growth once

In this sense, Lenin and Luxemburg were undoubtedly correct: in the last
instance, the perpetuation of the private accumulation of capital in
bourgeois society always depends on fighting a violent war.

Realising all this, the more intelligent strata of the bourgeoisie seek to
shift the nature of the war to that region which is least costly, and
results in the minimum loss of life among their own kind. As regards the
plebs and the "darkies" (sic.), well they can just crap out, "that's life"
or as they say, "shit happens". They had an opportunity to participate in
capital accumulation, if they don't, they deserve to die. That's really the
complaint of the Western bourgeoisie about Iraqi militants and terrorists;
they don't know what's good for them.


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