[lbo-talk] law of value

[Rakesh Bhandari]

With rising labor productivity, unit costs will tend to fall and in 
and through the resulting competition so will unit prices. Price 
becomes function of value.  Even Meghnad Desai is forced to concede 
that as an explanation of changing exchange ratios over time the law 
of value is remarkably robust.  It is an essentially dynamic law as 
Karl Korsch long ago recognized (see his chapters on Marx's economics 
in his Karl Marx, which may even be on line now). Here is one major 
difference I have with Gary.

What the law of value means in part is that once social labor 
relations are mediated through commodities, society is quite limited 
in the extent to which it can interfere with prices as they remain a 
function of value. Such interference is not only likely to fail due 
to black markets, it also likely to interfere with the achievement of 
the proportional apportioning of social labor needed to maintain the 
division of labor through which society is reproduced. Prices have to 
be set free, more or less, so as to be governed by the law of value.

The law of value is a requirement of social production in a commodity 
society. But the law of value is in contradiction to the private 
profit seeking character of general commodity production.

For Marx this was a real contradiction of capitalist commodity 
production. Capitalism contradicts itself. It is required to do 
incompatible things. The question for Marx is how such contradictions 
are resolved.

More later.

Rakesh