Matthias Wasser:
> I agree 100%. My only interest here is in how the world actually works,
> so if value theory is just a moral critique masquerading as political
> economy, I don't want to waste my time on it. But if it is political
> economy I want to understand how it operates, whether it actually
> corresponds to reality, &c.
It's neither, so you're posing a false dichotomy.
It's a theory of how social labour is allocated in a capitalist society. Carrol's suggestion of Perlman is a good one, so let's turn to him, shall we?
Freddy Perlman writes:
The question Marx raises is how the working activity of people is regulated in capitalist society. His theory of value is offered as an answer to this question. It will be shown that most critics do not offer a different answer to the question Marx raises, they object to the question. In other words, economists do not say that Marx gives erroneous answers to the question he raises, but that he gives erroneous answers to the questions they raise:
Marx asks: How is human working activity regulated in a capitalist economy?
Marx answers: Human working activity is alienated by one class, appropriated by another class, congealed in commodities, and sold on a market in the form of value.
The economists answer: Marx is wrong. Market price is not determined by labor; it is determined by the price of production and by demand. "The great Alfred Marshall" insisted that "market price - that is, economic value was determined by both supply and demand, which interact with one another in much the same way as Adam Smith described the operation of competitive markets."(63)
Marx was perfectly aware of the role of supply and demand in determining market price, as will be shown below. The point is that Marx did not ask what determines market price; he asked how working activity is regulated.
http://libcom.org/library/commodity-fetishism-fredy-perlman