Hey Bill and Carrol and everyone,
I think it's that Marx didn't consider services to be productive labor, but he should have. There's the famous passage from *Theories of Surplus Value* in which Marx facetiously claims that crime is productive:
"A philosopher produces ideas, a poet verse, a parson sermons, a professor text-books, etc. A criminal produces crime. But if the relationship between this latter branch of production and the whole productive activity of society is examined a little more closely one is forced to abandon a number of prejudices. The criminal produces not only crime but also the criminal law; he produces the professor who delivers lectures on this criminal law, and even the inevitable text-book in which the professor presents his lectures as a commodity for sale in the market. There results an increase in material wealth, quite apart from the pleasure which...the author himself derives from the manuscript of this text-book."
But my understanding is that that this is supposed to be a reductio ad absurdum. I'm no Marx expert either, but I think Marxist economists today *do *think that services (including teaching) produce value.
When I was looking for this passage, I noticed that Yoshie Furuhashi quoted it at more length on lbo-talk back in 1999: http://mailman.lbo-talk.org/1999/1999-March/004381.html. The longer version is worth reading.
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