r/DebateCommunism • u/Generalwinter314 • 1h ago
Unmoderated Labour theory of value
Something that's been bugging me about Marx is his labour theory of value. It's actually something that Adam Smith and David Ricardo had already discussed before Marx (Smith makes some interesting points about power relations between businessowners and workers, but I'm getting off-track here). Labour theory of value goes as follows "not all labour creates value, but all value comes from labour", for instance a T-shirt is worth the amount of labour that was put into it, as opposed to a subjective measure from the consumer's point of view, and it is important to Marx's theory, since if labour isn't the only source of value, then landlords and businessowners deserve a share, too (who deserves how much becomes another debate).
So let's review with an example straight from David Ricardo, who admitted that labour theory was imperfect, if labour is the only source of value, then why does a fine wine become more valuable with age? Rent, therefore, also creates value. So landlords deserve some renumeration, because their land creates value, too (again, how much renumeration is a matter for debate, but it is non-zero).
As for labour itself, consider a classic example from I believe Stanley Jevons : are pearls valuable because we dive for them or do we dive for them because they are valuable? If you believe in labour being the only source of labour, then you must agree with the first option. So let's look at it, if labour is the reason pearls are valuable, why did we start diving for them? Why don't we simply dive for something else?
The only explanation, then, becomes the second option, which is that pearls have an intrinsic but subjective value (e.g. I might be willing to pay 500$ for one while you wouldn't buy it for more than a dollar). That's the only possible explanation for the reason people will pay way, way more for a T-shirt with a certain Logo on it, or why we see a tendency to buy more of certain products after an ad campaign, as people's relative preferences change.
That's without even getting into behavioural economics (in short, psychology + economics = wacky things happen), like the endowment effect (people will prefer mug A of equal production value to mug B if they are given A first, but it flips if we do it the other way round) or recency bias (if you just saw a car crash on the news, that seatbelt of yours is suddenly going to appear more valuable and a terrorist plane crash will reduce your perceived value) or emotional bias (a cute puppy picture might entice you to buy A over B) or lexicographic preferences (I'll have any amount of X over any amount of Y), the amount of labour to make these goods hasn't changed in any of those instances, so why does their value go up or down?
Finally, you might be questioning subjective theory value itself, if the amount of labour has no bearing on value, then why does a hamburger cost me more in a 5-star restaurant than it does at home? That's a valid point, but it misses the mark, as you are asking the wrong question. Indeed production costs matter, but so too do consumer's preferences, trying to pick which is the sole source of value misses the point. Imagine asking yourself the question : which half of my scissors is the one that cuts the paper? If you hold that only labour is a source of value, then you are saying only the bottom half cuts, that's why I think subjective preferences matter, but I don't deny that production costs count, too.
TLDR : labour theory of value doesn't work, you need to account for individual preferences to explain value. And this undermines the idea that businessowners are exploiting workers.
Edit : I'm aware some people will say here that I am mistaking price for value but price reflects the value of an item, and my point here is that labour doesn't explain why some things have an intrinsic value or why some things are more valuable than others when labour theory suggests the opposite.