Marxian Value Reconsidered

Abstract

While it is increasingly recognized that Marx's theory was not a theory of prices,' there still seems to be some doubt as to its real meaning and its role in the general framework of Marx's economic analysis. Some have conjectured that it was an attempt to establish an index of output, and others that it was simply a propaganda device for picturing labour as exploited. Neither of these conjectures will stand up. Value measured by labour time is one of the worst possible indices of output, especially in a system such as Marx's where labour-saving innovations are emphasized. It permits such paradoxical results as falling wages (in terms) purchasing a growing mass of commodities.2 This forced both Marx and Ricardo to distinguish between quantity and value in inter-temporal comparisons, indicating that the difficulty was not only present but recognized. As to the exploitation of labour, this is not exploitation in the sense of under-payment of a factor of production for its contribution to output. Marxian exploitation is the exploitation of man by man, not of one factor of production by another. There is no real issue of the relative contributions of labour and capital in the Marxian system, which argues precisely that capital itself is created by labour, and therefore is not to be regarded as a contribution of its legal proprietor at all.3 There is in Marx a certain definitional sleight-of-hand by which output per unit of labour is made to appear as labour's output, but this proves to have little effect on Marxian economics as economics. The whole of the Marxian argument could be recast in terms of marginal productivity without doing violence to the analytic content of either system, whatever the effect on the moral overtones.4 It is sometimes claimed that Marx thought commodities ought to exchange in proportion to the labour expended on them, and that this would or should be done in the socialist society of the future. This scheme, which had deep roots in the general socialist tradition of the nineteenth century, was repeatedly denounced by Marx and Engels