Talk:Labor theory of value/Archive 2

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Socially necessary

This is related to the economic calculation problem. Critics argue that the labor theory of value is useless in the real world for deciding how much of a product is "socially necessary" and for allocating resources. Indeed, they argue that this doomed the Communist states to inefficient production based on guesses of what was "socially necessary" and eventual failure. Marginalism sovles this by acceptng prices as a true measure of the value of products and for allocating resources. Also some socialists accept this and advocate market socialism.

This doesn't seem applicable, the 'average socially necessary labour time concept is simply a means of suggesting that value is derived from the whole process of production, not a particular good and that slow, inefficient workers will not add value by taking twice as long to produce a good than everyone else. I'm loath to delete it since it would leave that section at only one sentence - could someone who knows the critique sort it?--Red Deathy 09:59, 22 August 2006 (UTC)

The economic calculation problem is very well known. If you can state how much of a product is "socially necessary" to produce, then you have solved it.Ultramarine 12:55, 22 August 2006 (UTC)

I'm aware of the economic calculation problem (you can see the changes I've made to the page recently) but it isn't applicable here, since it's taking a different meaning of socially necessary (and in fact doesn't mean you can't find out what is needed/desired, only you can't rationally decide how to produce it). In LTV Socially Necessary labour time refers only to the principle that one hours work does not (ahem) necessarilly turn into one hours value, but that the value of goods is found through competition and production as part of a system. For instance, it doesn't mean that we only need to take three hours to make a cricket ball (it might possible to do it in one) but that currently in the economy generally it takes three hours. Liekwise, it does not imply that the goods are necessary, sicne it applied to fripperies as well - glow in the dark stickers for ceral boxes are not necessary, but do require socially necessary labour time to produce. Do you see the distinction and why the calculation problem isn't relevent? I agree that it is possible to criticise this because it is an abstraction (does Marcx, for instance, mean mode or median average?) so the section should stay but be re-written.--Red Deathy 13:33, 22 August 2006 (UTC)

The problem with "socially necessary" is that it is an ad hoc ad on principle that covers various problems with the theory. For example, labor theorists agree that only useful products should be produced. But who and how to decide what is "socially necessary" and useful? That is the heart of the economic calculation problem.Ultramarine 13:39, 22 August 2006 (UTC)

Labour Theorists of Value don't agree that only necessary products should be produced, socialists argue that, and that is relevent to the economic calculation argument. LTV is desacriptive not normative, it simply says that the value of a good is derived from the average socially necessary labour that would go into its production. Market demand and custome decide what that social necessity is. For example, if a trade union sucesfully resists the introduction of machinery into an industry, say, the socially necessary labour time will be the prevellent one in that industry, even if by introducing that machinery the time needed to produce goods could be radically cut. This: The problem with "socially necessary" is that it is an ad hoc ad on principle that covers various problems with the theory is a valid criticsm that shoudl make the meat of the section, the economic calculation stuff is erroneous (and slightly erogenous).--Red Deathy 13:55, 22 August 2006 (UTC)

The LTV states that only useful products have a value. But it never explains how to decide this. Marginalism explains how, useful products are those people are willing to buy. In the real world the LTV is worthless for how to organise an economy or even to decide if to make more or less of a single product.Ultramarine 13:59, 22 August 2006 (UTC)

The main problem with the LTV is that it doesn't explain the relative differences in prices of commodities. It seems like it can explain some commodities, but there are exceptions where it doesn't work. The only theory that explains all cases is the marginalist theory of value based on the subjective theory of value. It says that for a commodity to have value it must be useful in satisfying human wants and it is not in unlimited supply, and the value of it is determined by the least productive use of that commodity in satisfying a human want. Economizer 15:14, 22 August 2006 (UTC)

Thanks for that, but that's irrelvent to the discussion at hand here about the section on criticism regarding socially necessary labour. This is a place for discussing the LTV article, not arguing the relative merits of theories.--Red Deathy 15:27, 22 August 2006 (UTC)

Obviously the merits of alternative explanations should be discussed.Ultramarine 16:20, 22 August 2006 (UTC)

Not in this discussion section and not necessarilly in this article, if we are to maintain NPOV. the point at hand is that the economic calculation problem has nothing to do with socially necessary labour time. I'm about to go home, so I will go and delete that para now.--Red Deathy 16:24, 22 August 2006 (UTC)

And LTV agrees with this definition of useful, there will be no price if no-one will buy it, and no one will buy it unless they consider it useful. Much like Russell's orbiting teapot, a diamond in the floor of the seabed has no value. As I've tried to explain, the socially necessary labour time can be utterly unnecessary but In the real world, LTV is an explanation for free market economics as seen and observed in action. It is descriptive not prescriptive - hence why the economic calculation argument has no bearing on this page. Firm managers are not presumed to sit down and use Marginal Theory to price their goods, likewise LTV. To return to the article, I think the section needs to remain but to be changed. Unless you can provide a good reason for that para I'll excise it and leave a stub thing on the section...--Red Deathy 14:35, 22 August 2006 (UTC)

Actually there are forms that are normative. They say that the price ought to correspond with the labor incurred in producing a good. Economizer 15:14, 22 August 2006 (UTC)

Yes, but those are political theories based upon LTV, not predictions of the LTV itself.--Red Deathy 15:27, 22 August 2006 (UTC)

Firm managers do implicitly use Marginalism when deciding if they should make more of a product or invest more in its quality, comparing this to alternative options with the help of prices. But they cannot use the LTV. How are they supposed to determine if enough of a product is socially necessary or not? Ultramarine 16:23, 22 August 2006 (UTC)

And firm managers implicitly apply LTV by looking at market pries and seeing if they can produce more goods more cheaply or improve their quality - socially necessary does not mean that there is some objective necessity for a good - have you not read a word I've written this afternoon - it merely means teh average time it takes under given conditions to produce a good. Prics are a machanism for deciding whether or not to put in the time/effort (i.e. labour) of producing a good/service. BTW, in what way is this article not neutral?--Red Deathy 16:47, 22 August 2006 (UTC)

The LTV does not consider prices to be a true measure of long-term value and advocates cannot therefore use them. That is the point with the economic calculation problem. You seem to argue for market socialism.Ultramarine 16:53, 22 August 2006 (UTC)

God - LTV does say that prices reflect or relate to value, value, in effect, emerges or becomes known through price. Economci calculation problem applies where the means of production are not privately owned and traded, it has nothing to do with LTV. People who advocate LTV say that capitalism, as it works now, operates according to the logic of LTV, it's not normative, some people may advocate using labour time as an economic tool, but that is a matter for the economic calculation page. Smith, Marx & Ricardo all claimed that LTV was responsible for prices in a free market. I am not arguing for market socialism (my position is the opposite, in fact, I beleive in the abolition of value and of the need and use of money). According to LTV Market capitalism runs according to labour time principles--Red Deathy 16:59, 22 August 2006 (UTC)

See this (corrected): [1]Ultramarine 17:02, 22 August 2006 (UTC)

Ultramarine, yes, some schools of socialism wanted to restore LTV and use labour time vouchers in socialism, claiming that capitalism distorted true value relations. That, however, is a matter for the socialism article, not for the LTV article, here we set out what LTV as a theory is. LTV is a thery that explains free market economics as we see in the world today - it doesn't matter if you agree with it or not, what matters is that we present the theory as expounded clearly and accurately, and that we put opposition accurately. The economic calculation problem has no bearing on the question of socially necessary labour time up until someone discusses planning using labour time in a socialist commonwealth, then we can have that argument. Until then, socially necessary is found via the free market.--Red Deathy 07:02, 23 August 2006 (UTC)

Obivously this article should deal with all aspects of the LTV, including how it could be used under socialism. As you yourself note, socialists have argued that it should be used under socialism. Ultramarine 16:11, 23 August 2006 (UTC)

What is the ultimate requirement for NPOV?

I can't believe that NPOV requires us to present in the best possible light every concievable theory out there. Say I had an article on the "flat earth theory", and it simply said "the theory holds that the earth is flat". To someone who is not very knowledgable, he might leave with the impression that the earth is indeed flat. Same with LTV. Do we need to present LTV in a positive light, without mentioning there are better explanations for value? -- Dullfig 15:23, 23 August 2006 (UTC)

You could set out historically the people who held the Earth was flat, and why they felt it was flat, and whether there are any adherents today. The same can be done in a creationism article. The reader of the text is then allowed to make up their own mind by reading the round earth and evolution articles and comparing the arguments. Of course, rival theories should be mentioned, but the article should not be written with constant reference to refutation. Further, you should avoid turning the article into a debate by then opening the door to refutations fo refutations. It's not the best possible light, merely setting out why sensible people once held the idea will do without having to put (but they were wrong) in brackets at the end of every sentence.--Red Deathy 15:30, 23 August 2006 (UTC)(But he's wrong)

In fact, check out the Flat Earth page...--Red Deathy 15:36, 23 August 2006 (UTC)

Dullfig, you should understand that there are no better theories of value as the LTV uses the term. In fact there are no other theories at all that use the term in that way. So making comparisons between the LTV value and other theories that use a homograph for that term is misguided. If one wants to compare the explanation of a particular price one theory or another arrives at, then how would we decide which one was better. One of the modern criticisms raises Occam’s razor as the criteria. But that's only one criteria out of many used to just one theory against another. One has to use another theorey to decide which of the two theories to favor. Deciding which criteria to use requires a criterion to make that decision and so on.

If the price of a bottle of coca cola is $1. The LTV says that this price arises from the influence of the amount of labor required to produce the bottle of coca cola along with of the utility derived from it the tendencies for the profit rate to equalize and to disequalize through monopoly power,, etc — shifting the price in conflicting directions by requiring greater or lesser distributionso of value between buyers and sellers of the bottle of coca cola. On the other hand, a neoclassical theory would say that this price arises utlimately from the choices made by firms and individuals but is also infrluence by the technology and initial endowments those individuals and firms had at their disposal, along with the groping process — described by Smith as the Invisible hand and modern neoclassical economists as the Walrasian auctioneer. This Walrasian auctioneer is the omniscent, omnipotent and omnibenevloent auctioneer whom oversees the process of price formation in the neoclassical theory.

So confronted with those two theories of price formation how would we develop the criterion which one to choose which one was better? Its simpler and meets occam's razor to just say its the Walrasian auctioneer that makes it all happen. And there may be something to that. However, the LTV adds insights missing from that theory: namely that there is a finite value to commodities that gets distributed through the process of exchange and price formation. Also the LTV highlights that commodities do not just matierlize from thin air but require the deliberate intervention of human beings to produce them.j

My sense is the constant need to make counter-point after counter-point within the article doesn't arise from a good-will move to save readers from believing an erroneous theory.. Rather Its more an attempt to inject a POV itno the article to undermine the important insights the theory provides. The job for Wikipedia editors is, as Red Deathy says, to simply present the theory and any of the important criticisms. We're getting the theory part to where it belongs, but the criticisms section is a mess. Its missing all the important criticms of the theory and instead is has been turned over to proxy for a usenet forum for anyone who ever once heard something about the LTV. --Cplot 21:50, 23 August 2006 (UTC)

Every single economic transaction consists of a buyer and a seller. The problem with LTV is that it looks exclusively at the seller, and says that the value is entirely determined by the seller, and the amount of work that went into making the object. Now, LTV is not the only one-sided theory, mind you. Marginalism considers the transaction entirely from the buyer's point of view, and completely glosses over the work the seller did. My point (and that of Ayn Rand) is that we need to consider both sides of the transaction. Value is created between the buyer wanting something, and the seller making it. To use your example of Coca-Cola, I'm sure that if you where filling Coca-Cola bottles with gasoline, it would probably be just as much work as filling bottles with the actual beverage, and would be absolutely worthless. Unless a lot of people saw value in getting gasoline in small bottles. Maybe in a war zone they could be used as Molotov cocktails... But I digress :) I hope you get my point. Dullfig 00:36, 24 August 2006 (UTC)

No Dullfig, I don't get your point. Everyone of the theories discussed agree that transactions are two-sided. Again, you're confusing price with value. The LTV understands value as that which is created by the producer — in other words the human laborer. Yeet even value cannot be created by a laborer if the laborer is producing something with any use.

Price on the other hand is understood in LTV shaped by many other things (including the desries of the buyers). Neoclassical theory also seees prices as two sided. Ricardo, Smith, Marx, and so on. There's nothing unique about Ayn Rand’s views or marginalism’s or LTV’s in this respect. --Cplot 07:44, 24 August 2006 (UTC)

I have to disagree with respect to Marx. If price does not precisely match value put in by worker, that would by definition leave a profit. And profit is proof of exploitation. But this is a contradiction, because, as you said, price is determined (at least partly) by the buyer, and that would make the buyer complicit in the exploitation. Right? So I still can't see how you can say that under Marx prices would not be equal to value... -- Dullfig 22:27, 24 August 2006 (UTC)

I agree with Dullfig. He does not understand the topic. For one thing, Marxian exploitation is not a moral or ethical concept. So the word "complicit" shouldn't appear here. For another thing, one could look at Smith's distinction between market price and natural prices. For Smith, natural prices can only rule when outputs are at the level of effectual demand. For consumables, this level has something to do with what buyers want to purchase at natural prices. In a long tradition of looking at such prices, including John Von Neumann, for example, one can characterize the coefficients of production when output is at these levels by something like Leontief Input-Output matrices. Given, say, the wage, one can calculate Marx's prices of production from these matrices. Prices of production are Marx's version of Smith's natural values. And one can also calculate labor values, at least under some interpretations of Marx. In both of these calculations, the use made of capital goods enters into the equations on a par with the supply of capital goods. And typically, as anybody who knows something about a topic not treated adequately in the article knows, prices of production are not equal to labor values when the rate of profits is positive and labor is exploited. (Of course, market prices are not equal to labor values, either.) Of course, in an industry of average organic composition of capital, price equaling labor value is consistent with a positive profit. But why is Dullfig going on about random stuff unrelated to the article? Is this Usenet? -- RLV

You wrote more than I did... :-) Dullfig 04:01, 25 August 2006 (UTC)

Ok, let's compromise. I think this article needs to strictly stick with just defining what LTV is, where it came from, and maybe a concise pro and cons section. Now, here is where trouble always begins, because when you have a pro and cons section, then people of both camps keep trying to expand their side of the article, and it grows and grows. But I can't see leaving out pros and cons, seems like the article would not be complete without it. Ideas? Dullfig 04:08, 25 August 2006 (UTC)

Exactly. The first and foremost important thing to do is to define "labor theory of value." I provided a large list of sourced definitions. One thing we cannot do is interpret the texts of Smith, Ricardo, and Marx ourselves and make up our own definition. No. Did they ever say "This is the labor theory of value and this is how it's defined"? No. Did any of those theorists ever use the term "labor theory of value"? The term and its definition is the work of secondary sources. All of the sources define it as the theory that the exchange value or price of a commodity is proportional to the amount of labor that went into or is necessary to producing it, in the long run. Economizer 05:07, 25 August 2006 (UTC)

"All of the sources..." is poppycock. I already quoted sources (E.g., Foley's textbook) that defined it otherwise. -- RLV

Ok, but that's what, one out of 20? We have to go with the consensus of sources. If there are a few sources at least with Foley's definition then it deserves mention as an alternate definition. If not, then it would be too fringe to include in the intro. Or I could be wrong and the consensus of definitions agrees with Foley's. But we can't know unless the sources are provided. I provided a large list of sources that said it was a theory of exchange value. I have absolutely no POV here. Whatever the consensus of sources say is what I'm going to go with. Economizer 07:20, 25 August 2006 (UTC)

"One out of 20" is balderdash. Notice I wrote "E.g.". Furthmore, it has been pointed out to Economizer that some of his sources can be cited against him. This bit about "fringe" in this context, where Economizer refuses to recognize what some Marxists and others say, is nonsense. -- RLV

Economizer, you know this because I've coverd it on this discussion page, but none of the sources you've provided could be verified. You' are the one here working on the fringe. You have yet to provide a singel source that supports (the key word here is supports) your definition. --Cplot 08:10, 25 August 2006 (UTC)

Just a reminder. I will not discuss anything with the above editor and will not read his comments. Cplot has attacked me repeatedly as "vandalizing" the article and accused me of bad faith. He apologized once, so we resumed discussions. But then he started it again. I will not accept any more apologies and there there is no point in us having a discussion. Why he would want to have a discussion with someone who he says has "bad faith" and who he personally attacked as a "crazy person" is an open question. I want nothing to do with him. I am open to discuss this article with any other person who does not accus me of bad faith and does not label my edits "vandalism." Economizer 08:24, 25 August 2006 (UTC)

Well, I have to say, Cplot is correct (at least with regards to Marx I can say this) that Value and Exchange Value aren't the same - I think I have a couple of books at home that'll bear that out if you really want secondary sources, but I think we should be wary of relying on commentary here. I'l repeat again, just because something is sourced doesn't mean it qualifies for wikipedia nor for any particular article.--Red Deathy 08:29, 25 August 2006 (UTC)

Dullfig, in Marx's theory and in Marixt value theory, the price of everyt commodity could equal its value and there would still be profit. Your stating another common misunderstanding about LTV and Marx's value theory. --Cplot 08:23, 25 August 2006 (UTC)

Even in a Marxist society? Dullfig 16:37, 25 August 2006 (UTC)

Economizer, I do not neceearily want to discuss the article with you. I want you to stop vandalizing the article and I'm trying to use words to convey that message. You don't have to continually post the same reminder. You only have to stop the vandalism. You only cutoff conversation with me when I started making substantive arguments that got in the way of the your subtle vandalism. --Cplot 08:28, 25 August 2006 (UTC)

Dullfig, regrettably your view of Marx is a dull figment of your imagination. I suggest you read some of his work before you set yourself up as a world expert. The Gotha Program would be an easy starting point. PS I answered your ludicrous assertion about the impossibility of equivalent exchange months ago.--Jack Upland 10:43, 29 August 2006 (UTC)

Look, Jack, this is how I see it. It is analogous to solving a theorem. You postulate something, then you take it to its logical conclusion. Then if you find that what you concluded is patently ridiculous, it means that what you postulated must be wrong. Same with Marx. Marx postulated that value was derived from labor. Marxism taken to its ultimate conclusion says that private property should be abolished. Since that is patently ridiculous (how can you not be the owner of that which you produce) it must mean that Marx's postulations must be patently wrong. End of discussion. I don't need to "accurately represent" his theories. I know they are wrong by the conclusions they lead to. Dullfig 17:21, 29 August 2006 (UTC)

Dullfig, you say: "how can you not be the owner of that which you produce?" I don't know where you live, but where I live workers produce things every day that they do not own. Thtat's the nature of capitalism. Workers produce and someone else owns. if you find that ridiculous, then you too (like Marx) are an anti-capitalist. --Cplot 19:31, 29 August 2006 (UTC)

Well, I think the best part of Dullfig's comment is the conclusion:

I don't need to "accurately represent" his theories. I know they are wrong by the conclusions they lead to.

He has therefore acknowledged what we have said all along: he is completely biased. As such, he should disqualify himself from editing Wikipedia.--Jack Upland 22:57, 29 August 2006 (UTC)

And you on the other hand are the paragon of neutrality. I see. Dullfig 04:47, 30 August 2006 (UTC)

Oh, and by the way, I hope you are not implying that only people on the left are able to set aside their bias to write a neutral article. Dullfig 04:51, 30 August 2006 (UTC)

I don't think I've ever made a comment about your political stance nor said that I was the 'paragon' of anything. I was merely referring to your comment that you did not need to 'accurately represent' someone's ideas because you 'knew' they were wrong. I don't care quite frankly if you're referring to Karl Marx, George W Bush, or Paris Hilton. You must accurately represent other people's views - otherwise you are just dishonest and not worth arguing with. If you're convinced you're right while you misrepresent your opponent's opinion - well, yeah, you are biased, and I don't care if you're a fully paid up member of the Communist Party or if you're a Orange Person. And finally if that is really what you think about other people's opinions, yeah, you should vote yourself out of Wikipedia.--Jack Upland 11:24, 1 September 2006 (UTC)

Jack: I'm not trying to offend anyone. I am merely trying to point out that you, and correct me if i'm wrong, think that the Labor Theory of Value is not only being mis-represented, but that it is in fact true and correct. In other words, if Adam Smith thought that LTV was the correct explanation to the value of objects, then I suppose the text should reflect that. But it is incorrect, in my view, to present the theory as if it where a currently accepted theory, as it is not. I don't think you can find a single economist today (except socialists) that would hold that the value of objects is due to the labor expended in making them. Where in the article is the reader informed of that fact? Dullfig 01:15, 3 September 2006 (UTC)

Dullfig, nowhere in the article is it reflected how little you understand this topic. But it's reflected here on the discussion page and I think that's all we need. --Cplot 01:43, 3 September 2006 (UTC)

Nice. Ad Hominem attacks can never take the place of a well reasoned argument. In your mind, there is no need to address any of my points, just attack me personaly and move on. I try to make a point, next thing I know I am being called an ignorant. Usually you can tell when someone doesn't know what to say anymore, when they start insulting. Dullfig 01:51, 3 September 2006 (UTC)

Dullfig, first as has been mentioned here before. This is not a usenet group to dicsuss the LTV. Second, I fail to see what substantive point you're making about the article. Did you think we should assign a red-scare template badge to the article so that unsuspecting readers won't be taken in by well reasoned arguments and rhetoric of the communists/socialists. Readers who search for the LTV want to know what it is and what the ways luminaries throughout history that have contributed to the theory defined, wrote about and shaped the theory. Readers of Wikipedia do not need someone to hold they're hand and tell them which ideas here might be dangerous or subversive. So If the point you'r trying to make .is only that (and I fail to read in your comments any other point) then it really doesn't warrant serioud discussion (personal attacks or silence is all that remains). Another "substantive" point I see you making is that the article should forget about accurately describing the LTV. Again, what kind of response, if any, are you expecting from these suggestions? --Cplot 06:33, 3 September 2006 (UTC)

Cplot: read the Flat earth article, and tell me it doesn't clearly state that the theory has been superceeded. Yes, my point is exactly what you infer: the article should clearly state that LTV has been superceeded, and is no longer considered serious by mainstreem economists. Dullfig 18:05, 3 September 2006 (UTC)

There are several things wrong with that proposal. First it violates Wikiipedia NPOV policy to use concepts like "mainstream" in that way. Second, the theory has not been superseded because no other contemporary theories use the concept of value in the way LTV does. Thirdly, they're are many contemporary economists who still adhere to the theory in its contemporary form (unlike the flat earth). Some are referenced in the references section (take a look).

And finally just because its associated with socialism does not mean it has been superseded. How would a theory be superseded without active engagement and criticism by rival theoryies. The "mainstream" ceased to engage the LTV about the time it matured into its contemporary form. At that point the "mainstream" simply began ingnoring it; afraid to even read the work of its adherents; and simply repeating the criticiisms applied to earlier froms of the LTV.. That's not how theories get superseded. These "points" you make seem to indicate you haven't even glanced at the article. --Cplot 18:42, 3 September 2006 (UTC)

Have you read any contemporary books on astronomy that start out by doing a point-by-point refutation of the flat earth theory?! When theories are superseded, they are no longer talked about. they are dead. they are ignored. they no longer exist. Astronomy professors might mention the flat earth theory as a historic footnote, but they no longer need to explain to anyone why the earth is not flat.

Same with LTV. First, LTV does not take into account, and cannot explain, why things have different values to different people, in other words, there is a subjective component to value. There always will be. Second, LTV cannot explain why there are things of value that require zero labor, like for example land. Third, LTV cannot explain why there are things that require comparatively minimal work, like paintings, that go for astronomical sums (this is due to scarcity), or why the painting would go up in value after the death of the painter.

These are not minor details that can be swept under a rug. They are huge holes in LTV. If LTV was a good theory, there would have been no need to come up with new ones. But they did come up with new ones, like Marginalism, supply and demand, objectivist (there's Ayn Rand again :-), subjective, etc. These theories are not competing theories, they where meant to replace LTV. LTV has been superseded. Dullfig 05:56, 5 September 2006 (UTC)

by the way, out of the list of supporters of LTV in the references section, which one is not a Marxist? Dullfig 06:01, 5 September 2006 (UTC)

User:Dullfig And MU can't explain what price is, what mysterious Utils are, etc. Yes, LTV is not the mainstream theory - but don't forget, we are not talking about an empirical science, we are talking about social science. It can explain those things you say it can't, quite happilly - but this is a place to discuss the page, not to debate teh subject, what are you proposing to add or subtract from the article?--Red Deathy 07:11, 5 September 2006 (UTC)

Dullfig, the LTV can also not explain why you can't even bother to read the article before you start listing criticisms. Those criticisms you list are no doubt very nice criticisms of some other theory. They do not apply to the LTV. Even a cursory reading of the article would make that clear. So perhaps you should find the discussion page of the article where those criticisms are relevant and air them there. We're supposed to use this page to discuss this article and ways of improving the article, not some other theory and whether it should have existed or not.

And why else are you asking about Marxism and socialism than to make ad hominem attacks. As far as I know neither Smith nor Ricardo were Marxists. I suspect Smith was a member of the communist party though. Come on, Smith that sounds like a pseudonym. And who knows about Benjamin Franklin — probably a communist. --Cplot 19:37, 5 September 2006 (UTC)

Why do you keep asking me to read the finer points of the article?! the earth is not flat, and value is not determined by the labor input. Don't you get it? we can work on the finer points of LTV, and get the article completely correct and factual, but the fact remains that the theory is not mainstream, and has been superseded. Why can we not agree on that? Dullfig 03:22, 6 September 2006 (UTC)

Dullfig, that's your POV, the fact remains that there are still numerous and not totally discredited people who support LTV Joan Robinson was, IIRC a non-Marxist proponent. Anyway, perhaps we could agree on non-paradigmatic, or heterodox (I think I prefer heterodox - I've used it elsewhere to useful effect)--Red Deathy 07:29, 6 September 2006 (UTC)

Ok, what do you propose? we have to be able to stabilize this page, otherwise it's useless, if everytime someone visits the page it has been totally changed by an edit war :-) Dullfig 17:52, 6 September 2006 (UTC)

Dullfig, our rather fuitless discussion here has little to do with the recent rash of vandalism that hit the article. There's nothing that needs to be done about that except remain vigilant with reverting to the non-vandalized article. That is what's done with vandalism on every article on Wikipedia, and its fairly effective according to an IBM study. Usually the vandals don't also join in on the disucssion, but I don't think that should change our rseponse on the article page.

Clearly, the ad hominem attacks you made of those on the reference list and your statement above that you "don't need to "accurately represent" these theories. [because you] know they are wrong by the conclusions they lead to" suggests that you too are a vandal and we're not seriously considering your proposals on how to deal with the article. We probably shouldn't even tax the Wikipedia servers by engaging in these fruitless discussion. You've even admitted you haven't read the prsent article! --Cplot 21:30, 6 September 2006 (UTC)

I see, step two: if ad hominem doesn't work, proceed to anounce you are outraged by my actions, and demand satisfaction. Meanwhile YOU HAVN'T ANSWERED A SINGLE ONE OF MY POINTS. You're good.... what comes next? Appeal to authority? Straw man? Dullfig 22:05, 6 September 2006 (UTC)

Dullfig, I'm largely happy with the articlae as it is (there is great room for improvement, but I'd rather see the essentials settled before we go on to what amounts to a rewording and simplifying exercise 9I'd like to see the scary maths out, for example) Until the current dispute is largely settled, I favour the status quo, so what changes would you like to see?--Red Deathy 07:33, 7 September 2006 (UTC)

I think the article should mention that presently the LTV has lost favor among neoclassical economists, and that LTV is largely considered current only among socialist thinkers. Dullfig 00:50, 10 September 2006 (UTC)

And thanks CPlot for putting it in ;-) Dullfig 00:55, 10 September 2006 (UTC)

Sure Dullfig. Sorry if i didnt' use the key ad hominem words (socialist, communist, muck-raker, etc). I didn't thinkt hose would be accurate or appropriate for Wikipedia. --Cplot 02:11, 10 September 2006 (UTC)

Now that you mention it, I was disapointed that you didn't phrase it thus: "LTV is no longer considerd valid by the supperior intelect of the capitalist thinkers; however it is still taken as an article of faith by commie pinko marxist propagandists". But oh well, can't have everything, right? :-) Dullfig 20:18, 10 September 2006 (UTC)

Sourced

Wikipedia requires verifiability, if it is not verifiable that is grounds for removal, however, just because something is verifiable does not mean that it has to stay - it might be placed in the wrong part of the article, it might not be relevent, or it might be actually incorrect. Specifically, WP:Lead I'd suggest is not the place to put refutations of the subject under discussion, they should come at the end or during the expansion in the main body of the text. Finally, I'd suggest that primary sourvces are to be preferred wherever possible, especially in a social science topic, otehrwise what we're getting is the verifiable opinion of someone else unless their work invovles a ground breaking discovery (a new document, etc.)--Red Deathy 07:33, 24 August 2006 (UTC)

lead section edit

I reincorporated the distinctions about the three uses of the term value back into the lead section. I think its important for those distinctions to be ther ein the lead section because so many readers will not know that those distinctions are made within the theory and think that the LTV means that there can't be prices or use-value different than the value referring to the amount of labor in a commodity.. I'd say that's the most commonly held misconcpeiton abou the LTV.

Also, I had to rmove the portion about the LTV being considered false, for obvious NPOV reasons. --Cplot 19:15, 9 September 2006 (UTC)

--Red Deathy 15:26, 13 September 2006 (UTC)==Value and Exchange Value==

Economizer's citations:

• "The labor theor of value says that, in competitive markets, commodities that can be produced over and over against exchange in the marketplace according to the amount of average quality work time it takes to produce them." (Yates, Michael D. Let's Put the Nature of Work on Labor's Agenda: Part Seven)

• "The LTV is the theory that market prices are attracted by prices proportional to the labor time embodied in commodities. In other words, relative prices tend towards relative labor values." (Vienneau, Robert. Frequently Asked Questions about The Labor Theory of value)

• "The central claim of the labor theory of value is that products exchange in proportion to the amount of labor time required for their replacement." (King, Peter and Ripstein Arthur. Did Marx Hold a Labor Theory of Value?)

• "The labor theory of value states that the market prices of commodities tend to be proportionate to the labor socially necessary to produce them. (Zachariah, Dave. Testing the labor theory of value in Sweden)

• "Marx and Engles subscrived to an economic theory known as the "labor theory of value." When they first began their economic studies, that was the state-of-the-art theory in economics. Not only had the two great economists Adam Smith and David Ricardo developed it, but all other writers on economic matters, among them Benjamin Franklin, had held it. Marx quotes Franklin extensively. In outline, the labor theory of value asserts the following: All commodigies are useful to someone (otherwise they will not sell). They have, in the classical terminology, "use value." But they also exchange with other commodities, The ration in which they exchange with other commodities in called their "exchange value."...The theory further assumes that in most exchanges, equals exchange for equals. In some way a quarter of wheat is equal to x blackling or y silk or z gold..But that raises a further question immediately, namely, in respect to what are a quarter of wheat and the specific quantities of other commodities equal to one another? The classical economic theory answered: with respect to the emobodies labor. The value of a commodity was the labor time embodied in it. Hence the labor time embodied in any given commodity determined the proportion in which this commodity exchanged with others. (Schmitt, Richard. Introduction to Marx and Engels: A Critical Reconstruction. Westview Press (1997), p. 104-105)

• "Adam Smith theorized that the labor theory of value holds true only in the "early and rude state of society" but not in a modern economy where owners of capital are compensated by profit. As a result, "Smith ends up making liteel use of a labor theory of value." (Canterbery, E. Ray, A Brief History of Economics: Artful Approaches to the Dismal Science, World Scientific (2001), pp. 52-53)

• "The classical economists adopted the simplifying assumption of the labor theory of value. This theory asserts that labor is the only factor of production and that in a closed economy the prices of all commodities are determined by their labor content. In particular, since our interest lies mainly in relative as opposed to absolute prices with regard to the pure theory of trade, according to the labor theory of value, goods are exchanged against one another according to the relative amounts of labor they represent." (Chacholiades, Miltiades. The Pure Theory of International Trade, Aldine Transaction (2006), p. 14)

• "Like most of the classical economists, Marx tried to explain price formation by a labor theory of value. The rates at which goods exchange against each other are explained by the amount of labor that has gone into their production." (Elster, Joe. An Introduction to Karl Marx, Cambridge University Press (1986), p. 64)

• "The labor theory of value, for Marx, played a double role - as a theory of exchange and a theory of exploitation. Marx's approach was to use the theory of exchange as a conduit to generate the theory of exploitation. (Roemer, John E. Analytic Foundations of Marxian Economic Theory, Cambridge University Press (1989), p. 52)

• "Marx believed the exchange value of a commodity was determined by the amount of labor time necessary for its production. His theory is therefore usually called the labor theory of value." (Hunt, E. K. Property and Prophets: The Evolution of Economic Institutions and Ideologies, M. E. Sharpe (2002), p. 109)

• "The labor theory of value states that the value or price of a commodity is equal to or can be inferred from the amount of labor time going into the production of the commodity." (Salvatore, Dominick. Schaum's Outline of International Economics (1995), p. 15)</ref>

Where to start, well, my ref. from Junankar disputes this, what I've learnt when studying Marx and reading capital disputes this, tehre are three levels, Use Value, Exchange Value and Value itself, which are not necessarilly the same thing, as Cplot's footnote quoted. The quotes above do not refute that, yes, exchange value is determined by emobied socially necessary labour, but isn't the same, for Marx as value. Likewise, the same can be true and hold that price and value are not the same thing.--Red Deathy 14:53, 13 September 2006 (UTC)

The sources above all say that "value" in "labor theory of value" refers to value in exchange. That is the classic labor theory of value. Marx took the labor theory of value and transmogrified it into something else. You can't look at Marx and say what his position was, was THE labor theory of value. The definition of labor theory of value has to come from secondary sources. Leave the interpretation of the original sources to the experts. You may be able to find one or two sources that says otherwise, but they are the extreme minority and should not be represented as any more than that. Economizer 15:02, 13 September 2006 (UTC)

Interpretation is one thing, but being able to cite something directly is another, and Marx' position (and marxists) represent the fullest description of the theory - Cplot also pointed to sections in Smith and Ricardo that bore this out, I won't revert to that coz I've not checked them, I'll leave that to him. Finally, I'm not convinced your seconary sources are discussing the precise point we are dancing around, nor, looking at them, do I think they conflict with the idea that exchange value and value are distinct in LTV, they sound like generalised definitions.--Red Deathy 15:05, 13 September 2006 (UTC)

Just to ask, Economizer, do you accept that Marx distinguished Price and Exchange Value?--Red Deathy 15:08, 13 September 2006 (UTC)

Yes. Marx has is own unique theory of value. It is not THE labor theory of value as it is most commonly defined. Marx is a special case that needs to be discussed in his own section. Marx didn't come up with the labor theory of value. He took it from others and changed it into something else. Economizer 15:10, 13 September 2006 (UTC)

Right, and do you think Marx's version is the most developed form, or have tehre been significant developments in it since then?

I don't know if I'd call it a "developed form." It's just not the labor theory of value as it is commonly known and defined. It's something else. Economizer 15:31, 13 September 2006 (UTC)

I think the problem with Marx is that he set out to prove that, under capitalism, workers where being exploited. He then adapted the LTV to prove his point. The problem is that when you already decided beforehand what the outcome of a theory "should be", any modification to the theory becomes suspect. So I wouldn't call his LTV "the most developed", I would call it simply "different". To call it "most developed" is POV. And I agree that Marx's LTV should be in a section of its own. Dullfig 17:30, 13 September 2006 (UTC)

To me both of the following sentences look like an original research: "This third term for value is the one understood by the labor theory of value." "Value in the labor theory of value is therefore different than other uses of the term value, such as moral value, appraised value (potential price), price or usefulness." Can someone provide a source for them? -- Vision Thing -- 20:37, 13 September 2006 (UTC)

Cplot is the source. He made a footnote, but that footnote is his own original research and he's using that as the source. Economizer 22:42, 13 September 2006 (UTC)

Vision thing, those citations were deleted by Rconomizer, but I restored them.

Economizer, You just keep listing secondary sources without confronting the issue of primary sources. You've yet to come up with a single source that advocates the LTV as you want to define it. Theories have advocates by their very nature. If there aren't any advocates, then it its not a theory: its a strawman position. Earlier I had proposed some disambiguation that separates the strawman LTV from the actual LTV. I think that would improve the article (or if you prefer we could have two separate articles). However its important that the strawman LTV make it clear that that's what its referring to. Alternatively, you could deal with it in a historical section where a separate LTV no longer practiced (from Petty and Franklin) is discussed and differentiate it from the modern advocates of LTV — whether or not they trace this theory to any of Marx's influence. After all there are modern neo-Ricardian LTV theorists too, and these theorists don't think of it in the strawman way either.

Finally, you have to stop claiming that citing primary sources is original research. You'll have to go vandalize the Wikipedia policies page to back up that claim. Original research is where one is trying to produce their own primary source here on Wikipedia. --Cplot 20:55, 13 September 2006 (UTC)

The Peach reference in the article, as I've previously noted, argues that Ricardo sometimes understood "value" to mean absolute value, as distinct from price. So it's not just Marx's theory, as least according to some references. I personally don't think the lead has enough distinctions. There's use value (which is neither ordinal nor cardinal utility); exchange value, as in market prices; exchange value, as in natural prices (aka as prices of production); labor embodied; and labor commanded. I also leave you with a Joan Robinson quote backing up CPlot (RLV):

"In the model... there is no technical progress ... and the ratio of capital to labour is constnat. Thus real output per worker employed is constant (hours of work per year do not vary) and real wages per man are constant. So long as these assumptions are retained Marxian value presents no problem. Value is the product of labour time. Value created per man-year is constant because hours of work are constant. Real product per man year being constant, on the above assumptions, the value of a unit of product is constant. For convenience we may assume money wages per man constant. Then, on these assumptions, both the money price of a unit of output and the value of a unit of money are constant. This of course merely plasters over all problems of measurement connected with the use of index numbers, but provided that the technique of production is unchanging, and normal prices are ruling, those problems are not serious, and we can conduct the analysis in terms of money values. (Rosa Luxemburg regards it as a matter of indifference whether we calculate in money or in value.)" -- Joan Robinson, "Introduction" (in The Accumulation of Capital by Rosa Luxemburg, 1951), all emphases in the original.

Economizer, now you're deleting my comments?!? What is your problem? You really have no business participating in Wikipedia if yoou just want to make up your own rules. I consider deleting others comments on a discussion page to perhaps your most flagrant violation so far. How hard would it have been to copy you post back to where it didn't belong rather than reverting to delete my comment. Its the same amount of effort. --Cplot 00:55, 14 September 2006 (UTC)

So to restore my comment:

Economizer, entries on discussion pages are supposed to be inn chronological order within each thread. I fixed your post above. I guess just another area where Wikipedia guidelines and policies don't apply to Economizer (excpet the ones he makes up in his head). --Cplot 22:51, 13 September 2006 (UTC)

And in reply to Economizer's comment "Cplot is the source". Yes I wrote that portion. And its cited below with a quotation from Marx (so not my original research ) and a citation of Enqirue Dussel's original research (and I am not Eniqure Dussel). So in what sense is this original research. I've already laid out all the reasons I think what you're doing is vandalism. --Cplot 22:53, 13 September 2006 (UTC)

Other issues

Economizer, this page has separate references and notes. The fact that you can't be bothered to provide references separated from notes does not mean you should change the heading for "Notes" to "Notes and References". Perhaps you just didn't notice this, but given the other flagrant disregard of Wikipedia policy (including making up your own Wikipedia policies), I'm inclined to think its just more of your subtle vandalism to undo the tremendous work so many Wikipedia editors have put into creating and maintaining this article. I'm really getting disgusted with this repeated vandalism. You should really be ashamed of yourself.

And one more thing. You claim that you want to make the article about the LTV as its commonly understood, not as Marx, or Smith or Ricardo understood it. Yet most of the citations you bring here mention Smith or Ricardo or Marx by name. To me this again just shows your flagrant disregard for the Wikipedia community. --Cplot 21:11, 13 September 2006 (UTC)

This rash of Soakalism/Vandalism

Economizer tries to hold most of the discussion through his editing comments rather than participating in discussion here. However here's one place where he's come closest on the discussion page to claiming usre of primary sources constitutes original resarch.

"It is still original research because you're your own source. You're making footnotes but *you're* writing the footnotes and using them as a reference. You're pointing to sources but you're the one interpreting them and asserting that the sources are saying what you're saying, instead of providing direct quotes. Are you familiar with WP:OR? Economizer 19:20, 4 August 2006 (UTC)"

From the actual policy (as opposed to the Economizer policy):

"Articles may not contain any previously unpublished arguments, concepts, data, ideas, statements, or theories. Moreover, articles may not contain any new analysis or synthesis of published arguments, concepts, data, ideas, or statements that serves to advance a position."

and

"Original research that creates primary sources is not allowed. However, research that consists of collecting and organizing information from existing primary and/or secondary sources is, of course, strongly encouraged. "

In other places he's suggested the text of the article all has to be directly quoted from sources:

"(cur) (last) 01:41, August 4, 2006 Economizer (Talk | contribs) (this is still original research. none of the sources say what is "typically understood" to be the use of the term "value")"

Of course the quotes come from Marx and a prominent contempoarty scholar on the LTV. I don't quote them directly as Economizer insists I must, but again this is a made up policy that cannot be verified in any of Wikipedia's policies and guidelines pages.

At Wikipedia the text is largely composed by the editors without over-quotiation. Otherwise it couldn't be placed under a public license. None of us have the right to solely quote others and then pass those quotations into a public license.

Then Economizer has repeatedly demonstrated no specialist knowledge in this field, but has instead done wild google searches looking for any key words that support his incorrect conclusions. Every source Economizer has povided that I've tracked down has not proven out Economizer's claims. After tracking down about a dozen sources I stopped indulging these wild-goose chases. In several cases the sources actually undermined Economizer's argument. Often times Economizer's misreading (or not reading at all) these articles and then attributing Economizer's LTV to these theorists also does a disservice to the sources by attaching to contemporary thinkers what Economizer has argued is a deficient and anacrhonistic theory (so this could constitute libel especially given my attempt to verify Economizer's claim do not bear them out):

"I don't know of any contemporary thinkers who hold Ricardo's labor theory of value which says exchange value depends on the amount of labor put into a good. It is so obviously deficient in explaining exchange value" (Economizer 06:56, 4 August 2006 (UTC))

and

"The reason you can't find anyone who agrees with it today is because it is a bad theory" (emphasis added).

So the good-faith asssumption is that these were just misguided key word searches where Economizer didn't follow through and read the article. However, in response to discussion here, Economizrer has refused to acknowledge, reply or engage in discussion that points out these sustantive problems with these claims. Instead Economizer simply changes the article back to the unverifiable state (see Wikipedia verifiability).

Now Economizer is claiming the primary sources of Marx, Smith and Ricardo don't count becuase those theorists didn't adhere to teh LTV (as Economizer defines it). He aruges (implicitly) that there are no adherents to Economzier's LTV. Those theorists that the rest of us thought were prominent in theorizing the LTV were not according to Economizer. Yet nearly half of the sources Economizer provides explicitly mention and attribute the LTV to Marx, Smith or Ricardo. So Economizer is just trying to have it both ways there. I've repeatedly asked Economizer to tell us who is a primary source I can go to and verify these claims. Economizer will not respond. The only sources Economizer wants used are disreputable secondary sources. Verification requires we can also verify the secondary source claims. Otherwise we might as well just drop the policy because everything goes when any secondary source will do. --Cplot 01:46, 14 September 2006 (UTC)

To be honest, I am beginning to think Economizer's edits may constitute vandalism myself, especially their new game of reference bombing, which reads like flinging a million unnnecessary references at a page - you only need one to verify with some see alsos and a bibliography - adding a million references reads like making an argument rather than editting a page. I've dug up a couple of potential books I can look at to see if I can get a decent solid ref. to hang this article on - could I ask Economizer to wait until after the weekend to make anymore revisions? --Red Deathy 07:49, 15 September 2006 (UTC)

Occam's Razor

This section is just horrible. It is self contradictory, makes no sense and is full of really bad grammar. At least rewrite it so that it is coherent, even if you want to keep the blatant POV.radek

Give examples of the problems.--Jack Upland 22:49, 23 September 2006 (UTC)

Examples? The entire section is absolute garbage. It's supposed to be part of a larger section detailing criticisms of the LTV. Instead it's what was originally a pro-marginalism argument that has since been rewritten to become an anti-marginalism polemic--a fact summed up and well-exemplified by the final, completely and riduculously POV sentence fragment that "marginalism" is "empirically and logically wrong". If it can't be cleaned up and turned into an actual criticism of LTV, rather than a running argument between LTVists and marginalists (and I for one can't see how it could be, since that appears to be what it was from the beginning), it should be removed altogether. 24.72.6.129 22:40, 25 September 2006 (UTC)

I concur, and Occam's razor is itself contentious for inclusion anyway. Do readers need to be adviosed of an occam's razor critique? - I'd suggest only if a notable critic had advanced it - otherwise occam's razor is just part of ordinary critical thought.--Red Deathy 07:29, 26 September 2006 (UTC)

I'll not RV it's re-inclusion, but ask, in the first instance for a citation of the use of occam's razor by a notable critic - otherwise it just reads like the inclusion of debating points (and a highly debatable debating point at that).--Red Deathy 07:09, 16 October 2006 (UTC)

Locke

Moved Locke to Birth section from Overview section, but my understanding is that he really has a theory of property, not economic value. However, since he keeps cropping up, perhaps he needs to be mentioned.--Jack Upland 22:24, 23 September 2006 (UTC)

Frank Knight

I vote this be deleted. He's not a significant figure and the quotation contains no significant substance.--Jack Upland 22:48, 23 September 2006 (UTC)

The bit about Carl Menger is fairly pointless and should be deleted also. Of course, Bohm-Bawerk is dated in that lots has been done since then. -- RLV, 1 October

Agree about Knight - Disagree about Menger, a substantive critique worth mentioning for historical value if nothing else--Red Deathy 07:17, 2 October 2006 (UTC)

Knight not a significant figure?! Intangible 02:42, 11 October 2006 (UTC)

Sorry, no, just that the section citing him was really just an argument by authority: "Frank Knight didn't like it" - it didn't propose any specific detailed critique.--Red Deathy 07:36, 11 October 2006 (UTC)

Sorry, again, I thought it had already been deleted, it has been now as a mere argument by authority.--Red Deathy 07:37, 11 October 2006 (UTC)

State preserves the inequality of power?

Under marx's contribution, it says that workers are exploited, and that the state preserves the inequality of power. It seems to me that there should be some qualifier here, as this was probably only true during marx's life. In the US, for example, there is nothing to prevent you from quiting your job and becoming a business owner. Dullfig 00:07, 25 September 2006 (UTC)

There never was a legal barrier to a worker becoming a businessman.--Jack Upland 22:25, 30 September 2006 (UTC)

Costs and Values?

I confess I am not an economist and have probably not fully absorbed all of the information put across in this article. I am confused, however, and would appreciate some clarification. In what way, may I ask, does labour create value? More than this, does 'value' exist in some Platonic or metaphysical sense, to be somehow invested in the products of labour? Surely in the real world labour only creates costs? It is customers who create value by being prepared to buy the products of labour. Just imagine a factory given over to producing two-legged tables. It may employ-and pay for-plenty of labour amongst its other set-up costs and overheads, but where is the value? Practically speaking the product is worthless. In real economies all actions and reactions are surely determined by markets, and by the attitudes and expectations of customers, not by some idealised conception of value. Please excuse my ignorance. White Guard 02:56, 8 October 2006 (UTC)

White guard, I think you're absolutely right. You have not fully asorbed the information put across in this article. The article talks about both use-vlaue (related to demand) and value as created by labor. If buyers can create value simply by buying, why do any of us need to lift a finger to do anything. We should all stop working immediatly and just go buy. : Your question is a rather remedial one and one that I think would be answered by a careful reading of the article. If you have specific questions you might want to pose those here after a careful reading. --Cplot 02:56, 9 October 2006 (UTC)

Oh yes, of course, remedial; I simply can't help being dim, falling well short of your Olympian heights. But in my ignorance I will continue to pose question in the old Socratic style, and risk being quickly dismissed by the likes of you. Do buyers not create demand by creating markets; is labour not deployed to meet the demand arising from markets? Does labour create 'value' just by producing? Above all is labour not just another cost to production? Please do not attempt to answer, just as you have not answered my other questions. And please, please try to resist making any more cheap and snide remarks. It reveals far too much about your character. White Guard 03:10, 9 October 2006 (UTC)

White guard my point is that this is not the place for these types of discussion. The discussion page is meant as a place to discuss the article and specifrically how to improve it. It is not meant to delve (Socratically or otherwise) into the profound meanninng of markets. My point is to ask you to cite specific sections of the article and underscore where they are not clear. What specifically led you to think that buying creates the value defined by the labor theory of value. Any other discussions and Socratic questions should be taken eslewhere. --Cplot 05:47, 9 October 2006 (UTC)

The questions arise from the article, and will remain here for those with the wit to understand and the insight to respond. And for your information Socratic questions are a technique in Greek dialectics, intended to probe for the truth. I thought all Olympians understood that; apparently not-(specifrically (sic)-what was that about remedial?). White Guard 06:01, 9 October 2006 (UTC)

I think what he is trying to ask is: if a table is alone in the forest, is it still a table? :-) Dullfig 22:31, 9 October 2006 (UTC)

Ah, Bishop Berkeley, welcome! What's to mind? Never matter. What's the matter? Never mind. White Guard 23:37, 9 October 2006 (UTC)

White Guard, Dullfig is your ally. Like you, he does not understand the article topic, is uninterested in understanding the article topic, and is uninterested in discussing any specific text in the article. -- RLV, 10 October 2006

Anyways. The article might need even some more expanding on the issue why everybody thinks the LTV is a dud concept. Intangible

But that would be original research :-). --Cplot 22:32, 10 October 2006 (UTC)

I can assure 'RLV' that I understand much more than has ever been dreamt of in his philosophy. With reference to the above remark there are plenty of academics-both econonist and philosophers-who will explain just why the LTV is metaphysical nonsense-and it would not be original research. White Guard 23:58, 10 October 2006 (UTC)

The empirical evidence above is that White Guard remains uninterested in understanding the article and the article topic. My FAQ even addresses the misconception that the LTV says past costs determine value. I've read lots pro and con various labor theories of value too. So what? To me, one needs to understand the mathematics of Leontief input-output matrices, and so I don't expect the topic to ever be clearly stated for a general audience. -- RLV, 10 October 2006

There are plenty of critics of LTV, but also defenders. The role of the article is not to say LTV is wrong but to lay out a history of its development and show its broad outlines (it was, obviously, once, a highly credible theory - unless we assume Smith & Ricardo were cretins tehre must have been good reason for them to believe it). As it is, the criticisms section is badly worded, and does need making a tad less POV and filling out in an informative way.p.s. could we stop debating the topic and get onto working on the article?--Red Deathy 07:41, 11 October 2006 (UTC)

Let me explain from a professional economists point of view why LTV is useless metaphysical nonsense. First of all politics and economic theory does not belong together. This is why communism failed. The reason we value goods using marginal utility is that is that any other method fails to explain why prices adjust the way they do. If goods are vauled using LTV and a central planner uses this when determining how much should be produced a socially inefficient equilibrium arises. In addition to this it is fairly well proven both empirically as well as theoretically that a central social planner is nothing but a political attempt to achieve what would ultimately be the same as if the market was left to achieve this equilibrium by itself. The social planner suffers from a serious information lag problem due to the fact that he cannot possibly obtain real-time data about every consumers preferences and budget restriction. The market solves this by decentralising the mechanism determining the equilibrium prices. Hence LTV is nothing but a metaphysical useless term which early economists had to rely on due to lack of future research on this matter. Smith and Ricardo were not stupid but if we are not allowed to point out flaws in their early "research" we might as well give up and return to the dark ages where all that was not already known to man was deemed blasphemism. LTV is considered a misunderstanding from the early days of economic theory and the article whould reflect that. MartinDK 17:06, 18 October 2006 (UTC)

MartinDK, this is not the place to discuss your views on LTV. The discussion page is for discussion ways of improving the article on LTV. Clearly the article has a horrible criticisms section: no one would dispute that. Unforuantely, its largely due to the ’professional economists’ or those who play‘professional ecomists’ on Wikipedia whom offer such platitudes on the main article page without any familiarity with the literature on the topic. No one here is stopping anyone from adding anything to the criticism page except the most ridiculous and desparate arguments. Read through this discussion page and you‘ll find some hints for imprvoing the criticisms section. --Cplot 18:05, 18 October 2006 (UTC)

First of all I have a diploma to prove my status as a professional economist. Just so we are clear on that. Second I was offering not my personal view but the view of every well educated economist on this matter in hope that you amongst others would relize that the critique put forward here is not original research but common knowledge among economists. I would be happy to engage in a collaborative rewrite of the criticisms section. Anyone who wants to engage in such a rewrite based on peer-reviewed research are more than welcome. This of course includes you as well :) MartinDK 18:33, 18 October 2006 (UTC)

I'm glad someone else here besides me acknowleges the fact that "value" in "labor theory of value" almost always refers to market price or exchange value. The introduction to this article that Cplot has written is horrible. He even wrote his own footnotes of his own opinions to be used as references for the introduction! It's ludicrous. I wrote another version that is sourced, and I will put it back in now. He will revert it back to his flawed version and call what I'm doing "vandalism."Economizer 18:42, 18 October 2006 (UTC)

MartinDK, thanks for offering to work on the criticism section. Your first post made it sound like you thought the supporters of the LTV were somehow stopping critics from contributing to the criticism section. That’s not at allt he case. In fact, I would say the supporters here have done much more to improve that criticism section than those who think the LTV is just “metaphsycial nonsense”. There are surprisingly few compelling criticsms of LTV since the early 1800’s. I do think both Böhm-Bawerk and Bortkewiecz are notable enogh to get some (or better) treatment in the article than they do. Usually what we get instead are many editors who, though they may be familiar with neoclassical economics, have little or no familiarity with LTV. The criticisms therefore end up as vitriolic yet generic (in that they can be fashioned to criticize anything; like the occham’s razor criticsms that was recently deleted). They do not draw on actual work in the field, but just what someon’s ‘common-sense’ might tell them is wrong with the theory: and we know what Gramsci had to say about common-sense. --Cplot 19:04, 18 October 2006 (UTC)

OK let me explain to all of you how I view this discussion and the article in general as an "outsider" to this whole debate. First of all we need to stop the reverting which means that the article needs to stay the way it is until we agree on the edits that are going to be made. Otherwise this is going to spin out of control and someone will have the article protected and the whole process will be halted. Second, I think the article should be concentrated on the pure theory of LTV. No references to anybody's political views, just the pure economics of LTV. Personally I have to admit that I do not consider it a useful concept anymore within the mainstream theory of economics. But then again Marxist economics is not mainstream so let's look at it from that perspective and just analyze it from there. Third, there should be no original research here. There is plenty of available research within this field and we should stick to simply explaining that. My main objection and the reason I posted here to begin with is that the article seems to be trying to somehow fit this into a more general context which is flawed. It cannot be understood if we talk about marginal utility and prices clearing markets.

The term "value" is one of the most misunderstood terms within economics even among people who are well educated within this field. It has its roots in moral philosophy and as such it is easily abused by people trying to mix politics and "pure" economic theory. It is a metaphysical term simply because it was developed in a time where economics was still trying to evolve as a seperate science from moral philosophy. Marx was actually one of the first to systematically model economics using mathematics and hence try to seperate economics from philosophy. but it was early days back then for economics as a science and hence there is a limit as to what we can expect from his and others results. I am sure that the Wright Brothers would have loved to construct a Boing 747 if they could but no one is blaming them for not being able to do so. Sadly most people don't seem to be able to understand the analogy with economics. Within mainstream economics value refers to the (marginal) utility of a good which in turn is expressed in the price of that good. hence LTV is basically ignored because it doesn't provide useful information within that framework. However, within marxist economics it does provide useful meaning and as such we should describe this and its implications within the marxist framework. Marx actually (although I must state that I do not really subscribe to his theories in general at least) priovided some of the first purely mathematical analysis of economics. This article should try harder to present this to the reader. MartinDK 20:57, 18 October 2006 (UTC)

It’s great to have some new eyes looking at the article. However, you should really be more specific with your criticisms. For esample, where does the article look like original research? How is the article “trying to somehow fit [LTV] into a more general context” of “marginal utility and price clearing markets”? Many contemporary theorists (Freeman comes to mind) argues that a strength of LTV is that it’s useful in understanding value and prices even when markets do not clear. Which also raises the question of how you’re using the term ‘general’ when you’re talking about the special case of market clearing.

Also, it’s important to understand that the LTV is drawn from the long tradition of political economy. This is a tradition that rejects the conept of “pure” economics as a fantasy. So one might apply the “pure” economics as a critique of the LTV, but it really has little to do with LTV itself. Specifically where do you read in Marx a “purely mathematical analysis of economics”? Marx did what some might call pure mathematical work in calculus, but I’m not aware of any writing where he used this for a discussion of political economy or “pure” economics. In Capital, Marx applies rudimentary mathematical fumulae and examples, but those can never be divorced from the philophical, epistmological, political, historical and economic discussion in which it is steeped. --Cplot 23:39, 18 October 2006 (UTC)

Sorry for being unclear. My point about original research was not aimed at the article itself but was merely a warning that we should not try to let ourselves be guided by our own beliefs and theories. it was meant as a general note with regard to the future path of our work, not something in the article as it is now. The article tries to fit LTV into the general framework of modern day mainstream economics partly because of the way the introduction tries to explain the difference between value as described by prices and utility and value as described by LTV. Second there are several references to marginalism especially in the recently inserted criticism using occham’s razor (which I, like you, consider pure nonsense).

I use the term general when talking about market clearing simply because it is the way economists refer to that. I understand this may be misleading so I will refrain from doing so. The term general really holds no seperate value in that context so there is no need to use it.

Political economy was not and still isn't a seperate science. It is deeply rooted in moral philosophy as are most sciences when you look back far enough. Indeed, the first Greek philosophers tried to understand nature from a moral point of view as well but as methods improved and more results were achieved it diverted from that standpoint. Economics is as I said deeply rooted in moral phiosophy and continues to be so if you look at and understand the very basic assumptions made about human behaviour and social ambitions. However, to say that pure economics is a fantasy is an over reaction. But in the 1800's it wasn't. When Marx wrote Capital there was no clear definition of a market. There was no available mathematics to describe the price mechanism because the fix-point theorem needed to prove that theory had not been developed. What sets Marx apart from earlier economists at the time was his attempt to use calculus in a way that had not been seen before. Compare Capital to any of the previous books by Ricardo and Smith and you will see what I mean. He tried to lift economics from a purely philosophical matter to something concrete using mathematics. Sure, he was driven by political motivations based on his observations of a very unreasonable social situation. But even if one disagrees with the politics of his theories they were a valuable contribution to economics as a seperate science. He was being scientific, applying calculus where no one had done so before at the same level. That is what I meant by his "pure economics". I am not saying that they should be taken out of the context they were written. But if you look at them as part of the history of economic science they stand out as valuable by themselves. All science is evolutionary. Let's try to understand LTV as part of that evolution.

Finally, I would like to point out that I do have some very hard earned experience with settling edit disputes form the Axis powers article. So to all of you, please stop the reverting and come here instead so we can discuss it and work in collaboration on improving the article. I respect the work you have done on this article, I am just giving you a fresh opinion from someone schooled in economic theory and the history of it as a science and its use of mathematics. Your perspective on it seems to be different and that is great. It is this kind of different sciences/perspectives coming together that makes Wikipedia great. Feel free to counter any of my point made! All I ask is that the reverting ends and we come together with mutual respect for each other and the basic academic principles that apply to all science, whether it is an attempt to sum up previous results or original research. MartinDK 07:16, 19 October 2006 (UTC)

MartinDK, we welcome your contributions to the article. I don’t imagine we’ll have any edit disuptes. You shouldn’t start out by assuming the worst. --Cplot 21:50, 19 October 2006 (UTC)

Gosh, you mean to say that what I have been saying all along, that LTV is obsolete and not considered mainstream, is actually the point of view of most mainstream economists? incredible...

These accusations that I should not give my oppinion as long as I don't completely familiarize myself with the article, and become an expert in LTV are ridiculous. After all, no one needs to know the nitty-gritty, most intimate detail of "flat-earth theory" to know it is obsolete, right? At some point in time the article has to mention that LTV is not mainstream. Dullfig 01:45, 21 October 2006 (UTC)

It should say so in the introduction. As I have said before LTV is metaphysical nonsense from a neoclassical/mainstream point of view. The two quite simply do not mix. It is definately not mainstream. Let's be entirely clear on this. It has no place in neither neo-classical not keynesian economics. It was an invention of Ricardo and Smith, elaborated on by Marx and disregarded by later economists including several ones who definately wouldn't be considered right wing in any way at all. Some followers of Ricardian economics also support it though (for obvious reasons....). However, some today even argue that LTV is not needed to argue in favor of Marx's theories. That all that is needed is the discussion of how to divide assets between workers and capitalists and that LTV was indeed a mistake to begin with. But... I refuse to blend politics and economics so I am not getting myself involved in that debate. I am not assuming the worst Cplot... of the last 9 edits 7 counts as reverts. MartinDK 07:36, 21 October 2006 (UTC)

The current intro clearly states that it is non-mainstream abnd heterodox - that seems quite sufficient to me. I think one way to end the edit war is to emphasise that the most developed version of LTV was Marx's and that is the one presented in the introcution (for marx value and price are clearly distinct) I can't say, flicking though Ricardo I've come across him making the same point. User:Economizer is just plain wrong when they say that this version is OR, but might have a point on it being a bit wrong in its current phrasing. that said, I think it onl;y requires a tiny alteration to clarify, not massive restructuring. I'd really like to see the criticisms section seriously beefed up, though - as I think I've mentioned before...--Red Deathy 10:30, 21 October 2006 (UTC)

That's fair enough. I still think that the point about value without a qualifying adjective automatically refering to LTV is wrong and quite frankly not really needed. How about just keeping the preceeding paragraph and then "forget" about mainstream economics until we get to the criticism. it is only a minor tweak but I really think it would help a lot and certainly end a lot of the confusion about who defines value as what because, as I said before, the term value is so easily misunderstood anyway and it requires a lot more discussion anyway. So lets leave the whole discussion of the finer details of how we define value to another article.I am not saying its bad I am just saying I think it confuses people. We have to remeber that people visiting this article may not know very much about economics in general so we need to keep it really simple without loosing the accuarcy. That to me is the real challenge of any article really. Maybe we should start to discuss how we want to reorganize the criticisms section? what over all structure is wanted and what should be included? Is it just a minor tweak we are looking for or are we really interested in rewriting the whole thing? MartinDK 12:09, 21 October 2006 (UTC)

MartinDK, the lead section is not trying to claim the term value without qualification belongs to the LTV. Rather it’s saying that within the LTV, value has these three meanings. I think if you look at it again, you’ll see that. If that’s still not clear, then please add some wording that makes that clearer for you and others that might read it the way you do. As for the ’edit war’ I think you should read through this discussion page. You’ll see that there really isn’t an edit war. Economizer is clearly a vandal: a sophisticated vandal, but a vandal nonetheless. A quick read through the discussion will show that. So if one doesn’t count vandalism, the only reverts have been related to Occam’s razor. And even on that section those participating in the discussion are in agreement that it shouldn’t be there (my apologies fo accidentally re-adding it when I reverted the vandalism).

So just to be clear. We are not trying to reflect mainstream economics in this article. The only place mainstream economics relates to LTV is in it’s criticsm of it. One note on that though, Keynesian economics does not reject the LTV. Keynes actually uses a variant (without calling it that) of the LTV in his most famous work: The General theory of Employment, Interest and Money. As I said before, there are actually very few contemporary analytical criticms of LTV. The mainstream economics approach is to simply denograte it and, more often, ignore it. --Cplot 16:20, 21 October 2006 (UTC)

You are absolutely right about Keynes. Page 213-14 in The General theory of Employment, Interest and Money does indeed talk about this. The page numbers may vary according to whatever copy you have though. However, Schumpeter hailed socialism as the way of the future but denounced LTV so... opinions do indeed differ especially across time. You are right about mainstream economics completely disregarding it (as well as other abnormalities such as imperfect asset markets and the fact that people do not always have transitive preferences).

I suggest one small alteration of the introduction.

The term value in the labor theory of value is often confused with the term price as used by many economists. However, contemporary LTV theorists distinguish between several key uses of the term value.

should be changed to

The term value takes on many meanings within economics. Hence it is very important to be clear on what is actually meant when the term is being used. The term value in the labor theory of value is often confused with the term price as used by many economists. However, contemporary LTV theorists distinguish between several key uses of the term value.

That satisfies me because it makes it clear to the reader that he or she should be vigiliant here not only because it takes on different m,eanings within LTV but because the term is generally confusing and people often misunderstand each other when refering to value. Like I said it is a little tweak.

I noticed that there is some time between the edits that have occured so no its not really an edit war as such but it just seems to me that the only contributions right now are reverts even if there is some time between them. MartinDK 17:14, 21 October 2006 (UTC)

That sounds like a good improvement to me for the lead section. Thanks also for checking those page numbers on Keynes. It occurs to me that such a fact probably belongs in the article somewhere.. --Cplot 17:41, 21 October 2006 (UTC)

I have to say that I really like the intro as it stands now. I hope no one decides to radically change it. Dullfig 21:33, 21 October 2006 (UTC)

The intro is horrible. It's wrong. It says that "value" in the labor theory of value does not typically refer to exchange value or price, but that is exactly what it typically refers to. That section with the 1.2.3. is ridiculous. And this sentence is dead wrong: "Value in the labor theory of value is therefore different than other uses of the term value, such as moral value, appraised value (potential price), price or usefulness." "Value" DOES refer to price. I wrote an intro that included many sources to show this but Cplot keeps deleting it. I am going to put it back in. Economizer 01:19, 22 October 2006 (UTC)

Ok the way I have understood it LTV to Smith and Ricardo equals the price/exchange value. Why? Because to Smith and Ricardo there was no need to explain any division of profits between workers and capitalists. Marx uses LTV in a different way and in his model LTV only makes up a part of the exchange value. Hence the idea of workers being exploited. In that way Marx's way of using it can be seen as a critique of the simplicity of Ricardo and Smith. However, and please correct me if I am wrong here, I don't recall Marx having a problem with thinking of the exchange value as the sum of labor value and a markup where the markup is the capitalists profit. And if that markup is proportional to the labor value then labor value does determine the path of prices over time but there will always be a markup originating from the profit made by the capitalists. hence labor valu and exchange value will differ but only with a proportional markup. If I am correct about this not being in violation of Marx's theories then I think it would be a good way to relate the two interpretations of LTV. When you boil it down like this it becomes quite clear I think. Also it relates it to modern theories of prices being determined by markup over costs and therefor also answering White Guard's question. MartinDK 03:04, 22 October 2006 (UTC)

Thanks for the help on the lead section.I never imagined such a small change as your sentence would go so far as to please Dulfig. Anyway, at this point I would recommend reading the remainder of the article. And follow some of the reference links. There’s some very good material there for understanding the LTV. If you have specific questions about the article or even those refercences several of us here could help answer those questions. I think right now your questions are just too general to understand. As I recommended before, try to bring up specific pieces from the article when asking your questions. I’m confident even a mainstram economist can understand this stuff. --Cplot 13:00, 22 October 2006 (UTC)

MartinDK Ricardo ast least did spend a lot of time explaining the division between capitalists and workers (inedeed, he goes so far as to point out that raising wages doesn't necessarilly increase price and that over time rentiers and workers could squeeze capitalists out of their profits). Marx, however, makes a sharp break between price and value, seeing value, I think, as some sort of underlying logic upon which the cost of production operates - I think the fullest explanation of his system can be found in this chapter of Capital III. For Marx the exchange value of a good was the full added value, including profits (and total prices should resolve into total values, hence the transformation problem). The source of exploitation is not underpaying the workers but the difference between the value of labour power as a commodity and the value of the labour they add to the work process.--Red Deathy 07:33, 23 October 2006 (UTC)