Re: I repent for asking
This is a good point ---
On Tue, Oct 5, 2021 at 9:52 PM <gilschaeffer82@...> wrote:
I should have added something about depreciation and capitalists fighting over the return from machines. Capitalists do fight over the return from machines. The capital goods sector produces machines to sell for a profit. They can make a profit because the capitalist making consumer goods sees that she can make more profit by using the machine than not.
BUT here you are referring to the USE VALUE of the machine produced to the capitalist who buys it. Marx made very clear right at the beginning of Vol I that commodities MUST have use value in order to be considered commodities -- BUT -- the exchange value (which is of course what brings the producing capitalist surplus value) is determined by "socially necessary labor time." (SNLT) [apologies for saying the obvious --- I need to do this to remind myself!!] --- In other words, the "fight" over the return from machine PRODUCTION starts with the "exchange value" of the machine. If the machine is extremely valuable to the capitalists who buy it, initially it will have a price above it's "cost of production" until competitors realize how profitable it is and enter the market. (This is Joseph Schumpeter's argument as to how innovations drive the economy forward --- he argued that everything "new" enjoyed a temporary monopoly --- remember he wrote this in 1913 when the evidence of successful oligopolistic pricing was pretty slim --- In fact, economists STILL are arguing about how "like competition" our oligopolistic markets are!!!) IN a world of competition (especially the 19th century variety that Marx was observing) even very valuable machines end up selling at the "cost of production" which Marx argues is based on SNLT.
These two capitalists fight over the price of the machine.
Only in the early phase of the machine's existence. Competition will compete it down to the "cost of production"
Furthermore, the "price" that the consumer goods producing capitalist depreciates includes the profit that the producer goods capitalist made because his machine had the capacity to increase productivity.
YES -- very good, strong point --- but it does not negate the idea that you cannot get surplus value from utilizing a machine (remember the PRODUCER of the machine used living labor) --- the capitalist who buys the machine depreciates it at the cost he/she paid for it.
Since there is no way to determine precisely beforehand how much productivity will be increased by new machinery and reorganization of production, there is no way to value any of the productivity-increasing potential of the machinery according to some standard of socially necessary labor time.
AGAIN -- I think you are confusing the USE VALUE of the machine to the capitalist who purchases it --- (here I agree one cannot determine beforehand how much productivity will be increase --- and as per Michael Yates' comment from Harry Magdoff -- even AFTER the machine is being used, the precise increase in productivity caused by the machine is hard to measure because there is also the varying of the INTENSITY of the work done [that's why Taylorism was so important]) --- with the exchange value that accrues once competitors have entered the market and competed the price down to the "cost of production" which Marx asserts but actually (here I echo Joan Robinson) doesn't really PROVE is at SNLT.
Hence my initial offering that the LTV is "good" as a macro tool for understanding profit and growth and dynamics but "lousy" as price theory.
(Sorry to go on so long saying what many on the list will feel is obvious. As I said above, I state the obvious to remind myself -- )