24. Karl Marx - Theory of Surplus-Value
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- Опубліковано 1 лют 2024
- Karl Marx’s theory of surplus-value is a pivotal point in the history of economic thought. Not only did Marx solve some of the thorny problems left over from Smith and Ricardo but having proved that capitalism was an exploitative system, he changed classical political economy. After Marx, those who supported capitalism entirely gave up on the labour theory of value. Marxism sounded the death knell of classical political economy. A new discipline of economics was developed after Karl Marx in such a way that even the possibility of exploitation was abstracted away from the theoretical framework.
Please make a full playlist for Das Kapital.
Please full das capital sir from India
Great work, sir! It's very heartening to see such content being produced by Pakistani academia for the broader public. I hope you continue to spread knowledge like this.
Much awaited.
Also, sir you started reading to us the book Das Capital but left midway.
I am sure you're busy in your work but can you please continue the rest of it?
That really changed my perspective and the theory of surplus value blew my mind.
Sir please complete your series on dad kapital, I also could not understand it by myself
Dr taimur u portray karl marx very clearly ❤ I highly obliged your way of communication and knowledge ❤❤❤❤🎉🎉
Excellent explanation , sir please teach us das capital.
Good refresher. Good lecture.
Sir, what book would you recommend for studying the History of Economic Thought?
Dr. Rahman, can you please share the reading list for this course?
Baba Karl Marx in Pakistan....😅😅
Where's one Baba-e-Koun Asim Munir, Mistry?
Sir love u❤
Listen juliet, Dr taimur is here with new video
Sir kindly share the slides in description.
In simple terms (beginning points)connection of production is a place where an industry is established, forces of production is the labors who is working there, now combined these two things which make means of production which a capitalist own and like that they control the entirety of society. To my understanding correct me if I’m wrong.
Yes. Capitalists control society by controlling the means of production.
Aoa sir kindly make separate play list for philosophers
This is part of the playlist titled History of Economic Thought
How do you define labor time if it is done by machines. On the top of it now robots and ai is used intensively. Where gone the labor time?
Listen to his reading on Das capital where he explains this. It's a playlist on youtube. Search for 'das capital taimur rehman'
Machines are simply congealed past labour. They transfer their value as a constant. Hence the value spent on them is called constant capital. This constant capital keeps rising as a proportion of total capital as capitalism develops. And this is what drives down the rate of profit. Drives up the rate of exploitation. And causes greater relative poverty of the poor in the midst of a society that can produce plenty. This is essential to the imperative that drives capitalism to a proletariat revolution.
I have answered your question relating to the machines in my comment from the 03.02.2024.
From my point of view, another mistake made by the interpreters of capital is related to the so-called “average socially necessary working time”.
This cannot be determined from production, but only after the corresponding product has been sold on the market: the entire working time is private working time and is privately owned by the entrepreneur.
Only when the product is sold can it be determined which proportion of working time is recognized by society as necessary and which as additional work - precisely through the added value.
The sum of socially necessary working time (the amount that is replaced by reimbursement of costs to the entrepreneur) and surplus work (what the buyer pays as added value in addition to the reimbursement of costs c + v) results, in terms of time, total working time spent.
The entrepreneur does not have to pay the part that the customer pays through added value. Marx defined this part as so-called “unpaid working time” and used it to explain capitalist exploitation.
In individual sales it can happen that the costs are completely replaced and added values are paid in different amounts. Note: For value-added payments, the costs must be fully reimbursed.
It can also happen that the entrepreneur receives reimbursement of the costs for some products, but no added value. And, for example, if better products appear on the market, he will not even be reimbursed for his costs through the sale of his products.
From such different sales, the average socially necessary working hours and the average overtime can be determined retrospectively (!).
@@Taimur_Laal For the past 30 years I am searching the word "congeal" in thesaurus / dictionary of all hues. Non existing. Why? Perhaps in classicsl era it meant to say "conceal". Hidden.
The LTV is flawed: only a buyer on the market can pay the surplus value.
Since, according to Marx, surplus value is part of value, value cannot exist until it is clear whether the entrepreneur succeeds in achieving surplus value for his product, and if so, to what extent.
Furthermore, the surplus value is not paid on the costs, as Marx describes it with W = c + v + m, but on the replacement of the costs W|real = c|replacing costs + v|replacing costs + s|real.
Further evidence that value is created in the market.
You can only produce the prerequisites for (good) surplus payments and values, but neither the surplus values nor the values themselves.
The value is assigned the same amount by both exchange partners on the market to both the goods and the value equivalent.
Since the value is assigned, it does not matter whether the necessary quality improvements to the raw materials and output products are achieved by human or mechanical labor or by parts of nature used as labor.
Your objection is quite simply the view that since value is realised in the market through exchange, it must be created in the market. This is easy to counter since you are simply equating exchange value (price) with value (labour embodied in a commodity). You have not understood the distinction between exchange value and value.
What Marx has to prove is not that labour hours are spent on the production of a commodity. That is self evident. But that labour hours spent (or more accurately socially necessary labour hours spent) are the determinants of exchange value (price). This he proves by showing that the normalisation of the rate of profit drives prices to the point where price is approximately equal to SNLT.
This is an approximation since the organic composition of capital also impacts the deviation of price from SNLT. Hence, in volume 3 of Das Capital he shows that the sum of exchange values will be equal to the sum of SNLT. The deviations cancel each other out.
@@Taimur_Laal
*** I changed this paragraph slightly.
Thank you for your reply! Getting a response from a scientist is something very rare!
In my view, there is no difference between value and exchange value, since value is formed in the market, not created.
***
Value is a relationship that exchange partners enter into with one another for the exchange of goods that are not freely available in order to exchange them with equivalent value, i.e. not to advantage or disadvantage anyone in an economic sense. The advantage for both is that each exchange partner achieves a sufficiently large (assumed) gain in use value through the exchange.
There is not just one price:
1. Offer price
It is based on the proportionate costs that an entrepreneur incurs for producing a product. Marx records this in his value formula with c + v (W = c + v + s). But he can only estimate the surplus value that he can get on the market for his product; it is an expected surplus value.
If he fails to sell the product, he will not receive any reimbursement of the costs and certainly no surplus value.
Since the surplus value is part of the value, the value cannot exist until it is clear whether the entrepreneur succeeds in obtaining surplus value from the buyer and, if so, to what extent.
In addition, the surplus value is not paid on the costs c + v, but on the replacement of the costs. And this is what happens in the market.
Even if an angel from heaven handed the entrepreneur the sum of money “s”, that would not be any surplus value because it would only replace part of the costs.
Consequently, on the production side of the commodity society there is only one expected value, which shows to what extent the entrepreneur would like to be reimbursed for the costs of the product and to what extent he expects surplus value.
It is not certain whether the sale will be successful and the value will be created on the market at the expected level - it is just an expectation.
2. Sales price or purchase price
This is negotiated between buyer and seller. In a bazaar this happens through dialogue, in a department store it happens through one-sided adaptation of the buyer to the seller's instructions.
If they cannot agree, there will be no exchange - the sales contract/invoice cannot contain a sales price and a different purchase price.
The sales price and purchase price are identical and reflect the real value of the goods and the value assigned to the value equivalent as a proxy.
The value formula needs to be adjusted for the market:
W|real = c|replacing costs + v|replacing costs + s|real.
The real value does not correspond to the expenses plus an expected surplus value that is added to the expenses, but rather to the replacement of the expenses plus the real surplus value.
This means that the expenditure is recognized to the appropriate extent as socially useful and therefore as value-creating.
Marx distinguishes between value, exchange value and use value. In my opinion, a distinction must be made between value, expected value and use value.
For this reason, the transformation problem is a non-existent pseudo-problem.
The working hours you mention are included in the expected value. There is also an expected profit.
Buyers decide what is socially necessary when, through purchasing, they recognize the expenses as being for them, i.e. socially useful. This is how the value is formed.
Marx's value formula cannot be used to describe the formation of value as a process, but can only be used to explain, even if it is wrong, how value must be formed if the production of goods is to be continued, improved and, if possible, expanded.
In individual cases there is no requirement that values must be created in such a way that the expenses must be replaced and the expected surplus value must be paid.
@@rainerlippertthank you for your clarification. Let’s work with your definition and see if it helps us understand markets and prediction.
It is true that value is REALISED in the market. But an unsold item is not without value. Otherwise we would have to conclude that all things sitting on the shelf have no value till the instance of their sale.
In fact, things have value even when they are not sold. I pay nothing for a birthday gift. But I now control more valuable commodities than before. Yet I paid nothing for them.
My assets that I have no intention of selling, have value even though I have no expected price for them (since I’m not interested in selling them and have no evaluated them). Yet they have an objective value.
Many things have value without having an exchange value. All pro-gratis work falls in this category.
Many things have exchanged value but no value - there is a market price for bribes (let’s say to look the other way for an infringement of a law). But it has no value - it is not the product of work. Rather it is not working that is being bought here.
So for these reasons the notion that value is created by the market is incorrect, in my opinion.
It fails to acknowledge that things have value, even when they are not part of the market.
@@Taimur_Laal
Thank you very much for your answer!
It's very good to have a discussion and not just proclaim and hear proclamations (as has been the case at least in Germany for several years now)!
My thoughts on this topic differ from your thoughts.
In my view, it is important to distinguish between economic values and ideal values.
Economic values are only important for exchange and they are only created for and with exchange.
Money is a right to a share of all goods that can be distributed economically. The money value reflects the percentage of this right to all of these goods.
In stable times, the right to goods seems to be firmly linked to money, but in times of crisis it becomes clear that the right is only allocated in exchange, because the scope of the allocation is then reduced.
The characteristic of all types of values is that they are assigned by people (there are also approaches to this in the animal kingdom). This applies to money, gold, work products, houses, works of art, etc.
In my opinion, there are no intrinsic values.
There is no value in a classic car. Classic car lovers assign a high idealistic value to a classic car, but also in an idealistic way a high economic value, in my view an expected value.
But only the sale will show whether the economic value can be realized. Only then is the real value formed, which can be above or below the expected value or exactly corresponds to it.
If the classic car is given away, no economic value is created based on this classic car. However, the recipient may sell it so that an economic value is created later.
A person in need who has no relationship with classic cars does not assign the classic car any ideal value, but rather a scrap value. However, this is initially just an expected value. Whether this becomes a real value can only be shown with the sale.
Average values for goods can be determined from many different sales transactions. However, this average does not exist as such, but is dynamically redesigned with each subsequent sale.
The giver assigns an ideal value to a birthday gift and hopes that the recipient assigns the same ideal value to the gift. But that is not certain. Both the giver and the recipient can assign an economic value to the birthday present, but only in an ideal way, i.e. an expected value. This expected value could be the same as the value formed at the time of purchase or that derived from the work done for the gift. But that too would only be expected economic value.
This is what a house looks like too. The expected value is often determined from tables etc. But the real value is only created when it is sold. The real value can differ greatly from the expected value, for example if the real estate market collapses.
Bribes have a corresponding economic value because they are exchanged for an illegal service. This is assigned a malicious ideal value - otherwise the economic value will not be assigned. This is also the case with contract killers. Merchandising items are also assigned an economic value when purchased. If they are disposed of immediately after purchase, they are not assigned any real ideal value.
Value is a relationship between people, specifically between exchange partners. Marx formulates value as a social relationship.
Such a relationship must include at least one objective element, since it goes beyond an individual person, works between two people, as well as between the two exchange partners and the entire society - it is called intersubjective because it never works outside of conscious processes.
But value must also include subjective parts, since it is formed between people, specifically between their conscious processes.
I have shown this in several videos. The most current one can be found here:
ua-cam.com/video/k0ROLxkBUzA/v-deo.html
In my view, the fact that value is only created on the market can also be seen in the values of the laborforce through which, according to Marx, value is created.
In the GDR, the classic interpretation of the LTV was used as the basis for economic policy: the “values” were supposedly created through production, the “values” were reported to the state bank and it had to put the money into circulation for them.
But not all products were sold; prices and production figures were fixed for a long time. This created a comprehensive scarcity economy.
At that time I tried to find the error and had my first discussion about it at the GDR “Staatliche Plankommission”, the State Planning Commission around 1983. I was then able to expand the discussions at universities and an institute. With the ‘big change’, these discussions seemed to become obsolete.
I have been discussing the LTV (and the Austrian School of Economics) worldwide for several years.
In any case, the expected values of production should not be included in the values of the workforce, but only the real values that are formed on the market, of course on a statistical basis. Due to the surplus of money, due to the expected values that were seen as real, there were fictitious shares in the values of the workforce. This led to a widespread shortage economy.
Dr taimur isn't in a good mood today despite giving lecture on Karl
'Rate of exploitation' as Marxists say. How do we see it happening in real/ materialistic sense in a capitalist society? Like how does it present itself?
It is the proportion of social wealth that goes to the capitalist vs the working class.
@@Taimur_Laal but to trigger a bloody proletarian revolution, the absolute material conditions have to go down rather than just the relative ones. On the other hand, we know that capitalism has immensely improved the working and material conditions of the working class, more so than any other previous system.
Marx was kinda genius however, I'd put Keynes above him when it comes to Economics
No comparison even. Not even close. Keynes has no theory of value. He has no explanation of surplus value. He doesn’t examine long term trends of rates of profit. He doesn’t examine long term trends of capital formation and mechanisation.
His great contribution, though, is to prove that a market economy can easily be stuck at a level below full employment. And that was quite correct.