- Capitalism and Alternatives -
: But I have to ask, what is that £1? What does it signify? Why is it that both I and Guardian Newspapers think an Observer is worth £1? Indeed, I don't need to know any of those details, but i do need to know how much £1 is worth.
I would question wether you even need to know that. In order to get the paper you would only ned to know hat handing over that shiny coin results in you getting the paper - you need know nothing more than that strictly speaking. Thats the transaction.
:I was chastised for suggesting such a link before but yes - the 'utility' you gain from the internet is more than for the observer so given the two have the same exchange value you choose that which gives you more 'utils' - a subjective (individual specific) evaluation.
: Indeed, but you have just accepted that utility does not determine exchange value: where does exchange value come from, then?
Without anyone else in the transaction it would indicate that which you would willingly exchnge for the item. When millions of people are doing those exchanges its impossible to manage each one individually (imagine mind reading checkout staff!) so the price ends up as an amount which will attract the number of buyers roughly equal to the supply - which is blinkin' difficult to calculate - so as to generate the most revenue / profit.
: But my personal preference for internet time was higher than for the Absurder, and yet, they both have the same exchange value.
Because so many other fellows want the paper, because of the relative supply of the two, because of the access to market of that supply, because of the amount to exchange y'all had - I think you get the picture. the factors involved are legion. This was the very reasonable criticism made of command economies by Von Mises - that you'd never calculate that lot from the department of commerce.
: But what am I measuring desire in? What is a desire unit? What is teh metric? How may I quantify desire - especially as you have so estutely noted, exchange value is not related to use/desire value.
You just cant mate, sorry. Best you can do is relate you 'desire' to the desire you have for alternatives and go from there.
: Exactly, money is guaranteed by selecting a commodity, and stating that the exchange value contained in that commodity is equal to teh value of money; given your model of desire units, upon what basis is this achieved, how could this be possible in a solipsistic world where price is governed solely by caprice and desire?
If money was based upon potatoes then the desire for potatoes would be the regulator - the note would be a promise to pay potatoes. Thats simplisitc - now take money as representing all products - promises to pay all products and hey presto you have a stable currency made up by millions of wildly swinging desires/abilities to exchange and all those factors above - all fluctuating itself to a relative stable standstill.
: My point, though, is that Labour time is the exchange value, modified here or there for supply and demand, that Labour time is the starting basis for exchange value - you are quite right, that if we started an economic system, based ion Labour time vouchers, we would return to having money very swiftly...
Indeed, and the modification of supply/demand and all those factors is what i think makes using labor time as the basis theoretically interesting and practically / mathematically too simplistic and too uninforming to describe actual exchanges..
: This can be seen as the unconscious way in which labour time comes to be the metric for echange: how long would it take me to do it myself, how much effort?
But then how long would it take you to build a satellite and TV all by yourself? yes its a handy guide to job-switching behaviour, but it often isnt a question of how long - but more 'what the.. how did they make that!!' and then pleasingly- "only the equivalent of weeks wages!".
: I do, if A goes up in Price, then both B and C go down in price relatiove to A. But you would need a bench-mark by which to measure that rise, otheriwse it merely becomes that A>B. Which is not a useful statement.
We are left with less than useful statements - as I descibed above with all those factors, only focussing on labor is also not useful.
: No, I mean fixing it to some common, understandable comparison, like Gold and its value.
As SDF pointed out elsewhere (sorry, dont know which point) Gold is subjected to the same relative desire conundrum as all things. Its useful, it may be steadier than many things but its still subject to the vagaries of demand/supply - as are currencies themselves.