: SDF: An assumption basic to Adam Smith and David Ricardo too.
Absolutely. Ricardo especially.
: The theory states basically that the value of an object is solely a result of the labor expended to produce it.
: SDF: Could you cite a source for this definition?
I've seen the above written in economic notes before, but its pretty much paralell with my conclusion (it isnt really a citation), based upon labor being considered the only meanignful element in an (made, presumably) objects value.
: From what I remember, the labor theory of value states "basically" that the EXCHANGE value of an object is a result of the labor expended to produce it.
This is what I explained with the labor value being whatever the difference between 'other costs' and exchanged value - but you note that as an exchange value it can be variable, even negative - it follows the exchanged value, one can only know the labor value after its been sold in effect - as per my example of the $200 product and the $50 product involving the same work.
The rest is a reasonable assumption - that more time and skills makes a product more useful to a consumer increasing its exchange value - but that is no universal rule - its a 'reasonable guideline'
: For instance, if we want to exploit the use-value of a coal mine, for instance, to allow coal to be sold or somehow otherwise distributed, someone has to WORK at the mine.
Yes I take your point - its also true of my 'nice weather' example - someone has to make the houses, but the making of houses in California and Alaska probably takes similar time and skills yet house prices can be hugely different - meaning that the 'post sale' labor value of the builder is hugely variable aswell.
: People work, and the sum of this work is reflected in the "wealth" that is the domain of FINANCIAL SOCIETY under capitalism.
Thats a reasonable explanation although it doesnt account for the differences in value added by different acts of 'working' by different people and of the relative usefulness each persons work has in relation to each other person. Thats where it gets complex - too complex for the labor theoru of value to be useful as an analysis tool ecxept in adding a retrospective 'whatever the exchanged value thats the labor value' condition.
: The real problem IMHO with the discussion of "nature" as the ultimate source of all values (in volume 1 of CAPITAL) is that it never really happens -- "value" in CAPITAL is equated with "exchange value," so Marx didn't really explain the "natural origin of values" which his theory presumed. See, there are use-values, which I suppose ARE "natural," and there are exchange-values, which are the product of a particular form of society, i.e. financial society. Marx appears to have equated "value" with "exchange value" ( & for me it's what makes CAPITAL vols. 2 and 3 so difficult to pick up a second time). Exchange values by definition aren't "natural," they're an effect of a system of exchange, defined of course by MONEY. The whole effort behind the "labor theory of value" was to explain values (i.e. prices) in a money system.
Perhaps its worth going further and even questioning 'natural' use-values as being 'natural' - whenever the item with a use-value has been mixed with human effort. The above is a good explanation of the point I made about capital 2&3 not really explaining what is promised in 1.
: Wine may taste better when it is aged, but that says nothing about the effective demand the wine itself fetches. It may taste great and cost $5, or it may "taste great" and the only reason you think that it tastes great is because you paid $500 for it, and you don't want to feel ripped off. Sure, we might argue that more expensive wine has a more interesting "use-value," in that we might be more likely to drink it than we would to pour it into our kitchen sinks. But this says nothing about the price of the wine.
It does explain exchange value as being a result of subjective judgement, and it does render the labor theory of value as a somewhat arbitrary tool. So the labor value is $5 or $5000 - doesnt seem to make sense does it?
: At any rate, what you appear to have hit upon is the idea that the labor theory of value does not say anything about the taste of good wine, or anything else of importance about the particular selection of use-values by any particular society of human beings. It abstracts economically from the idea of a society based upon exchange.
Thats pretty much it.
: Think of it as the explanation of an energy circuit -- people work, and their financial "employers" take the products of this work, and sell the produce of the global working class back to itself, at a monetary profit of course.
I think we can use 'use-value' to help here. The use value of one carpenter, several pieces of wood and some toolsis not very much to someone who wants to sit down. But a chair is - so the employer creates a use value for the above variable with intent to make a chair for which the 'sitter' is willing to exchnage more vlaue than he would for the presence of the variables. Ofcourse the carpenter could go it alone - exchange things for wood and tools, make and exchange the chair.
The 'profit' is therefore the increase in usefulness to the consumer - and as people invent and create things so they exchange things of increasing usefulness for things of increasing usefulness - and before you know it you have a huge economic system, growing.
: The only reason anything has a price, is because someone else worked upon it.
And that, by necessity, includes anyone who has facilitiated and organised the 'someone else' to work upon it - they too are part of that process - or we are left with the fellow, the wood and the tools - and no chair.
Your examples of Nike etc prompted me to think that when an economy in which there are many 'useful things' being traded for many 'useful things' (like America) meets an ecnonomy whose cycle of exchange is 'lower' (in purely perceived use-values ofcourse) you get the situation where said workman, wood and tools in the poor country is of very low relative use-value in that country (as compared tio the same in the US), whilst the end product is of relatively use-value according to the American consumer (because he has so much more the trade for it)
In the end a global economy would act to create a global market the same as exists in 'national' markets like the US - the same range of rich and poor and in betweens. This is why i dont think 3rd world countries are automatically doomed to be forever poor - unless they are aided and abetted by various 'initiatives' by the IMF, their own government and other governments and so forth contriving to keep them that way.