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Reinterpreting Marx

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California State University, Dominguez Hills
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Created: April 27, 2002
Latest Update: April 27, 2002
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takata@uwp.edu

Subjective Theory of Value

Copyright: Jeanne Curran and Susan R. Takata and Individaul Authors, April 2002.
"Fair use" encouraged.

From: EDavisMail@aol.com
Date: Sat, 27 Apr 2002 16:22:00 EDT
Subject: Re: HAB: Re: Situating Reason [Re: McNuggets]
To: jeannecurran@habermas.org

Jeanne,

Thanks for your inquiry. Please feel free to post the message. I would appreciate any feedback your graduate assistants might have.

Cordially,
Erik R. Davis
San Francisco

Here are a few extra details about me that you may find relevant: I have an MA in Economics from Cal. State Univ., Hayward, and much of my research there involved the theory of value. Though Hayward has a few professors who are quite vocal advocates of the interdisciplinary approach--and who practice a very interesting "Austrian" style of economics that brings an interpretive-institutional methodology (a bit like Max Weber) together with an old-style liberalism (a bit like J. S. Mill). Alfred Schutz--widely considered to be the father of phenomenological sociology--was actually a product of this unique school of thought. That brings us back to Habermas, who has drawn quite a bit on Schutz, and who has always been a profound source of inspiration for me. I'm currently a graduate student in the Philosophy Dept. at San Francisco State Univ., but will likely transfer over to either the Political Science or Interdisciplinary Social Science programs within the next couple of semesters.

From jeanne:
I would like to post this message for my graduate assistants. We are planning a course for Fall in which we will be reinterpreting theory. My teaching site is at http://www.csudh.edu/dearhabermas - we use the weekly journal issue for reading and discussion.

Thank for considering this, jeanne Cal. State Univ, Dominguez Hills, Dept. of Sociology

The posted message:
At 08:40 PM 4/26/2002 -0400, you wrote:
>I think that first sentence an excellent point--that is, the first >sentence about Adam Smith and the labor theory of value. Actually, if you >would like to take your point further, some economic historians have >alleged that Marx ripped off David Ricardo. Smith, who wrote much earlier, >wasn't very consistent in terms of applying the labor theory of value. It >certainly predates even his work. >

Regarding the rest of the post: most every contemporary economist actually >thinks that the labor theory of value is a joke. Few take it seriously >anymore. I don't mean this as a value judgment, merely a brute fact. The >labor theory of value would be the last thing to survive--and, well, it >really hasn't survived much at all. >

The FUNDAMENTAL difference between the classical tradition from which >Smith and Marx emerged and the neo-classical theory typically taught today >(based on Menger, Jevons, and Walras) is that the former--classical >tradition--had a tension between the (1) subjective and (2) labor theory >of value, while the NEO-classicals have more clearly embraced the (1) >subjective theory of value. They call this the marginalist revolution. >

It is clear that neo-classical theory evidences how much of Adam Smith >remains intact after more clearly embracing a subjective theory of value. >At the same time, it is extremely unfortunate that the interdisciplinary >sensibility of Smith's political economy, including especially his respect >for cultural factors, was pretty much completely lost--mainly because it >doesn't easily fit into the increasingly mathematical formalism that >dominates contemporary economics. >

Marx's theory displayed a tension between the two major theories of value, >with Capital I displaying the most maniacal dedication to the (2) labor >theory of value, and with Capital III (with more of Engels's influence) >making considerable concessions to the (1) subjective theory of value. >(This is in no small part because there were already some rather >embarrassing critiques of the labor theory of value to be published by >that time, for example, by Eugen von Bohm-Bawerk.) >

The core of Marx's alleged critique--especially Capital I--assumes the >validity of the labor theory of value and deduces the extraction of >surplus value and exploitation accordingly. >The theory of surplus value as Marx presented it simply stands or falls >with the (2) labor theory of value, and to the degree that one embraces >(2), the theory of surplus value and exploitation as presented by Marx >necessarily follows--logically, that is. >

However, we shouldn't ultimately care how much labor-time the Nazi's spent >building Auschwitz, it doesn't make it any more valuable to me--it is a >tragedy that should never have happened. Why should we value anything more >simply because it involves more labor-time? This would be the critical >point. A similar point, though merely practical, can be made by simply >putting two people together and having the second person destroy >everything that the first person makes. Clearly, both persons will have >expended labor-time, but nothing of value will have emerged. This would be >the practical point. The labor theory of value is blind to fullfillment >and communicative rationality in the exact way that perversely >instrumental reason can be blind to its own ideology. A critique cannot >even be made within the context of merely the labor theory of value--which >was such a crucial tool for Marx's alleged exposure of liberal values as a >sham. Here, of course, I am somewhat repeating Habermas in KHI. >

We may hope that Marx merely wanted to ascribe the labor theory of value >to a particularly limited understanding of "labor as such" that dominated >the emerging capitalism of his time. He was certainly critical of the >increasing tendency to reduce everything to "labor as such". Still, the >commodification-critical aspect of Marx's work was ultimately something >worked out by others and wretched from the context of his work--and, >especially in Habermas, completely disassociated with the labor theory of >value (quite explicitly in THE THEORY OF COMMUNICATIVE ACTION, Vol. 2). >

So the commodification thesis remains intact, the base-superstructure >remains as well in terms of life-world and system, but the labor theory of >value has been dropped. >

Cordially,
>Erik R. Davis
>San Francisco > And an earlier message to which Erik was responding:

Rauno Huttunen wrote: > > >

The labour theory of value wasn't Marx invention - it was Adam Smith's > > theory. No economist dare to say that Smith's > > labour theory of value is a joke. we could skip surplus value or > > base-superstructure metaphore but labour theory of value remains. > > >

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References on the Subjective Theory of Value: