It is truly incredible that these people have not only not read Marx, but also not read any Adam Smith or David Ricardo (even though they likely view Adam Smith as their ‘more scientifically correct ancestor like Newton or Darwin’), so they have absolutely no conception that Marx is literally just expanding on both Smith and Ricardo’s theories and works, testing their claims with newly available statistical economic data (that was collected because of initiatives by Smith and Ricardo but never actually followed up on because that is never how economic planning actually works in western democracies, nobody actually looks at real economic statistics outside of academia or bureaucratic functionaries, they simply publish them when they are in their favor) and expanding on their claims, taking them to their logical conclusions.
It’s so infuriating to see them posit that something like the Labor Theory of Value is horseshit because it is from Marx when the Labor Theory of Value is not originally a Marxist claim, it is far older than that, but it was most explicitly a claim by Adam Smith that Marx then went to great lengths to provide evidence for and demonstrate how the value applied by labor affects commodity pricing of supply and demand based on it’s ‘usefulness’. AND THIS IS LITERALLY ON THE WIKIPEDIA PAGE ‘LABOR THEORY OF VALUE’.
And that said, nowhere in Marx does he ever actually say ‘Labor Theory of Value’ because this is just his ‘Theory of Value’, which happens to center on labor because it is the only way that he was able to make sense of things like the gold inflationary crisis in Spain, or how cheap products from India could be priced despite their demand and distance (remember this is just prior to mass industrialization in Britain). From there he was able to extrapolate what was causing these events that contradicted a purely ‘supply and demand’ based system to create a model of exploitative economic relationships that actually run society, in direct contrast to the popular British utilitarian rhetoric at the time, which was about ‘providing moral value (read now as jobs) to indolent and uncultured savages’.
As @[email protected] pointed out, these neoliberals are quite literally the using the exact same appeal as those old British utilitarians, literally dressing up old unscientific and racist ideas in new clothing and attempting to pass them off as ‘more modern’ than Marxist economics.
Is there any chance you could provide a tl;dr on Jevons, who is mentioned in the thread? That’s the one thing they mention that I’m not familiar with (obviously I’ve heard about the “marginal revolution”, but the predditors there are demonstrating how vibes are inadequate)
So Jevons is the guy who first indicated the idea of Austrian economics or marginal economic theory, depending on who you ask. Jevons basically says that things are worth what people will pay for them, basically, it doesn’t matter how much labor is put into an item, what matters is the subjective value and availability of that item. Basically, what Jevons says is that ‘price is value’, a very different distinction than what had been made before and reduction of theory, (which is why it is called ‘a revolution’). And he isn’t exactly wrong, but for wrong reasons.
For example, Jevons says that it is because of the marginally reducing utility (lessening use-value) of a singular items as there are more items that determine the items value and therefore it’s price. A man rich in diamonds but starved of water would happily exchange his diamonds for far less than the labor cost to create those diamonds, for example, because those diamonds have lessing marginal utility. However, he also posits that sometimes the more of something there is, the higher the demand actually goes because the utility has been marginalized by use (something that we can see with induced traffic, more lanes equals more traffic).
The problem of course here, is that while that is correct, it is not a holistic example, nor does it actually address Adam Smith’s LTV. Basically, what the LTV says is that if you cannot make the price of something match the social utility value, then an activity ceases. If the diamonds cannot at least provide enough to feed, water and house the workers, then people will not mine diamonds. Basically, it is likely that people aren’t actually taking into account all the labor that it takes to get the water to the diamond guy. In the same way, when previous luxuries become available to the public, they quickly attain a social utility value, thus explaining why demand remains constant or increases despite supply increase. It is a sign of what does and does not have social utility, regardless of price.
Edit: This can also be explained by capitalism’s need to generate profit and increasing returns, spending money to induce demand so their product attains an appearance of social utility, which is the big difference between Jevons and Marx, Marx believes that induced demand is false demands for false needs (in particular the need to generate an ever increasing profit), where true social utility needs will become apparent after the political revolution and the overthrow of capitalist domination of nature and the market, while Jevons treats all needs, induced or not, as authentic.
I’ll have to reread some Jevons, it has been while.
2nd Edit: I’ve been thinking for a longtime that the problem with economic theory is in it’s categories. I think that instead of ‘micro’ and ‘macro’ it should be in terms of ‘scarce and not scarce’ I know there is an ‘economics of scarcity’ but it doesn’t seem to be pushed as one of the major schools in economic theory.
It is truly incredible that these people have not only not read Marx, but also not read any Adam Smith or David Ricardo (even though they likely view Adam Smith as their ‘more scientifically correct ancestor like Newton or Darwin’), so they have absolutely no conception that Marx is literally just expanding on both Smith and Ricardo’s theories and works, testing their claims with newly available statistical economic data (that was collected because of initiatives by Smith and Ricardo but never actually followed up on because that is never how economic planning actually works in western democracies, nobody actually looks at real economic statistics outside of academia or bureaucratic functionaries, they simply publish them when they are in their favor) and expanding on their claims, taking them to their logical conclusions.
It’s so infuriating to see them posit that something like the Labor Theory of Value is horseshit because it is from Marx when the Labor Theory of Value is not originally a Marxist claim, it is far older than that, but it was most explicitly a claim by Adam Smith that Marx then went to great lengths to provide evidence for and demonstrate how the value applied by labor affects commodity pricing of supply and demand based on it’s ‘usefulness’. AND THIS IS LITERALLY ON THE WIKIPEDIA PAGE ‘LABOR THEORY OF VALUE’.
And that said, nowhere in Marx does he ever actually say ‘Labor Theory of Value’ because this is just his ‘Theory of Value’, which happens to center on labor because it is the only way that he was able to make sense of things like the gold inflationary crisis in Spain, or how cheap products from India could be priced despite their demand and distance (remember this is just prior to mass industrialization in Britain). From there he was able to extrapolate what was causing these events that contradicted a purely ‘supply and demand’ based system to create a model of exploitative economic relationships that actually run society, in direct contrast to the popular British utilitarian rhetoric at the time, which was about ‘providing moral value (read now as jobs) to indolent and uncultured savages’.
As @[email protected] pointed out, these neoliberals are quite literally the using the exact same appeal as those old British utilitarians, literally dressing up old unscientific and racist ideas in new clothing and attempting to pass them off as ‘more modern’ than Marxist economics.
Is there any chance you could provide a tl;dr on Jevons, who is mentioned in the thread? That’s the one thing they mention that I’m not familiar with (obviously I’ve heard about the “marginal revolution”, but the predditors there are demonstrating how vibes are inadequate)
It has been awhile but I will take a crack at it.
So Jevons is the guy who first indicated the idea of Austrian economics or marginal economic theory, depending on who you ask. Jevons basically says that things are worth what people will pay for them, basically, it doesn’t matter how much labor is put into an item, what matters is the subjective value and availability of that item. Basically, what Jevons says is that ‘price is value’, a very different distinction than what had been made before and reduction of theory, (which is why it is called ‘a revolution’). And he isn’t exactly wrong, but for wrong reasons.
For example, Jevons says that it is because of the marginally reducing utility (lessening use-value) of a singular items as there are more items that determine the items value and therefore it’s price. A man rich in diamonds but starved of water would happily exchange his diamonds for far less than the labor cost to create those diamonds, for example, because those diamonds have lessing marginal utility. However, he also posits that sometimes the more of something there is, the higher the demand actually goes because the utility has been marginalized by use (something that we can see with induced traffic, more lanes equals more traffic).
The problem of course here, is that while that is correct, it is not a holistic example, nor does it actually address Adam Smith’s LTV. Basically, what the LTV says is that if you cannot make the price of something match the social utility value, then an activity ceases. If the diamonds cannot at least provide enough to feed, water and house the workers, then people will not mine diamonds. Basically, it is likely that people aren’t actually taking into account all the labor that it takes to get the water to the diamond guy. In the same way, when previous luxuries become available to the public, they quickly attain a social utility value, thus explaining why demand remains constant or increases despite supply increase. It is a sign of what does and does not have social utility, regardless of price.
Edit: This can also be explained by capitalism’s need to generate profit and increasing returns, spending money to induce demand so their product attains an appearance of social utility, which is the big difference between Jevons and Marx, Marx believes that induced demand is false demands for false needs (in particular the need to generate an ever increasing profit), where true social utility needs will become apparent after the political revolution and the overthrow of capitalist domination of nature and the market, while Jevons treats all needs, induced or not, as authentic.
I’ll have to reread some Jevons, it has been while.
2nd Edit: I’ve been thinking for a longtime that the problem with economic theory is in it’s categories. I think that instead of ‘micro’ and ‘macro’ it should be in terms of ‘scarce and not scarce’ I know there is an ‘economics of scarcity’ but it doesn’t seem to be pushed as one of the major schools in economic theory.