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In Marx's critique of political economy, any labor-product has a value and a use value, and if it is traded as a commodity in markets, it additionally has an exchange value, most often expressed as a money-price. Jump to: navigation, search Karl Marx Karl Heinrich Marx (May 5, 1818 Trier, Germany – March 14, 1884 London, England) was an influential German philosopher, political economist, and revolutionary organizer of the International Workingmens Association. ...
Jump to: navigation, search Political economy was the original term for the study of production, the acts of buying and selling, and their relationships to laws, customs and government. ...
Jump to: navigation, search Value is a term that expresses the concept of worth in general, and it is thought to be connected to reasons for certain practices, policies, or actions. ...
Jump to: navigation, search The word commodity is a term with distinct meanings in business and in Marxian political economy. ...
In Marxian political economy, exchange value refers to one of three major aspects of a commodity, i. ...
In economics and business, the price is the assigned numerical monetary value of a good, service or asset. ...
Origin and definition These four concepts (value, use value, exchange value and price) have a very long history in economic and philosophical thought, from Aristotle to Adam Smith, and their meanings evolved. Marx comments for example that "in English writers of the 17th century we frequently find worth in the sense of value in use, and value in the sense of exchange-value." With the expansion of market economy, however, the focus of economists has increasingly been on prices and price-relations, the social process of exchange as such being assumed to occur as a naturally given fact. Jump to: navigation, search Aristotle, marble copy of bronze by Lysippos. ...
Jump to: navigation, search For other people named Adam Smith, see Adam Smith (disambiguation). ...
Marx emphasizes that the use-value of a labor-product is practical and objectively determined, i.e. it inheres in the intrinsic characteristics of a product which enable it to satisfy a human need or want. The use-value of a product therefore exists as a material reality vis-a-vis social needs regardless of the individual need of any particular person. The use-value of a commodity is specifically a social use-value, meaning that it has a generally accepted use-value for others in society, and not just for the producer. Material is the substance or matter from which something is or can be made, or also items needed for doing or creating something. ...
// Latin root meaning The term social is derived from the Latin word socius, which as a noun means an associate, ally, companion, business partner or comrade and in the adjectival form socialis refers to a bond between people (such as marriage) or to their collective or connected existence. ...
The concept is introduced at the beginning of Das Kapital, where Marx writes: Das Kapital (Capital) is a very large treatise of political economy written by Karl Marx in German. ...
"The utility of a thing makes it a use value. But this utility is not a thing of air. Being limited by the physical properties of the commodity, it has no existence apart from that commodity. A commodity, such as iron, corn, or a diamond, is therefore, so far as it is a material thing, a use value, something useful. This property of a commodity is independent of the amount of labour required to appropriate its useful qualities. When treating of use value, we always assume to be dealing with definite quantities, such as dozens of watches, yards of linen, or tons of iron. The use values of commodities furnish the material for a special study, that of the commercial knowledge of commodities.[5] Use values become a reality only by use or consumption: they also constitute the substance of all wealth, whatever may be the social form of that wealth. In the form of society we are about to consider, they are, in addition, the material depositories of exchange value." [1]
This was a direct reference by Marx to Hegel's Elements of the Philosophy of Right, §63. See [2].
Transformation into a commodity The transformation of a use-value into a social use-value and into a commodity is not automatic or spontaneous, but has technical, social and political preconditions. For example, it must be possible to trade it, and to transfer ownership or access rights to it from one person or organisation to another in a secure way. There must also be a real market demand for it. And all that may depend greatly on the nature of the use-value itself, as well as the ability to package, store, preserve and transport it. In the case of information or communication as use-values, transforming them into commodities may be a complex and problem-fraught process. Jump to: navigation, search Information is a word which has many different meanings in everyday usage and in specialized contexts, but as a rule, the concept is closely related to others such as data, instruction, knowledge, meaning, communication, representation, and mental stimulus. ...
Jump to: navigation, search Communication is the process of exchanging information, usually via a common system of symbols. ...
Thus, the objective characteristics of use-values are very important for understanding (1) the development and expansion of market trade, and (2) necessary technical relationships between different economic activities (e.g. supply chains). To produce a car, for example, you objectively require steel, and this steel is required, regardless of what its price might be. Necessary relationships therefore exist between different use-values, because they are technically, materially and practically related. Some authors therefore write about an "industrial complex" or "technological complex", indicating thereby how different technological products are linked in a system. A good example would be all the different products involved in the production and use of motor cars. Jump to: navigation, search A supply chain is a network of facilities and distribution options that performs the functions of procurement of materials, transformation of these material into intermediate and finished products, and distribution of these finished products to customers. ...
The category of use-value is also important in distinguishing different economic sectors according to their specific type of output. Following Quesnay's analysis of economic reproduction, Marx distinguished between the economic sector producing means of production and the sectors producing consumer goods and luxuries. In modern national accounts more subtle distinctions are made, for example between primary, secondary and tertiary production, semi-durable and durable goods, and so on. François Quesnay. ...
In Marxian economics, economic reproduction refers to recurrent (or cyclical) processes by which the initial conditions necessary for economic activity to occur are constantly re-created. ...
Measures of national income and output are used in economics to estimate the value of goods and services produced in an economy. ...
The role of use value in political economy In his very influential text The Theory of Capitalist Development (1942), American Marxist Paul Sweezy claimed that:
"Use-value is an expression of a certain relation between the consumer and the object consumed. Political economy, on the other hand, is a social science of the relations between people. It follows that 'use-value as such' lies outside the sphere of investigation of political economy".
Curiously, Sweezy disregarded that in consuming (both intermediate and final consumption), producers and consumers might also be socially related. Intermediate consumption is an economic concept used in national accounts, such as the United Nations System of National Accounts (UNSNA) and the US National Income and Product Accounts (NIPA). ...
Likewise, in his influential Principles of Political Economy, the Japanese Marxist Kozo Uno sums up the theory of a "purely capitalist society" in the three doctrines of circulation, production and distribution. Apparently it did not occur to him that even in the purest capitalist society, (final) consumption would have to occur as a necessary aspect of economic reproduction, and that capitalist relations extended to, and included, the way in which consumption was organised in capitalist society - increasingly substituting private consumption for collective consumption. Jump to: navigation, search For other uses, see Reproduction (disambiguation) Reproduction is the biological process by which new individual organisms are produced. ...
Marx himself explicitly rejected Sweezy's and Uno's interpretation, and in an important essay Roman Rosdolsky shows the important role of use value in Marx's economics. The fact is, that Marx himself had, in the introduction to his Grundrisse manuscript, defined the economic sphere as the totality of production, circulation, distribution and consumption. He did not however live to finish Das Kapital, and did not theorise how commercial relations would reshape the sphere of personal consumption in accordance with the requirements of capital accumulation. Jump to: navigation, search Roman Rosdolsky was an important Marxian scholar and political activist. ...
Das Kapital (Capital) is a very large treatise of political economy written by Karl Marx in German. ...
Jump to: navigation, search Most generally, the accumulation of capital refers simply to the gathering or amassment of objects of value; the increase in wealth; or the creation of wealth. ...
It was only later that scholars such as Fernand Braudel, Ben Fine, Manuel Castells and Michel Aglietta tried to fill this gap in Marx's unfinished work. Jump to: navigation, search Fernand Braudel Fernand Braudel (August 24, 1902–November 27, 1985) was a French historian. ...
Use value and utility Marx's concept of use-value seems akin to, but in reality differs from the neoclassical concept of utility. Jump to: navigation, search Neoclassical economics refers to a general approach (a metatheory) to economics based on supply and demand which depends on individuals (or any economic agent) operating rationally, each seeking to maximize their individual utility or profit by making choices based on available information. ...
Jump to: navigation, search In economics, utility is a measure of the happiness or satisfaction gained from a good or service. ...
- Marx usually assumes in his analysis that products sold in the market have a use-value to the buyer, without attempting to quantify that use-value other than in product units (this caused some of his readers to think wrongly that use-value played no role in his theory). The neoclassicals, on the other hand, typically see prices as the quantitative expression of the utility of products for buyers and sellers, instead of expressing their exchange-value.
- In neoclassical economics this utility is ultimately subjectively determined by the buyer of a good, and not by the intrinsic characteristics of the good. Thus, neoclassical economists often talk about the marginal utility of a product, i.e., how its utility fluctuates according to consumption patterns.
- Marx rejects any economic doctrine of consumer sovereignty, stating among other things that "In bourgeois societies the economic fictio juris prevails, that every one, as a buyer, possesses an encyclopedic knowledge of commodities".
In summary, different concepts of use value lead to different interpretations and explanations of trade, commerce and capitalism. Street markets such as this one in Rue Mouffetard, Paris are still common in France. ...
Neoclassicism (sometimes rendered as Neo-Classicism or Neo-classicism) is the name given to quite distinct movements in the visual arts, literature, theatre, music, and architecture. ...
In political economy and especially Marxian economics, exchange value refers to one of four major attributes of a commodity, i. ...
In economics, marginal utility is the additional utility (satisfaction or benefit) that a consumer derives from an additional unit of a commodity or service. ...
Consumer sovereignty is a term which is used in economics to refer to the disputed notion of the rule or sovereignty of purchasers over producers in markets. ...
Jump to: navigation, search A fruit stand at a market. ...
Jump to: navigation, search This article is about the business concept; Commerce is also the name of several places in the United States. ...
Jump to: navigation, search In common usage capitalism refers to an economic system in which all or most of the means of production are privately owned and operated and where the investment of capital, and the production, distribution and prices of commodities (goods and services) are determined mainly in a...
Indifferent to use value? Some have claimed that capitalists are basically "indifferent" to the use-value of the goods and services in which they trade, since what matters to capitalists is just the money they make; whatever the consumer does with the goods and services produced is, so it seems, of no real concern.
This is however a caricature based on a misunderstanding of business activity and the bourgeoisie as a class. The reason why capitalists can never be indifferent to use-values is because inputs (labour, materials, equipment) must be bought to produce outputs that: Jump to: navigation, search Bourgeoisie () in modern use refers to the wealthy or propertied social class in a capitalist society. ...
- will sell,
- are legally permitted by the state to be sold,
- do not destroy the reputation of the supplier (with its obvious effect on sales).
Often Marx just assumed in his argument that supply and demand will balance, and that products do sell. Even so, Marx carefully defines the production process both as a labour process creating use-values, and a valorisation process creating new value. Jump to: navigation, search A state is an organized political community occupying a definite territory, having an organized government, and possessing internal and external sovereignty. ...
Abstract labour and concrete labour refer to a distinction made by Karl Marx in his critique of political economy. ...
The Valorisation of capital is a concept created by Karl Marx in his critique of political economy. ...
In modern times, business leaders are often very concerned with total quality management in production, which has become the object of scientific studies, as well as a new source of industrial conflict, since attempts are made to integrate everything a worker is and does (both his creative potential and how he relates to others) in the battle for improved quality. This article needs to be cleaned up to conform to a higher standard of quality. ...
In truth, from beginning to end, and from production to consumption, use-value and exchange-value form a dialectical unity. If this is not fully clear from Marx's writings, that is perhaps mainly because he never theorised the sphere of final consumption in any detail, nor the way in which commerce reshapes the way that final consumption takes place.
See also Jump to: navigation, search The word commodity is a term with distinct meanings in business and in Marxian political economy. ...
In Marxian political economy, exchange value refers to one of three major aspects of a commodity, i. ...
Jump to: navigation, search The labor theory of value (LTV) is a theory in economics and political economy concerning a market-oriented or commodity-producing society: the theory equates the value of an exchangeable good or service (i. ...
Abstract labour and concrete labour refer to a distinction made by Karl Marx in his critique of political economy. ...
References - Karl Marx, Capital Volume 1, Chapter 1.
http://www.marxists.org/archive/marx/works/1867-c1/ - Karl Marx, Notes on Adolph Wagner's “Lehrbuch der politischen Ökonomie” (Second Edition), Volume I, 1897
http://www.marxists.org/archive/marx/works/1881/01/wagner.htm - Roman Rosdolsky, The Making of Marx's 'Capital', chapter 1: "The role of use-value in political economy" (London: Pluto Press, 1977).
- Isaac I. Rubin, Essays in Marx's Theory of Value (Detroit: Red & Black, 1972), chapter 17: "Value and social need"
http://www.marxists.org/subject/economy/rubin/ch17.htm - Simon Clarke, Marx, marginalism, and modern sociology: from Adam Smith to Max Weber (London: The Macmillan Press, Ltd, 1982).
- Francis Green and Petter Nore, Economics: An Anti-Text (London: Macmillan, 1977).
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