From The Science of Value
'Labor-Power – A Commodity Like Any Other?'
The fact that the independent existence of exchange value is only expressed adequately as self-valorizing value still does not say anything concerning the question as to how this valorization is at all possible. The question therefore arises as to how the existence of an increase in capital can be explained on the basis of the exchange of equivalents. This is the fundamental question that Marx seeks to answer with his theory of surplus-value.
Early economists had regarded capital profit as a mere premium upon the value of commodities. It was clear to Smith and Ricardo that the existence of the return on capital as a phenomenon that is not merely coincidental or marginal could not be explained by a premium, but had something to do with the labour expended by workers. But they assumed that the workers sell their labour. For a labour theory of value, then, the problem arises of explaining why a worker receives for (for example) 10 hours of labor a wage containing a sum of value that is less than the value that he adds to the value of the available means of production during this ten hour period. Socialists and Left-Ricardians had concluded that the exchange between capital and labor is “unjust”, that it does not correspond to the laws of the exchange of equivalents, and raised the demand for a just exchange or for the “full output” for the worker, a demand that Lassalle had also raised. The “vulgar economists” used this problem as an argument against the labor theory of value: since the workers receive the full value of their labour in the form of the wage, the value of the product could not depend exclusively upon labour. Smith also drew a similar conclusion. As already presented in the first chapter, Ricardo was not a proponent of the labor theory of value that Marx attributed to him, but Marx was not entirely wrong with his accusation that Ricardo had ignored the problem. Ricardo assumes without further ado that the relative value of goods – for the production of which a specific quantity of labour has been expended – is greater than the relative value of this expended labour.
In contrast to the classical political economists, Marx distinguishes between labour and labour-power, i.e. the ability of a person to perform labour:
It is not labour which directly confronts the possessor of money on the commodity-market, but rather the worker. What the worker is selling is his labour-power. As soon as his labour actually begins, it has already ceased to belong to him; it can therefore no longer be sold by him. Labour is the substance, and the immanent measure of value, but it has no value itself.
Marx attempts to explain the valorization of capital on the basis of the exchange of equivalents by distinguishing between value and use-value of the commodity labour-power. Analogue to the value of all other commodities, Marx sees the value of labor-power as determined by the quantity of abstract labour necessary for its reproduction. The use-value of labour-power consists of the labour that it can perform. The capitalist, by allowing the worker whose labour-power he has purchased to work, consumes its use-value. The commodity labour-power has the curious property that its consumption constitutes value. The valorization of capital is explained by the fact that during the consumption of labour-power in the capitalist process of production, a greater value is created than the value necessary for the reproduction of labour-power. The difference between the value produced by labour-power and the value necessary to reproduce labour-power is appropriated by the capitalist as surplus-value.
Marx writes of exploitation to the extent that the labourer works longer than is necessary for his own reproduction, and the capitalist appropriates the fruits of the surplus labour without offering an equivalent. The laws of the exchange of equivalents are not thereby violated, since the labourer, to the extent that he sells his labour-power as a commodity, only has a claim to its value, but not to its use-value. The consumption of use-value is the right of the purchaser. The fact that the consumption of labour-power yields a greater value than that which must be paid for it, is the “luck” of the capitalist, but not a violation of the laws of the exchange of equivalents.
The problem of mediating the creation of surplus-value and exploitation with the exchange of equivalents is solved by Marx not only by means of considering the sphere of circulation, but through a combined investigation of the spheres of circulation and production. If only the sphere of circulation is considered, than equal values always confront one another, the exchange of equivalents occurs. However, the form M-C-M’ breaks down into M-C…P…C’-M’. There are two acts of exchange, where each taken for itself adheres to the laws of the exchange of equivalents, but which are separated by an act of production (P). Within this act of production, exploitation occurs; the labourer creates a greater value than he obtains, he expends more labour-time than is necessary for his own reproduction. However, since this process of production is also the process of consumption of the commodities purchased by the capitalist, the process of value-creation occurring there has nothing to do with the exchange between labourer and capitalist: exploitation and the exchange of equivalents do not contradict each other.
Marx’s conception of labor-power was criticized from various sides. The objections can be summarized in two points.
Firstly, there is the objection that in his determination of the value of labour-power, Marx does not consider the reproductive labour of women. Attention is thus called to an actual difference in the determination of the value of labour-power as compared to all other commodities. Whereas the entire direct and indirect labour necessary for its production enters into the determination of value of an ordinary commodity, only indirect labour enters into the value of the commodity labour-power, i.e. the value of the commodities that must be purchased for the labourer’s household. The direct labour that must be additionally expended by the labourer and his wife remains disregarded. To that extent, Harvey states that Marx did not propose a labour theory of value for the commodity labour-power, but rather a production costs theory. For many feminist authors, the basis of exploitation is thus shifted: the foundation of exploitation and of surplus-value is no longer the exploitation of the (male) wage-labourer in the factory, but rather the unpaid reproductive labour of women.
Secondly, in contrast to all other commodities, the commodity labour-power has a further peculiarity that provides further occasion for critique of Marx’s conception. The basket of goods that is supposed to determine the value of labour-power is not firmly established. What Marx refers to as a “historical-moral element” enters into the value of labour-power. Against this, the objection is raised that this element, even more strongly than Marx emphasized, is determined by class struggle, so that it’s ultimately class struggle that determines the value of labour-power. However, one can also raise the fundamental objection as to whether the value of labour-power can at all be bound to the conditions of reproduction, however these are determined. For example, considerable differences in wage levels cannot be explained by referring to different necessities of the reproduction of labour-power. Furthermore, the objection that Keynes (1936, p. 11) raised against the neo-classical theory of wages can also be brought to bear upon Marx’s determination of the value of labour-power: the labourer does not receive a specific basket of goods as compensation, but rather a particular sum of money; the real wage and therefore the “value of labour-power” thus first emerge subsequently, when the prices for individual goods on the market have emerged.
Concerning the first objection, it must be said that Marx presents the determination of the value of labour-power as it presents itself from the result. Labour-power is a special commodity: the process of its production is not capitalist, but it is also not a case of simple commodity production. Labour-power is not produced from the get-go as a commodity, but it is sold as a commodity. The worker’s household, which produces labour-power, is distinguished from the usual producers of commodities by the fact that it cannot switch branches of production: if furniture production is no longer worth it, a cabinet maker can become a weaver, and if this also is no longer possible, he ultimately has the option of: selling his labour-power. But the seller of labour-power has already arrived at this final level with no alternative. Production of labour-power is ultimately identical with the production of one’s own life and can therefore not simply be abandoned like the production of any other commodity.
One could accuse Marx of not sufficiently emphasizing the peculiarity of the determination of the value of labour-power. However, it was not at all the case that Marx overlooked the reproductive labour in the household performed in particular by women. It was clear to Marx that this labour did not enter into the value of labour-power as value-constituting labour. This is first the case when reproductive labour has become a commodified service. A more exact investigation of the particular determination of the value of the commodity labour-power probably would have been a topic for the “special study of wage-labour” planned by Marx. For the analysis of a particular capitalist society, the more exact determination of the value of labour-power, the level of reproduction, and the mode of reproduction are of course of decisive importance. However, the argument that the exploitation of (male) workers in the factory is only made possible by the exploitation of women in the household seems to mistake concrete historical conditions (particularly in countries of the so-called Third World) with the possibility of exploitation as such. The fact that a large part of reproductive labour is still performed in the household is more a pre-capitalist remnant and characteristic of a less developed capitalism, rather than a general condition for exploitation.
If reproductive labour is taken over by state or capitalist institutions (nursery schools, bakeries, canteens, etc.), then it can be performed with a generally lower expenditure of time on the basis of increases in productivity that are now made possible. Releasing women to a large extent from domestic labour and subordinating them to the direct exploitation by capital not only allows capital to appropriate a greater mass of surplus-value, but also to increase the rate of surplus-value: since the reproductive costs of the family have to be paid from the wages of two labour-powers, the value of an individual labour-power decreases.
The second objection fundamentally calls into question whether the price of labour-power has anything at all to do with the conditions of its reproduction. However, Marx’s determination of the value of labour-power is not intended as an explanation of the prices of individual labour-powers or all differences in wages. In determining the value of labour-power by its (monetary) costs of production, Marx expresses nothing further than a condition for the existence of capital: the existence of capital requires the reproduction of labour-power as mere labour-power. Individual labour-powers must therefore obtain at least as much money as is required for their reproduction. On the other hand, they cannot be released from the compulsion to sell their labour-power.
However, the question arises as to how this condition of existence of capital can be secured, since the deviation of the market price of labour-power from its value cannot be compensated for by the flow of labor that was used in the production of labour-power into other spheres of production, or from these spheres into the sphere of the production of labour-power. Classical political economy solved this problem by its law of population: in the case of wages being high, working class families would procreate at a considerably higher rte due to the favorable material situation, thus leading to an extraordinary increase of the working class, so that wages would then once again decline.
But even if this simple mechanism actually existed, the period of time required by it would be too great to reduce the price of labour-power to its value. In contrast to the “natural” law of population assumed by classical political economy, Marx formulated in the 25th chapter of the first volume of Capital a specifically “capitalist” law of population. As a consequence of the production of relative surplus-value, it is capital that not only determines the variation in its demand for labour-power, but also the supply of labour-power, by releasing previously employed labour-power. It is not the procreation of working class families, but rather the changing value composition of capital (the relation of constant to variable capital) that produces a relative surplus population (see the 8th chapter below). Only the existence of a constant “industrial reserve army” ensures that the commodity labour-power is sold at its “value”, i.e. its cost of reproduction, even without extra-economic force.
So it is class struggle that immediately decides the price of the commodity labour-power, the conditions of labour, etc., but class struggle is not an independent factor, exogeneous to the economy. The strength of social classes is bound up with the dynamic of capitalist accumulation. The strength of classes is itself inextricably linked to the dynamic of capitalist accumulation.
These considerations show that the commodity labour-power is a special commodity. The determination of its value cannot be placed directly alongside the determination of value of all other commodities, as Marx does in the fourth chapter of the first volume of Capital. Rather, it’s a case of an analogous conceptual construction. When Marx therefore claims to have explained the exchange between capital and labour under the preconditions of the exchange of equivalents, one must however agree to the extent that in distinguishing between the value and the use-value of labour-power, he dissolves the aporias connected with this problem.