Labor Theory of Value

Adam Smith, Ricardo, and Karl Marx contributed to the idea of a Labor Theory of Value, that the economic value of a commodity comes from the labor that produced it. This theory has supposedly been disproven by neoclassical economists, but I think this view is asinine. Neoclassical economics may explain ok what the value of a commodity is, it does not explain why a commodity has the value it does. This can only be explained by the labor used to produce it.

The Labor Theory of Value says that the value of a commodity is determined by the amount of socially necessary labor hours to produce it. The Labor Theory of Value can't be used for specific individual examples, but it explains the economy as a whole very well. It is best only to use this theory only in the context of society as a whole.

The best way to illustrate this theory is a theoretical example. Suppose everything produced is completely automated. Everything would be free because there is no labor needed to produce anything. Everything would have no economic value since no labor was used to produce it. When you understand this, then I think it is easier to understand this theory in our current environment. When you look at today's world, and see which things have economic value, it is obvious that labor is the source of this value.

Many people don't realize that the labor theory of value was first proposed by Adam Smith, and think it is purely a Marxist concept. Marx just expanded on the labor theory of value Smith came up with. Now, I don't completely understand the Labor Theory of Value myself, but when you look at it in the context I do, I think it is a valid theory, and may be the best way to determine economic value. Many people have no idea what the Labor Theory of Value is, and they can "disprove" it by making a bunch of strawman arguments that the labor theory itself has never supported. The Labor Theory of Value is still valid in economics of today's world, and should not be ignored by modern economic schools of thought.

 

Everything should be free anyway, through serfdom.

 

Value of labor is based: the employees contribution to the company's profit, supply of individuals that can perform a given job(based on education and experience to name a few).

In other words without the employee would the company continue to make a profit, would it be easy or difficult to fill their position, does the position require education or can an individual be trained in a manner cost effective for the company. And so on. You can not simply divide the companies annual earnings by the number of employees it took to achieve those earnings as each job/position has a different value based on what I just previously stated.

I won't even attempt to explain why the above is true as it is self-evident.

 

Are you like...ok, are you joking when you say this crazy stuff you say or are you actually serious?

 

Joking or not joking, it is the same to me.

 

Trolling isn't the best debut performance, but welcome anyway.

 

Feudalism is a legitimate ideology.

 

The only value a commodity has comes from what someone is willing to pay for it. Labor costs only come into play if something is made or not, if the cost to make something is more than what people are willing to pay... well than its not made. If something can pull more than what the labor costs to make it, than it is made; the larger the difference the more people will try to make it. That is how the world works, not on some Economic theory...

 

I think the thread is about how labor is valued not how a product or service is valued. Workers salary are determined based on their overall contribution and value to the business they work for. When their job requires more training, education or experience they are valued more and hence paid more. Take a business class or study it on the internet. You don't understand the concept.

"The value of the job/role is determined by both its relative internal value and its external (market) value."

 

Who is the theory useful to aside from communists? Unlike a lot of Marx's other theories LTV is dismissed today. Could this be because from a capitalist's perspective LTV is not useful in understanding or managing the economy?

 

The labor theory of value has been discredited many times over the last 100 years, I can't believe there are people who still think it is something worth holding up. Being the foundation of Marxism, that makes Marxists something like flat earthers.

 

Well, since things produced by automation are sold everyday which denotes value, I'd say your premise is all shot to hell.

 

This sounds like a retarded, short-lived clone of Locke's labor theory of property.

The value of a commodity can be explained through both demand and also through the possible uses of the product (which generally goes back to demand). Demand is not a perfect valuation system because demand can vary unpredictably and arbitrarily: for example, crack cocaine is worth a lot to crack heads, but is worthless if you try to sell it to a Mormon. Similarly I think, a video game has value but only when there are gamers around. Whereas, I would argue at least, milk has a more intrinsic value because everyone can drink it for nourishment. Point is, you can value items in many better ways besides how much labor was used to produce it.

The problem with the labor theory of value is that it attributes inherent value to labor, regardless of what that labor is or what the product made by that labor is. A programmer's labor is worth more than a taxidermist's labor because people these days want computer code more than they want to mount a stuffed bobcat, and that is partly because they can do a lot more with computer code than they could with a stuffed bobcat.

 

Why would you mount a stuffed bobcat anyway? Wouldn't the sex be better if it were alive?

 

It has become more than evident by their posts on these message boards that conservatives and neoconservatives believe U.S. capitalism has no need for labor, and consumers are nothing more than an unnecessary luxury. Their beliefs extend to the fantasy that it is simply the goodwill of the employer, not production requirements, that businesses hire workers, and that these workers should be grateful for any pittance they are paid.

Before Ronald Reagan sold the right-wingers on the theory that, as workers, they had become a costly liability instead of a productive asset, business and labor had a symbiosis, working together for the benefit of both.

During this time of mutual benefit, business and labor flourished and built the United States into an economic super power. Unfortunately, getting this fact driven into the skulls of the right wing has become impossible, and they are determined to help the greedy and unethical turn the U.S. into a third world country.

 

There is no way to calculate value, none. Value is a subjective psychological concept.

 

I don't agree, the fact is that some forms of labor are worth consistently more than other kinds and this is based upon the product of the labor. Even bobcatophiles probably value a doctor's labor over a taxidermist's.

 

/yawn

Sorry. Simpleton menial labor is not worth anything anymore. Don't blame republicans. Blame technology and innovation...... Or simply understand that it now allows us to use those resources for some other purpose.....

I WILL NEVER understand why progressives fight SO HARD for a 40 hour job doing the same mindless menial task over and over and over and over.......

Here's an idea? Go to college or a trade school and pursue a REAL career..... Preferably something that challenges your mind instead of numbing it.....

 

so a 25 yr old bobcatophile in perfect health with no medical issues would rather spend his money on a doctor?

and WTF, I am a bobcatophile, are you one of those bobcatophile bigots? get your ass over to the bobcat forum and say that, tough guy

 

That is the right wing belief, and your narrow thinking cannot be changed by evidence.

 

So.... automation and computer technology hasn't replaced human labor? Good luck providing the evidence to THAT claim......

 

Not to the extent right-wingers want to believe.

It would be interesting to see what would happen to businesses if all minimum wage workers came down with the flu during the same week. The conservative/neoconservative business theories would be shot to he11.

 

Yes, you'd completely destroy the economic principles of supply and demand.....

Here's a tip. You want to make decent money? Learn how to do something any 6 year old Asian or a robot can't do. Or buy yourself a nice spatula.

 

"Upon this subject, the habits of our whole species fall into three great classes---useful labour, useless labour and idleness. Of these the first only is meritorious; and to it all the products of labour rightfully belong; but the two latter, while they exist, are heavy pensioners upon the first, robbing it of a large portion of it's just rights. The only remedy for this is to, as far as possible, drive useless labour and idleness out of existence." ~Abraham Lincoln

Labor by itself has no value. It is only valuable in what it produces. I could dig holes every day, & fill them, & do a lot of work, but if nothing useful is produced it was useless labor. That is why make work govt jobs are counterproductive. they produce nothing, & are a leech upon the real producers in the nation.

Only productive labor.. farming, manufacturing, building, or support services for these things, add anything to the real product of a nation. Governance, the judicial system, the military, the welfare state.. all these things are a drain upon the producers.. they are dependents & mooch off of those who produce. It is up to the society to decide what level of expenses like these that they need or want.

 

Not at all, since minimum wage workers do nothing of value. At least that is the opinion of the right-wingers, and they are experts in all fields.