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hmm yes I say wisely, it must be a moral flaw, I cannot be wrong that shitloads of people just don't have the loving money. oh god someone else argue with the goddamn lib I want to die reading that poo poo it's actually worse than the physics economy, at least that's novelly silly
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Mar 23, 2019 03:57
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Think of how many trabants you could buy with $60k tho, comrade. A whole fleet!
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Mar 23, 2019 03:59
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 Humans: correct in making leap from wealth as currency to wealth as energy. But logic failure: wealth ultimately is extension of desires, fluctuating with emotions and state of mind. Desires: when all are supported in purely adaptable system, true wealth is achieved.
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Mar 23, 2019 04:23
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Volkerball have you considered that there are a lot of people who literally could not spare $20 a week
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Mar 23, 2019 17:25
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Sorry about your thread Eschaton.
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Mar 23, 2019 18:27
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Dean of Swing posted:
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Mar 23, 2019 18:48
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not gonna lie guardian h'mee did pass through my mind when I was skimming through op's posts
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Mar 23, 2019 21:38
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OwlFancier posted:I also want to suggest that "bitcoin disproves LTV" is a weird position to take given the entire basis of cryptocurrencies is that they're produced and function by via proof of work. Literally the only way to make more bitcoins is to perform the work that is deemed necessary by the society of bitcoin users. Nah If it costs $6000 worth of energy to produce a Bitcoin in December 2018 and LTV suggests that Bitcoin is worth $6000 because that's the labor/work it took to produce it, then why does that Bitcoin later sell for $4000 in 2019? Because the value of a Bitcoin or any other widget has nothing to do with the work it took to produce it.
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Mar 24, 2019 08:36
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No the price of a thing has nothing, individually, to do with the labour required to produce it, value and price are not the same thing, I already said that. The price of things fluctuates wildly, the value of things specifically refers to the embodied labour of a product and its relation to the sum of stored wealth in existence at the time.
OwlFancier fucked around with this message at 08:58 on Mar 24, 2019 |
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Mar 24, 2019 08:56
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Pablo Nergigante posted:Volkerball have you considered that there are a lot of people who literally could not spare $20 a week But lots of other people, who are not wealthy or even middle class, in fact could? I don't understand what the issue with VB is. He's pointing out how compound interest and investing work. He's pointing out that returns on invested capital in things like housing are available even to people who don't have the cash or credit to plunk down for a house. He's not wrong about any of that, and as far as I can tell he's not saying setting aside $20 per week in an IRA is going to cure all the great ills of society.
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Mar 25, 2019 13:22
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OwlFancier posted:No the price of a thing has nothing, individually, to do with the labour required to produce it, value and price are not the same thing, I already said that. The price of things fluctuates wildly, the value of things specifically refers to the embodied labour of a product and its relation to the sum of stored wealth in existence at the time. so how do you calculate the value of a single bitcoin according to LTV?
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Mar 26, 2019 06:39
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Sum total of the labour required to produce it, so, the value of the labour and resources requried to generate the energy and produce the equipment necessary to perform the calculations. Which means, if I recall correctly, that ones produced later are actually worth more because they get harder to produce over time, similar to how resource exhaustion would increase the value of resources due to requiring more labour to extract them. Obviously that isn't relevant to the price because there's no actual difference between things produced with difficulty and things produced easily. What I can't tell you is whether or not the value, for the purpose of calculating the total economic value of the product, stays the same per unit based on its production cost. As in, does the value of all instances of a thing decrease or increase as the amount of socially necessary labour to produce them changes, or do you keep the value of each unit produced and new ones simply contribute more? Mostly because I don't know enough about that application of LTV to tell you, but I would imagine it's written down somewhere. If I had to guess though I would suggest it's probably you add the labour value of each unit produced onto the end and then average it across all instances of the product.
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Mar 26, 2019 06:47
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quote:Sum total of the labour required to produce it, so, the value of the labour and resources requried to generate the energy and produce the equipment necessary to perform the calculations. quote:What I can't tell you is whether or not the value, for the purpose of calculating the total economic value of the product, stays the same per unit based on its production cost. quote:If I had to guess though I would suggest it's probably you add the labour value of each unit produced onto the end and then average it across all instances of the product. But since the product stays the same as you say, its use-value doesn't change, how come the "total economic value" change when the marginal cost of production rises over time? Because of supply-demand changes the exchange value since presumably less units of buttcoin could be produced? But then how is that different from a price shift? Typo fucked around with this message at 16:51 on Mar 26, 2019 |
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Mar 26, 2019 16:36
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It's weird to use the LTV to calculate the value of a bitcoin, because it's almost purely a capital investment. You spend the money on the electricity, and on the machine to mine the bitcoin, and it produces a bitcoin, but the labor involved is essentially "install bitcoin program and then wait," and is a trivial component of the ultimate product. As far as my education goes, you don't consider the labor involved in producing the tools (i.e. the computer and the software) you're utilizing when a third party produces them, you just consider them part of the capital portion. Bitcoins are one of the worst things to try and apply the LTV to, really, because they're purely a speculative investment, relying on arbitrage to have any value whatsoever. Applying LTV to currency is an oxymoron - currency is only useful for its exchange value, and it's use value is ridiculously low (like melting coins for scrap or burning paper money for warmth). That's the whole point of currency, otherwise we'd just be bartering.
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Mar 26, 2019 17:53
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oliveoil posted:Nah The Marxian labour theory of value does not claim that the labour input of an individual commodity for sale on the market will be exactly equivalent to the labour embodied within it. Under Marx's framework price and value only even out when you look at the entire economy, individual transactions don't work that way. Individual commodities can and will sell for more or less than their labour costs due to local factors, including supply and demand or depreciation.
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Mar 26, 2019 18:14
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Infinite Karma posted:It's weird to use the LTV to calculate the value of a bitcoin, because it's almost purely a capital investment. You spend the money on the electricity, and on the machine to mine the bitcoin, and it produces a bitcoin, but the labor involved is essentially "install bitcoin program and then wait," and is a trivial component of the ultimate product. As far as my education goes, you don't consider the labor involved in producing the tools (i.e. the computer and the software) you're utilizing when a third party produces them, you just consider them part of the capital portion. I think this is a pretty severe misunderstanding of Marx's theory. Money, including currency, is a commodity that is produced by socially necessary labour time just like all other commodities.
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Mar 26, 2019 18:17
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Helsing posted:I think this is a pretty severe misunderstanding of Marx's theory. Money, including currency, is a commodity that is produced by socially necessary labour time just like all other commodities.
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Mar 26, 2019 18:24
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you could argue that buttcoins are much closer to being a "physical" commodity like gold than an actual currency but then again in Marx's day fiat currency wasn't widespread and everyone was on the gold standard so maybe he sees currency as commodity because for him money = gold + minting under which the labor to produce isn't trivial Typo fucked around with this message at 18:30 on Mar 26, 2019 |
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Mar 26, 2019 18:26
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Typo posted:you could argue that buttcoins are much closer to being a "physical" commodity like gold than an actual currency quote:but then again in Marx's day fiat currency wasn't widespread and everyone was on the gold standard so maybe he sees currency as commodity because for him money = gold + minting under which the labor to produce isn't trivial I don't think Marx is capable of describing a system where labor has become irrelevant, instead of just being exploited.
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Mar 26, 2019 19:37
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Typo posted:But that just begs the question of how do you calculate value for inputs, and if you answer "the labor value of oil used to generate the electricity" or w/e, that really just pushes the same question up another level so to speak That's exactly how you do it, right back to the raw resource extraction which is achieved via pure labour. Though of course most methods of extraction require tools produced elsewhere so you would need to plot out the whole economy to get an accurate understanding, it's not something you can really do it's a theory of how you would do it if you had to, and a way of conceiving the way the economy increases in value over time. The total economic value changes as you bring more of a thing into existence anyway. Two cars have more value than one car because you've put more labour in to convert the raw parts to a more useful form. If you have to search around harder to get parts to build the second car, that uses more labour, and drives the value of the second car up. It is like a price change because the increased labour costs necessitate an increased sale price for the second car, but the point of LTV is to argue that the second car is actually more valuable than the first one because it represents more embodied labour. Regardless of what you might sell it for at market. The LTV calculated value of a thing is not the same as the price and the price can bear very little similarity to the value, but they are both affected by similar factors. OwlFancier fucked around with this message at 21:56 on Mar 26, 2019 |
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Mar 26, 2019 21:54
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OwlFancier posted:That's exactly how you do it, right back to the raw resource extraction which is achieved via pure labour. Though of course most methods of extraction require tools produced elsewhere so you would need to plot out the whole economy to get an accurate understanding, it's not something you can really do it's a theory of how you would do it if you had to, and a way of conceiving the way the economy increases in value over time. But even if we were to, for a moment ignore the capital cost of extracting raw resources, different labor are still valued differently. Let's say we are extracting a barrel of oil from the ground. How do you establish the ratio of "labor value" for an hour of trained petroleum engineer vs hour of untrained worker whose job is just to use pickaxes to break apart rocks to get to the oil underneath (just an example I don't know poo poo about oil extraction process). Do we assume both have uniformal value? Do we fall back on the "labor hours" needed to train the engineer vs manual worker (but that once again begs the infinitely regressive and circular question of how to value -those- workers at the university or w/e) I mean if your basic point is that LTV is a philosophical concept and not an analytics tool I agree with you. quote:The total economic value changes as you bring more of a thing into existence anyway. Two cars have more value than one car because you've put more labour in to convert the raw parts to a more useful form. If you have to search around harder to get parts to build the second car, that uses more labour, and drives the value of the second car up. But what if marginal cost of production drops due to economy of scale, does that make the first car worth less? quote:It is like a price change because the increased labour costs necessitate an increased sale price for the second car, but the point of LTV is to argue that the second car is actually more valuable than the first one because it represents more embodied labour. Regardless of what you might sell it for at market. But can you see the problem with this philosophy if the two cars are identical, nobody would care that the production cost of the second car was higher in labor hours or w/e. If the second car took more hours to make but (for w/e reason) had a defect engine or w/e due to a careless mistake, would it be valued higher than the first car still? It seems to me valuing something based on the process of production rather than end product doesn't fit real life very well. Typo fucked around with this message at 22:22 on Mar 26, 2019 |
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Mar 26, 2019 22:16
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Typo posted:But even if we were to, for a moment ignore the capital cost of extracting raw resources, different labor are still valued differently. Well, a lot of people would suggest that an hour of a human life is actually worth the same, whether it is spent scrubbing floors or building rockets. You could reasonably include education costs in there yes, but fundamentally the argument that LTV advances is that the CEO's time is not actually worth more than yours, and the reason you get paid a fraction of what they do has nothing to do with worth and everything to do with them deciding to pay themselves more and you less because they are the only ones who get to make that decision. Typo posted:
I don't think so, but it definitely makes the second car worth less and thus lowers the average worth of all cars you have produced, because the socially necessary labour required to make it has decreased, even though producing it still definitely increases the total value of cars you have produced. Automation and historical labour embodied in productive capital such as a forest transformed into arable land or a mine dug to a mineral seam, or an already existing assembly line, that reduces the amount of labour someone alive today needs to do to produce things, and LTV argues that this means the products are worth less, because they require less labour to make. What should morally happen and what LTV is often used to argue, is that the gains of this production efficiency should be spread among everyone putting work-hours into the production, but instead they are generally given to the owners of the means of production to do with as they please. Typo posted:But can you see the problem with this philosophy If the production errors are genuinely accidental and require labour to fix, that has simply increased the socially necessary labour cost of producing the car. On aggregate this is part of the production cost, sometimes you will have errors and you need to budget labour hours to fix them because your means of production is imperfect. So yes, the second car is worth more because it took longer to make. Of course you can't sell it for more, but the average production cost in labour hours including fixing mistakes definitely would affect the price you sell all models of the car for, wouldn't it? Almost the whole point, really, of LTV is that it describes how automation and the existence of productive capital like factories and machines and poo poo, how that actually affects society. It argues that that productive capital, the means of production, should be making all our lives easier, because it reduces the amount of labour we need to do to produce things. What it should be doing is making us all live better lives, and to an extent it does, but it argues that it could be making our lives a lot better than it does if control of that production were democratically controlled, because at present the reason there are all these absurdly rich people kicking around is because they're skimming off the surplus value produced by the people who work to produce things. The reason we all go to work and get paid a pittance while the boss gets rich and fat is because we don't get to keep the things we produce, or even a fair share of what we produce. And the reason we have to work so much is because the boss wants to get as rich as possible for doing nothing, and he achieves that by making us work longer and produce more for less. If that surplus value was instead redistributed among the workers then everyone could, like, work less. Or have more stuff, or maybe we could scale back production altogether and not murder the planet. Many things are possible! As far as complete automation goes, well, LTV does get a bit weird there, but what it would strongly suggest is that if something can be completely automated then the products literally have no value. Which suggests they should be free. So if you apply it to say, software, where you can copy things for basically nothing, then the value of a piece of software is proportional to the number of copies in use divided by the production costs. LTV breaks down the same way that normal concepts of production costs break down in software development because you spend all your money producing one copy of the software but can reproduce it infiitely for free. But some suggestions you could certainly infer from an LTV standpoint would be a drastic shortening of copyrights because once the costs have been recouped there is no ethical justification for continuing to create scarcity. And that in general, copyright ownership is probably the ultimate expression of capital holding the means of production, it's the platonic ideal, almost, the availability of a thing that costs nothing to produce is entirely controlled by a capitalist because doing so makes them money. OwlFancier fucked around with this message at 06:40 on Mar 27, 2019 |
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Mar 27, 2019 06:05
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OwlFancier posted:Well, a lot of people would suggest that an hour of a human life is actually worth the same, whether it is spent scrubbing floors or building rockets. You could reasonably include education costs in there yes, but fundamentally the argument that LTV advances is that the CEO's time is not actually worth more than yours, and the reason you get paid a fraction of what they do has nothing to do with worth and everything to do with them deciding to pay themselves more and you less because they are the only ones who get to make that decision. CEO vs worker is a pretty loaded example, because there are empirical studies showing yeah a large percentage of CEOs are useless and don't do poo poo so yeah it's easy to argue their time isn't worth anymore than your time. But I think it's really hard to make the same argument that an hour of time of a trained doctor or nuclear engineer is worth exactly the same as a manual worker or janitor. A doctor for instance, might very well be using his or her hour of time to save a life which to me is way more valuable and takes more skill than a manual worker's hour. Even if you think that they -should- be valued the same, treating all labor hours as having the same value seems like a completely unworkable way of organizing your economy. quote:I don't think so, but it definitely makes the second car worth less and thus lowers the average worth of all cars you have produced, because the socially necessary labour required to make it has decreased, even though producing it still definitely increases the total value of cars you have produced. Automation and historical labour embodied in productive capital such as a forest transformed into arable land or a mine dug to a mineral seam, or an already existing assembly line, that reduces the amount of labour someone alive today needs to do to produce things, and LTV argues that this means the products are worth less, because they require less labour to make. What should morally happen and what LTV is often used to argue, is that the gains of this production efficiency should be spread among everyone putting work-hours into the production, but instead they are generally given to the owners of the means of production to do with as they please. quote:If the production errors are genuinely accidental and require labour to fix, that has simply increased the socially necessary labour cost of producing the car. On aggregate this is part of the production cost, sometimes you will have errors and you need to budget labour hours to fix them because your means of production is imperfect. So yes, the second car is worth more because it took longer to make. Of course you can't sell it for more, but the average production cost in labour hours including fixing mistakes definitely would affect the price you sell all models of the car for, wouldn't it? can you see that this is sort of absurd? A more efficient production process which uses -less labor- per unit by LTV standards seem to be -lowering- the total economic value of same units produced. Which means the total value of your output actually -drops- as it gets more efficient and use less labor. As it gets less efficient, total value of output -increases-. quote:because they're skimming off the surplus value produced by the people who work to produce things. quote:What it should be doing is making us all live better lives, and to an extent it does, but it argues that it could be making our lives a lot better than it does if control of that production were democratically controlled Typo fucked around with this message at 07:32 on Mar 27, 2019 |
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Mar 27, 2019 07:27
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Typo posted:CEO vs worker is a pretty loaded example, because there are empirical studies showing yeah a large percentage of CEOs are useless and don't do poo poo so yeah it's easy to argue their time isn't worth anymore than your time. The argument is that the doctor's time is needed, but so is the janitor's. The heart surgery needs doing, but so does the floor need cleaning. The doctor is embodied labour in terms of the time taken to train them, so yes their time arguably is worth a bit more, but it's not, like, millions of times more. And absolutely the large majority of wage inequality is not well correlated to actual value of labour. And critically, the doctor's higher labour value is the result of labour that has been put into them. They are productive capital, in that instance, the same way a skilled labourer is. Now you're right that people balk at the idea, but is that because it's wrong or is it because they all wish they were the one's being paid millions? Or is it because they haven't considered the possibility that, through collective action, it might be possible to organize society differently? Certainly it's not how it works currently, and if you just decided, in one company, to pay everyone equally, then a lot of people wouldn't want to work there, but perhaps that's more societal inertia making it work that way? Typo posted:can you see that this is sort of absurd? No, value per unit decreases, but the point of production efficiency is as it decreases the amount of labour needed to produce an object, you can produce more things with the same amount of labour. The total economic value produced per hour (LTV wise) remains the same as long as you have the same amount of people producing things, but that economic value encompasses more goods. And obviously the total economic value in existence increases because you have been producing longer, produced more things. Again the example of a fully automated society, that would be post scarcity, commodities would have no value, unless, of course, artificial scarcity were created by the owners of the automated means of production. Or perhaps more relatably, as production becomes more and more automated, the price of goods drops, because they are cheaper to produce, or alternatively, it doesn't, but the owners of the production company get increasingly wealthy because they have greater profit margins from selling the cheaper-to-produce products at the same price. This is quite observable with early models of products generally being less effective and more expensive, then as they popularize, you can buy the same functionality for far less money because they are produced en masse. Typo posted:So how does LTV deal with the risk of investing capital into an enterprise (capitalist or socialist co-op or w/e)? If I put my life-savings into starting a factory or w/e, is it legitimate for me to get returns above what my labor input is? Is it legitimate to get paid to take a risk with my money? As far as I'm aware it doesn't. It would argue that your "life savings" such as they are represent embodied labour, and depending on where you got them from it might dispute the legitimacy of your having them in the first place. Advocates of the theory would probably suggest that the risks of investment in production should be socialized in the same way the benefits should be. If you get together with some other people and decide to pool the surplus of your labour and it makes a very useful business, then the results of that business should be distributed among its workers, but similarly if it doesn't, then you shouldn't be left destitute. You aren't supposed to be able transition to being able to live without doing anything because you had money and now you own the company, and extract work from everyone else, but equally you shouldn't be starving because you did that and it didn't go anywhere. Socialized ownership of the means of production is generally accompanied by socialized welfare systems as well. Though, really, LTV advocates would probably suggest that you just accumulating a big pile of money over the course of your life would be a bit weird in the first place because that's a bit capitalist. They would probably suggest that you should instead be deciding with everyone else in the place you work what to do with the collective product of your labour. So it'd be more like you and everyone else who works there would vote on whether to expand the business in particular directions and if they don't work out, well, you would vote on whether to close them down, or reorient the business towards things that do work out. Or maybe you fold it up and all go find work in other areas. Essentially the whole concept of needing a big pile of money to buy security from poverty is kind of a capitalist idea. Really that's more of a moral question than an economic one though. Can you make money by having money? Of course, in a capitalist society you can, you can own the means of production and extract value from the labour of others. LTV describes quite accurately the method by which you would achieve that by investing in setting up a factory. You put the money down, you own the factory, you get to tell the people who can't afford their own factory what to do, how long to work, and how much of their surplus to give you for the privilege. Should you do that is dependent on whether you think that arrangement is ethical or not. Generally if you subscribe to LTV you would probably say it isn't. OwlFancier fucked around with this message at 08:03 on Mar 27, 2019 |
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Mar 27, 2019 07:45
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I know I've been away from this thread for a while and it is going in some new and interesting (sometimes) directions, particularly with the hashing out of what LTV is and how we are to understand that theory. I haven't had time to read all that has been said, but I do think that at least LTV acknowledges you can't have anything of any value with no work being done. That's a very loose concept which defines value by considering mostly what it cannot be (a system without any work being done in it), but I think it should force most people to acknowledge that LTV at least is on to something when it tries to relate work to value. Whether that is really simple or very complex, nuanced, and best interpreted through intermediary concepts is of course unresolved as far as I can tell. I think the Marxist concept of use-values is still not a bad addition to that discussion... In any event, I'm still slogging through the reading schedule I gave myself with what little free time I have for it. I don't have anything I want to present to this thread to continue my argument coherently yet, but I do have a collection of quotes which I found interesting from the sources I had listed earlier, which winnows down the field and focuses my attention (as well as the attention of anyone else who has been following my arguments and/or criticizing them): some good stuff here both in support of and against what I now know should be called econophysics. Let me know what you think; might help me come up with a better ultimate synthesis: http://www.cadmusjournal.org/node/146 "In this essay, human society is regarded as a “superorganism”, analogous to colonies of social insects. The digestive system of the human superorganism is the global economy, which ingests both free energy and resources, and later excretes them in a degraded form. This process involves an increase in entropy. Early in the 20th century, both Frederick Soddy and Nicholas Georgescu-Roegen discussed the relationship between entropy and economics. Soddy called for an index system to regulate the money supply and a reform of the fractional reserve banking system, while Georgescu-Roegen pointed to the need for Ecological Economics, a steady-state economy, and population stabilization" "Soddy was extremely critical of the system of “fractional reserve banking” whereby private banks keep only a small fraction of the money that is entrusted to them by their depositors and lend out the remaining amount. He pointed out that, in this system, the money supply is controlled by the private banks rather than by the government, and also that profits made from any expansion of the money supply go to private corporations instead of being used to provide social services. Fractional reserve banking exists today, not only in England but also in many other countries. Soddy’s criticisms of this practice cast light on the subprime mortgage crisis of 2008 and the debt crisis of 2011. As Soddy pointed out, real wealth is subject to the second law of thermodynamics. As entropy increases, real wealth decays. Soddy contrasted this with the behavior of debt at compound interest, which increases exponentially without any limit, and he remarked: “You cannot permanently pit an absurd human convention, such as the spontaneous increment of debt [compound interest] against the natural law of the spontaneous decrement of wealth [entropy]”. Thus, in Soddy’s view, it is a fiction to maintain that being owed a large amount of money is a form of real wealth." "Georgescu-Roegen later wrote: “The idea that the economic process is not a mechanical analogue, but an entropic, unidirectional transformation began to turn over in my mind long ago, as I witnessed the oil wells of the Plosti field of both World Wars’ fame becoming dry one by one, and as I grew aware of the Romanian peasants’ struggle against the deterioration of their farming soil by continuous use and by rains as well. However it was the new representation of a process that enabled me to crystallize my thoughts in describing the economic process as the entropic transformation of valuable natural resources (low entropy) into valueless waste (high entropy).” After making many technical contributions to economic theory, Georgescu-Roegen returned to this insight in his important 1971 book, The Entropy Law and the Economic Process (Harvard University Press, Cambridge, 1971), where he outlines his concept of bioeconomics. In a later book, Energy and Economic Myths (Pergamon Press, New York, 1976), he offered the following recommendations for moving towards a bioeconomic society: the complete prohibition of weapons production, thereby releasing productive forces for more constructive purposes; immediate aid to underdeveloped countries; gradual decrease in population to a level that could be maintained only by organic agriculture; avoidance, and strict regulation if necessary, of wasteful energy use; abandon our attachment to “extravagant gadgetry”; “get rid of fashion”; make goods more durable and repairable; and cure ourselves of workaholic habits by rebalancing the time spent on work and leisure, a shift that will become incumbent as the effects of the other changes make themselves felt." "Adam Smith was perfectly correct in saying that the free market is the dynamo of economic growth; but exponential growth of human population and economic activity have brought us, in a surprisingly short time, from the empty-world situation in which he lived to a full-world situation. In today’s world, we are pressing against the absolute limits of the earth’s carrying capacity, and further growth carries with it the danger of future collapse. Full-world economics, the economics of the future, will no longer be able to rely on industrial growth to give profits to stockbrokers or to solve problems of unemployment or to alleviate poverty. In the long run, neither the growth of industry nor that of population is sustainable; and we have now reached or exceeded the sustainable limits." "One of the central problems in reducing consumption is that in our present economic and social theory, consumption has no upper bound; there is no definition of what is enough; there is no concept of a state where all of the real needs of a person have been satisfied. In our growth-oriented present-day economics, it is assumed that, no matter how much a person earns, he or she is always driven by a desire for more." "In a traditional culture, where change is extremely slow, population has an opportunity to expand to the limits which the traditional way of life allows, so that it reaches equilibrium with the environment. For example, in a hunter-gatherer culture, population has expanded to the limits which can be supported without the introduction of agriculture. The density of population is, of course, extremely low, but nevertheless it is pressing against the limits of sustainability. " "The introduction of Pigovian taxes by one country may make it less able to compete with other countries that do not include externalities in their pricing. Until such reforms become universal, free trade may give unfair advantages to countries which give the least attention to social and environmental ethics. Thus free trade and globalization will become fair and beneficial only when ethical economic practices become universal." https://www.degruyter.com/downloadpdf/j/jheec.2016.3.issue-1/jheec-2016-0001/jheec-2016-0001.pdf "In mechanics, the idea of a perpetual motion machine was disproved by the law of entropy. Similarly, Georgescu-Roegen, using the thermodynamic theory, criticized the numerous theories of growth that were popular at that time. In his opinion, although all production processes do not obey the same economic laws, all economic processes, like biological processes, are subject to the Entropy Law. So, in accordance with Gowdy and Mesner, ‘invoking the Second Law of Thermodynamics, Georgescu-Roegen incorporates the idea of entropic degradation as a fundamental constraint on all economic activity’ (1998, p. 146)" http://cob.jmu.edu/rosserjb/ENTROPY%20AND%20ECONOPHYSICS.pdf "The ontological approach to econophysics derives from the direct and foundational role of energy in the economy, not merely for industrial production or providing for electricity or transportation, but at the ecological or biophysical level, that of solar energy driving the global biosphere. This is more a return to the Carnot and Clausius view of thermodynamics, where the continued incoming of solar energy shows the openness of the earth’s system that allows it to avoid the law of entropy as long as the sun lasts [11] [21].3 However, that arriving solar energy itself is finite and thus provides a direct limit on economic activity that depends on the ecosystems through which the solar energy dissipates in the food chains that are driven by that energy. In addition, Georgescu-Roegen [11] extended this argument to broader material resource inputs, arguing that they are also subject to a form of the law of entropy as well that provides further limits on the economy. More broadly for him [11, p. 281] “the economic process consists of a continuous transformation of low entropy into high entropy, that is, into irrevocable waste, or, with a topical term, into pollution.” "Likewise for Georgescu-Roegen [11], while he saw entropy as the ultimate limit to growth, he did not see it as all that useful for determining value, which he saw as ultimately coming from utility. Thus, nobody wants the low entropy poisonous mushroom and some people value more highly the high entropy beaten egg to the low entropy raw egg. These are matters of utility, and while GeorgescuRoegen did not see utility (or marginal utility to be more precise) as the sole source of value as did the subjectivist theorists of the Austrian School, he certainly saw it as very important and was a major developer of modern utility theory early in his career.5" "While variations of this argument have become highly influential, especially in ecological economics as with Martinez-Alier [24], it has faced sharp criticisms as well. Thus,Gerelli [25] argues that the scale of the solar input is such that it is orders of magnitude beyond really limiting the world economy, with many other more mundane constraints more relevant in the short run. Nordhaus [26] estimated entropy to be as many as 12 orders of magnitude below technology as a limit to growth, with Young [27] weighing in similarly. In that regard the drawdown of stored energy sources and their limits such as with fossil fuels may be more relevant with the pollution from using them even more limiting as with such outcomes as climate change arising from the burning of such fuels releasing their stored carbon dioxide. Other critics have emphasized either the limitless ingenuity of the human mind such as Julian Simon, who argued that [28, p. 347] “those who view the relevant universe as unbounded view the second law of thermodynamics as irrelevant to the discussion.”" http://entropyeconomics.com/wp-content/uploads/2019/02/Startups-and-the-Remaking-of-the-Firm-High-Alpha-Entropy-Economics-Feb-2019.pdf "The dominant business story of the coming decade will be the disaggregation of the firm. After reaching a peak of corporate and industry concentration, the undeniable forces of technology have unleashed a new phase of decentralization."
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Mar 27, 2019 08:06
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Eschat0n posted:“You cannot permanently pit an absurd human convention, such as the spontaneous increment of debt [compound interest] against the natural law of the spontaneous decrement of wealth [entropy]”. 1. Assume only banks can print new money. 2. Initialize the system with banks having $1M and nobody else having any. 3. 1000 people borrow $1000 each. 4. Apply a little interest to the debts. 1000 people now have $1000 each and owe $1010 to the bank. 5. Everyone genuinely strives to pay off their debt. There are only three ways it's possible to not be left with people owing the bank money: death eliminating some debt, bankruptcy eliminating some debt, or people working for the bank directly (in which case as a whole they are essentially being paid in debt reduction, not in actual money). In the absence of at least one of these options, there's $10000 owed that literally doesn't exist and can't possibly be paid back, and that amount is forever increasing because compound. You don't even need spontaneous decrement for this to be absurd, you need only the absence of any spontaneous increase in currency originating from outside of the source of debt.
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Mar 27, 2019 15:19
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Typo posted:A more efficient production process which uses -less labor- per unit by LTV standards seem to be -lowering- the total economic value of same units produced. Which means the total value of your output actually -drops- as it gets more efficient and use less labor. As it gets less efficient, total value of output -increases-. Consider the ideal trade- you find a lump of gold with minimal effort. The gold itself has very little value to you however it has a high perceived value on the market. You will be easily able to trade this object of minimal value for something of greater value, thus profiting. Value on the supply side is a liability as, unless price changes with value, higher value means less profit.
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Mar 27, 2019 16:12
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Ok so these posts are getting long so I'm gonna start splitting up the responsesOwlFancier posted:The argument is that the doctor's time is needed, but so is the janitor's. The heart surgery needs doing, but so does the floor need cleaning. The doctor is embodied labour in terms of the time taken to train them, so yes their time arguably is worth a bit more, but it's not, like, millions of times more. And absolutely the large majority of wage inequality is not well correlated to actual value of labour. And critically, the doctor's higher labour value is the result of labour that has been put into them. They are productive capital, in that instance, the same way a skilled labourer is. They are both needed but it seems to me that one is needed a lot more than the other: if the floors don't get cleaned at the theater for the night, worst that happens is the next morning some movie-watchers are gonna have a worse experience. If the Doctor doesn't work that night: somebody dies. But if you are acknowledging that different labor hours needs to be valued differently, that goes right back to my original question of how do you establish the ratio of value between the doctor's hour of work vs a janitor's hour of work. Typo posted:Let's say we are extracting a barrel of oil from the ground. How do you establish the ratio of "labor value" for an hour of trained petroleum engineer vs hour of untrained worker whose job is just to use pickaxes to break apart rocks to get to the oil underneath (just an example I don't know poo poo about oil extraction process). Do we assume both have uniformal value? Do we fall back on the "labor hours" needed to train the engineer vs manual worker (but that once again begs the infinitely regressive and circular question of how to value -those- workers at the university or w/e) quote:No, value per unit decreases, but the point of production efficiency is as it decreases the amount of labour needed to produce an object, you can produce more things with the same amount of labour. The total economic value produced per hour (LTV wise) remains the same as long as you have the same amount of people producing things, but that economic value encompasses more goods. And obviously the total economic value in existence increases because you have been producing longer, produced more things. Again the example of a fully automated society, that would be post scarcity, commodities would have no value, unless, of course, artificial scarcity were created by the owners of the automated means of production. Say Month 1, Socialistic Factory Co-op gets order for 10 cars, workers spend (again example) total 1000 hours to make 10 cars Month 2, Factory gets order for 10 cars, worker spends only 900 hours to make them (they got more experienced at it) but don't make more because there's only order for 10 cars It seems to me under LTV framework the second month's 10 cars would actually be valued lower than the first month's production of 10 cars. Even though the second month's was manufactured at a greater efficiency. This again, seems absurd to me but it also seems to be the natural conclusion of this framework. quote:, you can produce more things with the same amount of labour. let's say first Month factory workers make 10 cars in 1000 man-hours Let's say second month Factory workers make 15 cars in 999 man-hours (they get more experienced and faster at making cars and slacked off a bit on the side) It seems to me that under LTV framework, the second month's "batch" of 15 cars would be valued -lower- than the first month's batch of 10 cars, despite there being more items of the same quality within the second batch. Which suggests to me this framework does not work very well when applied to real life. Since value is defined in such a way that maximizing value is to maximizing labor hours used to produce a widget rather than maximizing the production of widgets at a minimum cost. Maybe this is an appealing philosophy, and granted I admittedly have fallen behind on my readings of Marxist-Leninism so maybe it's explained away in chapter 11 of Kapital or w/e and I'm just misunderstanding completely. But I don't see this as workable when applied. quote:Now you're right that people balk at the idea, but is that because it's wrong or is it because they all wish they were the one's being paid millions? Or is it because they haven't considered the possibility that, through collective action, it might be possible to organize society differently? Certainly it's not how it works currently, and if you just decided, in one company, to pay everyone equally, then a lot of people wouldn't want to work there, but perhaps that's more societal inertia making it work that way? Typo fucked around with this message at 19:16 on Mar 27, 2019 |
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Mar 27, 2019 19:11
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quote:As far as I'm aware it doesn't. It would argue that your "life savings" such as they are represent embodied labour, and depending on where you got them from it might dispute the legitimacy of your having them in the first place. Advocates of the theory would probably suggest that the risks of investment in production should be socialized in the same way the benefits should be. If you get together with some other people and decide to pool the surplus of your labour and it makes a very useful business, then the results of that business should be distributed among its workers, but similarly if it doesn't, then you shouldn't be left destitute. You aren't supposed to be able transition to being able to live without doing anything because you had money and now you own the company, and extract work from everyone else, but equally you shouldn't be starving because you did that and it didn't go anywhere. Socialized ownership of the means of production is generally accompanied by socialized welfare systems as well. If I use the money to start new business, am I entitled to some kind of return outside of labor rendered for taking a risk with my savings? Or are you saying that any private investment is illegitimate in this framework and only the state can do it.
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Mar 27, 2019 19:29
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Typo posted:So what if I got my money from being a life-long Stakhanovite who saved my money (many bonuses were handed out for exceeding quotas!) from working at Socialist factory workplace. The idea of saving in the first place is antithetical to socialism. The reward for exceeding quotas and the widget factory is an economy with more widgets and thus everyone in the society has greater access to widgets, yourself included. "Saving" implies either you were unjustly overcompensated for your labor and thus your wealth is stolen from someone who was undercompensated OR you subjected yourself to a lower standard of living than you should have had. But subjecting yourself to unhappiness is not justification to make up for your unhappiness by subjecting others to cruelty. But, of course, claiming that all people have some right to any share of resources or the ethics of leveraging other's happiness for personal benefit are value judgements. I would also say that judgement changes depending on if we're producing bread at the cost of people starving or if we have a society with an acceptable ground floor and we're producing luxury goods at the cost of someone getting a smaller TV. quote:They are both needed but it seems to me that one is needed a lot more than the other: if the floors don't get cleaned at the theater for the night, worst that happens is the next morning some movie-watchers are gonna have a worse experience. If the Doctor doesn't work that night: somebody dies. Okay, let's say you're right. Assume that a heart transplant which takes an hour is inherently more valuable than a clean floor, which took an hour to clean. But they both have some non-zero value. Doesn't that, then, imply there is an amount of clean floors equivalent to a person's life? LVT would suggest that the value from the end of doctors and janitors is equal and the difference comes in market preference, or price. This preference has nothing to with work required by a doctor or janitor or the food and shelter required to keep a doctor or janitor alive. Instead, we ethically consider a life saving operation invaluable and always preferential to having our doctors clean floors.
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Mar 27, 2019 20:57
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quote:LVT would suggest that the value from the end of doctors and janitors is equal
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Mar 27, 2019 21:06
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Typo posted:Before i address the rest of your post, what does this mean? A doctor and janitor work just as hard so their labor has the same value. When you look at the value they provide society you're looking at a market demand definition of value. In LTV value is from the perspective of the laborer, or the doctor and janitor.
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Mar 27, 2019 23:55
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MixMastaTJ posted:"Saving" implies either you were unjustly overcompensated for your labor and thus your wealth is stolen from someone who was undercompensated OR you subjected yourself to a lower standard of living than you should have had. But subjecting yourself to unhappiness is not justification to make up for your unhappiness by subjecting others to cruelty. I don' t think I follow this line of logic I defer consumption for the future (that's saving) out of wages paid to me for overfilling Socialistic quotas, how am I "subjecting others to cruelty"? Or am I misreading your argument. is deferring consumption to the future (trading a lower standard of living for today in exchange for higher standard of living tomorrow) inherently illegitimate as well? Is stuffing my money into a piggy bank instead of spending it today exploiting somebody? If so, do I literally have to spend my earnings the second I receive them to fulfill socialistic principles? quote:A doctor and janitor work just as hard so their labor has the same value. When you look at the value they provide society you're looking at a market demand definition of value. In LTV value is from the perspective of the laborer, or the doctor and janitor. Typo fucked around with this message at 00:20 on Mar 28, 2019 |
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Mar 28, 2019 00:15
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The suggestion is generally that you wouldn't live in a society where you have a right to own a factory, much less where you would be saving the capital required to do it. Your factory would also be collectively owned by all its workers.
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Mar 28, 2019 01:38
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Typo posted:I don' t think I follow this line of logic Oh, no, I mean the act of profiting off private property. The act of pocketing wealth from your workers because you own the means of production is cruelty. quote:is deferring consumption to the future (trading a lower standard of living for today in exchange for higher standard of living tomorrow) inherently illegitimate as well? Is stuffing my money into a piggy bank instead of spending it today exploiting somebody? See, you're stuck in this very capitalist mindset. The idea is that everyone is entitled to an equal share of the economy. It's not you work an hour to earn a soda. You work an hour to contribute to society. Because society has enough sodas, you can consume a soda. You can grab a soda now because you know you'll want it tomorrow but you can't hoard a pallet of 12 packs. Likewise, you don't build a soda factory because you want to get rich- you build it because you and a bunch of others want soda and are willing to produce it. You don't own the factory- society owns the factory and your reward is the soda you create. quote:Ok, the wording you use "the end" confuses me, I mean I can see your point from a philosophical perspective, it just seems incoherent to organize any economy: Socialist or Capitalist, from this framework. Well, obviously we should prioritize doctor training to janitor training. But the reason is because human life is more important than clean floors, not because one is more valuable. And again, capitalist mindset tells us that doctors are only going to do their job if they're rewarded with greater luxury. But this is unsubstantiated bullshit. People will be doctors because they understand the importance of healing others. I doubt many doctors would agree to mop floors for the salary they make as doctors- people prefer careers they're good at.
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Mar 28, 2019 02:28
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Plus the notion is generally that if you lived in a society where you can just... have stuff that is abundant, you wouldn't feel an inclination to hoard it. You can't sell it because things aren't sold. You're just hoarding like people hoard trash now.Typo posted:let's say first Month factory workers make 10 cars in 1000 man-hours Also this, what's weird about this? If you've made 15 cars for cheaper than you would previously have made 10, then yes you have made cars individually less valuable? What's strange about that? Bear in mind you would also include the labour cost of the materials so that probably wouldn't actually be cheaper, but if you somehow did manage to make the production costs cheaper over time, say by improving the process for all the parts and material extraction too, what would be weird about that? The first iphone was really expensive because it was new technology with very limited production line, but now you can buy a better smartphone than that for like £40 or something. Because the process has been refined over time to make better things more easily? OwlFancier fucked around with this message at 02:41 on Mar 28, 2019 |
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Mar 28, 2019 02:35
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Typo posted:But even if we were to, for a moment ignore the capital cost of extracting raw resources, different labor are still valued differently. Marx discusses this in Section 2 of the first first chapter of Capital. According to him skilled labour is indeed just an intensification of simple labour and skilled labour is paid at a higher rate according to a mixture of two things. 1) The received social conventions of a given society (which would reflect some mix of received social tradition, cultural values, class power, etc.) and 2) the socially necessary labour time that was required to educate the skilled worker. Marx writes: Capital, Chapter 1, Section 2, "THE TWO-FOLD CHARACTER OF THE LABOUR EMBODIED IN COMMODITIES" posted:Skilled labour counts only as simple labour intensified, or rather, as multiplied simple labour, a given quantity of skilled being considered equal to a greater quantity of simple labour. Experience shows that this reduction is constantly being made. A commodity may be the product of the most skilled labour, but its value, by equating it to the product of simple unskilled labour, represents a definite quantity of the latter labour alone.[15] The different proportions in which different sorts of labour are reduced to unskilled labour as their standard, are established by a social process that goes on behind the backs of the producers, and, consequently, appear to be fixed by custom. For simplicity’s sake we shall henceforth account every kind of labour to be unskilled, simple labour; by this we do no more than save ourselves the trouble of making the reduction. Engels, in a discussion of this passage, adds: Engels, Anti-Dühring, Part II: Political Economy, VI. Simple and Compound Labour posted:But not all labour is a mere expenditure of simple human labour-power; very many sorts of labour involve the use of capabilities or knowledge acquired with the expenditure of greater or lesser effort, time and money. Do these kinds of compound labour produce, in the same interval of time, the same commodity values as simple labour, the expenditure of mere simple labour-power? Obviously not. The product of one hour of compound labour is a commodity of a higher value—perhaps double or treble — in comparison with the product of one hour of simple labour. The values of the products of compound labour are expressed by this comparison in definite quantities of simple labour; but this reduction of compound labour is established by a social process which goes on behind the backs of the producers, by a process which at this point, in the development of the theory of value, can only be stated but not as yet explained. Typo posted:I mean if your basic point is that LTV is a philosophical concept and not an analytics tool I agree with you. You're getting confused because in the example you're dealing with individual cars being produced by a single factory. The confusion should disappear if you understand that Marx is describing social averages that are true across an entire industry or economy. This is why it's crucial to emphasis that Marx says the value (which, remember, is distinct from its price) of a commodity is based on the socially necessary labour time expended to produce it. If the average socially necessary labour time required to produce a commodity falls then average worker output per hour will increase. That should increase the supply of the commodity, whether it is cars of microchips or shoes, and ceterus paribus this increase in supply will eventually bring down prices. Society is vastly more efficient at producing computers than it was thirty years ago but computers are individually much less valuable. What once was an extremely pricey object that could only be afforded by governments and research institutes is now an almost universally owned common household object. Firms will try to resist this downward pressure on prices by seeking to carve out a monopoly or by differentiating their products through branding. That aspect of capitalism wasn't of particular interest to Marx but the Austrian economist Joseph Schumpeter (who coined the phrase "creative destruction"), whose own analysis owes a lot to Marx, makes some helpful contributions in this regard. In the short term an entrepreneur can extract additional surplus value from a rise in productivity but over time competition means that increasing productivity does tend to drive down prices. When Blackberry developed the first smartphones they initially enjoyed a commanding position in the industry and were able to exploit it accordingly. Over the years however the initial advantage faded as other firms entered the market and developed competing products. Today smart there are numerous brands of smart phone and their price has dropped a great deal. quote:It seems to me valuing something based on the process of production rather than end product doesn't fit real life very well. This depends on the industry and there are certainly many commodities whose exchange value isn't primarily based on their costs, but cost-plus pricing is extremely common in the real world, much more so than the kind of strict utility optimization that is predicted by standard neoclassical economics. Here's the Harvard Business Review on the topic of cost-plus pricing: Harvard Business Review posted:Cost-plus pricing is a lot like the romance novel genre, in that it’s widely ridiculed yet tremendously popular. Almost every manager I know will claim they hate pricing based only on costs. Yet cost-plus pricing remains the most widespread pricing method, used to price everything from a bottle of beer in a bar to multibillion-dollar infrastructure projects.
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Mar 28, 2019 05:05
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OwlFancier posted:The suggestion is generally that you wouldn't live in a society where you have a right to own a factory, much less where you would be saving the capital required to do it. Your factory would also be collectively owned by all its workers. so is collecting interest from a business loan legitimate if I (an individual) don't own shares in w/e business I'm lending to?
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Mar 28, 2019 05:20
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Typo posted:so is collecting interest from a business loan allowed? Hell no, usury is like the platonic ideal of capitalism. Just because you have money doesn't mean you have a right to force other people to give you more money for the privilege of borrowing it. Commies would generally suggest that there should instead be a social fund which allocates resources where they're needed and socializes both the gains and losses.
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Mar 28, 2019 05:21
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MixMastaTJ posted:Oh, no, I mean the act of profiting off private property. The act of pocketing wealth from your workers because you own the means of production is cruelty. quote:The idea of saving in the first place is antithetical to socialism. The reward for exceeding quotas and the widget factory is an economy with more widgets and thus everyone in the society has greater access to widgets, yourself included. quote:See, you're stuck in this very capitalist mindset. The idea is that everyone is entitled to an equal share of the economy. It's not you work an hour to earn a soda. You work an hour to contribute to society. Because society has enough sodas, you can consume a soda. Like I'm not arguing against your point, I just want to be clear where you are getting this from quote:Well, obviously we should prioritize doctor training to janitor training. But the reason is because human life is more important than clean floors, not because one is more valuable. But it seems to me like you -are- telling me that doctor labor hour is more valuable than janitor labor hour
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Mar 28, 2019 05:26
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