Opinion of the labor theory of value

[I spent the winter writing songs about getting better]

LOL there are people that still believe in Marxism today.

[ag]

Labor theory of value is not a Marxist theory. It goes back to, at least, Adam Smith and was the mainstay of pretty much every classical economic theory between Smith and Marx. In this sense, Marxism is simply a somewhat conservative economic theory for its age: labor theory is not a Marxist invention in any sense ("surplus value", on the other hand, was a key Marxist idea - but that is something else).

The major problem with labor, or any other, theory of value was always finding a consistent definition of value. Marx was aware of inconsistencies in Smith, etc., and was trying to deal with them. Post-Marx, some of his followers were able to produce, at least, a logically consistent version: unfortunately, the clearer they worked it out, the more obvious arbitrariness of using labor, rather than anything else, was becoming.

In parallel, many economists back in the 19th century decided to abandon, as a dead end, the search for any objective value, and replaced it with a subjective value notion: which, to avoid confusion, they called utility. Neoclassical economists (such as Marshall), thought of it as an actual measure of satisfaction, a "psychic utility". That approach has been further replaced in mainstream economic theory by the revealed preference approach (to a degree derived from the old Austrian school), in which even the subjective utility is but a mathematical tool, a convenient representation of ordinal preference, which, in turn, are revealed through actions. Finally, many of the modern approaches to decision theory go beyond even that, dealing with models which cannot be represented by means of utility maximization at all. in modern discussion of economics, value, in the sense in which it had been used 150 years ago by classical economists, is simply not a notion that anybody considers. This is not, really, about labor: it is value that the problem.

In any case, to sum up, labor theory of value was, in its time, a significan attempt at defining objective worth of things. It long predates Marx: if anything, Marx was very unoriginal in sticking to it. Eventually, economists did not so much abandon the labor theory of value specifically, as the question this theory was supposed to answer. These days no (non-Marxist - and even many a Marxist) economist would even think of some sort of objective "worth" of goods, which could be called "value".

[Gustaf]

Labor theory of value is not a Marxist theory. It goes back to, at least, Adam Smith and was the mainstay of pretty much every classical economic theory between Smith and Marx. In this sense, Marxism is simply a somewhat conservative economic theory for its age: labor theory is not a Marxist invention in any sense ("surplus value", on the other hand, was a key Marxist idea - but that is something else).

The major problem with labor, or any other, theory of value was always finding a consistent definition of value. Marx was aware of inconsistencies in Smith, etc., and was trying to deal with them. Post-Marx, some of his followers were able to produce, at least, a logically consistent version: unfortunately, the clearer they worked it out, the more obvious arbitrariness of using labor, rather than anything else, was becoming.

In parallel, many economists back in the 19th century decided to abandon, as a dead end, the search for any objective value, and replaced it with a subjective value notion: which, to avoid confusion, they called utility. Neoclassical economists (such as Marshall), thought of it as an actual measure of satisfaction, a "psychic utility". That approach has been further replaced in mainstream economic theory by the revealed preference approach (to a degree derived from the old Austrian school), in which even the subjective utility is but a mathematical tool, a convenient representation of ordinal preference, which, in turn, are revealed through actions. Finally, many of the modern approaches to decision theory go beyond even that, dealing with models which cannot be represented by means of utility maximization at all. in modern discussion of economics, value, in the sense in which it had been used 150 years ago by classical economists, is simply not a notion that anybody considers. This is not, really, about labor: it is value that the problem.

In any case, to sum up, labor theory of value was, in its time, a significan attempt at defining objective worth of things. It long predates Marx: if anything, Marx was very unoriginal in sticking to it. Eventually, economists did not so much abandon the labor theory of value specifically, as the question this theory was supposed to answer. These days no (non-Marxist - and even many a Marxist) economist would even think of some sort of objective "worth" of goods, which could be called "value".

Yup. It always struck me as odd that so many people fail to see that the main issue with Marxism is how old it is. Any theory constructed 150 years ago is unlikely to have gotten everything right.

[Antonio the Sixth]

Gotta agree with Gustaf on that last point.

About the labor theory of value, it's a worthy and interesting one philosophically but clearly not in empirical economics. Since I find philosophy far more interesting than empirical economics, I voted FT.

[Intell]

It's sayings are much more important that the economics, alone. FF theory, BRTD lives in his liberal bubble for literally everything.

[Sir Mohamed]

Labor theory of value is not a Marxist theory. It goes back to, at least, Adam Smith and was the mainstay of pretty much every classical economic theory between Smith and Marx. In this sense, Marxism is simply a somewhat conservative economic theory for its age: labor theory is not a Marxist invention in any sense ("surplus value", on the other hand, was a key Marxist idea - but that is something else).

The major problem with labor, or any other, theory of value was always finding a consistent definition of value. Marx was aware of inconsistencies in Smith, etc., and was trying to deal with them. Post-Marx, some of his followers were able to produce, at least, a logically consistent version: unfortunately, the clearer they worked it out, the more obvious arbitrariness of using labor, rather than anything else, was becoming.

In parallel, many economists back in the 19th century decided to abandon, as a dead end, the search for any objective value, and replaced it with a subjective value notion: which, to avoid confusion, they called utility. Neoclassical economists (such as Marshall), thought of it as an actual measure of satisfaction, a "psychic utility". That approach has been further replaced in mainstream economic theory by the revealed preference approach (to a degree derived from the old Austrian school), in which even the subjective utility is but a mathematical tool, a convenient representation of ordinal preference, which, in turn, are revealed through actions. Finally, many of the modern approaches to decision theory go beyond even that, dealing with models which cannot be represented by means of utility maximization at all. in modern discussion of economics, value, in the sense in which it had been used 150 years ago by classical economists, is simply not a notion that anybody considers. This is not, really, about labor: it is value that the problem.

In any case, to sum up, labor theory of value was, in its time, a significan attempt at defining objective worth of things. It long predates Marx: if anything, Marx was very unoriginal in sticking to it. Eventually, economists did not so much abandon the labor theory of value specifically, as the question this theory was supposed to answer. These days no (non-Marxist - and even many a Marxist) economist would even think of some sort of objective "worth" of goods, which could be called "value".

Basically this.

[Kingpoleon]

Labor theory of value is not a Marxist theory. It goes back to, at least, Adam Smith and was the mainstay of pretty much every classical economic theory between Smith and Marx. In this sense, Marxism is simply a somewhat conservative economic theory for its age: labor theory is not a Marxist invention in any sense ("surplus value", on the other hand, was a key Marxist idea - but that is something else).

BRTD probably considers Smith a Marxist. Disagree? You're a fascist. I'm afraid you aren't quite used to BRTD's mudslinging, name calling and blustering style.

[cMac36]

LOL there are people that still believe in Marxism today.

Labor theory of value actually originated with the classical economists iirc.  Marx twisted it around and used it for his own ends, and against the classical theorists.