History and criticism of the labor theory of value in English political economyWhitaker, Albert C. (Albert Conser)
History
History and criticism of the labor theory of value in English political economy
Whitaker, Albert C. (Albert Conser)
Economics -- Great Britain -- History; Labor theory of value -- Great Britain -- History
“variety in the proportions in which the two sorts of capital
may be combined introduces another cause, besides the greater
or less quantity of labour necessary to produce commodities,
for the variations in their relative value—this cause is the
rise or fall in the value of labour.”[65]
A rise in wages affects “relative values,” because wages, being a
different fractional part of the entrepreneur’s costs of different
commodities, the _whole_ of entrepreneur’s costs is affected in varying
degrees by the increase of this one factor. In Ricardo’s view a rise
of wages means simply a fall of profits. If the entrepreneur’s cost
of production of good A were ½ wages and ½ “profits,” and of good B ¾
wages and ¼ “profits,” then if general wages rise a fixed percentage,
and consequently general “profits” fall a fixed percentage, it follows
that the entrepreneur’s costs of A and B will change, one relatively to
the other, though the costs of these goods in labor are not altered. He
concludes:
“It appears that in proportion to the durability of capital
employed in any kind of production, the relative prices of
these commodities on which such durable capital is employed,
will ... fall as wages rise, and rise as wages fall; and on
the contrary those which are produced chiefly by labour with
less fixed capital, or with fixed capital of a less durable
character than the medium in which price is estimated, will
rise as wages rise, and fall as wages fall.”[66]
Public-domain text, read in full here on John Shaqi.
Reviews
Reviews
No reviews yet
Be the first to share your thoughts on this work.
Join the Discussion
Join the discussion
Sign in to leave a comment or review.
Sign InorCreate an account