I am working on a book (details later.) I am posting draft chapters online. Any and all feedback is welcome.
Chapter X- Value
(and its temporal, non-equilibrium nature)
In our previous chapter our analysis brought out some crucial characteristics of Marx’s value theory, characteristics that only exist when the theory is viewed from a temporal, non-equilibrium perspective.1 These are:
- Price and value are not the same thing. Because Marx distinguishes between value and price he is able to explain the temporal mechanism which disciplines and apportions labor in the absence of a social plan.
- This apportioning and disciplining is made possible by the existence of money which serves as a symbol and measure of value in the abstract. Because all commodities must exchange with this universal measure of value in order for the private labor they represent to become social labor money is able to reward some producers and punish others. These market signals are what discipline and apportion labor.
- This is indirectly social labor because these price signals happen after production has taken place and before the next production period happens. Therefore, although value is created in production the real social value of a commodity is never known until all products of labor meet in the market. This indirect means of apportioning and disciplining labor is what makes capitalist labor indirectly social.
These points all correspond with the central value concepts that Marx lays out in his opening chapters of Capital. These central concepts are:
- Exchange-value is an expression of an intrinsic value in commodities. Labor is its substance.
- Labor has a dual character: It is both concrete and abstract. It creates use-value and value.
- Commodities have a use-value and a value but value can only be expressed through exchange-value, in the physical body of another commodity (ie. the money commodity). Thus the tension in the commodity between use-value and value becomes externalized in the relation between the commodity and money. Money, as the universal equivalent, becomes the embodiment of abstract labor.
- The above conditions make possible the fetishism of commodities.
The purpose of this chapter is to explain these basic concepts of Marx’s value theory and to show that only a non-equilibrium, temporal framework allows us to understand Marx’s concepts. Equilibrium theories not only actually render all of Marx’s concepts irrelevant but also fail to explain reality on their own terms.2 I proceed through each of the four points above and explain their relevance through a temporal, non-equilibrium framework.
Marx begins with the commodity because this is the basic unit of capitalist social relations (not all relations for all times and places.) He begins with the commonplace observation that all commodities have a use value and an exchange value. He then quickly goes on to show that exchange value is just an expression of an underlying intrinsic value. Before going into what Marx means by ‘intrinsic value’ we should note what bourgeois theory makes of use value and exchange value.
Marginal utility theory, which forms the ideological fluff of the modern college economics class, holds that utility for the use-values of commodities is what determines the exchange-values of commodities. Marginal utility theory rests on a series of absurd presuppositions, is logically circular and can only explain prices in the way it claims to explain them under circumstances so restrictive as to make it laughable. 3 A critique of marginalism is not appropriate here, but it is mentioned in order to bring out the contrast between the marginalist concept of value and Marx’s. For the marginalist commodities have no value aside from the subjective valuations that consumers have for them. Commodities have prices but these prices are not reflective of any underlying value of the commodity. Rather, these prices are a reflection of the colliding utilities of a world of consumers.
General equilibrium theory4, which is found throughout most modern traditions of bourgeois economics (“neo-classical” and Sraffian as well as many so-called “Marxist” thinkers), comes from the theoretical toolbox of Léon Walras. Any and all theories which use Walrasian tools of equilibrium to understand capitalism end up with the same theoretical conclusions: prices are completely determined by the quantities of use-values produced and the real wage.5 Value, as something distinct from price, is rendered redundant. Thus even ‘Marxist’ equilibrium thinkers have no real use for value as a category when explaining price. All discussions of price can happen solely by counting the quantity of units produced and consumed without any discussion of labor-time. The blatant contradiction between this result and Marx’s entire project (which takes value as its central problematic) leads such ‘marxist’ thinkers to bend over backwards and invent all manner of workarounds and reformulations. Once we drop the equilibrium tools, to decide to do Marx without Walras, all of their efforts become pointless.6
This leaves Marx, specifically the temporal interpretation of Marx, all alone in having a theory of value in which value is a distinct concept separate from price. How does Marx establish the existence of an intrinsic value? His logic is quite simple. If I equate two commodities, say an apple and a pencil, I can only say that one is equal to the other if they share a common substance. Any time we say two things are quantitatively equal it means that they both share some qualitative property that can be prepared in measurable proportions.
This is easier to see if we expand the picture in order to equate the apple to many commodities. Each equation (1 apple=2 pencils=10 nails=1 sandwich=etc.) gives a different exchange-value of the apple. But has the value of the apple changed? No! Only the particular commodity which measures this value has changed.
In the above series of equations we were forced to make recourse to a concept of intrinsic value in order to understand what remains the same when the commodities standing in relation to the apple changed. The existence of an intrinsic value is the only plausible way to explain what it means for a commodity to have an endless series of exchange-values. Each exchange-value is an expression of the same thing, of something that the apple represents, a given amount of value.
The only other option is to say that all exchange-values are contingent, random, meaningless. This might be plausible in some other form of society where exchanges rarely happened. But in a capitalist society exchange is a regular, predictable social phenomenon. Exchange-values are often stable over periods of time and people make choices with often accurate guesses as to what the exchange-values of commodities will be. This implies that there is something intrinsic to commodities that is being measured by the various exchange-ratios between an apple and other commodities.
In marginalist and equilibrium theory the goal of a value theory is to explain prices through causal determination. The theories claim to be able to explain what determines the individual prices of commodities. It is often stated that Marx is setting up a similar argument in Volume 1 of Capital.7 While it is true that Marx has a theory of price (the only actually coherent theory of price in all of economics) he does not (as we discussed in the previous chapter) claim a direct and exclusive determining link between the private labor that goes into an individual commodity and its market price. Furthermore, the point of his intrinsic value argument is not to get to the bottom of the question “What determines price?” Rather, his point is to answer the question “What is exchange-value an expression of?” or “As what do commodities exchange?”8 This immediately makes his claim much broader, encompassing a whole series of questions about the unique characteristics of labor under capitalism. The focus of the theory moves away from the narrow technical view of bourgeois price theory (which conveniently assumes capitalist social relations in an uncritical way) to a broad social view that calls into question the supposed universality of capitalist social relations.
As Andrew Kliman argues9, many writers, Marxists among them, take ‘value’ to mean ‘power of exchangeability’. In other words they think that Marx is asking, “What makes things exchangeable?” and answering with, “They are exchangeable because they are products of labor.” But objects don’t need any common, intrinsic property in order to be exchanged. Rather, Marx is asking “As what do commodities exchange?”10 They exchange as values. But what is this value, then, if not the power of exchangeability? Value is the social bond between producers in a society where producers only confront each other indirectly through the interaction of commodities. Some examples will help to clarify this argument.
Let us consider two persons meeting by chance on the Appalachian trail. They both have some possessions that they have acquired by accident, objects they have found on the trail. When they meet they decide to exchange objects, say an apple for a pencil. These objects have an exchange value for this moment in time. But it is not true that this points to any underlying value because we have abstracted away all of the social relations necessary for value. As our two hikers continue on the trail they could encounter others and decide to trade again. Now 1 apple could equal 4 pencils and the one pencil could equal 2 shoes. The exchange-values are not conditioned by any social process other than the fleeting agreement between two isolated individuals acting on the basis of immediate need and accidental endowments. (This is, of course, the very sort of theoretical abstraction that bourgeois theory likes to base itself on.)
Next consider a pre-capitalist community producing its own means of subsistence. Within the community the products of labor do not take on value relations with each other because there is no exchange of products among individuals. However the community does produce a surplus product which is traded with other similar communities. Thus, between communities the products of labor have exchange-values. To the extent that exchanges between communities become regular then these products also have intrinsic value, to a degree.11 One could make the mistake of thinking that ‘to the extent that exchanges become regular’ means ‘to the extent which value determines an equilibrium price’. But this is not a necessary qualification for primitive value relations in such a society. And we have already seen that even in a capitalist society value does not determine individual prices!
With the bulk of production happening for subsistence labor is not completely at the beck and call of value relations. It is quite hard for value to apportion and discipline labor when productive units are whole communities which can produce for subsistence without complete dependence on the market. While exchange-value between communities implies an indirect social bond between producers, this is a weak bond. Value is not an autonomous force in society yet.
Such a society does give rise to money. Money springs from the interstices between communities. And this money is an embodiment of abstract wealth. But because production is not predominantly production for exchange, money is not the goal of production. Money and value do not come into their own until the development of capitalism.12
Finally we turn to capitalist society where the producers are deprived of their own means of subsistence. They must buy their subsistence in the market. In order to do so they must sell their labor to a capitalist who then sells the products of their labor in the market. Here all products of labor come to the market and find their exchange-values. These exchange-values are measured in the relation of all commodities to money. Through their relation with money all commodities express their common substance, social labor, through their common bond, value. Value is the social bond between indirectly social labor. It is also the mechanism by which society unconsciously regulates this labor. Because this disciplining and apportioning takes place unconsciously through the blind forces of price signals it takes the form of an economic law, the law of value. And because the social power of this law comes from the hands of the laborers who are its subject, value is also alienation. Value, the substance expressed in exchange-value, is social bond, mechanism, law and alienated power. Thus, coming back to the purpose of these three examples, Marx’s theory of intrinsic value encompasses a much wider picture of social relations than the simplistic notion of ‘power of exchangeability’ or ‘determinant of price’.
A further point should be make regarding the notion of ‘indirectly social’. In equilibrium theory labor is, by default, directly social. In equilibrium supply equals demand which means that exact ratios and levels of productivity already exist and continue to exist. There is no need for value relations between producers because there is no need for value to act as a mechanism for apportioning and disciplining labor. In equilibrium input and output prices are artificially constrained to be the same.13 This means that there can be no change in value relations. Furthermore, when one calculates values with the restraint that inputs must equal outputs one arrives at a situation where there can be no temporal feedback between production periods. Producers already know their precise social relation to total social production. This is the opposite of Marx’s idea that it is the uncertain social relation between production periods that makes labor indirectly social.14
Once Marx establishes that intrinsic value is what lies behind exchange-value and that labor time is the substance of value he then must ask about the character of this labor. Specific labors (apple picking, pencil making, etc.), or ‘concrete labor’ to use Marx’s term, are heterogenous. Each concrete labor process produces a particular use-value. Just as use-value can’t be reduced to a common substance neither can concrete labor. But value is a common substance. It is labor in general, labor abstracted from all of its concrete qualities. Thus Marx argues that capitalist labor is both concrete and abstract at the same time. It produces specific use-values through specific concrete labor processes but it also produces value, abstract social wealth. Just as value does not refer to any specific use-value, but to abstract social wealth in general, abstract labor, which forms the substance of value, is indifferent to the particular concrete labors of workers. It is the most general character of labor, abstracting away all particularities. We will discuss the topic of Abstract Labor more in chapter X, but for present purposes we should at least note that abstract labor is not the result of a conscious mental process of abstraction. Rather, it is a real abstraction made by the structure of capitalist production itself. This real abstraction produces the mental abstraction we call ‘labor in general’. 15 How does this happen? How are concrete, heterogenous labors simultaneously rendered abstract? To answer this Max must develop his concept of money. First, however we must look at some of the key features of this notion of abstract labor and how they require a temporal, non-equilibrium interpretation of Marx to have any validity.
A key result of the distinction between concrete and abstract labor, and the corresponding distinction between use-value and exchange-value, is the observation that changes in productivity do not necessarily change the total value produced by society. If society produces 60 pencils an hour then each pencil is worth 1 minute of labor and 60 pencils represent an hour of social labor. If society gets a new machine that makes concrete labor more productive so that society can make more use-values per hour, say 100 pencils an hour, this does not mean that we have produced more value in an hour. 1 hour is still 1 hour. The value output remains the same while the use-value output increases. The unit price per pencil falls to 36 seconds a pencil because 1 hour is being divided by 100 pencils instead of 60.16 Thus there is a difference between physical productivity and value productivity, a difference that corresponds to the dual character of labor (that it is both concrete and abstract.) Concrete labor produces a certain quantity of use-values depending on how productive labor is. At the same time, this concrete labor always produces one hour of abstract labor for ever hour it works.17 While capitalism races to increase the physical productivity of concrete labor it cannot do the same to abstract labor as abstract labor is measured in time. An hour is always an hour. Human labor time is still the ultimate limiting factor of political economy. As we will see in the chapter on Socially Necessary Labor Time and in the chapter on the Tendency of the Rate of Profit to Fall, this is one of the most crucial and unique aspects of Marx’s theory of value as it accounts for the dynamism and destructiveness of capitalist production.
It is a distinction completely absent from the equilibrium position. In equilibrium, when output prices and input prices are constrained to equal each other, the prices of commodities are completely determined by the quantity of use-values produced and any reference to labor-time is pointless. For the equilibrium theorist a rise in productivity causes a rise in the total value produced and a rise in profits.18 This is the complete opposite of what Marx predicts! Once again the use of equilibrium methods is shown to be incompatible with Marx’s value theory.
Some of the most difficult pages in the first chapter of volume one of Capital are the sections on relative and equivalent forms of value. Readers often scratch their heads at the these highly abstract passages but Marx has method in his madness. He is preparing one of the most crucial insights of the opening chapters, one that links intrinsic value, abstract labor and a theory of money.
We started with the concept that intrinsic value is a property of commodities but that it can only be expressed in the physical body of the another commodity. If an apple is exchanged with a pencil then the use-value of the pencil becomes the expression of the value of the apple. The value of the apple is externalized, expressed outside of the apple’s physical body in the form of its equivalent, the pencil. Through a series of expanding examples Marx arrives at the situation where all commodities express their values through an exchange-value with gold, the money commodity. Here the body of the money commodity, the use-value of gold, becomes the body through which all commodities express their values. The antagonism within the commodity between use-value and value is externalized to become commodities and money. The value of the commodity achieves an independent form in money, the universal equivalent of all commodities.
By finally establishing the theoretical derivation of money as universal equivalent Marx is able to tie together all of the theoretical content of the proceeding arguments in Chapter One of Capital. Money, by expressing the value of all commodities, turns private labor into social labor. All labors relate themselves to the labor of the gold producer. Through gold all labors become social. It is only through this universal relation of all commodities to the money commodity that a common substance in all commodities, value, can manifest itself. By equating all labors to the concrete labor of the gold producer society abstracts away all of the concrete properties of human labor, reducing value to an abstraction of human labor in its universal form.
This gives money a central place in Marx’s theory. Money is the embodiment of abstract labor. It is value in general, labor-time in general. Returning to our discussion of the role of money in disciplining and apportioning labor we can see now how the function of money, as embodiment of abstract value, is so important to this concept. Commodities can be sold for a greater or lesser amount of money than the labor-time that went into their production (price can be higher or lower than value.) This is a transfer of value in exchange. This is the way the market rewards or punishes producers, apportioning and disciplining labor in the absence of a social plan. Without the concept of money as an embodiment of abstract labor this process makes no sense.19
However the equilibrium tradition leaves very little if any relevant role for money. It conceptualizes money merely as a ‘veil’ covering a world of perfectly arranged exchanges of use-values. Though many attempt to introduce money into their equilibrium models there is no necessity for money in an equilibrium model.20 If supply and demand are assumed from the beginning to be in balance, and prices are just a reflection of use-value proportions, then there is no need for anything that reapportions or disciplines productive resources. Money can be arbitrarily inserted into an equilibrium model but it is not necessary. For Marx, money is the cornerstone of capitalism. Not only is is the goal of capitalist production but it is also the mechanism of turning concrete labor into abstract labor and the mechanism of disciplining and apportioning labor.
Marx concludes the first chapter of Capital with his famous section on the fetishism of commodities which we have looked at in Chapter One of this book. In an important passage he asks where the fetish character of the commodity comes from. It does not come from the use-value of commodities since use-value and the concrete labor that produce it hold no mysteries, create no odd social inversions by themselves. But Marx also says that the fetish does not “proceed from the nature of the determining factors of value.”21 Such a statement can cause head-scratching if we are under the impression that the whole point of the opening chapter of Capital is to reveal the determining factors behind value! But Marx spends almost no time in Capital establishing the idea that labor-time is the substance of value. Instead he is concerned with the type of society that creates such value.
He continues, “Whence, then, arises the enigmatic character of the product of labor, as soon as it assumes the form of commodities? Clearly from this form itself.”22 It is the form of organization of society, in which producers only form social relations with each other through the value relations between their products, that results in the fetish. The fetish is the objective conception of the world corresponding to a specific objective organization of society, our society. This organization of society contains all of the inter-related categories that Marx has just enumerated: intrinsic value expressed in exchange-value which takes the form of all commodities equating themselves to money, the universal equivalent, and the corresponding process of abstraction where concrete labors also become abstract because they are all related to the labor gold producers.23
Of course, in equilibrium there can be no fetishism of commodities because equilibrium does not require any of the constituent aspects of capitalist social relations that obscure the social nature of production. In equilibrium there is no role for money and all producers magically know the social worth of their products. Labor is not indirectly social and there is no fetish.
The complex inter-relations between intrinsic value, money, abstract labor, fetishism and all of the other categories that Marx introduces in the opening chapters of Capital are not easy to summarize in a few short pages. It is hoped that readers new to this material pick up Capital and work their way through the pages with care. Rather than being a mere summary of Marx’s ‘opening moves’ this chapter has sought to bring out what is most distinctive and crucial in Marx’s value theory and why it is imperative to abandon any use of the tools of bourgeois theory when reading Marx. For far too long it has been common practice to read Marx’s explanation of these opening categories through the lenses and with the tools of bourgeois theory. This has lead to numerous theoretical quagmires and caused many to abandon key elements of Marx’s theoretical project.
Not only is the equilibrium tradition wholly incompatible with Marx but it also is wholly incapable to explaining any of the social phenomena that Marx’s value theory captures. Equilibrium theory cannot explain the necessity of money. It cannot explain motion in economies. It cannot explain the disciplining and apportioning of labor. It cannot explain what it means for commodities to have values (the question “as what do commodities exchange?”). Since capitalism has never been in equilibrium and never will be in equilibrium, since it cannot even be said to fluctuate/orbit around an equilibrium point, we are left wondering why the tools of general equilibrium have remained so central to the economic profession for so long. But this chapter is not the place to examine the degeneration of the dismal ‘science’. Rather, this chapter is the place to assert the importance of Marx’s value theory, the only theory of capitalism which identifies the historically specific qualities of the system and thus makes it clear that capitalist is not an eternal system and that humanity is not required, by nature, to endure the continual violence, destruction and dehumanization of this system.
1When I use the term “temporal” or “non-equilibrium” I am referring to the body of Marxist theory known as the “Temporal Single System Interpretation” or “TSSI”.
2Many of these arguments regarding the importance of temporal, non-equilibrium interpretations of Marx as well as the theoretical problems of the equilibrium method are influenced by the work of Alan Freeman. The particular arguments in this chapter about the relevance of these ideas to the opening arguments in Capital are mine.
3For the absurd presuppositions of marginal utility theory see Simon Clarke’s “Marx, Marginalism and Modern Sociology”. For the logical circularity of marginalism see Bukharin’s “Economic Theory of the Leisure Class”. For the unrealistic and absurdist restrictions necessary for support marginalism’s price theory see Steve Keen’s “Debunking Economics.” As a critique of marginalism is not the goal of this chapter I will not waste space beating a dead dog.
4As Mark Blaug points out, “Since General Equilibrium has no empirical content, it is difficult to justify the very term theory, and its most prominent defenders have indeed been careful to label it a framework or paradigm.” Blaug “Methodology of Economics” p.161. The point is important: equilibrium analysis is a set of tools more than it is a theory. However, all tools have built in assumptions which can effect the outcome of their use. As many TSSI scholars have shown, the use of equilibrium analysis, even by self-described Marxists, results in ideas diametrically opposed to those of Marx.
5The direct link between Walrasian equilibrium (where input and output prices must be equal) and physicalism (the determination of value or exchange-value solely by the use-value structure of the economy) and Say’s Law (the dogma that every purchase is a sale and that supply and demand balance) is one of the important lessons drawn by the TSSI school. These universal inter-relation of these aspects of equilibrium is demonstrated quite convincingly by Alan Freeman in “The Limits to Ricardian Value: Law, Motion and Contingency in Economics”.
6One can only assume that the great hostility of many so-called ‘Marxist’ thinkers to the TSSI is a result of the fact that the TSSI has rendered all of their obfuscations and work-arounds irrelevant. This would certainly explain the common unwillingness among many ‘Marxists’ to directly engage with the TSSI. See for example the recent “Elgar Companion to Marxist Economics” edited by Fine and Saad-Filho which systematically omits any mention of the TSSI.
7For instance, Bohm-Bawerk states, in a paragraph that quotes fragments of Marx’s Capital out of context, “It states, and must state, after what has gone before, that commodities are exchanged in proportion to the socially necessary working time incorporated in them. Other modes of expressing the same law are that ‘commodities exchange according to their values,’ or that ‘equivalent exchanges with equivalent’.”Karl Marx and the Close of His System. p.12
8Andrew Kliman makes this interpretive point quite convincingly in his paper “Marx’s Concept of Intrinsic Value”.
11Clearly Marx thought that the categories of his theory of capitalism (intrinsic value, abstract labor, etc.) come into their own in capitalist society. But that does not mean that they didn’t exist, in less-developed states, in pre-capitalist society. “Human anatomy contains a key to the anatomy of the ape. The intimations of higher development among the subordinate animal species, however, can be understood only after the higher development is already known. The bourgeois economy thus supplies the key to the ancient, etc. But not at all in the manner of those economists who smudge over all historical differences and see bourgeois relations in all forms of society. One can understand tribute, tithe, etc., if one is acquainted with ground rent. But one must not identify them. Further, since bourgeois society is itself only a contradictory form of development, relations derived from earlier forms will often be found within it only in an entirely stunted form, or even travestied.” Marx, Grundrisse p.105 However the degree to which these categories may have had real meaning in pre-capitalist societies depends on the degree to which directly social production relations were replaced by indirectly social relations. “The less social power the medium of exchange possesses (and at this stage it is still closelybound to the nature of the direct product of labour and the direct needs of the partners in exchange) thegreater must be the power of the community which binds the individuals together, the patriarchalrelation, the community of antiquity, feudalism and the guild system.” Marx, Grundrisse p.157 Therefore, when I say “to a degree” regarding the existence of intrinsic value in exchange between self-sufficient communally producing communities I mean that this category becomes ‘real’, has potency, only in a limited way, only so far as decisions about production are conditioned by exchange-values.
12See Marx in the Introduction to the Grundrisse, p. 101-104
13This is standard for all equilibrium models and a major cause of criticism from TSSI thinkers. In equilibrium the value of a commodity, a quantity of steel for example, when it enters production is the same as the value of steel at the end of production. There can be no change in the value of commodities. In practice this means that inputs are often revalued to match output prices, or that a coefficient is applied so that: (input x Y)+labor=(output x Y). Y is the “value” which allows the physical quantities of inputs and outputs to equal each other. This constraint leads to all values being determined by the use-value structure of the economy. We find value algebraically given then quantity of inputs, outputs and the wage (which, in a multi-sectoral model is just a quantity of subsistence goods.) Value as an independent category becomes redundant.
14As noted previously, some Marxist writers attempt to side-step such problems by treating value as a center of gravity around which prices fluctuate. For a critique of this approach see Alan Freeman’s “An Invasive Metaphor: The Concept of Centre of Gravity in Economics.”
15In the introduction to the Grundrisse Marx argues forcefully that mental conceptions of the world spring from the specific material-social organization of the world. The appearance of the concept of “labor in general” in human society is one example he gives of this. “Indifference towards any specific kind of labor presupposes a very developed totality of real kinds of labor, of which no single one is any longer predominant.” “…the abstraction of labor as such is not merely the mental product of a concrete totality of labors. Indifference towards specific labors corresponds to a form of society in which individuals can with ease transfer from one labor to another, and where the specific kind is a matter of chance for them, hence of indifference.” p.104
16In this example value is being measured in labor-time. In reality we would measure value in money. In order to move theoretically to this next step we merely need to specific the ‘monetary expression of labor time’ (MELT) which is the amount of labor-time reflected by a given unit of money. If MELT was 10 dollar=1 hour of labor time, then in the above examples the pencil is first worth 16 cents and then worth 10 cents.
17“As productivity is an attribute of labor in its concrete useful form, it naturally ceases to have any bearing on that labour as soon as we abstract from its concrete useful forms. The same labor, therefore, performed for the same length of time, always yields the same amount of value, independently of any variations in productivity.” Marx, Capital vol. 1 p. 137
18See Freeman “Limits of Ricardian Value” p. 19
19At the same time we must avoid the idea that labor becomes abstract only in exchange, after production, when commodities are exchanged for money. Labor is abstract in production. Commodities have a price before they enter the market. It is the role of money in the reproduction process of capitalism that makes abstract labor possible. There are also a host of other social preconditions that are required in order for abstract labor to exist (wage-labor being the most crucial.) These aspects of abstract labor and others will be explored in the chapter on abstract labor.
20In Walras’s original theory of General Equilibrium there is nothing that serves the function of money in any meaningful sense. Rather one commodity is chosen at random to be numéraire. This numéraire is merely the an accounting unit for the mathematician to use for establishing some unit of value to measure all of the commodities in their equations. But the numéraire does not actually exchange with all other commodities, nor does it serve as an embodiment of value that allows for the punishing and rewarding of producers. It is therefore not money in any meaningful sense.
21Capital vol. 1. p.164
23Nicole Pepperell puts it this way: “What does it mean to say that the ‘form’ of the commodity explains its fetish character, while also insisting that the component parts within that form, taken by themselves, do not? What Marx is trying to express, I suggest, is that the fetish character of the commodity is an emergent phenomenon. He is arguing that the component parts of the commodity are currently arrayed in an overarching assemblage that generates a distinctive effect – the fetish character of the commodity – that would not be produced by any of those parts, taken in isolation or assembled into other wholes.” Pepperell, “Disassembling Capital” p.99