Labor theory of value
- This theory, elaborated by classical economists, most notably David Ricardo in 1817, who had preceded Karl Marx, is the starting point for Marx’s own theory of surplus value or exploitation. According to the labor theory of value the value of any object (or to be more precise any commodity) is to be measured in terms of the amount of labor embodied in it. In other words, the value of a commodity is determined by the labor time required to produce it. So if it takes one day to produce a chair and two days to produce a table, then the value of the table is twice that of the chair. Different people will take different amounts of time to make a given commodity, so the labor theory of value takes an average, the “socially necessary labor time.” The value of any given commodity is based on the socially necessary labor time to produce it, that is, the time required to produce the commodity under average conditions of production, with average degree of skill and intensity of labor.
Historical dictionary of Marxism. David Walker and Daniel Gray . 2014.
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