[OPE-L:5495] Re: Counteracting factors

[charlie <charles1848@xxxxxxxxx>]

It seems that Jerry and I agree on the major points discussed,
and I think this discussion is an example for the claim that
Marx's theory of value both 1) recognizes particular economic
realities and 2) achieves a summary view of value (abstract labor
encased in commodities) and the economy-wide conservation laws
that it reveals.


Jerry cites the absence of economic rationality and perfect
information as workers spend their wages. In general and from my
own experience, I agree that these are hard things to achieve!

We can circumscribe a certain economic space for irrational and
uninformed spending. On one hand, it takes time and effort to be
a rational spender, and so we give in to irrational marketing for
lack of time to do otherwise. On the other hand, there is a limit
to the deprivations people can stand as a result of wasting
money.

In a way, such ever-present but limited waste is similar to the
circumscribed economic space for the sales effort. On one hand,
some capital devoted to marketing brings in revenue. On the other
hand, the need to recover marketing costs in the price of the
product limits the sales effort, both because, as Jerry has
noted, demand curves have elastic and inelastic sections, and
also because competing capitals can sell by offering lower prices
with less marketing (Ray-O-Vac vs. Energizer batteries, for
example). The sales effort as a percentage of all economic
activity is positive but below a ceiling. Looking at statistics
for the U.S., I estimated the sales effort to be approximately
one-fourth of the economy (From Capitalism to Equality, p. 214).

Charles Andrews
Web site for my book is at http://www.LaborRepublic.org