The new value controversy

For Marxists, the present controversies are rooted in Marx's own development and exposition of the labor theory of value, especially its presentation in Volumes I (Marx, 1954 [1867]) and III ofCapital. As is well known, in Volume I, Marx begins with his analysis of commodities, emphasizing the role of human labor in both its concrete and abstract aspects, and from that he develops (1) the concepts of (exchange) value, of socially necessary labor time, and of its expression in the form of money and the distinction between value and price; (2) the concepts of capital and of surplus value; and (3) the concept of the commodity labor power. With these concepts, his analysis of capitalist production lays bare the nature of capitalist exploitation and links the phenomenon of profit to surplus value (i.e., the unpaid labor time of productive workers). In Parts I and II of Volume III, Marx, explicitly allowing for the interplay of many different capitals, endeavors to show how surplus value is converted into profit, how the rate of surplus value is converted into the rate of profit, how the general rate of profit is formed, and how the values of commodities are transformed into prices of production. He claimed that the transformation preserved the following equalities: total value=total prices; total surplus value=total profits; and, the rate of profit=the rate of surplus value. Marx's presentation of this material in Volume III is, unfortunately, quite rough, since this material is comprised of manuscripts that he had prepared prior to the publication of Volume I in 1867. These manuscripts were not, however, in a final, finished state, and unfortunately Marx never got around to getting them ready for publication.