The Creation of Value by Living Labour Vol.2
A Normative and Empirical Study
The book draws on Professor Cheng Enfu’s “New Four Theory” on value, wealth, and distribution, among which the “new living labor value theory” is particularly creative. The theory precisely follows Marx’s train of thought in his analysis of material production, and extends it to all social and economic sectors.
The book draws on Professor Cheng Enfu’s “New Four Theory” on value, wealth, and distribution, among which the “new living labor value theory” is particularly creative. Its basic idea is as follows. According to Marx, all labor that directly produces physical and mental or cultural goods for exchange in the markets, or direct services for the production and reproduction of labor goods, including internal management labor and scientific and technical labor, falls in the category of value-creating labor or labor of production. The theory precisely follows Marx’s train of thought in his analysis of material production, and extends it to all social and economic sectors.
A second obstacle to understanding the specific role of labor in emergent labor-intensive technologies is the exclusive focus of neoclassical economics on private production. The underlying assumption is that of an ideal system of production conducted by entirely distinct legal entities, each producing only for the market and interacting with others only through the market.
But the results of mental productive activities such as scientific labor, creative labor, and even management, increasingly take the form a general acquisition for society, which is therefore inherently social. Marx referred to this as “general social labor.” Private labor, within an enterprise, draws both on this general social labor and on the inputs that it acquires through the market. The same also applies to much cultural labor, which forms part of the process through which labor power itself is reproduced, not least shaping its productive powers. The most obvious example of this is education, which even neoclassicals have to recognize, up to a point, as a “public good.”
China’s economy involves a combination of ownership forms – public, private, and co-operative. Moreover, these ownership forms, under the definite and distinct conditions of Chinese society, are not necessarily the same as their formally identical equivalents in Western society, in exactly the same way that land ownership in 18th-century England, though formally the same as that prevailing in the French ancien régime of the same date, had already assumed capitalist characteristics far removed from those swept away in the revolution of 1789.
Even completely private capital operates under significantly greater and even qualitatively different public constraints in China than those found in fully capitalist economies, and is able to call on public resources that are not found in the same form. It is of course true that public constraints and resources exist in all societies, even those that proudly proclaim their capitalist character. However much neoclassical economics ignores this fact, and speaks as if all production were as private as the monads of Leibnitz. As a result, it has to deploy elaborate circumlocutions to deny the obvious fact that government, education, health, caregiving, and countless other public activities not only contribute to the value and wealth of society, but form an indispensable mental infrastructure without which private production could not even take place, any more than it could subsist without air, water, or sunshine. Western theory does not even grant government, let alone the public realm, the status of a factor of production. No wonder it cannot account for China’s growth.
Chapter 1 Introduction: A landmark encounter
The position of Marx within debates on the theory of value
The concept of theoretical counter-revolution
Marxism Marxism without Marx: The two-system fallacy
The militant emancipation of economics
Material foundations of theoretical counter-revolution
Eastern and Western Marx scholarship: a new phase and a research agenda
Chapter 2 Implications and methods of studying value transformation
Arguments concerning transformation
Implications of studying value transformation Structure of Book II
Chapter 3 Theoretical foundations and research methods
Theoretical foundations of the study of value transformation
The nature of value transformation
Mathematical calculation in value transformation
Chapter 4 A model for studying transformation Some assumptions The static transformation model
The dynamic transformation model
Chapter 5 Classical solutions to the transformation problem
The Winternitz solution
Meek’s solutions A and B
Makoto Itoh’s view of the transformation problem
Chapter 6 The Seton and Morishima models
The Seton model
The Morishima model
Morishima’s solutions to the transformation problem
Chapter 7 Price behavior and transformation
Samuelson’s ‘reverse transformation’
Analysis of Sraffa’s solution: Meek and Steedman
Nobuo Okishio’s dynamic transformation analysis Conclusion
Chapter 8 New developments in the study of transformation
The Shaikh solution
Balanced growth and the invariant equations
The WCR Model
The TSS school and transformation theory
A breath of fresh air from China, this fascinating book lifts a veil from the influence of Marxist thinking in China’s economic successes. It shows how debates initiated by Marxists lie at the forefront of a blend of policies whose striking achievements have little to do with Western economic orthodoxy. A major contribution to Marxist theory and a highly practical work, it confronts the complexity and uniqueness of China’s economic miracle by developing Marxism in exciting and innovative ways. Offering Western readers an unparalleled introduction to the dynamism and breadth of Chinese Marxist thinking, it extends the boundaries of political economy in creative and productive directions of world-wide importance.
—Alan Freeman, Geopolitical Economy Research Group, University of Manitoba
Prof. Cheng Enfu’s “Shanghai School” of Marxist economics has brought together a group of Chinese scholars, whose work has unusual depth and breadth. Starting from classical Marxist foundations, with the theory of value at its center, they have studied both early and present-day sources, both Marxist and non-Marxist, from both China and around the world. The book uses qualitative analysis and quantitative methods, in theoretical and empirical applications. But this work is not just exposition and development of theory. The authors also apply their concept of value creation, derived from Marx but by no means rigidly confined to his ideas, to vital matters of policy, especially relevant to today’s China and to the current explosion of high-tech services, managerial and cultural labor. Anyone interested in the Marxist political economy tradition, or in the present-day world and China’s place in it, cannot afford to miss this volume.
—David Laibman, Professor Emeritus, Economics, City University of New York Editor, Science & Society
This book is certainly a landmark, a mile-stone in the research of Marxist Labor theory! Expounds on the essence of Marx’s “theory of value” and its contemporary form Professor Cheng Enfu et.al. have not only explored the existing huge continent, but demonstrated an innovative approach.
—Jean Claude Delaunay, Paris-East University
The book demonstrates that the labour that produces material and spiritual goods directly for the purpose of market exchange and that directly serves the production and reproduction of labour commodities, including the management labor and scientific and technical labor, are all value-creating or productive labor. The authors of this book have long studied and explored the development of Marx’s labor theory of value and have put forward a new point of view. It is different from the view that only material production creates new values for commodities. The book is scientifically innovative and worth studying.
—Wang Zhiwei, Professor of Beijing University, Consultant of the Chinese and Foreign Economic Studies Association
Publication date: 2019
Page extent: 260
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