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Keen 2018 Masters Lecture 02 Value Theory For Understanding Capitalism

Summary:
Marx's dialectical philosophy leads to a theory of value that (a) is consistent with the Laws of Thermodynamics; (b) contradicts the Labour Theory of Value; (c) provides a structured means to acknowledge that in the co

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Marx's dialectical philosophy leads to a theory of value that (a) is consistent with the Laws of Thermodynamics; (b) contradicts the Labour Theory of Value; (c) provides a structured means to acknowledge that in the co Keen 2018 Masters Lecture 02 Value Theory For Understanding Capitalism
Steve Keen
Steve Keen (born 28 March 1953) is an Australian-born, British-based economist and author. He considers himself a post-Keynesian, criticising neoclassical economics as inconsistent, unscientific and empirically unsupported. The major influences on Keen's thinking about economics include John Maynard Keynes, Karl Marx, Hyman Minsky, Piero Sraffa, Augusto Graziani, Joseph Alois Schumpeter, Thorstein Veblen, and François Quesnay.

13 comments

  1. The Marx nobody knows

  2. Illmar Daniel Nemchenko

    Seems like description is not full.

  3. This is a really fantastic lecture, and has answered a lot of questions I have had about how Marx applied dialectical thinking to commodities (it also cleared up my conception of the dialectical method). Fantastic to see someone really take a dive into what Marx believed philosophically and how it can be understood in his political economy. Thank you so much for the upload, I was getting really into investigating this stuff recently.

  4. Good to see you again Dr. Keen!

  5. was tough going, but thanks prof

  6. save place

  7. 1:00:00
    1:01:00 – book titled The Theory of the Leisure Class by Thorstein Veblen : Kindle http://moglen.law.columbia.edu/LCS/theoryleisureclass.pdf
    _________ https://oll.libertyfund.org/titles/veblen-the-theory-of-the-leisure-class-an-economic-study-of-institutions
    Thorstein Bunde Veblen
    https://en.wikipedia.org/wiki/Thorstein_Veblen
    1:01:53 – Student comment Dubai an interesting society : Ostentatious and very feudal
    1:02:05 – Student comment use value of water in the desert & cost of production of water in the desert
    1:03:19 – Is the debate describing a Production & reproduction political economy or an island, utility-making society?
    1:03:35 – The Dialectic of the Commodity Marx's vision of the commodity in capitalism (capital production-ism)
    1:03:50 – Before 1857 view of commodity the same for Smith & Ricardo & Marx = Exchange value only
    1:04:07 – After Marx reads Hegel again Marx observes Exchange Value & Use Value
    1:04:24 – How did we evolve this distinction between Exchange Value & Use value ?
    1:04:501:05:091:05:15 – Property-in-common
    1:05:29 – Book titled THE CLAN of the CAVE BEAR
    1:07:05 – Marx describes villagers living on the common boundary of land between them
    1:08:13 – From that moment the distinction between
    _________ The Utility an object for the purposes of Consumption
    _________ The Utility of an object for the purposes of Exchange
    1:08:19 – Its Consumption (or Use) value becomes distinguished from its Exchange value (Marx1867: 91)
    .
    1:09:08 – Louis Pierre Althusser ( 1918 – 1990 ) French Marxist philosopher.
    Born in Algeria and studied at the École normale supérieure in Paris & became Professor of Philosophy.
    Althusser's life was marked by periods of intense mental illness.
    In 1980, he killed his wife, the sociologist Hélène Rytmann, by strangling her.
    He was declared unfit to stand trial due to insanity and committed to a psychiatric hospital for three years.
    He did little further academic work, dying in 1990 — Wikipedia
    .
    1:09:30 – If told to ignore Chapter 1 through 8 of Capital by Marx, then you miss the struggle of logic
    1:09:37 – Marx didn't skip the first 8 chapters of THE CAPITAL
    1:09:44 – Marx retrained to the issue asking, Where did surplus come from ?
    1:10:13 – The Demise of the Labour Theory of Value (Which Marxist Economists Also Skipped)
    1:11:06 – Student asks is this abstract & concrete labour?
    1:11:28 – "We are, therefore, forced to the conclusion that the change results in the Use-value,
    _________ as such, of the commodity, i.e. , its consumption
    (see potato famine)
    1:12:07
    1:12:51 – Marx said: Therefore the value of labour power and the value it creates are two entirely different magnitudes
    1:13:14
    1:14:04
    1:14:39 – One Marxist economist who was not well read was Paul Marlor Sweezy ( 1910 – 2004 )
    _________ who became an instructor at Harvard in 1938 https://en.wikipedia.org/wiki/Paul_Sweezy
    1:14:46 – The actual words written by K Marx are different than as remembered by Sweezy
    1:14:49 – Roman Osipovich Rosdolsky ( 1898 – 1967 ) Important Ukrainian Marxian scholar & political revolutionary
    1:15:40
    1:15:48
    1:16:06
    1:17:17 – Understanding Marx on use-value requires one large conceptual leap :
    _________ In the M—-C—M+ circuit , USE VALUE IS QUANTITATIVE
    1:18:18
    1:18:45
    1:19:04 – Both Exchange-value & are magnitudes
    1:19:36
    1:19:52 – Exchange Value & Use Value , being intrinsically incommensurable magnitudes  
    .
    4th 20 minute break & stand (see Khan Academy length of human attention)
    . approx : Sat , 05 , Sep , 2020

  8. 20:04 – Cobb-Douglas
    21:03
    23:12
    23:38
    24:24 – Marx : Oops !
    25:03 – Labor Theory of Value & Dialectics
    25:25 – There is something to consider about Marx
    25:52
    27:03https://en.wikipedia.org/wiki/Johann_Gottlieb_Fichte
    _______ In philosophy, the triad of thesis, antithesis, synthesis (German: These, Antithese, Synthese; originally: Thesis, Antithesis, Synthesis) is a progression of three ideas or propositions.

    The first idea, the thesis, is a formal statement illustrating a point; it is followed by the second idea,
    the antithesis, that contradicts or negates the first; and lastly, the third idea, the synthesis,
    resolves the conflict between the thesis and antithesis.
    It is often used to explain the dialectical method of German philosopher 
    Georg Wilhelm Friedrich Hegel, but Hegel never used the terms himself; 
    instead his triad was concrete, abstract, absolute.
    The thesis, antithesis, synthesis triad actually originated with Johann Fichte — Wikipedia
    27:45
    28:40
    28:54
    29:20
    29:35 – Marx and Contradiction by Lawrence Wilde (Avebury series in philosophy)
    29:39 – In philosophy, the triad of thesis, antithesis, synthesis
    _______ (German: These, Antithese, Synthese; originally: Thesis, Antithesis, Synthesis) is a progression of three ideas or propositions.
    The first idea, the thesis, is a formal statement illustrating a point; it is followed by the second idea, the antithesis, that contradicts or negates the first; and lastly, the third idea, the synthesis, resolves the conflict between the thesis and antithesis.
    It is often used to explain the dialectical method of German philosopher Georg Wilhelm Friedrich Hegel,[3] but Hegel never used the terms himself; instead his triad was concrete, abstract, absolute.
    The thesis, antithesis, synthesis triad actually originated with Johann Fichte
    .
    29:55 – Diagrammatically Foreground in Tension Background
    30:17
    31:25https://www.marxists.org/archive/marx/works/1844/manuscripts/preface.htm
    Economic & Philosophical Manuscripts Written: Between April and August 1844; 1st Pub: 1932; Source: Marx. Economic & Philosophic Manuscripts of 1844;
    Progress Publishers, Moscow 1959; Translated: by Martin Milligan;
    https://www.marxists.org/archive/marx/works/download/pdf/Economic-Philosophic-Manuscripts-1844.pdf
    32:13
    32:32 – Something that would add value to economics if this would happen today
    33:14
    36:59 – The Punchline
    37:40

    2nd 20 minute break & stand (see Khan Academy length of human attention)

    43:56
    46:04 – The demise of the classical labour theory of value
    48:00 – Edward Lawrence Wheelwright was a notable Australian economist, radio host and anti-war activist who taught at the University of Sydney from 1952 until 1986 https://en.wikipedia.org/wiki/Edward_Lawrence_Wheelwright
    50:3452:2255:34
    57:20
    58:37 – Imperial Back Scratcher 59:25 – Feudal society values Use
    59:52https://www.poundshop.com https://www.poundland.co.uk https://www.selectfashion.co.uk/1-and-under/
    .
    https://www.onlinepoundstore.co.uk https://www.one-below.co.uk https://www.poundstretcher.co.uk

    3rd 20 minute break & stand (see Khan Academy length of human attention)

  9. Sharing is caring https://tinyurl.com/yy4h9jbj or https://www.youtube.com/watch?v=t6CvqSQkvGg
    00:00
    01:00
    01:33 – Value Theory Discussion
    01:35 – Philosophical discussion of Value Theory
    01:40 – Recap
    ___ 02:00 – TO MODEL IS NOT TO REDUCE
    02:05 – Economics must be constant with thermodynamics
    02:25
    02:36 – 
    02:40 – This Lecture : Overview of conventional "Labour theory of value" version of Marx
    _______ clash of this conventional theory with energy-aware production function
    02:44 – 
    https://www.c-span.org/video/?475648-1/the-big-count-story-us-census
    Reel America The Big Count – The Story of the U.S. Census
    This National Educational Television broadcast from 1960 details the results of the 1950 U.S. Census.
    Host George Stone and acting director of the 1950 Census Phillip Hauser,
    also a University of Chicago professor, discussed statistics beyond population including housing, the mobility of the American people, education levels, and the general improvement in living standards since the Great Depression of the 1930s. This program was recorded at WTTW Chicago.
    0 : 21 : 01 –
    Phillip Hauser : But our high level of education & increasing level of education of the American people is in large measure a reflection of the general high economic level of living & high productivity .

    Phillip Hauser : And let’s take a look .

    Phillip Hauser : Perhaps , the major factor responsible for this tremendous increase in per capita production & our level of living.

    Phillip Hauser : I refer to

    Phillip Hauser : Sources of Energy Used for Production of Goods & Services

    Phillip Hauser : Notice that in 1850 , over 50 % of all the sources of energy were ANIMAL .

    Phillip Hauser : And another 13 % were human beings .

    Phillip Hauser : Only one-third of energy used for goods & services was mechanical in 1850.

    Phillip Hauser : But a century later , by 1950 , almost 99 % of all our energy used was mechanical . And infinitesimally small percentages human . Animal had virtually disappeared .

    Host George Stone : That explains why it's such an event when we see a horse these days , hum ?

    Phillip Hauser : This is also true .

    Phillip Hauser : And it explains the great difference in the level of living between , let us say , the average person in Asia & the average person in the United States .

    Phillip Hauser : Think of it this way : The average person in the United States has something in excess of 10,000 kilowatt hours of energy per capita per year working for him .

    Phillip Hauser : In Asia , this is less than 300 . A ratio of better than

    thirty-five to one .

    Phillip Hauser : That's what makes the American way of life .
    0 : 22 : 30 –
    Host George Stone : Yeah , that's a pretty startling comparison , actually : 10,000 to 300 . (Whislte)
    0 : 22 : 35 –
    Phillip Hauser : And our income continues to rise rapidly .

    Phillip Hauser : For example , since 1929 , "Donner income" has increased by 160 % .

    Phillip Hauser : And our income in constant dollars , that is , allowing for some inflation , by about 57 % .

    Phillip Hauser : 1929 , the average American family income was about $4,000 per year .

    Phillip Hauser : By 1957 it had risen to over $6,000 per year .
    .
    03:14 – Alternative Dialectical Interpretation that contradicts the conventional labour theory of value
    Keen Use , Value , & Exchange : The Misinterpretation of Marx
    http://gesd.free.fr/keen1990.pdf
    Use-Value , Exchange-Value , & The Demise of Marx's Labour Theory of Value by Steve Keen
    https://keenomics.s3.amazonaws.com/debtdeflation_media/papers/Jhet_use.PDF
    The Misinterpretation of Marx's Theory of Value by Steve Keen
    https://pdfs.semanticscholar.org/e4b3/d95e1f21d65370ce15fabce3fd05bb74e41d.pdf
    .

    03:45 – [ Today's Students of Marx dislike a mention of Dialectics ]
    03:46 – Dialectics & Economics
    03:55 – The way Karl structured his thinking about capitalism is what made him such a strong thinker
    04:1604:36
    04:52 – Neoclassical economists believe their model is constructed with reductionism & it is instead constructionism
    04:59
    05:26 – Instead of Aggregate , neoclassical economists extrapolated (Debunking Economics Chapter 3)
    05:59 – If you add together individual downward sloping demand curves , to you get a downward sloping demand curve ?
    06:15
    06:27 – If you're going to aggregate , then , by definition , the individual objects must differ in kind
    06:51 – The conclusion neoclassical economists reached was that IF
    .
    07:08 – Neoclassical economists assert all consumers & all goods consumed are EXACTLY the same
    07:13 – With some fudging
    07:17 – They called aggregation from micro to macro was actually extrapolation
    07:23
    07:38 – Extrapolation failed

    07:40 – More is different by P Anderson
    _______ https://www.tkm.kit.edu/downloads/TKM1_2011_more_is_different_PWA.pdf
    .
    http://robotics.cs.tamu.edu/dshell/cs689/papers/anderson72more_is_different.pdf
    .
    07:53 – Philip Anderson
    .
    https://www.semanticscholar.org/paper/More-is-different.-Anderson/8019560143abeb6145ed95aa04ad8ddf9898178d .
    .
    https://www.tkm.kit.edu/downloads/TKM1_2011_more_is_different_PWA.pdf .
    .
    https://science.sciencemag.org/content/177/4047/393 .
    .
    Book titled MORE AND DIFFERENT: NOTES FROM A THOUGHTFUL CURMUDGEON by PHILIP W ANDERSON
    HC – 1st Edition ISBN-13: 978-9814350129 ISBN-10: 9814350125 Named a Top Five Book of 2012 by Physics Today
    Kindle Edition
    .
    08:0508:32
    08:50 – Karl's Dialectic philosophy makes it possible to organize economics
    08:51 – Energy & the Labour Theory of Value
    09:00 – Karl began as a Dr of Philosophy
    09:02 – A Different Way To See What Karl Marx Thought
    09:38 – In 1844 evicted from Prussia to France
    09:53 – You got German Philosophy on My English Political Economy & on My French Political Theory !
    10:1010:1110:33
    10:47 – The Labor Theory of Value
    _______ Their ideas : Yuck & Marx will think his own
    10:50
    10:55 – Smith Cattle & Ricardo
    11:56
    12:12
    12:32
    13:00 – The greater the human share in a commodity , the greater the profit of dead capital
    13:14
    13:27 – The Anarchist named Pierre-Joseph Proudhon wrote 1846 book
    _______ The System of Economic Contradictions, or The Philosophy of Poverty
    13:44 – Karl Marx wrote 1847 book The Poverty of Philosophy (or Up Yours Pierre – LOL j/k)
    13:49 – Ricardo's Socialists preceded Karl & argued that if LABOR produces ALL the VALUE , then
    13:55
    14:10 – YEARS BEFORE Karl Marx , Ricardian Socialists asserted that if labour produces the VALUE,
    _______ then why give Capitalists a chamber pot ? 14:19
    Not Marxism but Ricardoism
    14:23 – Marx was critical of the tendency of CAPITALISM to COLLAPSE
    14:25
    14:57 – Karl solved several dilemmas of the CLASSICAL ECONOMIC analysis
    15:02 – First Dilemma : Where does profit come from IF all things exchange at their Value ("cost of production")?
    16:30
    16:51 – The UNIQUE characteristics of LABOUR : Labour differs from LABOUR-POWER
    18:00 – C = Constant Capital 18:25 – Marx then says one thing & contradicts what Marx says (Left Brain Marx vs. Right Brain Marx)
    18:30 – Many were critical
    18:37 – book titled MARX AFTER SAFFRA by Ian Steedman 1977 ISBN-13: 978-0860917472 ISBN-10: 0860917479
    _______ http://pinguet.free.fr/trpfwiki.pdf .
    18:58
    19:30 – How does LABOR THEORY of VALUE stack up against it ?

    1st 20 minute break & stand (see Khan Academy length of human attention)

  10. 1:20:17 – In the circuit C — M — C
    1:20:31 – In the circuit M — C — M+ Use-Value is quantitative & plays an essential economic role to explain source of surplus using dialectic of commodity as applied to labor-power 1:20:44

  11. 1:23:071:23:14 – Exchange-Value 1:23:22 – Use-Value 1:23:27 – 
    1:23:32 – Karl's logic contradicts Karl's previous Labor Theory of Value
    _________ because ALL Inputs to production are potential sources of Surplus
    1:23:401:24:041:24:18

  12. 1:24:30 – Good Bye THE RATE OF PROFIT TO FALL
    1:24:36 – Good Bye THE INEVITABILITY of SOCIAL-ism
    1:24:401:24:49 – 
    1:25:04 – What's the opposite of Capital ?

  13. e = productivity cubed
    https://www.c-span.org/video/?475648-1/the-big-count-story-us-census
    Reel America The Big Count – The Story of the U.S. Census
    This National Educational Television broadcast from 1960 details the results of the 1950 U.S. Census.
    Host George Stone and acting director of the 1950 Census Phillip Hauser,
    also a University of Chicago professor, discussed statistics beyond population including housing, the mobility of the American people, education levels, and the general improvement in living standards since the Great Depression of the 1930s. This program was recorded at WTTW Chicago.
    0 : 21 : 01 –
    Phillip Hauser : But our high level of education & increasing level of education of the American people is in large measure a reflection of the general high economic level of living & high productivity .

    Phillip Hauser : And let’s take a look .

    Phillip Hauser : Perhaps , the major factor responsible for this tremendous increase in per capita production & our level of living.

    Phillip Hauser : I refer to

    Phillip Hauser : Sources of Energy Used for Production of Goods & Services

    Phillip Hauser : Notice that in 1850 , over 50 % of all the sources of energy were ANIMAL .

    Phillip Hauser : And another 13 % were human beings .

    Phillip Hauser : Only one-third of energy used for goods & services was mechanical in 1850.

    Phillip Hauser : But a century later , by 1950 , almost 99 % of all our energy used was mechanical . And infinitesimally small percentages human . Animal had virtually disappeared .

    Host George Stone : That explains why it's such an event when we see a horse these days , hum ?

    Phillip Hauser : This is also true .

    Phillip Hauser : And it explains the great difference in the level of living between , let us say , the average person in Asia & the average person in the United States .

    Phillip Hauser : Think of it this way : The average person in the United States has something in excess of 10,000 kilowatt hours of energy per capita per year working for him .

    Phillip Hauser : In Asia , this is less than 300 . A ratio of better than

    thirty-five to one .

    Phillip Hauser : That's what makes the American way of life .
    0 : 22 : 30 –
    Host George Stone : Yeah , that's a pretty startling comparison , actually : 10,000 to 300 . (Whislte)
    0 : 22 : 35 –
    Phillip Hauser : And our income continues to rise rapidly .

    Phillip Hauser : For example , since 1929 , "Donner income" has increased by 160 % .

    Phillip Hauser : And our income in constant dollars , that is , allowing for some inflation , by about 57 % .

    Phillip Hauser : 1929 , the average American family income was about $4,000 per year .

    Phillip Hauser : By 1957 it had risen to over $6,000 per year .

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