"Tim"
q.con> wrote in
news:YZ6dndlqk7hPV1fVnZ2dnUVZ_qninZ2d@aci.on.ca:
>> But yes, goods can have a market value even if no labor is invested
>> in them. E.g., a diamond-laden meteorite which lands in my back yard.
>> Or do you hold that its value is due to the effort I exert in picking
>> it up and carrying it to a gem dealer?
> I'd hold that you might get some money for it, but the market value of
> finished stones will differ from the price you get. In essence the
> buyer values the labour put into the finished stone. If they didn't
> they'd but the unfinished stone for a lesser price. Or do you hold
> that a raw diamond doesn't cost significantly less than a finished
> diamond?
You are ignoring the point. Or points. One of which is that the meteorite
has a market value *prior* to the investment of any labor in it. The other
is that the increased value of the diamonds after being cut is not due to
the labor invested by the cutter, but to his knowledge of how and where to
make those cuts. His labor -- the holding of the chisel and swinging of the
hammer --- is not what adds value to the diamond. The same amount of labor
applied by a woodcutter or a quarry worker would destroy whatever value the
diamond had, not enhance it.
>> That is indeed the 18th century analysis of production factors, when
>> "labor" referred to human draft animals who pulled oars and plows,
>> swung hammers and shovels, toted barges and lifted bales. You should
>> read some more modern stuff, e.g., Paul Romer. The real factors are
>> natural materials, knowledge and imagination, and capital. Labor is a
>> minor component.
> The books I read on the subject were written in the late 1980's. What
> meaningfully changes by pulling knowledge and imagination out of
> labour?
What changes is that, once one realizes that it is not the physical effort
invested which adds value to a product (or not much value), but the
knowledge and skill with which that labor is exerted, then workers will
understand that their incomes will be proportional to their knowledge and
skills, not the number of hours they work or the number of calories they
expend. Their employers will understand that the value of the work done by
their employees can be increased by improving their workers' knowledge and
skills.
Even more importantly, what changes is the realization that unlike the
amount of physical effort (as measured in the number of hours invested or
the number of calories burned), there is no limit to the amount of value
that can be produced via knowledge, skill, and imagination. The sky is the
limit, for both the workers and their customers.
