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Generally Marx assumed that—irrespective of the price for which it is sold—skilled labour power had a higher value (it costs more to produce, in money, time, energy and resources), and that skilled work could produce a product with a higher value in the same amount of time, compared to unskilled labour. [27]
Labor-power might be seen as a stock which can produce a flow of labor. Labor, not labor power, is the key factor of production for Marx and the basis for earlier economists' labor theory of value. The hiring of labor power only results in the production of goods or services ("use-values") when organized and regulated (often by the "management ...
Thus, things have an "economic value" simply and only because it takes human labour-time to make them. This value exists and persists quite independently of fluctuating prices in markets. Although they are connected, the value relationships between labour-products and price relationships can vary independently of each other, within certain limits.
Consequently, labour power may be hired not "because it creates more value than it costs to buy", but simply because it conserves the value of a capital asset which, if this labour did not occur, would decline in value by an even greater amount than the labour cost involved in maintaining its value; or because it is a necessary expense which ...
The output measured at time 2 is greater than the output measured at time one for both of the components of growth: an increase of inputs and an increase of productivity. The portion of growth caused by the increase in inputs is shown on line 1 and does not change the relation between inputs and outputs.
At the heart of the argument is the labour theory of value and the related premise that profit represents surplus value created by labour working above and beyond the amount needed to reproduce itself, as represented by wages and the buying power of wages viz. the price of commodities (particularly necessities). In other words, profit is what ...
Adam Smith held that, in a primitive society, the amount of labor put into producing a good determined its exchange value, with exchange value meaning, in this case, the amount of labor a good can purchase. However, according to Smith, in a more advanced society the market price is no longer proportional to labor cost since the value of the ...
Work or labor (labour in Commonwealth English) is the intentional activity people perform to support the needs and desires of themselves, other people, or organizations. [1] In the context of economics , work can be viewed as the human activity that contributes (along with other factors of production ) towards the goods and services within an ...