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Is value created by labor necessarily the only way to create value? Can labor by itself cost $10, I pay out $10, but when I combine that labor (a largely undire
by virmundi 10y ago
Is value created by labor necessarily the only way to create value? Can labor by itself cost $10, I pay out $10, but when I combine that labor (a largely undirected force) with thought (scheduling, order placement, etc) I get a multiplier over the labor?
It seems like it should be possible to do this. I pay for raw, undirected labor. It's like raw iron. When I use my skills for planning (speaking as the management for the company), I can pay full price for labor, but get synergistic effect not possible without thought? To keep with the iron reference, in the end I produce steel or even better a car. Seems like the labor to extract the iron met a multiplier of my metallurgic enhancements.
- thehardsphere 10y agoThe mistake here is the assumption that value comes from labor. Value is inherently subjective, depending on what the purchaser is willing to pay for, not due to intrinsic properties of whatever the good or service is. Suppose in your raw iron example, instead of making steel or a car, you make an inferior product because either you or the people who work for you are incompetent. Suppose you make the 1960 Chevrolet Corvair, a car so horrible that it inspires the book "Unsafe at Any Speed" by Ralph Nader. Even though nothing about the product or the labor used to produce it changes, your product loses value immediately because people don't want to buy a dangerous car. Your hypothetical multiplier turns negative overnight, even though your car is just as unsafe before the book as it was afterward. If the labor and your intelligence were the source of the labor, the value of the car should not change just because Ralph Nader says it's dangerous.