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You mean the quackery of Benjamin Franklin, Adam Smith, Ricardo and so on? Someone should tell the record companies who say when you pirate a song, you're stea

You mean the quackery of Benjamin Franklin, Adam Smith, Ricardo and so on? Someone should tell the record companies who say when you pirate a song, you're stealing from the artist who will not be properly compensated for the time they labored to write and record that song. I see corporate spokesmen expounding the labor theory of value all the time.

missedthecue 6y ago
Yes, I meant the quackery of those you listed. Isaac Newton had a very distinguished mind, but was a proponent of young earth creationism; being right about one thing does not make you right about all things, and so it goes with Franklin, Smith, Ricardo et al. As far as LTV is concerned, we know it to be a flawed theory today because we understand the time value of money. LTV will hold in the long run with constant returns to scale. Without constant returns to scale, only the marginal consumer matters. In simpler terms, demand will affect price, not just supply. Now, if we make the errant assumption that the supply curve is completely flat in the long run, then LTV does in fact hold. That is, the LTV is not a terrible description of economic reality, as long as you note that a) an isomorphic argument can be made for “the land theory of value” or “capital theory of value”, so labor is in no way special, and b) LTV can only apply for goods with flat long-run supply curves. In any case, there’s a reason the early great economists used it! Smith, Ricardo, and others were not all idiots. However, today, we know better and it flies in the face of modern science and understanding to promote its use.