The Social Construction of Value, Price and Wages

(The Theory of Conceptual-Commodity-Value-Management within Post-Industrial Post-Modern Bourgeois-State-Capitalism)

Within post-industrial post-modern bourgeois-state-capitalism, value is no longer based on labor and/or on labor theories of value such as Marx’s theory. In fact, all post-industrial post-modern societies to various degrees have shed their modern labor theories of value and surplus-value; i.e., theories where labor-time and cost of production are the basis of price and value determinations. In contrast to labor theories of value, post-industrial post-modern societies are increasingly adopting theories of conceptual-commodity-value-management, where price and value determinations are increasingly based on perception and conceptualization-control through alliances of enterprise, alliances which structure price and value according to their own arbitrary whims and value determinations.

Contrary to Marx’s labor theory of value where the “labor-time materialized in the use-values of commodities is both the substance that turns them into exchange-values and . . . into commodities, and the standard by which the precise magnitude of their value is measured” ((Karl Marx, A Contribution To Critique of Political Economy, ed. Maurice Dobb (Moscow, Russia: Progress Publishers, 1970) 30.)) is no longer the case. Granted, labor-power is still the means by which commodities are created, where labor-power produces the internal duality of the commodity between use-values and exchange-values. However, the exact value and price determinations applied to a commodity and its internal dual forms of use-value and exchange-value is no longer based on labor-time, but instead on the arbitrary social constructions of value and price via network enterprise alliances, which increasingly construct value and price determinations on the conceptual perceptions of both the buyers and the sellers rather than any exact measurement of labor-time. In contrast to Marx, today it is not how much labor goes into a product/commodity that determines its value, its surplus value and price, although labor-time may be utilized to measure a minimum price and/or value, instead it is about what one can get for a commodity on the open market; i.e., what the public or individual conceptually is willing to pay for the product and/or commodity. And this new form of value and price determination is all about arbitrary social constructions; i.e., constructing brands, collusion-networks and conceptual-commodity-values and prices founded on perceptual manipulations and management beyond labor theories of value and/or surplus value. For example, such things as artworks, sport athlete salaries, professional services, paparazzi images etc. base their value and price determinations on theories of conceptual-commodity-value-management.

The theory of conceptual-commodity-value-management is founded on the idea that, in essence, price, value and surplus-value are subjective and are only stabilized and standardized through network-formations and/or group-formations, that reify particular prices, values and surplus-values according to their own common self-interests and self-image. For the theory of conceptual-commodity-value-management, price, value and surplus-value are inherently arbitrary. Regardless of how much labor-time is objectified within a commodity or product, labor-time increasingly has nothing to do with value and/or a final price, although it may play a part in determining the minimum price and/or value that something is offered for. In reality, price, value and surplus-value are increasingly based on what someone will pay for a commodity and/or service etc., and what the sellers and middle men think is fair market value in their own minds. Consequently, these arbitrary prices and values are socially constructed through government institutions, branding, fashion trends, supply and demand manipulations, network-formations, cartels and/or the media etc.

What something costs and what something is actually worth in labor-time is no longer relational, but purely the product of conceptual-commodity-value-management; i.e., an educated assumption and construct as to what a public and/or market will pay for something or someone, and what an industry will tolerate price wise as indicative of its own self-image and its own self-worth. This means that today most random price-hikes, stock speculations, securities speculations, C.E.O. salaries, I.P.O. price determinations and/or celebrity salaries are all arbitrary valuations. And the list goes on.  These arbitrary valuations are derived from the mechanisms of conceptual-commodity-value-management, that serve to detach prices and values from the rational ground of labor-time and re-establish price and value determinations upon the fluidity and flexibility of conceptual-perceptions; i.e., what enterprise alliances arbitrarily think is fair market value and how strong these alliances can defend and solidify a price, a value and a surplus value in their favor.

Money as the measure of value for all things conceals conceptual-commodity-value-management behind the façade of the invisible hand; i.e., so-called free market mechanisms and the monetary-system itself, which cloak the shady mechanisms of conceptual-commodity-value-management within a seamless veneer of free market and financial legitimacy. Money hides the arbitrary measurement criteria of post-industrial value and price determinations; money hides the machinations of conceptual-commodity-value-management. Money hides the fact that labor theories of value are no longer operational and functional with contemporary society. As Marx states within capitalist production and consumption “all commodities are…notational money, money is the only real commodity…It is the epitome of all things, the compendium of social wealth.” ((Ibid, 124.)) Money is the universal commodity and system of measurement that conceals all exploitive relations of production behind monetary notations:

The mysterious character of the commodity-form [i.e. Money]… reflects the social relation of producers…as a social relation between objects, a relation which exists apart from and outside the producers…It is nothing but the definite social relation between men themselves which assumes here, for them, the fantastic form of a relation between things…The money form…conceals…the social relations between [individuals], by making those relations appear as relations between material objects, instead of revealing them plainly. ((Karl Marx, Capital (Volume One), Trans. Ben Fowkes (London Eng.: Penguin, 1990) 164-169.))

Money’s value and power over the social world comes from its conceptual strangle hold, fashioned by a litany of social constructs such as institutions, factories, commercial stores, economic languages and corporate oligarchies etc., over the minds of the citizenry. Money’s value and power is not necessarily the product of the actual labor-time embodied or represented in money. It is money’s accepted universality, which is enforced by all sorts of disciplinary institutional mechanisms, that makes money the universal equivalent, which can be substituted and traded for any commodity. These mechanisms transform money into the “common bond” ((Karl Marx, A Contribution To A Critique of Political Economy, ed. Maurice Dobb (Moscow, Russia: Progress Publishers, 1970) 152.)) of social and economic relations.

Brought about through force, coercion, manipulation and swindle, it is the social and universal acceptance of money as the standard measurement of value and the standard medium of exchange that is the source of the power of money, the power of money being that “money [now] satisfies any need since it can be immediately turned into the object of any need”. ((Ibid, 124))  Only enshrined within the parameters of bourgeois-state-capitalism, does money have value, despite being literally worthless paper.  Its value is not intrinsic. Its value is derived from the position money hold within the parameters of our current socio-economic system; i.e., capitalism. Money and its value is a social construction of societal institutions and group formations that enshrine money as “the epitome of all things”. ((Ibid. 124)) As Marx states in A Contribution The Critique of Political-Economy, “the State…whose mint merely imprinted its stamp…transform paper into gold by the magic of its imprint…Apart from their function…[Monies] are useless scraps of paper”. ((Ibid, 119.))

Moreover outside the parameters of bourgeois-state-capitalism, paper-money loses all value “for the frontier of the country limit [money’s] movement… [money] lose all value, both use-value and exchange-value outside [its specific] sphere of circulation”. ((Ibid. 119)) What this means is that money must be socially recognized both within a country and outside a country in order to have circulation value. A monetary-system’s value must be socially recognized in order for a monetary-system to have value. This means that money’s value is not intrinsic; i.e., it is not based on labor-time, but is the product of social construction, a specific type of social construction that enshrines money and bestows upon it certain value, value which has meaning, legitimacy and influence only within a community and culture that recognizes its monetary value-form.

This social construction of money-value is not based on a labor theory of value but first and foremost on a theory of conceptual-commodity-value-management. People must be forced, coerced and manipulated, both mentally and physically, to accept a monetary-system as a universal standard of value and as a universal means of exchange, either through economic routine, economic enablement and/or economic domination. Monetary-systems and their methods of allocating value and price are in reality arbitrary, valueless and a matter of social construction. These systems and methods of allocating value and price have influence and weight only within the parameters of a socio-economic formation, like capitalism etc., where an array of institutional, political, economic, cultural practices and beliefs buttress the monetary-system and its method of allocating value and price through threats of violence, force and/or starvation.  As a result, people must accept socially constructed conceptual-commodity-values that are in essence arbitrary in order to have a functioning economy, and before any monetary system and market economy can function and operate effectively. Yet this crucial fact, concerning the social construction of value, price and money also means that values, price and money is subject to the powerful influence of enterprising alliances, whose sheer gravity of influence and control can artificially inflate prices, values, wages and money, for long extended periods of time and over large extended spatial areas. These enterprising alliances, who possess oligarchical force, can influence prices, values, wages and money to the point that these inflated and exaggerated prices, values, wages and money seem legitimate and the result of autonomous market mechanisms, when, in fact, the opposite is the truth.

Bourgeois-state-capitalism in its initial modern form may have relied on rational labor theories of value in order to beget converts throughout the 19th and 20th century. However, increasingly with the advent of post-industrial post-modern society, no longer requiring vast amounts of converts, bourgeois-state-capitalism in its contemporary form is increasingly relying on theories of conceptual-commodity-value-management in order to determine value, surplus value and commodity-price. Theories, which are unfettered by labor, labor-time and labor-power, but are more conducive to the fundamental requirements of post-industrial post-modern capitalism; i.e., its fundamental requirements for constant economic growth, increasing profits and the required flexibility for exploiting and adapting to market fluctuations and changes.

For instance, within post-industrial post-modern bourgeois-state-capitalism, wages are no longer based on labor-time and the cost of maintaining a worker for a certain time period via various means of sustenance. Workers are no longer paid weekly, monthly etc. in relation to what it costs for the worker to reproduce him or herself as an average worker. Contrary to Marx’s labor theory of value, which states that “the price of labor [is] determined by the cost of production, by the labor time necessary to produce…labor-power, [that is] the cost for maintaining the worker as a worker and of developing him into a worker”. ((Karl Marx, “Wage labor and Capital,” The Marx-Engels Reader, ed. Robert C. Tucker (New York, New York: W.W. Norton & Company, Inc., 1978) 206.)) In fact, today wages are based on what an employer envisions is fair market value and what an employee deems is suitable. It is the struggle between both the employer’s and the employee’s conceptual perceptions of what constitutes fair market value that now determines the wage paid and the wage received; i.e., the monetary amount that a worker will receive for a certain time-frame of labor-power and labor-time. Wages determined by labor-time and labor-power are jettisoned in favor of the fluidity and flexibility of socio-conceptual-perceptions in relation to what constitutes an acceptable wage. This theoretical shift in wage-value explains many contemporary wage phenomena such as the excessive wages of CEOs, super managers, sport salaries, entertainment industry salaries, and the huge wage and price differences between professions, jobs, services and commodities.

In line with Marx, yes “the material position of the worker has improved, but at the cost of his social position. The social gulf that divides [the average worker] and the capitalist has widened”. ((Ibid, 211.)) However, this gulf is not primarily caused by an intensification of work and/or necessarily a prolongation of the workday as Marx argues, due to the fact that work within a post-industrial post-modern society in many instances has gotten lighter, easier, precarious and more intellectual. To the contrary, the social gulf between capitalists and workers has widened because price, value, surplus value and wages are increasingly based on the arbitrary measurement criteria of conceptual-commodity-value-management; i.e., the arbitrary whims of capitalists, individual workers, cartels and professional associations etcetera. These socio-economic groupings increasingly base their individual valuations on their own perceived self-worth and arbitrary criterions etc., which are solidified and valorized through the influence and weight that their specific enterprising alliances exercise within their particular business branch.  In a society where wages, values, prices and surplus value are founded on a theory of conceptual-commodity-value-management, the network an individual belongs to is paramount in the amount of wages he or she receives, the surplus value a capitalist receives and the price that a commodity or service commands on the open market etc.

Moreover, the stronger the network, the more exclusive the profession and/or commodity, thus the more value and the higher price, which is capable of being socially constructed in the marketplace. Added to the fact that professional networks of various stripes and ilk function and operate in unison minimizes competition, solidifies inflated prices and values, and maximizes profits and the accumulation of surplus value as these enterprising alliances exploit greater segments of the population via their exaggerated conceptual-commodity-values. The strength and the influence of a specific socio-economic network, both within a specific branch of production and consumption and between different productive and consumptive branches, becomes the primary manner by which to maximize profits and determine values and prices. Consequently today, conceptual-commodity-value-management has become an invaluable tool in order to meet and solve the profit pressures and requirements of post-industrial post-modern bourgeois-state-capitalism. However, the cost of this shift from labor theories of value to theories of conceptual-commodity-value-management has been increasing financial inequality and the rise of  corporate-capitalist feudalism as the new socio-economic formation.

It is important to note that theories of conceptual-commodity-value-management are based on the logic of capitalism, that is the underlying socio-economic logic that: (1) fundamentally requires profit maximization by any means necessary and at any cost as soon as possible, and (2) fundamentally requires the satisfaction of the minimum maintenance requirements for the continued existence of humans. ((Michel Luc Bellemare, The Structural-Anarchism Manifesto: (The Logic of Structural-Anarchism Versus The Logic of Capitalism), (Montréal: Blacksatin Publications Inc.) 24.h).)) Theories of conceptual-commodity-value-management are practical out-growths of and solutions to the logical existential necessities of global bourgeois-state-capitalism. They are logical out-growths of the underlying logic of capitalism. Theories of conceptual-commodity-value-management conceal the logic of capitalism and its mechanics within their logical structures. This inherent logic is the motive force which stimulates price, wage, value and surplus value inflation, manipulation and collusion. All of which are present within the socio-economic networks of bourgeois-state-capitalism.

In addition, theories of conceptual-commodity-value-management are themselves concealed by money and by the circulation of money. As money and the circulation of money veil these basic post-industrial post-modern theories, akin to Marx, in “abounding. . . metaphysical subtleties and theological niceties” ((Karl Marx, Capital (Volume One), Trans. Ben Fowkes (London Eng.: Penguin, 1990) 163.)) that envelop the artificial social constructions of conceptual-commodity-value-management in notions of democratic equality, merit and financial legitimacy. From OPEC to NAFTA to giant transnational corporations etc., these oligarchical network-formations shape and influence markets, global commodity-circulations, prices and values determinations across the globe and within the micro-recesses of everyday life. These oligarchical network-formations manipulate profits in their favor, by reducing competition among themselves, altering conditions of sale, fixing market shares, and/or manipulating tariffs etc. in favor of their own self-interests and enterprising network communities.

Finally, detached from any basic labor theory of value, workers are increasingly subject to the arbitrary whims of oligarchical-networks, who raise or lower prices and value determinations at will, so as to increase profits, manage wages and intensify competition among an unsuspecting oblivious population. Detached from any basic labor theory of value, these oligarchical-networks, with [their] increasing mass of wealth,…increase the concentration of that wealth in the hands of [a few] individual capitalists.  [Their] capital grows to a huge mass in a single hand in one place, because it has been lost by many in another place. [Thus] the course of [this] accumulation…repels more and more… workers formerly employed… [into] a relatively redundant working population; i.e., a population which is superfluous. ((Ibid, 776-782.))

Daily life may have improved with all sorts of technologies and processes that have ameliorated the hardships of everyday living, but this has come at the cost of socio-economic domination in the workplace and marketplace via oligarchical-networks and enterprising alliances, which artificially and socially construct inflated arbitrary values, prices and wages so as to maximize profit and control their workforce. The end result is increasing unemployment, lack of class mobility, wage stagnation for workers and increasing large-scale financial inequality. The facility of daily life within post-industrial post-modern bourgeois-state-capitalism is thus counterbalanced by the increasing financial hardship and streamlining of the workforce, who pay for their comforts through wage stagnation, wage reduction, precarious working conditions and an increasing unemployment.

These duplicitous processes brought about by the theories of conceptual-commodity-value-management, utilized by oligarchical-networks and enterprising alliances, increase financial inequality due to the fact that wages, values, prices and surplus value determinations are increasingly subject to the marketplace domination and the arbitrary machinations of these oligarchical-networks and enterprising alliances. The rational basis embedded within labor theories of value has been subverted in favor of the unlimited freedom that theories of conceptual-commodity-value-management offer. Moreover, the shady dealings that theories of conceptual-commodity-value-management engender are in turn concealed within the mechanics of the monetary-system and money circulation, which only exacerbates the exploitation through confusion. Notwithstanding, the increasing financial inequality within post-industrial post-modern bourgeois-state-capitalism is, on all counts, the product of logical design and forethought, designed by the theories of conceptual-commodity-value-management that certain enterprising alliances and oligarchical-networks have adopted for themselves in order to increase profits, market share and to manage the workforce.  As a result, the increasing financial inequality at the moment is not the by-product of the accidental happenings and the random workings of autonomous market mechanisms; in fact, these autonomous monetary mechanisms only conceal the theory and the method within the current unscrupulous financial madness.

Bibliography:  ((Bellemare, Michel Luc. The Structural-Anarchism Manifesto: (The Logic of Structural-Anarchism Versus The Logic of Capitalism). Montréal, Canada: Blacksatin Publications Inc., 2016; (2) Marx, Karl.  A Contribution To A Critique of Political Economy. ed. Maurice Dobb. Moscow, Russia: Progress Publishers, 1970.  (3) Marx, Karl. Capital Volume One. Trans. Ben Fowkes. London Eng.: Penguin, 1990. (4) Marx, Karl. “Wage labor and Capital.” The Marx-Engels Reader, ed. Robert C. Tucker. New York, New York: W.W. Norton & Company, Inc. 1978. 203-217.))


Michel Luc Bellemare's latest book, Techno-Capitalist-Feudalism, was published in September 2020. He is also the author of The Structural-Anarchism Manifesto: (The Logic of Structural-Anarchism Versus The Logic of Capitalism). Michel Luc is a member of the Metis Algonquin Nation of Ontario, Canada. Read other articles by Michel Luc.