This paper deals with the conception, put forward by Malthus in his 1823 tract The Measure of Value (and also in later writings), that the value of labour is ‘constant’, and therefore the value of labour (i.e. labour commanded) rather than labour embodied is the true ‘invariable measure’ of value—thus also the true ‘cause’ of value. This conception is discussed here and shown to contain interesting points, such as a ‘corn ratio’ theory of profits, and, more importantly, another route (gone completely unnoticed) to the determination of the rate of profits which also by-passes relative prices. The paper also discusses the hostile reception Malthus's tract met, not only from Ricardo, but from virtually all the major economists of the time. It is argued that this hostile reception mostly derived from a lack of understanding of Malthus's arguments, and from the fact that in the 1820s the majority of economists, abandoning Ricardo's labour theory of value, grew more and more hostile to conceptions of ‘absolute value’, which underlie Malthus's ‘constant value of labour’ as well as Ricardo's labour theory of value. It is no coincidence that in 1825 Bailey's fully relativistic approach to value met with virtually universal approval.
Keywords: A10; B12; B51
Journal Article. 9616 words. Illustrated.
Subjects: General Economics ; Economic Methodology ; History of Economic Thought (to 1925)
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