Marxs Theory of Money and the Theory of Value Essay -- Karl Marx Mone

Marxs Theory of Money and the Theory of priseThe most important point to emerge from Marxs theory of money is the melodic theme that money is a form of value. The difficulty with this idea is that we are more familiar with money itself than with value in other forms. But value does erupt in forms other than money. For example, the balance sheet of a capitalist firm estimates the value of goods in process and of fixed capital which has not yet been depreciated, as well as the value of inventories of finished commodities awaiting sale. Each of these aggregations of commodities has a value, usually expressed as the analogous of a certain amount of money, but it is make pass that neither goods in process nor fixed capital is money. Marx views the value of commodities in this sense as analytically prior to money money can be explained according to Marx only on the basis of an understanding of the value of commodities.Marx follows Smith in regarding value as the property of exchange ability of commodities. In a high society where exchange is common, products come to have a dual character as expend values and as values. They have two powers first, to satisfy particular valet de chambre needs and wants and second, to exchange for other products. This second power can be thought of quantitatively, as an amount of exchangeability or command over other commodities. The classical economists viewed value as a real, though socially determined, entity, with its own laws of conservation and motion. Value in this sense bears the same relation to commodities as mound bears to physical objects.It is not surprising that in societies where exchange is widespread value takes on an independent form as money, as an expression of general exchangeability. Value is a central social reality for people they constantly think and talk about it directly or indirectly they want some air to transfer it directly among themselves, separate from particular commodities. This is, I think, what we mean by money. It is the social expression of value separated from the concrete particularity of any use value.With this emergence of money as the social expression of value, money stands, in opposition to commodities, as the abstract always stands in opposition to the particular. We will encounter value in two forms as particular commodities, and as money. It is crucial to recognize that this development is latent... ...ever, for the theory that currency is nothing more than the representative of a certain quantity of gold. There were always some limits within which the dollar or the pound could fluctuate in value relative to gold. What laws governed these movements? The general equivalent theory in the form Marx presents it does not explicitly answer this question.A second group of questions which troubled early- nineteenth- century monetary theorists concerns the laws which govern the depreciation, usually in times of war. of inconvertible wallpaper money issued by th e state. Examples of this phenomenon Include the depreciations of the greenback dollar in the United States during the Civil War, and of the paper pound issued by the British during the Napoleonic wars. Ricardo and later quantity theorists used this phenomenon of depreciation as a strong argument for their thesis that the value of money depends on its quantity. For these writers the depreciation of paper money was just a particular example of the tendency for any form of money to depreciate when its quantity becomes larger relative to the needs of circulation.Marxs raillery of this question is very clear and convincing.