I am trying to research connections between Locke, Smith, and Marx regarding labor. If I recall, Rothbard and others have written about Smith’s views on labor influencing Marx. I’d appreciate any suggestions or discussion as to good references on this issue.
In addition to the Smith-Marx connection, It is also my view that Locke’s idea that homesteading rests on “ownership” of labor is mistaken–it’s an unnecessary step; you can show Lockean homesteading is justified without making the crankish assumption that you own your labor. But the assumption that you can own your labor, I believe, has led to (or supports) modern mistakes like reputation rights, intellectual property, and the like–it’s led to an overemphasis on the right to “own” whatever you “create” by your labor, without first asking whether the thing created/labored upon is ownable in the first place (see, e.g,. my posts Objectivists: “All Property is Intellectual Property”, Rand on IP, Owning “Values”, and “Rearrangement Rights”, and Thoughts on Intellectual Property, Scarcity, Labor-ownership, Metaphors, and Lockean Homesteading. [Update: see also Hume on Intellectual Property and the Problematic “Labor” Metaphor and KOL 037 | Locke’s Big Mistake: How the Labor Theory of Property Ruined Political Theory]).
I’d like to investigate the extent to which Locke’s (and related) views about labor (and its role in homesteading) influenced Smith and the labor theory of value. Tim Virkkala tells me
I think it’s widely believed that the Lockean Theory of Land Acquisition gave weight to the Labor Theory of Value, though the two have almost nothing in common. … One is a theory of the justice of taking land out of “the commons” and respecting property rights; the other is a theory of how labor somehow effects prices and exchange ratios. Weird that it ever bled from one domain to the other. Rothbard charged that Adam Smith was unduly influenced by (to Rothbard) unspeakably vile Protestant views in Scotland. This seemed a tad strained to me. After all, I’ve read THE THEORY OF MORAL SENTIMENTS, and it’s not very Presbyterian.
Basically, I wonder if it can be shown that Locke’s misplaced and overly metaphorical emphasis on owning labor led not only to IP and related bizarre notions but also to communism. If anyone has any suggested references discussing this connection, please note or discuss in the comments.
Note: On an email list, David Gordon did mention this: “On the relation between Locke’s theory of property and the labor theory of value, R.L. Meek, Studies in the Labour Theory of Value, argues against a connection. G.A. Cohen, “Marx and Locke on Land and Labour” is a very good paper.” I’ve just ordered the former book as well as Cohen’s book in which his paper appears, but have not yet read them.
Update: See The Superiority of the Roman Law: Scarcity, Property, Locke and Libertarianism (Mises, Aug. 17, 2010)
Update: In this 2014 interview, with my old friends Joe Salerno and David Gordon, David makes several critical comments about my IP and other views. David implies my IP work was basically just a restatement of Tom Palmer’s and others’ work, there was no “Kinsella revolution,” and IP is only a minor issue, and Rothbard basically got it right.
As I partially indicated here, I disagree with David on much of this:
Rothbard was wrong, and so is David. And David is mischaracterizing Rothbard’s “contractual copyright” argument. David thinks Rothbard is against patents, but Rothbard’s contractual copyright idea covers inventions (a mousetrap is the example) so Rothbard is not really against patents. Rothbard is wrong in thinking you can use contracts to get anything like copyright or patent. Gordon is wrong to think my and Tucker’s argument against copyright is that abolishing it would give rise to tons of new wealth. He’s also blaming me for Jeff Tucker’s tendency to overpromote, which I had nothing to do with. David is wrong that IP is not a central issue; it’s not a “minor point.” David is wrong that the right-to-copy point is not question-begging. David is trying too hard to salvage Rothbard’s confused arguments about contractual copyright.
(In another video from around the same time, as noted here, Gordon made similar claims. In first 7 minutes of part 2 of an interview of Gordon (now deleted) again implied IP is not a big deal, Rothbard had it all figured out, Tucker and I are exaggerating things, I don’t understand Mises and Locke, and so on.)
First, I think this was in part a backlash from Jeff Tucker’s over-promotion of my IP views back when Jeff was still at MI. I was not responsible for this and never joined in; I’m not one for hype or even self-promotion. I never claimed I had spearheaded some “revolution” or denied how Palmer et al. were my influences; I cite and quote them heavily in my AIP. David is wrong that IP is minor; he just doesn’t get it. I think he is trying too hard to defend Rothbard’s very confused views on IP. I am not. Rothbard was great but he went astray on IP. Period. See the “contract vs. reserved rights” section of AIP. For some reason, perhaps because I explicitly disagreed with Rothbard, perhaps because Tucker was over-hyping and over-promoting my IP stuff while at Mises, David has been parsimonious in praising my AIP–implying it’s weak, I am making too much of a minor issue, I am only rehashing earlier work of Konkin and Palmer et al., and Rothbard’s contractual-copyright nonsense is basically right, end of story–and has instead lavished praise on far inferior works: namely Boldrin & Levine’s Against Intellectual Monopoly and Butler Shaffer’s flawed, confused, and somewhat incoherent A Libertarian Critique of Intellectual Property (see David’s positive review of AIM and his glowing introduction in Shaffer’s book). AIM is good as far as empirical work goes, but it is not Austrian and the authors even indicate support for other government programs to support innovation as alternatives to IP, like tax-funded prizes, which is completely unjust and unlibertarian.
As an example of David’s confusion on IP and his strained attempt to rehabilitate Rothbard, he writes, in his review of AIM, “These writers modify and extend the work of Murray Rothbard, who allowed copyrights but not patents.” However, Rothbard was not exactly against patents, nor was he exactly for copyright. As for patents: he pointed out patents skew research and development (Milton Friedman (and Rothbard) on the Distorting and Skewing Effect of Patents; see also Man, Economy, and State and Power and Market, Scholars Edition, pp. liv, 745–54, 1133–38, 1181–86). But in his Knowledge, True and False, he allows for some kind of “contractual” or “common law” copyright. Now this is confused, as I point out in the “contract vs. reserved rights” section of AIP. However, the example he gives is that of a mousetrap—an invention. The thing covered by patent law. So he somehow thinks his weird notion of common-law or contractual copyright could cover inventions. This is an awkward and unsuccessful attempt to justify a type of private patent law.
Yet his advocacy of this type of “copyright” is not copyright as we know it, but some contractual scheme. So it he was not “for copyright” but “against patent.” He was totally confused. Contracts create only in personam rights; but copyrights as well as patents are in rem rights (see my A Libertarian Theory of Contract: Title Transfer, Binding Promises, and Inalienability). So in reality, contract cannot be used to support either copyright or patent. And Rothbard is wrong to think you can use contracts to bind third parties. He lost sight of his own brilliant and pathbreaking contract theory. Moreover, Rothbard’s “common-law copyright” notion is confused because that term already refers to another legal doctrine that has to do with trade secrets in unpublished manuscripts.
As for IP being only a minor issue, well I think David is just wrong. See e.g. “Patent vs. Copyright: Which is Worse?”; “Where does IP Rank Among the Worst State Laws?”; “Patent Trolls Cost The Economy Half A Trillion Dollars since 1990”; “Costs of the Patent System Revisited; What are the Costs of the Patent System?;Death by Copyright-IP Fascist Police State Acronym; Masnick on the Horrible PROTECT IP Act: The Coming IPolice State; and many other posts and articles. It is a major issue and any libertarians interested in this issue KOL364 | Soho Forum Debate vs. Richard Epstein: Patent and Copyright Law Should Be Abolished.
In the video above, David also implies I am weak or sloppy in interpreting people like Locke. In the post above, for example, I was wondering about possible connections between the Lockean idea of mixing labor to homestead unowned resources, which I (and perhaps others; I cannot recall) have referred to as the Labor Theory of Property (LTP) and some as the “labor mixture argument”, and the later Labor Theory of Value (LTV) of Adam Smith, David Ricardo, and then Karl Marx. I believe both theories are flawed, for different but related reasons, and both, unsurprisingly lead to the IP mistake: “creationism” in the case of LTP (see KOL 037 | Locke’s Big Mistake: How the Labor Theory of Property Ruined Political Theory), and other mistakes in the case of the LTV leading to support even by some leftists of IP (see Classical Liberals, Libertarians, Anarchists and Others on Intellectual Property).
Regarding the contentions in this very post, as noted above, David wrote:
“On the relation between Locke’s theory of property and the labor theory of value, R.L. Meek, Studies in the Labour Theory of Value, argues against a connection. G.A. Cohen, “Marx and Locke on Land and Labour” is a very good paper.”
I’ve had time to look into some of this. Here are a few comments. These concern the following:
- Ronald L. Meek, Studies in the Labor Theory of Value (Amazon)
- G.A. Cohen, “Marx and Locke on Land and Labour,” in Cohen, Self-Ownership, Freedom, and Equality (Studies in Marxism and Social Theory) (Amazon)
- John Dunn, Locke: A Very Short Introduction (Amazon)
- Locke on Land and Labor Daniel Russell (jstor)
Following is an edited version of a note I sent to David about the LTP and LTV, in light of these works and David’s earlier comments:
I have read the Cohen paper. I am not so sure it says exactly what I thought you were implying. Cohen distinguishes different arguments of Locke, one being his “premiss”—the claim that most value is created by labor (like 99%) and very little comes from the natural resource itself. Cohen distinguishes Locke’s value/appropriation and value/inequality argument, both based on this “premiss,” from his more famous argument that mixing your labor with an unowned thing gives you ownership of it—what I (and I presume others) call the LTP and what Cohen refers to as the “labor mixture argument”. It is the LTP that I was thought might be connected to, might have influenced, the later labor theory of value. Although no doubt the LTP is also related to his premiss.
In any case, Cohen writes:
““7. Locke’s premiss is often described as a rough statement of what, since Marx, has been known as the labour theory of value. That is misleading,27 since the value which Locke says is (nearly all) due to labour is not the value Marx says labour created. Locke’s topic is use-value, not exchange-value. ”
27: “The frequency of the misleading description is no doubt due to ‘the emotional appeal’ of the labour theory of value, which ‘has induced some historians to interpret as many authors as possible’ as proponents of it: Joseph Schumpeter, A History of Economic Analysis, p. 98. See, for example, Richard Aaron, Locke, p. 280; John Gough, John Locke’s Political Philosophy, p. 81; George Sabine, A History of Political Theory, p. 528. John Dunn (Locke, p. 44) says that ‘the tangled history of the labour theory of value ever since, in the justification and rejection of capitalist production, was already foreshadowed in the ambiguities of the theory which he [Locke] fashioned’. That is strictly wrong, since Locke did not fashion that theory. But Dunn is nevertheless substantially right, to the extent that the theory of value typically enters the debates to which he refers in the misread, ideologically motivated, form described in section 5 above.”
As far as I can tell,l when Cohen says “Locke’s premiss” he is referring to the premiss behind the “value/appropriation and value/inequality arguments,” not the labor mixture argument (LTP). This is because he has just been talking about the common premiss of the other two arguments:
“So we find in Locke, or attributed to Locke, a pair of arguments, with a common premiss. The common premiss is that labour is responsible for virtually all the value of what we use and consume. The conclusion of one argument, which I shall call the value/appropriation argument, is that a person who labours on unowned natural resources becomes, thereby, their legitimate owner. …
“The common premiss of the value/appropriation and value/inequality arguments should not be identified with another, and more famous, Lockean claim [labor mixture argument]. That different claim is that, when one labours on something, one mixes one’s labour with it, thereby placing within it something one owns. ”
So what Cohen seems to be saying is that it is “misleading” to say that Locke’s premiss [the premiss of the value/appropriation and value/inequality arguments, not the labor mixture argument: the premiss being: ““that labour is responsible for nearly all of the use-value of things”] is “a rough statement of what, since Marx, has been known as the labour theory of value.”
So as far as I can tell Cohen is not saying that there is no connection between the LTP (labor mixture) and LTV. In fact in note 27, he quotes Dunn as saying:
“‘the tangled history of the labour theory of value ever since, in the justification and rejection of capitalist production, was already foreshadowed in the ambiguities of the theory which he [Locke] fashioned’. That is strictly wrong, since Locke did not fashion that theory. But Dunn is nevertheless substantially right, to the extent that the theory of value typically enters the debates to which he refers “
Now in the Dunn book, it is not 100% clear to me which property theory of Locke Dunn is referring to, but I think it is the labor mixture idea, which he says foreshadows (in its ambiguities) the later labor theory of value. Or maybe he means the other two arguments Cohen is talking about; or all of them — the “ambiguities”.
I had posited–really, simply wondered aboute–some possible connection between the LTP and the LTV namely, the former (earlier) theory influencing the latter. At the very least Dunn, a Locke scholar, seems to agree there is some connection–some “foreshadowing”. So this supports my sense that there is not only a facial commonality but some conceptual and chronological connection or development or influence. And your comment that Cohen “argues against a connection”–I am not sure this is exactly right. Cohen says it’s misleading to say that Locke’s premiss (that labor contributes 99% of the value) is a rough statement of the LTV. I agree, it is not a rough statement or equivalent to it. But what I was wondering about was the LTP not the other premiss.
Further, Locke’s premiss, that laboring puts most of the value on things, is not entirely unrelated to his labor mixture or LTP idea.
Meek seems also to be talking about connections between Locke’s “premiss” and not his LTP, and the LTV. e.g. p. 21:
“There were, it is true, plenty of statements made at about this time to the effect that labour “makes the far greatest part of the value of things we enjoy in this world”, … They sometimes meant, in the first place, that the use value or utility of commodities was largely the creation of labour. Locke’s famous discussion of the manner in which labour “puts the difference of value on everything” probably comes into this category. “ I think”, he said, “it will be but a very modest computation to say, that of the products of the earth useful to the life of man, nine-tenths are the effects of labour. Nay, if we will rightly estimate things as they come to our use, and cast up the several expenses about them— what in them is purely owing to Nature and what to labour—we shall find that in most o f them ninety-nine hundredths are wholly to be put to the account of labour.””
I do not see how this shows there is no connection between the labor theory of property and the labor theory of value. Though he does say: “Locke’s influence upon the early Classical economists was probably more political than economic.”
Yet later, he says:
“Those who suggest that the labour theory of value necessarily embodies a particular ethical or political viewpoint often emphasise the part played in its early development by Locke. It is certainly true that Locke tended to regard the expenditure of labour on the production of a commodity, not only as conferring “value” upon it (leaving aside here the question of what kind of value), but also as conferring a right of property in the commodity upon the individual who had expended his labour in its production. No one would wish to deny, either, that the Lockean theory of property rights contributed largely to the building up of the political atmosphere in which the Classical labour theory of value was eventually able to flourish, or that many o f the radicals did in fact look at the labour theory through Lockean spectacles.”
So yet again, we see some connection between Locke’s earlier labor theories and the later LTV.
Incidentally the paper by Russell noted above criticizes many aspecdts of Cohen’s paper, contending that Cohen misconstrues Locke.
So I believe that it is clear that there are some commonalities between the LTP and the LTV; both are mistaken, and both, especially the former, help support the flawed idea of IP.
- June 23, 2010 at 10:46 am
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Good to know a guy like Kinsella seems to share my view that Rothbard was way too harsh towards Smith. And I often see people bashing protestant ethics as being worse than catholic ethics free-market wise only because of the spanish scholars. And they ignore the fact that the very catholic Spain and Portugal were much more interventionist and anti-semite than the protestant Netherlands.
Smith commited some mistakes, but his good deeds outweights those mistakes IMO. Bashing the guy because he is “mainstream” is lame
- June 23, 2010 at 11:51 am
- June 23, 2010 at 9:06 pm
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gavin kennedy does a robust job in defending smith from rothbard’s accusations here:
http://adamsmithslostlegacy.blogspot.com/2006/01/myths-of-murray-rothbard-no-6.html- June 25, 2010 at 12:38 pm
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That should be an interesting read. Pity that Kennedy didn’t read Rothbard’s entire series before trying to refute it, as what I saw just now briefly glancing his blog was him dealing with the refuting Rothbard’s opinion of Smith, without having any understanding of the underlying reasons Rothbard felt as he did.
- June 25, 2010 at 12:29 pm
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Rothbard’s main criticism of Smith was that he took credit for others work without acknowledging their efforts, while adding little to no value to economic theory independently. His series, An Austrian Perspective on the History of Economic Thought sorts through these ideas over time, undermining claims of what Smith actually did to advance the understanding of economics.
- June 25, 2010 at 12:42 pm
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Rothbard’s opinion of Smith is largely shaped on scholarship conducted by Schumpeter, and I’m sure Kennedy has read Schumpeter’s criticism.
- June 23, 2010 at 11:29 am
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No amount of work will turn a mud pie into an apple pie.
- June 23, 2010 at 11:38 am
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Check out “The Fabrication of Labor” by Richard Biernacki. It looks at how the different conceptualizations of labor in different national cultures affected how economists theorized about them.
http://www.amazon.com/Fabrication-Labor-Germany-Britain-1640-1914/dp/0520208781 - June 23, 2010 at 12:12 pm
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Labor Theory of Value was the field of Economics’ first attempt at any discussion of the source of value. Blasting Smith because he contributed to its formation (although the person you’re really after is David Ricardo) is utterly ludicrous. It took generations to understand the subjective theory of value, that doesn’t mean Smith helped create communism or Marxism. In reality, we all know that socialism of all forms existed long before Adam Smith.
But the real issue here to me is that Kinsella doesn’t seem aware of what Mises himself wrote about Smith, Ricardo, Marx, and the labor theory of value in Human Action. We could all benefit from his perspective on the intellectual contribution of his predecessors. Specifically with regard to Max Weber, Mises writes that we should take his legitimate contributions as such, and praise Weber for making them; and unduly toss away his false conclusions.
Weber, Ricardo, Smith, Locke, and many other early economists contributed greatly to the field of economics. They also all made errors that were not detected or corrected until later, by people who further advanced the field of economics. Such is the nature of any intellectual pursuit. Disparaging a great economist for his mistakes is as silly as cursing the Founding Fathers for not eliminating slavery.
At a certain point you have to acknowledge that no one man can solve ALL of the world’s problems.
And perhaps most importantly, it has nothing to do with communism. Communism existed in many forms prior to the labor theory of value, and it continues to exist despite the fact that no one other than a few ill-informed college students believe in the labor theory of value. Tying them together brings no new information to history, economics, or libertarianism.
- June 23, 2010 at 12:24 pm
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Exactly. Socialism and Communism are the original governments of all human history. Blaming Adam Smith for something our tribal ancestors were already doing is silly.
- June 23, 2010 at 12:34 pm
- June 23, 2010 at 3:03 pm
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“Labor Theory of Value was the field of Economics’ first attempt at any discussion of the source of value. ”
Your statement is false. The scholastics came very close to the subjective theory of value (at least with respect to ordinary commercial goods); please see Rothbard’s history of economic thought before Adam Smith.
The rest of your post is too wishy-washy to demonstrate your argument. I see nothing in Kinsella’s academic proposal that indicates he harbors ill will towards the economists you mention or that he disparages their good contributions.
- June 23, 2010 at 12:47 pm
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Stephan Kinsella,
You write,
In addition to the Smith-Marx connection, It is also my view that Locke’s idea that homesteading rests on “ownership” of labor is mistaken–it’s an unnecessary step; you can show Lockean homesteading is justified without making the crankish assumption that you own your labor.
I admit to maybe not understanding (or knowing) Locke’s argument. I have personally never read Locke’s treatise, nor anything pertaining to it (except whatever Rothbard writes in his An Austrian Perspective on the History of Economic Thought).
I don’t understand why the notion that an individual owns his own labor is “crankish”. Who owns my labor, if not myself? In his concept of ownership, Karl Marx makes the mistake of not accepting the contract between employee and employer as a transfer of ownership. The employee is selling his labor for a certain wage. Before the labor is sold, though, it seems to me that the individual owns his labor (and thus is the only reason he can legitimately sell it).
Further, you write,
But the assumption that you can own your labor, I believe, has led to (or supports) modern mistakes like reputation rights, intellectual property, and the like–it’s led to an overemphasis on the right to “own” whatever you “create” by your labor, without first asking whether the thing created/labored upon is ownable in the first place…
While it may be true that the concept of self-ownership, and thus the ownership of one’s labor, has led to poorly developed property rights theory (such as intellectual property), it doesn’t make the concept itself wrong. I think it’s clear that if we are talking about writing a book, the physical book written belongs to the author. What doesn’t belong to the author are the words, and so by copying that book it’s not an infringement on that author’s property rights (unless the author and person X have previously decided on a contract agreeing to not copy the book—then it’s just a breach of contract). To clarify, the author is receiving the fruits of his labor.
Maybe I am missing something, though.
- June 23, 2010 at 2:13 pm
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I don’t understand why the notion that an individual owns his own labor is “crankish”. Who owns my labor, if not myself?
Owning your labor makes about as much sense as owning the light from your flashlight, or the velocity of your moving car. You could claim ownership of such things, but why bother? Consider your own statement:
Before the labor is sold, though, it seems to me that the individual owns his labor…
Let’s say I am bargaining with you on a price to paint your house. If I read you correctly, you are arguing that “the amount of labor sufficient to paint your house” is something that I own at this point, and that I am relinquishing ownership of that thing to you if we come to a deal. Doesn’t ownership of things that do not even exist physically and are only conceived of in the potential seem the least bit nonsensical to you?
- June 23, 2010 at 2:21 pm
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In your example, “labor” as you have described it complies with Ludwig von Mises’ definition of “technology” in Human Action. I’m not sure how that influences the matter at hand, but I think we all agree that we sell our labor on the labor market. How can something be sold if it cannot be owned?
Also, things like good will are often built into the valuation/selling price of a company or trademark (here I assume that no one will challenge the legitimacy of trademark ownership). These are intangibles and priced only according to their potential value to the buyer.
I think we all need to make sure we understand that just because the Labor Theory of Value is incorrect doesn’t mean that labor itself has no value or ownership. I think that’s Jonathan’s point, anyway…
- June 23, 2010 at 2:35 pm
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Scott D.,
Doesn’t ownership of things that do not even exist physically and are only conceived of in the potential seem the least bit nonsensical to you?
No, why would it be nonsensical? There is no overarching point to the ownership of labor. I’m not trying to build a case for something else. My point is that I don’t see anything crankish in the concept of the ownership of labor. Nobody else owns my labor but myself. As Ryan says, just because the labor theory of value is wrong doesn’t mean that so is the idea of ownership of labor.
It seems to me that ownership of labor goes hand-in-hand with ownership of self (ownership of one’s own actions).
Thinking about it twice, though, it seems that when one exchanges labor for a wage one is not selling his labor, as much as he is selling the fruits of his labor for that wage (“you produce for me, and I will pay you for that production”). Nonetheless, I think the point remains that one owns his own labor, as one owns his own actions (and labor is just a general category of rational actions).
Owning your labor makes about as much sense as owning the light from your flashlight, or the velocity of your moving car. You could claim ownership of such things, but why bother?
I’m not sure what your point is (and don’t I own the light of my flashlight, given that I can choose to turn it off or on?). It seems to me that you believe I am implying something much greater than I actually intend to.
- June 25, 2010 at 1:08 am
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Nobody else owns my labor but myself.
That statement, to me, is a signal that perhaps the question deserves a bit more thought. I could say that I own my thoughts, feelings, dreams, perceptions and sensations, but isn’t this just an expression of self-awareness? Does ownership have any meaning when the thing you claim ownership of does not even exist for anyone but yourself?
Thinking about it twice, though, it seems that when one exchanges labor for a wage one is not selling his labor, as much as he is selling the fruits of his labor for that wage…
Yes, exactly. The action of labor is always causally related to some change in the physical environment. Even a security guard who is paid just to watch a door has an effect, by altering the evironment to dissuade people from trying to sneak into the building.
I’m not sure what your point is (and don’t I own the light of my flashlight, given that I can choose to turn it off or on?). It seems to me that you believe I am implying something much greater than I actually intend to.
And you’ve hit upon my point exactly. You own the flashlight, but the light that it emits cannot be owned as a separate entity. You can’t sell the light from the flashlight. Oh, you can sell the flashlight. You could even get someone to pay you to shine your flashlight in a particular place, but are they actually buying light from you? It would seem to me that they are instead paying you for the service of shining your flashlight.
It is the same with labor. Your labor can have real effects whose outcome is deemed valuable, but you cannot separate your labor from you. Again, I am not claiming that you do not own your labor. Rather, I am saying that the concept of owning labor is meaningless, and as others have pointed out, leads to illogical conclusions.
- June 23, 2010 at 2:15 pm
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Well, I have not read either Marx or Locke (although I am familiar with their theories to a small extent), but maybe I can answer this based on my own reasoning:
Who owns my labor, if not myself?
This is a confusing way to put it. What does my labour actually mean? Is it the activity you do? You cannot own an activity, you can only act or not act. What you probably meant was Who owns the outcome of my labour? Well, what does that mean? From praxeological point of view, it can only mean things that are causally related to the act of labour. There is no way to narrow this down any more. This is why problems arise when you equate the outcome of one’s labour with property. You can see this both on Marxian theories as well as in many common IP theories, because this approach extends the definition of property beyond the scope of contracts. But the same assumption also means the demise of both theories. Causality extends to infinity. Once you cross the boundary of contracts, there is no place to stop. Without a place to stop, there are no boundaries. And without boundaries, the concept of property has no meaning.
(sorry for mixing your US spelling with my UK spelling, I prefer the UK one and want to remain consistent across my writings)
- June 23, 2010 at 2:29 pm
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Labor would obviously mean “the performance of an act.” One who performs an act cannot claim ownership over the activity, but can certainly claim ownership of the specific performance in question, even if the performance never actually takes place.
That’s my two cents anyway. I’ve made too many comments here now, so I will respectfully bow out and let others comment from here. Sorry everyone.
- June 23, 2010 at 4:50 pm
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[one] can certainly claim ownership of the specific performance in question, even if the performance never actually takes place.
But what does that actually mean? What is the scope of this “ownership”? That’s the problem. No matter how you formulate the definition of property, you need to define the scope thereof, and in my opinion, constructs like this don’t do that, they needlessly confuse instead. What is the scope of something that doesn’t take place? That makes no sense.
- June 23, 2010 at 7:15 pm
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I don’t understand what you don’t understand. The scope of the the ownership is the performance in question. “I will paint your fence beginning at noon on July 15th for $5000.” We’re talking about a one-time event at a known time, place, and date. Change any of the following, and you’re talking about a different performance: the actor, the location, the time, the date, the price, or the fence…
The scope of the ownership is determined by the contract, as Jonathan has implied, but not specifically noted. There is nothing abstract about it. The terms of the ownership are defined by the performance.
I am a semi-professional musician, so it is easy for me to see it this way. If someone hires me to play a specific piece on a specific date for a specific amount of money, then they are hiring my labor as a musician. If I violate the terms of that contract, then I have not fulfilled their order. But it is well within my power to deliver those terms, and as such I own my ability to do so.
The way you describe it, it’s almost as though you don’t see any employment contract as having any kind of validity beyond the abstract. In contrast, I see my ability to act as the fundamental unit of human ownership of anything at all. I believe Locke saw it this way, also.
But I do not believe that this is a justification for intellectual property or for the labor theory of value. On the contrary, I think this is a demonstration of Mises’ notion of technology (really, check it out in Human Action, he makes it pretty clear), and I think the key to understanding that it does not pertain to IP is understanding the difference between a performance of an activity and the activity itself in general.
- June 23, 2010 at 9:23 pm
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To be able to perform an action, it is sufficient to own one’s body. So the rihgt to do X is just a consequence of body-ownership. To say there is a right to do X that is somehow independent of or in addition to the body-rights is confused. Likewise, Rothbard in Ethics of Liberty explians that all rights are property rights; that there is no independent right to free speech or press–that these rights are just consquences of having property rihgts. To talk of owning action is just crankish and confused.
- June 24, 2010 at 7:33 am
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Stephan – I can’t reply to your comment directly, so I’m replying here…
I agree with everything you said, except for the last sentence, where you called my thoughts crankish and confused.
I think we are essentially in agreement about what I’m saying, but you’re stopping short of the semantic nuance I’m trying to convey, or else I’m just not doing a good job of conveying it. There is nothing confused about what I’m saying, even if you disagree with it. You’re trying to boil everything down to property ownership, which I could just as easily call crankish and confused. Perhaps it would help to better understand what Locke meant when he used the term “property” in the first place. (Hayek wrote on that topic, too.)
If there can be no ownership of action, then what exactly is being sold on the labor market? What is an accountant or a lawyer selling? Services. Action. Performance.
I empathize with your endeavor here, but I think you’ll find it a hard sell. I recommend reviewing Mises’ treatment of “technology,” Hayek’s treatment of Lockean “property,” and Locke’s Second Treatise… I really don’t find this issue as confusing (or “crankish”) as some do.
- June 24, 2010 at 7:51 am
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Sorry – I just thought of something else. It is most certainly NOT sufficient to own one’s body in order to perform an action. One must also possess the knowledge and/or skill required to perform the act. In short, one must possess in addition to one’s own body what Mises called technology. An invalid cannot perform a gymnastics routine, an ape cannot win a world-championship chess tournament. Sooner or later you have to acknowledge that there is more to action than physical possession. I don’t think that’s confused, or crankish, and I also don’t think it supports the labor theory of value, communism, or intellectual property. (On this last point, consider that in order to claim IP over the performance of an action, you would have to attempt to prevent others from gaining your knowledge, which is impossible without government coersion.)
- June 24, 2010 at 2:24 pm
- June 25, 2010 at 6:05 am
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Interesting, Stephan. I will have to read those things and consider the matter further. Thanks for the reading suggestions!
- June 23, 2010 at 2:43 pm
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Peter Surda,
This sort of touches on my point. Marx and Locke are effectively talking about two different things, and Marx misunderstands Locke’s thesis. In a society with multiple individuals property rights are largely defined by contractual law, more than some objective natural law.* So, in industrial Germany a worker has no claim over his production, because that worker explicitly agreed to a contract in which he surrendered his production for a wage. So, I agree with your overall point.
My point in my opening post was nothing more than the fact that property rights are defined by contracts and not by one’s labor doesn’t mean that the act of providing labor, or producing, is not owned by the specific individual acting. In other words, I argue that the two are unrelated.
* I don’t believe in natural, or objective, law at all, other than perhaps the ownership of one’s self, but I don’t think a discussion of natural law is necessary in this particular case.
- June 23, 2010 at 5:10 pm
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My apologies for dragging the discussion out of way of the original one, but I think my point is important.
The problem is that arguments and definitions that refer to abstract concepts as being property are confusing and useless. Confusing because the can be interpreted in many ways, making debate problematic. Useless because abstract concepts lack boundaries.
- June 23, 2010 at 5:21 pm
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I don’t think ownership of labor is abstract or confusing. Labor is nothing more than an action, and by definition you own your own actions (unless someone was to practice mind control over you). This, I think, is a foundation in the concept of ownership of self.
- June 23, 2010 at 7:22 pm
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i think it’s simpler to think of labor as time, which can be quantified as a finite resource. Acting under freewill we sell our time to our respective employers under the assumption that it will be used for the benefit of employer. I think it is somewhat related to the beginning of Rothbard’s treatise when he defines the individual’s lifetime as a resource and subject to scarcity, labor and liesure being the two uses for, and thus subject to marginal value theory.
Labor would equate to what Mises described in human action as technology, and depending on how you look at it might hold value because of higher skillsets garnishing higher wages; but looking at the last sentence it doesn’t really make sense to me.
What the F do I know, you guys figure it out. - June 23, 2010 at 9:23 pm
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Ownership of labor is confused — see my reply above http://blog.mises.org/13064/lock-smith-marx-and-the-labor-theory-of-value/comment-page-1/#comment-697053
- June 24, 2010 at 1:45 am
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I made some great cookies yesterday. Let me tell you, they were delicious. I know this because I ate them already (and have since gone to the bathroom). However, my labor in making those cookies is available on eBay. Minimum bid is $.44 (includes shipping.)
- June 26, 2010 at 8:10 am
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“Ownership of labor is confused — see my reply above”
Only to a parasite getting ready to feed.
- June 24, 2010 at 7:47 am
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I agree 100%. Kinsella is also right when he bring the question of “ownable” into the story. At the beginning I was also a believer in self-ownership and the idea that I own my labor… in the meantime I read a lot, and I discovered that the concept of ownership has no meaning in both of those cases. First the concept of ownership has some qualities (or call them properties) some of them may be optional but a number of them are required and if you can’t have those qualities of a class we call ownership then it isn’t ownership at all… and consequently the question of “ownability” arises. (The quotation marks are here because interestingly enough there is no mention of the words “ownable” and “ownability” in Oxford English Dictionary… I wonder why…)
I can say I own my car. I can use it, I can sell it, I can lend it, I can give it as a gift to someone, I can loose it, it can be destroyed, it can be replaced (the utility value at least), it can be stolen, &c…. I can’t do that with my labor nor with myself. The important thing to pay attention is that my car can exist independently of me, that is why it can be my ownership, that is why I can own it. My labor and certainly myself can’t exist independently of me.
I can’t answer Kinsella’s question (unfortunately) but I can tell something of a value instead (at least I hope so). People makes many mistakes in reasoning because they still try to build on Locke, Smith &c. While they works was and still are astonishing and valuable, they are a long time ago replaced with better works built on a top of them, works by Mises, Hayek, &c. I read Human Action regularly (twice a year) and between the readings I read a lot of other books, not necessarily “pure” Austrian/libertarian ones, like books from J.M.Buchanan, Michael Polanyi (I actually recommend his books Personal Knowledge and Meaning as a “must to read”), Karl Popper, &c. I do this because I know Mises, Hayek and all the others did the same, they was very familiar with all of these works, they didn’t come up with their ideas out of nothing by looking into the empty wall, they read all of those works and they combined the ideas and build on the previous ideas, correcting the errors they found along the way. Every time I read Human Action I understand it much better I see things I didn’t see before exactly because I learned some of the things Mises learned too. Human Action is an incredible masterpiece, it isn’t easy to understand, and I even believe that if I read it 100 times I will still be a little man who doesn’t understand it really.
So some of you can hate me because I say this, but the truth is that both economics and philosophy are hard areas, very hard areas, and I simple can’t understand why someone think he really command those things by quoting or believing some sentences written 200+ years ago. They are cute ideas, but that is all, most of them are primitive compared to the “upgraded” versions you can read from Menger, Mises, Hayek, &c. And even if you do, it is not easy to understand them really without understanding the underlying concepts which make possible real intellectual freedom and subsequently correct reasoning.
I always try to remember Michael Polanyi’s words: “The ideologies of the left and the right have no use for intellectual freedom.”
So at the end, it doesn’t matter who said what, we are not Marxist here, we don’t believe in something because some guy told us to do so, we try to find correct answers no matter who said it, when or why.
And this is why I agree with Peter Surda here, because he told us something very good, very real, and very correct, he was logical and also human. (I know this is actually a surprise especially for people who believe at least to some extent in positivist ideas, and most people does… unfortunately). A nonsense is a nonsense, no matter who said it, and ownership of labor or self ownership are exactly that… a nonsense. Nobody owns you not even you. Nobody owns labor, not even the guy who do the work. What you can own is the “fruit of your labor”… I’ll try to explain this a little better: we are all transformers, we transform matter from one form to another (using capital, knowledge and labor), so we actually don’t create things, we transform things hopefully from less valuable to more valuable forms.
What we can own is the “added value” not the labor. Before we start the transformation we have two different conditions, either we transform our property (we own the material we transform and the capital we need to do the work) or we transform somebody else property. In the first case, we own the property before the transformation (let say we own the wood and the glue) and after the transformation (we also own the chair we made). In the second case, we don’t own the product we only own the part of the “added value” of that property, in other words the product is now owned by the owner of the raw material, the owner of the capital (the tools we used) and we who transformed the wood and glue to a chair. We also must know that selling that product will require additional capital, knowledge and labor…
We are all “stakeholders” and after we sell the product we have a share of the property we owned together, the shares are determined by how the market value our stake. If there is a higher scarcity of raw materials than labor then the share of the raw material owner will be higher than our, if there is a higher scarcity of capital than labor then the share of the capital owner will be higher and if there is a higher scarcity of labor then the share of the labor provider (the worker) will be higher. The problem is that any of these stakeholders want to get the bigger stake, and that is why almost everyone is an enemy of the free market, because on the free market, none of them have control, all of them has opportunities and the freedom of choice, but they all want control not choice and not opportunities.
The labor theory of value is an idea that actually tells us that the market has no “right” to decide about value, this theory asserts that labor has value outside of the market. It doesn’t… I can work hard all day and produce no value, it is easy… I can also transform something of a more value to something of a less value so in that case my labor has negative value (loss). Do I believe that I own the loss? No I ask the government to bail me out…
But if I do that, I am not a stupid nor a bad man, no I just have a different experience based on the values and believes I hold and the tacit knowledge I posses. This is why the only way moving forward is to better our believes and knowledge, and rethinking our values all the time. If there is reasonable to hold to them, then we should, but if not, then we must find other more reasonable values. In a world where most people does worked with tangible (physical) things the concept of property was most of the time acceptable (this is why society accepted it), but now in the post-industrial world more and more people work with non-physical things, and some of them believe that the concept of property is acceptable as well (but society doesn’t accept that… that is why the majority downloads “illegal” stuff). The problem is that people used to live from capital and from labor (most of them mostly from labor) and they like to believe in a cute idea that they labor has value.
“IP” “laws” are here to give control to the provider of the idea (knowledge) based on the concept that an idea is a fruit of “labor”. It is a cute idea, but the problem is twofold, first as Peter Surda explained it has no logical sense, and as I like to say the “social phenomenon” part is also missing, in other words society doesn’t think it is the case. Why? Because society is about preserving the peace, the only “platform” acceptable for free enterprise and consequently the only way to use your capital, knowledge and labor in order to better yourself and rise your standard of living without harming other people… and if one side get privileges then peace is in danger.
That is why the majority of the people doesn’t care about the “IP” “laws”, because they have the tacit knowledge that “IP” “laws” hurts them… and people don’t accept anything that hurts them, what they really want in general, is that the market decide who’s stake will be higher today, not the “law”, not politics… unless they are 100% sure that the “law” and politics will give exactly to them the larger part. Of course this is not a zero sum game, but people tend to think of it as it is, because people tend to think only about already existing things, that is why they value an actual dollar today more than a hypothetical two dollars tomorrow, another thing in the story we are all tend to forget most of the time, and because of that all the answers are so cute to us that we accept them without really and critically thinking about them.
Now I admit I have no clue, so I get back to the reading…
- June 24, 2010 at 10:25 am
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JFC, you write ” I think it’s clear that if we are talking about writing a book, the physical book written belongs to the author. What doesn’t belong to the author are the words, and so by copying that book it’s not an infringement on that author’s property rights (unless the author and person X have previously decided on a contract agreeing to not copy the book—then it’s just a breach of contract). To clarify, the author is receiving the fruits of his labor.”
The physical book that appears in the store belongs to the publisher, who printed and distributed it. Once you buy it, it belongs to you.
The words belong jointly to the author and to the publisher. As the author normally gets a royalty on every copy sold, if you steal the words without paying for the book you have stolen from both the author and the publisher, who share the profits.
It’s the same in the music and film industries. Copyright protection tries to protect the intellectual property rights of both the studio and the artist from theft. There would be little incentive to produce and distribute works of art for public consumption if there were no intellectual property law.
If we transfer this kind of thinking to the world of paid labor, the principle still holds true– in a special way. The worker owns his labor until he sells it to another in return for wages. If that’s the entirety of the transaction, his employer now owns the fruits of those labors. (This is spelled out very specifically in many employment contracts where the worker is working in producing proprietary knowledge for the employer. As a condition of employment he has to sign an agreement that he will not, if he leaves the company, give any new employer the fruits of his labors at the old company, under penalty of judgment and heavy damages. Otherwise if your top research chemist ever decided to join the competition, you’d have to kill him!)
Ordinary labor normally has no claim to any additional compensation beyond the agreed-upon salary or wages. But in times where labor can command a premium, there are companies who skim off the top talent by also offering them stock options or a direct interest in the company. These plans go under the general designation of profit-sharing.
- June 23, 2010 at 1:24 pm
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I suggest you read Intellectuals written by Paul Johnson, chapter 3 is on Marx. The rest of the book is quite enlightening. I would never compare Marx to an orthodox economist.
- June 23, 2010 at 1:59 pm
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You are right that the common law types on “Law” are crankish—they mean well, but they operate from a state of ignorance regarding philosophy and political economy. Generally, they see “common law” as emanating in the ether from the Constitution or Declaration, as if it were some metaphysical force that binds all; that even judges can only avoid by trickery, and not by merely ruling incorrectly.
It never occurs to them that the “common law” is just as de facto and positivist as a statute. Sure, historically, because of the nature of its development and its method, the common law was a better approximation of rules and their application in accordance with the libertarian standard of justice, but that doesn’t make it real or de jure.
I do think there is a discoverable “natural law”; that is a set of objective ethics whereby the failure of an individual to observe those ethics would be an irrational act (not on Humean grounds though, more Aquinas and Finnis), but that is a philisophical position with many nuances and open to debate.
As to the connection with logical positivism & empiricism, my first reaction is that those principles came to popularity in the West around the same time legal positivism did. In many ways it was a rejection of the medieval scholastic method and the Old World continental views, which admittedly had their flaws.
- June 23, 2010 at 3:39 pm
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Mr. Kinsella,
To answer the original question you posed, I believe I remember Rothbard briefly mentioning how Smith and Ricardo encouraged the LVT in his one hour introduction to Austrian Economics http://mises.org/media/961.
Unfortunately, I don’t remember where in the video. Also, I do believe there is another article or video where he does go into more detail about it.
What’s the non-Lockean way of justifying homesteading? I thought Rothbard justified homesteading much the same way that Locke did?
- June 23, 2010 at 4:57 pm
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I don’t see what the labor theory of value and the labor theory of ownership (homesteading due to owning one’s own labor) have to do with one another. I also don’t see what an intellectual pedigree from Smith to Marx will accomplish. I just think you have to come up with a reasonable justification for homesteading that doesn’t involve the concept that one owns one’s labor.
- June 23, 2010 at 9:25 pm
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Some see some connection–that is what I’m after. See e.g. http://en.wikipedia.org/wiki/Labor_theory_of_value
The birth of the LTV
Benjamin Franklin in his 1729 essay entitled “A Modest Enquiry into the Nature and Necessity of a Paper Currency” is sometimes credited (including by Karl Marx) with originating the concept. However, the theory has been traced back to Treatise of Taxes, written in 1662 by Sir William Petty[15] and to John Locke’s notion, set out in the Second Treatise on Government (1689), that property derives from labor through the act of “mixing” one’s labor with items in the common store of goods, though this has alternatively been seen as a labor theory of property. Other writers (including Joseph Schumpeter) have traced back the concept even further to Ibn Khaldun, who in his Muqaddimah (1377), described labor as the source of value, necessary for all earnings and capital accumulation, obvious in the case of craft. He argued that even if earning “results from something other than a craft, the value of the resulting profit and acquired (capital) must (also) include the value of the labor by which it was obtained. Without labor, it would not have been acquired.”[16]”
At the very least, it seems that the errors in Locke and in Ricardo/Smith/Marx all stem from a confused understanding of what labor is.
- June 24, 2010 at 8:18 am
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I agree that there is a lot of confusion regarding labor, and what labor does and does not do. My point was that if you simply avoid all that confusion, and successfully come up with a convincing justification for the homesteading of property that does not involve the notion of labor, you don’t really need to delve into all that confusion. You can bypass it. Besides, one right idea is more valuable than a whole geneology of bad ideas.
- June 24, 2010 at 2:29 pm
- June 23, 2010 at 6:48 pm
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George Reisman has terrific stuff explaining how Marx fits into the classical tradition whose cornerstone was LTV.
- June 23, 2010 at 9:25 pm
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In Capitalism, I assume. I’ll take a look. Thanks SK
- June 23, 2010 at 10:22 pm
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I agree with S. Kinsella: wages are like any other price, it’s determined by supply and demand. Simple.
- June 24, 2010 at 4:48 am
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While it is obvious that the subjective theory of value is correct and the labor theory incorrect, I think we need to think through the whole issue of “labor.” Of course there is no labor prior to the action of laboring. Part of the problem may be that we are thinking of “labor” as a noun and not, as it really is, a verb. It is an action, not a thing.
When we hire someone, what are we doing? Are we paying for their time? In part. But really, we are paying for the actions they will perform during that time. If they do not perform those actions to our satisfaction, we no longer want them to perform those actions for us. When we hire someone, we are thus paying them for their laboring activities.
So the real question is: can one own an activity? Can one own one’s actions?
Now, as for Locke and Smith, I can see how one gets from one to the other. Locke suggests that we own land we put labor into. When we work the land, we increase its value. What increased the value? The labor. Thus, labor creates value — and we get the labor theory of value.
The subjetive theory of value is a much better theory because it can explain what the above theory cannot, which is why a piece of land devoid of trees because someone removed the trees through their own personal labor is worth the same to a farmer as a piece of land devoid of trees because there were never any trees there (a piece of plains land, for example). The answer is that land without trees has more value to a farmer than one with trees. He could care less how the land became treeless. If (value of treeless land) > (value of labor to remove trees) + (value of land with trees), then someone will happily buy up land with trees and remove the trees to sell the treeless land. If not, then there is no incentive to clear land, and nobody will clear it. But more than that, if someone has a lot of tree-clearing equipment, he can clear it cheaper than someone who does not, so it might be worth it to let someone else clear the land if it is cheaper for them to do so. Is one person’s labor worth less than another? That makes no sense with a labor theory of value — only with a subjective theory of value.
I’m not sure how this relates to IP, though. Is phyiscal work, such as the mere repetition of movement one does on an assembly line, really the same as invention? Both are certainly kinds of activities, but they are also just as certainly on different levels of complexity. Invention is creative action. Is not creative action a different kind of action? One can steal an idea or an invention, but one cannot steal one’s labor (at least, not for long, anyway — as the laborer will stop working once they realize they have been doing so for free). This suggests they are different kinds of things.
As a writer, I can see a few points of view on this. If I write a poem, I want people to read it and, hopefully, be influenced by it. So I want it out there. Most poets have to give their poems away to literary magazines, though every once in a while, you can sell a poem. The right of the poem, even one that is sold, remains with the author. I can publish my poem elsewhere, for example (though the place that reprints the poem often want to know it has been published elsewhere). Now suppose that I write a poem:
On the Wealthy
We learned to hate the wealthy when
The wealthy were all thieves
And rulers with the strength to take
Whatever they should please.The wealthy, when they gained their wealth
From voluntary trade,
Were thought to get their wealth the way
The ruler thieves were paid.So then we turn back to the thieves
Who promise that they’ll take
The wealth from those who earned that wealth
Then lie: “It’s for your sake.”We’ve come to trust the ones who made
Us never trust the rich
And, rather than take a hand up,
Lie beaten in a ditch.Exchange is new and power’s old
So it feels natural –
But if we keep believing that,
We’ll live still in the Fall.Now suppose that some other poet comes along and read my poem and changes just a word or two:
We learned to hate the wealthy ’cause
The wealthy all are theives
And rulers with the strength to take
Whatever they should please.And then claims they are the original writer of the poem. What recourse do I have? I mean, it is one thing if the person does it to satirize my poem — so long as they acknowledge I am the original author. Unless the poem is protected somehow as my creation, what if any recourse could I have? I’ve never had a satisfactory answer to this.
But poems, like I pointed out, are often given away for free. Novels are typically written, then sold to a publisher, and the author is paid by the publisher for that first opportunity to publish the work. So, that is easy enough without IP. But plays are another creature entirely. Right now, theaters have to pay me to perform my plays. But without IP protection, all I have to do is send it to one theater, and it could potentially be sent to just about every theater in the world, and everyone could produce it, with no benefits to me (other than reputation — which is great, but it doesn’t exactly pay the bills, now does it?). Now, I would love to be independently wealthy and able to write and give away plays all day long (if I were, I would), but that is hardly the case. I have to receive some compensation in order to be in a position to be able to create more plays. Unless I become a successful playwright — meaning I am making money writing my plays — I probably won’t be able to write too many more. It’s a matter of time and money (if I have to spend all my time working at other jobs, like the hotel I am working at and writing from now, then I cannot write plays).
Painters do not have this problem. They have a unique physical object they are selling. But musicians and playwrights, on the other hand, face these kinds of problems. I would love to know what one could do to solve these problems without IP.
- June 24, 2010 at 8:29 am
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“Unless the poem is protected somehow as my creation, what if any recourse could I have? I’ve never had a satisfactory answer to this.”
I think the reason you’ve never had a satisfactory answer is because you’ve decided ahead of time what answers you want. Therefore, any answer that says that there is no recourse if somebody attributes your poem to himself is immediately rejected.
- June 25, 2010 at 1:25 am
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I don’t know what answers I want. I want an actual answer. Snide remarks aren’t an answer — and suggest you don’t have one.
- June 25, 2010 at 7:32 am
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Well, maybe if I make the question more generic it will be obvious. What recourse should you have when you are unhappy about something? This is the wrong question. Why should you have legal protection merely because you are unhappy?
- June 26, 2010 at 2:06 am
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Just because you are unhappy with someone on your property, does that mean you have legal protection just because you’re unhappy? This is MY creation. It is MY poem. It is my property. Being robbed makes you unhappy — should we just say, “So what?” There’s more to this than unhappiness.
Fortunately for this topic, Kinsella gives actual answers. Because so far on this subthread, most people would dismiss oppoents of IP as cranks. Let’s try to come up with some real arguments.
- June 26, 2010 at 3:23 am
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This is circular reasoning, which is what Russ was pointing out in the beginning. You cannot define property by being unhappy about an activity. I am unhappy when people answer stupidly, does that mean they are violating my property? Of course, you should have a legal recourse when you are unhappy about a property rights violation, but that assumes the existence of the property rights over that in the first place. If immaterial goods cannot be owned, even if you are unhappy, there is no legal recourse, although you are still left with economic means of reaction.
- June 27, 2010 at 1:06 am
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This isn’t about being unhappy. It’s about theft.
- June 24, 2010 at 8:36 am
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Nobody buys anyone else’s actions, they buy the product of those actions.
Contracts provide a means by which the price of a future product of an action can be established. Such a contract creates information that allows each party to act based on his understanding of the likely outcome of the action.
Labor performed without an agreed upon contract is an entrepreneurial act in which the laborer assumes the risk that he may be unable to secure a satisfactory price for his product. In fact, I would say that he doesn’t even own this product. A positive property rights regime might increase his chances of being paid for this product – or more accurately, it would enable him to more easily prevent others from using it unless he received a satisfactory price. However, absent such a regime, he must bear all costs of this protection.
Regardless of whether the product is a painted fence, and assembled widget, a or a script for a play, the contract serves the same purpose. A “creative” act with an intangible product is no different from any other act. If you create something prior to finding a buyer, you assume all risk that you won’t be able to recoup the opportunity cost of your time spent laboring.
The problem of IP, from a utilitarian standpoint, is incentivisation. Since IP is cheap to reproduce, it is difficult to protect once it has been created. This makes it difficult to profit as an entrepreneurial actor, creating a product prior to finding a buyer. The utilitarian pro-IP protection argument is that this entrepreneurship must be incentivised by granting the actor exclusivity over the act of reproducing the product, otherwise such entrepreneurship of intangible products will grind to a halt.
So how could this entrepreneurship be supported without positive IP rights? This is really a question of business models, not fundamental rights. You could write plays in order to build a reputation as a reliable playwright, in the hope that some producer will offer you a contract to write a new play in the future. You may not have complete creative control in this arrangement, because you are creating a product that someone else wants.
This is just one possible path to success – given the chance, I’m sure that many others would be discovered by entrepreneurs. If eliminating IP protection really does cause a collapse in supply, the most dedicated and talented playwrights who continue to produce regardless should find willing buyers who demand new content.
Only scarce goods can be valued and sold. Future goods are always scarce in the present. Present goods that can be easily reproduced are only scarce if they are withheld from distribution. If you expect financial profit from labor in any field, find a contractual buyer first or assume the risk of an entrepreneurial loss.
If you are unable to work full time in labor that you enjoy, welcome to the rat race!
- June 24, 2010 at 9:54 am
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You said: “Nobody buys anyone else’s actions, they buy the product of those actions.”
I disagree with this. This becomes really obvious in the realm of performing arts: music, dancing, stand-up comedy, acting, etc. When you hire a singer, you aren’t buying “a song,” you’re buying a specific performance by a specific individual. The action is the product; the product is the action. More complex examples, such as painting a fence or buying a computer stem from the most basic fundamental unit of the performance of a given action by a given individual. In my opinion, anyway.
- June 24, 2010 at 12:24 pm
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What you are buying in all cases is your satisfaction. The act of performance is a means to achieve that. To put it in differnet words, the performance is the condition of the contract. Or yet another way, the satisfaction is causally related to the act of performance.
- June 24, 2010 at 2:32 pm
- June 25, 2010 at 6:09 am
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Technically, every contract is a purchase of satisfaction, but only indirectly. Forget action and consider any physical transaction – satisfaction is implied. Moreover, satisfaction definitely cannot be “owned” (especially if you think a performance can’t be owned!).
- June 25, 2010 at 6:45 am
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I do not claim that satisfaction can be owned, but that it is the goal. You need to stop inserting “property” everywhere, it is deceptive
- June 25, 2010 at 1:28 am
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Creativity doesn’t work that way. You can’t be creative on demand, even if you are being paid to be creative. When a poem or a play or a short story comes to me, it comes to me. I write it down, or I lose it. I can’t sit around and wait for someone to pay me. More, nobody is going to believe I’m a poet if I haven’t written any poems. This is an unrealistic expectation when it comes to any kind of creativity, it seems to me.
- June 25, 2010 at 7:55 am
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I agree, but you also don’t have to share or promote your creation as soon as you create it. Your poem is a scarce good to everyone else until you decide to release it in some form. If you are able to build up a reputation (probably by seeking promotion rather than pay early in your career), you may be able to persuade fans to pay you in advance, or contract to pay for it and not reproduce it (which is not the same thing as a universal copyright law). Of course, they are then assuming the risk that the new unknown poem may not give them as much satisfaction as a previous one did.
Again, this is just one conceivable business plan, and it may not be suited to whatever ends you hope to achieve in your creative endeavors. If you are unwilling to sacrifice creative control for a paycheck, you probably get some satisfaction out of the act of creation itself. This doesn’t mean that it isn’t labor, only that any price you might receive for it is complemented by the satisfaction you have gained in creating it. Logically, this should mean that you are generally willing to accept a lower price for something in which you have full creative control.
As Peter Surda clarified, you don’t purchase someone else’s action, you purchase the satisfaction you hope to receive as a result of the performance. Exchange is a means to an end just as performing the song yourself with a hairbrush in front of a mirror would be. If you pay someone else to do it, you obvously expect to gain more satisfaction from their performance than from your own.
If someone else wants to pay you to create something, they either want you to use your own creative judgement, which they have presumably come to trust, or they want you to create something to their specification. In either case, they are seeking their own satisfaction, not yours. If you don’t like the terms of the contract based on creative differences or whatever, you don’t have to take the job. If they don’t think that you will deliver something to their satisfaction, what motive do they have for paying you?
The defining element of markets is exchange. This means that in order to participate you must produce goods that other people want, not just ones that you want. In order to be successful in exchange, you must identify what other people want, and find a way to secure payment while it is still a scarce good.
- June 26, 2010 at 3:30 am
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All of this is true, but it doesn’t address the issue of the fact that someone can steal a poem in a way that is different from the way you can steal a shirt. I’m not talking about sending it around to people because you like it. By all means, do that. So long as you attribute the poem to me. How, without IP, can we ensure that my poem that I created will be attributed to me?
This is less a problem with a poem, for example, since we poets do in fact give those away most of the time. But one can become wealthy writing plays and movie scripts. Off of just one, in fact. Suppose I write a screenplay, and I can’t copywright it, because there are no IP laws, and someone gets ahold of my screenplay and sells it, claiming they wrote it? They get paid, I get nothing. I don’t even have legal recourse. I suppose someone could say, “Well, sometimes life’s not fair.” True enough. Think about that the next time you get robbed. Don’t worry about it, don’t report it to the police — after all, sometime’s life’s not fair. Nobody here’s going to accept that as an explanation for things you buy.
I want to know how my creation is protected. To say, “It shouldn’t be” won’t convince anyone who is an artist or inventor.
- June 26, 2010 at 3:59 am
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I want to know how my creation is protected.
Your creation is already protected by the (physical) property laws. You just want the protection to be extended onto a more abstract level.
- June 27, 2010 at 1:08 am
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That makes no sense for a poem or a play. Those are reproducable words.
- June 27, 2010 at 5:09 am
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So, because the delimitation of rights does not fit into your business model, the rights should be changed?
- June 28, 2010 at 12:37 am
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It doesn’t fit reality. That’s why I’m not yet comfortable giving up my IP rights. Address the concern. Deal with the reality of the thing at hand. It’s not an issue of it being a “business model,” but of physical reality. It is infinitely reproduceable — and more and more so as time passes. Land is not. We’re not dealing with the 19th century. We’re dealing with the 21st. Please join that reality in discussing these things.
- June 28, 2010 at 1:56 am
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It does fit reality, you just refuse to see it. IP, on the other hand, is all about imagination and interpretation.
- July 1, 2010 at 4:23 am
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It’s not that I refuse to see it — it’s that irrefutable evidence has yet to be presented to me. Deal with the arguments. Don’t just lament the fact that I have yet to blindly become a true believer. Maybe I can’t see it because it’s not really there. Prove otherwise.
- July 1, 2010 at 4:51 am
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Well, I dealt with the facts, as opposed to imagination, for a long time and this is my conclusion. You have not dealt with the facts. Rather than me abandoning my “beliefs” (which are actually a conclusion of a long process of analysis and hard confrontations), it should be you who abandons yours and face the facts.
- July 2, 2010 at 3:03 am
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You have presented no facts. You have merely made the contention that intellectual property isn’t property. I disagree. I propose that it has more complex existence than what are commonly understood to be “physical objects” and that you want to accept the existence of lower-complexity entities, but not of higher complexity entities. You disagree with me that a certain aspect of reality actually exists. But it exists whether you agree that it exists or not. That’s a fact.
- July 2, 2010 at 3:37 am
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You refuse to abandon your belief that your imagination is real.
- July 3, 2010 at 3:05 am
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Yes, you amino acid, the cell is real. It actually exists. And the mind and imagination exists in the same relationship to the brain.
- July 3, 2010 at 7:01 am
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You are confusing physical objects with the categorisation thereof which happen in human minds.
- July 4, 2010 at 2:44 pm
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This isn’t about categorization. It’s about the creation of new things through the organizing abilities of the mind. I don’t know what you’re talking about.
- July 4, 2010 at 3:27 pm
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The creation you are talking about only occurs in people’s minds, it is not an empirical phenomenon. On the empirical level, you merely alter existing objects, but your mind can interpret it as an act of creation. You mix metaphors with empirical phenomena, causing confusion.
- July 5, 2010 at 12:36 am
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No, the creativity I am talking about has in fact been mathematically modeled, and is known as bios theory. I am pretty sure if you can model a process, that process has existence. And, as I have shown, physical things are in fact processes. You are merely rejecting as real a more complex level process while accepting as real less complex level processes. That is all.
- July 5, 2010 at 3:03 am
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You appear to be committing the same misinterpretation of my argument Kerem Tibuk does, only he has been stuck on it for a year. You on the other hand, have shown the ability to properly counterargue, as a true scholar. Thank you.
You seem to think that the strength of my argument lies in the denial of causality and similarity. However, that is not the point. The point is that they both extend to infinity, and in order to use them to define property, you need to divide them to two categories: the relevant and the irrelevant. It is this distinction that is unreal, subjective, and only exists in people’s minds. Therefore, you need to come up with a different factor that determines property boundaries.
My theory, on the other hand, is based on change. Change determines boundaries. Any change. There is no need to divide the changes into the relevant and irrelevant.
- June 24, 2010 at 9:40 am
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you’re assuming that the product you’re selling currently must find a market. imagine that a ip-free market will bear only old plays, where all the creative costs are sunk – well, playrights will go the way of wagon-wheel fabricators, and no one sings ballads about their demise.
more likely, however, is that there remains some appetite for new material, and consequently some writers will be able to insist on money up-front, or some other innovative pay model. reputation does pay many bills: see paris hilton and others, famous for being famous.
what if the arts market were slimmed down in line with consumers’ preferences, could you criticize them for their tastes?
- June 25, 2010 at 1:35 am
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I would love for the arts market to slim down in line with customer’s preferences — I suspect I would do a lot better than many of the pomo work out there now. But that is less an issue with IP as with government subsidization of theaters.
- June 25, 2010 at 1:52 am
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true, but aside from subsidies, if the lack of government-sanctioned ip protection resulted in a smaller arts pie, would not that be a reflection on the sum of consumers’ wishes?
- June 26, 2010 at 2:09 am
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Not necessarily. It might be a refleciton of artists’ unwillingness to release anything they can’t ensure is protected from theft.
- June 26, 2010 at 2:26 am
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then it’s on the artists to incorporate some protection device, and to bear the costs of this. much like i put up a fence at my own expense to deter pilferers, or mark the boundaries where i can defend what’s mine.
- June 26, 2010 at 3:00 am
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And if you personally cannot defend what is yours? This ends up boiling down to “it’s yours if you can keep it,” and that’s no defense of property rights — of any kind.
- June 26, 2010 at 4:23 am
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“it’s yours if you can keep it”
fences may indeed provide physical protection, but in most cases the security is by virtue of people recognizing where someone’s claim is, in order not to involuntarily trespass. ideas are too amorphous to be claimed by any one person without others contesting their origins. even the most original literary work contains sentences, ideas, turns of speech etc that have appeared before, and so “originality” is established on purely arbitrary lines.
- June 27, 2010 at 1:23 am
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Reality is ambiguous this way. And it’ s not arbitrary. A change that makes a difference is original. No change is theft. Period.
- June 27, 2010 at 6:48 am
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one comma omitted makes an “original” work. period.
- June 28, 2010 at 12:38 am
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Wrong. Period. If I steal your car and paint it a different color, that doesn’t make the car mine.
- June 24, 2010 at 2:30 pm
- June 24, 2010 at 5:49 pm
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Troy: I’ll have to go with the subjective theory of value. An article of commerce is only ‘worth’ what someone’s willing to pay for it. But that’s quite a separate question from ‘asking price’. To compute the asking price, the manufacturer has to take into account all of his production costs. And among those, labor is very often the greatest one.
Also, a farmer would greatly prefer a field that had been cleared of trees to one that had always been treeless, for the reason that treeless land indicates a dry zone. And he would have to add the costs of irrigation to render the land usable. Whereas land cleared of trees should normally get plenty of rain. It is thus worth much more.
I’m just a big killjoy some days. Otherwise a very good post.
- June 25, 2010 at 1:31 am
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Now we’re just nitpicking. I eliminated any other considerations just to make the point that the subjective theory of value and not the labor theory of value is the correct one. Of course, all those other things would be taken into consideration.
- July 5, 2010 at 5:40 am
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“I’m just a big killjoy some days”
Once again michael, despite making an almost trivial post by his waffly standards, manages to insert himself into it, showing yet again what he is really here to do ie. talk about himself.
- June 24, 2010 at 5:13 am
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With apologies, I’m a lawyer. I will unfortunately not be able to contribute to Stephan Kinsella’s original question because I don’t have the necessary background. However, the above discussion touches on a concept that, as a lawyer, I have not been able to understand: self-ownership. The reason why I don’t understand self-ownership is that, although from a legal perspective ownership of something is characterized by its owner’s ability to sell or otherwise dispose of the thing, that ability does not exist with respect to the owner’s self. Such an exception, in my lawyerly mind, completely undermines the concept of self-ownership and makes it impossible to understand.
In my opinion, pace Murray Rothbard, we should get rid of the concept of self-ownership in our analysis of property rights. I fully agree with Stephan Kinsella’s initial statement that “Locke’s idea that homesteading rests on ‘ownership’ of labor is mistaken–it’s an unnecessary step.” The approach I would take, and I confess that I have not had the time to fully explore what I’m about to suggest, would be to think about the owner’s own satisfaction as the basis of property rights. I apologize in advance for the lengthy posting that follows.
If we imagine a situation in which there is only one person in the world, property rights are so unnecessary that they would not event exist. That individual would not need to assert his or her rights against any other individual. It is possible, though, that the individual would need to defend certain things from the “competition” of animals. For example, the individual may have hunted a rabbit and there may be a hyena around trying to take that rabbit away from the individual. Or, a somewhat different example, the individual may have made a toy with some wood and stones, and a chimpanzee may be trying to take the toy away from the individual. In those situations, property rights would not be asserted, but instead violence might be resorted to. I would tend to believe that the individual would not be pleased if the rabbit or the toy were taken away from him or her. The individual’s level of satisfaction would be lower after the loss of the rabbit or the toy than it was before.
With one essential exception, the situation does not change much if there are two people in the world. Assuming that they live in the same area and can be in contact with each other, these two people will probably maintain the same type of relations that the original individual maintained with the hyena and the chimpanzee, one of violence. The second individual would be perceived by the first as posing the same kind of threat that the hyena and the chimpanzee posed, that is, the possibility of losing the rabbit the individual hunted or the toy the individual made, and of suffering the consequent loss of satisfaction.
However, and this essential exception is what makes the difference between human and non-human relations, it is possible for the two individuals to realize that they can work together to achieve objectives that they would not be able to achieve individually. If they come to that realization (and logic would indicate that such realization took place even before the dawn of civilization), those two individuals will start to cooperate with each other. But cooperation is impossible in an atmosphere of violence, and therefore each of the individuals will avoid triggering the violence that would arise, for example, if one of them tried to take away without consent the rabbits that the other hunts or the toys that the other makes.
A third individual can be added to the cooperating group, and a fourth and a fifth, each of them staying away from each other’s rabbits and toys. As the group increases in size, direct exchange arises and specialization improves productivity. At some point, the rabbit hunter starts exchanging rabbits for the toys of the toymaker, and their respective levels of satisfaction increase, all as wonderfully explained by Mises and Rothbard.
Eventually, however, given human nature, one of the members of the group, or maybe a person who is not a member of the group, will want to obtain a rabbit or a toy without hunting or making it or giving something in exchange for it. The rabbit hunter or the toymaker would likely want to keep the rabbit or toy, and violence would become almost unavoidable. As a result, the framework for cooperation would be weakened.
Recognizing, probably subconsciously, that it is not in their interest to resort to violence and weakening the framework for cooperation, because that weakening would result in lower productivity and therefore lower satisfaction, the members of the group find a solution that avoids violence: arbitration. They ask a third person, probably the oldest or the strongest of the group, to solve the dispute. And the arbitrator will most likely ask, “who hunted the rabbit/made the toy?”. The arbitrator will probably realize that losing the rabbit or toy against their will would result in loss of satisfaction on the part of the rabbit hunter or the toymaker, and will rule that the rabbit or the toy stays with the hunter or maker.
As the group becomes more complex, a violence-triggering situation will arise that involves a person who has not directly produced the item in question, for example if the person hunted a rabbit and then exchanged it for a hat. If the hat is the item in question, then the analysis of the situation can quickly become impossible. The performance of a complete analysis would require tracing the original item that was hunted or made and then given in exchange for something else that someone else hunted or made, with as many layers of hunting, making and exchanging as needed. To avoid this complexity, the question that the arbitrator needs to ask is no longer, “who hunted/made it?”, but rather, “who is entitled to it?”. Entitlement then would arise from hunting, making or exchanging something that one hunted or made for something else that someone else hunted, made or received in exchange, ignoring previous hunts, makings or exchanges that cannot be traced. As you can see from the complexity of the description of the analysis, way before the moment when a hundred exchanges have taken place it may no longer be possible in practice to ascertain all the transactions that resulted in the situation at hand.
I believe that the concept of property rights arose as a convenient tool to solve disputes. The above account makes logical sense to me, although I would be unable to prove it factually. That account would not explain ownership of land, although with more time and thought it may be possible to expand the theory to cover it (for example, as an evolution from reduced satisfaction for the loss of a crop to reduced satisfaction for the loss of the place where the crop grows). But the account might do away with the concept of self-ownership and ownership of one’s own labor as a basis for the theory of property rights. I hope that some of you find this approach interesting.
- June 24, 2010 at 9:24 am
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selling one’s kidney, cornea, blood, semen, hair, breast-milk…isn’t that self-ownership in glorious action?
- June 24, 2010 at 9:56 am
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newson, I would believe that the examples you provide above do not relate to the concept of self-ownership as used by Locke and Rothbard, which is what I was referring to. What you suggest seems to relate more to the ownership of parts of the seller’s body, or of the metabolic production of the seller’s body, than to the Lockean and Rothbardian concept that, because a laborer owns himself or herself, by mixing the laborer’s labor with land, the result of that mixture is then owned by the laborer.
- June 25, 2010 at 2:01 am
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It reflects the action of a rational animal with a volitional consciousness. It is only because you are able to form various concepts that you are able to form the concept of surviving with one kidney less (for instance). Tigers can’t and do not volunteer their kidneys for other tigers. There is, therefore, no need to refer to “self-ownership” to understand these choices made by people.
- June 24, 2010 at 9:33 am
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Sorry if this has already been said, I haven’t yet had time to read all the comments to this post.
I recently finished reading The Wealth of Nations in Liberty Fund’s excellent two volume addition. Although Smith seems at times to be ambiguous regarding the relationship between labor and value, I got the distinct impression that, fundamentally, he saw labor as a means of measuring the value of goods, as opposed to all the value of goods being derived from labor. He clearly states (I don’t have the exact quote in front of me) that the exchange value of goods is determined on the market by forces of supply and demand aggregated from all the various economic actors. His discussion of “natural price” and its relation to labor is fuzzy, and although at times he seems to be implying that the natural price of a good is somehow tied to labor, at other times he goes in the other direction.
My personal thinking is that (1) he had not clearly worked out the implications of this theory, thus leading to ambiguity in his explanations, and (2) his stressing of labor is a direct result of his laudable efforts to demonstrate the value of the division of labor, both domestically and internationally.
In the Locke’s Second Treatise, it is clear that Locke takes a much more hardcore view of the labor theory of value, stating that the vast majority of all “value” of goods comes from labor. Even this statement, however, must be qualified. Looked at in context, he is attempting to illustrate the degree to which human labor can transform the natural world to meet the needs of man. Cultivated land bears more fruit than wild land. Looked at in this light, it is true in a certain sense that labor makes things valuable, or, to be more precise, things which man has labored on are more likely to be valued by others than raw nature.
Both Smith’s and Locke’s views on labor were early attempts to understand highly complex phenomena in a new and emerging science. Although their ambiguity allows for a lot of misunderstanding and even perversion, I think it is a bit unfair to attack them so vehemently as Rothbard has done, simply because they made errors in a new field. Additionally, I believe that is unfair to blame someone because of what later thinkers did with their ideas (or unfair to blame them to such an extent as Rothbard has done).
After all, we do not vilify Copernicus because, despite his invaluable contributions to modern science, he still made many mistakes. Smith and Locke, I would argue, deserve a bit more leniency than has often been given them by their critics. - June 24, 2010 at 9:49 am
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“I’m aware of the arguments connecting Smith/Ricardo and Marx. What I’m more interested in is any connection between Locke’s views on labor and is relation to homesteading, and Smith/Ricardo.
Lockean homesteading is basically right, in my view, but it doesn’t need to assume ownership of labor. It’s just an unnecessary assumption thrown in.” -SK(1) How exactly do you see Locke’s conception of “owning” labor as connected or potentially connected with Smith? (Sorry if I’m asking to repeat yourself)
(2) In Locke’s chapter on Property in the Second Treatise, his most extensive discussion of labor runs parallel to his account of how man leaves the State of Nature and moves into “civilized” society. I think that, when he looks at a hypothetical “natural” world and his modern day England, and asks how that change could have come about, human effort is what he hones in on.
With regards to “owning labor”, I think that Locke is trying to create a justification based on Natural Law to get rid of the idea of any kind of natural slavery. Since, according to him, each man is living his life on loan from God (which is why suicide is not OK for him, since you are damaging God’s property), and his labor is not separable from himself, his labor (in this life) is his own. This premise also makes freedom of contract more easily defensible.
Although this may not be completely necessary to account for homesteading, it plays an important role in Locke’s overall understanding of Natural Rights. He needed to establish a natural, non-conventional justification connecting a man with his property, prior to the intervention of society and its laws.
- June 24, 2010 at 10:40 am
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Looking over all these comments, I’m thinking there’s general agreement that one can own labor. And can sell that labor on the open market. Also that one owns oneself. Therefore it should be possible and legal, in a libertarian society, to sell oneself to another and to be that person’s slave.
What would possess one to do that? Duress. Let’s say that the clearly evil avenue of discharging one’s debts to another through personal bankruptcy is considered to be theft from that other, in this perfect society we posit. And so bankruptcy is rightly outlawed. Then it would only seem natural that when one accrues a legitimate debt to another, and can’t pay, that he either be imprisoned for theft (we can send him to a poor farm or a debtor’s prison) or he can avoid such a fate by selling himself to his creditor and existing thereafter as his legal slave.
Can anyone find a flaw in that theory?
- June 24, 2010 at 10:50 am
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I think we need to distinguish between different kinds of slavery. For example, there may be stipulations in a contract that, in the event one party cannot pay, he will be subject to a certain kind of servitude for a certain length of time.
This is not the same as me simply selling myself into completely slavery for an indefinite period of time, with no qualifications. I see the big differences between the two scenarios as follows. In the first case, there is no complete surrendering of the will of the debtor. My servitude to the other party may involve certain kinds of labor, but limits would be set on the length and/or nature of my servitude. In the second case, I am attempting to completely alienate not only my own labor, but my WILL, which is simply impossible.
Needless to say, this is not a complete explanation, but I think that the basic distinction exists.
- June 28, 2010 at 2:21 am
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Well, I think you’ve set up an interesting situation, but I think there are some issues with the scenario posed here.
1) Supposing the debt is on a loan or credit extension the stipulations of violations of that contract would be set up in the contract itself theoretically (or if they were not, a court would need to arbitrate to decide the punishment to suit that crime).
2) It seems that whether the contract or arbitration decided the punishment it’s almost certainly not anything like debtor’s prison. Why? Because absent government the only way to pay debtors prison is for the company to put up the dollars to leave the debtor in prison. And no court would be ok with killing the man or putting him in poor conditions, the whole grounds for libertarianism being Non-Aggression Principle it’s difficult to imagine anyone deciding this is the correct punishment for not repaying a loan.
So the only way for me to go along with the whole slavery scenario here is to imagine that the contract stipulates that prison (or slavery itself) is the outcome of not repaying the loan. If this were clear before the contract was signed and agreed upon by both parties, I’d say the agreement should be honored. However, provided that the nature of slavery/prison was not defined, I’d say there would at least be arbitration for what was meant by that in terms of how many hours of labor/etc. The decision would be based on the situation and limitations on servitude would be in keeping with that.
- June 28, 2010 at 2:23 am
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I think it’s important to check other parts of the premise here as well. While “bankruptcy law” would not exist, debt forgiveness would likely still occur in many cases. The amount would not be worth collecting if it were too low, and also the costs of litigation might also exceed the amount to be recovered.
I work at a finance company and there are amounts we regularly waive that have nothing at all to do with government policy.
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