[Sino-US Innovation Times, Boston, November 7, 2024] (Reporter Wen Youping’s note) This year’s Nobel Prize in Economics theme is “Institutions determine economic prosperity and even the success or failure of a country.” Obviously, this universal value will be more brilliant and more powerful because of the aura of the Nobel Prize! Nobel Prize in Economics award-winning works provide solid and powerful factual evidence that the political and economic systems of society determine the prosperity of the social economy and even the success or failure of a country. In fact, there is also an equally solid and powerful, more profound underlying logic, which is the economic law that is not subject to human will, the so-called “underlying logic.”
How to compare the latest economic Nobel Prize theme to better help people understand the objective laws of economic operation? To this end, this newspaper has specially opened an economic theory column “The Underlying Logic of the Economic Nobel Prize” and is honored to invite Deng Qinghui, a well-known Chinese private entrepreneur and author of “Commodity Value Theory”, as a columnist and host to dedicate his economic academic monographs published in Shenzhen for more than 40 years of successful operation of technology companies and a series of thinking articles on the actual economic operation.
As the opening of the column, today we publish Deng Qinghui’s first article in the series of interpretations of this year’s Nobel Prize in Economics theme “underlying logic” – “Another step forward for “undifferentiated human labor” – on the definition of labor”, for readers.
“Definition of labor” is called the unsolved mystery of economic theory for hundreds of years. The author Deng Qinghui attempts to reveal the true meaning of the value of commodities and currencies, which are the most prominent in the operation of social economy, so as to understand the law of the movement and change of commodity value. In this way, the underlying logic of economic laws that are not subject to human will, that is, “the system determines the prosperity of the economy and even the success or failure of the country”, is revealed. If this goal can be achieved, it will be a great relief for this newspaper!
The classical labor theory of value advocates that the amount of labor determines the value of commodities, but the amount of labor is only measured by labor time. This article believes that: just as time alone cannot measure the movement distance of an object, time alone cannot measure the amount of human labor. This article also finds that the reason for this error in the measurement unit of labor is that the classical labor theory of value does not have a definition of labor. The major works of all the representatives of the classical labor theory of value did not give physical meaning and physical units of measurement to the labor, and therefore often caused confusion about the source of value and the standard of value measurement. Adam Smith tried to measure the labor with “necessities of life” itself, which was a valuable step for the measurement of labor; Karl Marx proposed that the labor was “the simple condensation of undifferentiated human labor”, which was only one step away from the scientific labor definition recognized by the author of this article, “the labor is the undifferentiated physical energy, that is, the heat energy consumption of human beings”.
“Undifferentiated Human Labor Amount” Taken a Step Further
— On the Definition of the Amount of Labor
By Deng Qinghui
Classical labor value theorists argue that labor creates value and often assert that the amount of labor determines the value of commodities, using the amount of labor as a standard to measure the value of all commodities. However, we find that classical value theory measures the amount of labor solely by the time worked by a certain number of people. Clearly, just as mere time cannot measure the distance traveled by an object, mere time cannot measure the amount of human labor. A review of the works of various classical value theorists reveals that the error of measuring the amount of labor by labor time stems from the lack of a defined concept of the amount of labor in classical value theory. In other words, the definition of the amount of labor has actually been an unresolved mystery in economics for centuries!
William Petty’s Initial Insight: “Human labor of equal duration has the same amount of labor”
In the 17th century, the naive labor theory of value was first proposed by William Petty in his 1662 work “Treatise of Taxes and Contributions,” where he stated that “the value of a commodity is the human labor contained within it.” He suggested that “an equal amount of human labor time has an equal amount of value.” Petty illustrated this with the example: “The surplus grain a man gains from farming in a year is equal to the surplus silver another man gains from mining and refining silver in a year,” concluding that “the price of surplus grain equals the price of silver.” He then extended this example from one person to a hundred people and from one year to ten years, maintaining that even under these conditions, the conclusion remains the same: if the number of workers and the time spent are equal, the amount of labor is also equal, thereby creating equal value and pricing the commodities equally. [1]47-48 This assertion arises from Petty’s belief that the amount of labor depends solely on the number of workers and the time spent, disregarding factors such as workers’ skill levels and the risks involved in the labor process. Petty did not explain why the amount of labor should only be related to the number of workers and time, perhaps because he did not feel the need to address this issue. In fact, the notion that “different types of labor generate the same amount of labor as long as the number of workers is equal” is not a definition of the amount of labor. Due to the absence of a clear definition of labor amount, Petty could not clarify why the same number of workers over the same period would produce an equal amount of labor.
William Petty also believed that since the value of silver itself fluctuates, using currency to measure the amount of labor would still be unstable and inaccurate. Therefore, he argued that a “constant standard of value” should be sought. He proposed that the stable and accurate measure for labor quantity and labor value should be labor and land. He stated:
“I think the value of all goods should be measured by land and labor; that is, we should say that a ship or a suit of clothes is worth how much land or how much labor. This is because, ultimately, ships and clothes are produced by land and the human labor invested in it. This reveals the true nature of all goods…” [1]50
William Petty tells us that land and labor should be used to measure the value of labor and all goods, but his reasoning is quite simple: it is because all goods are produced by land, and human labor is invested in the land. In other words, since the value of commodities originates from land and human labor, land and human labor should become the standard for measuring the value of labor. Clearly, Petty here confuses two different issues: the source of a commodity’s value and the standard for measuring the value of labor.
How much land area equals how much labor? William Petty never made this clear. Are they using labor to measure labor? We find this even more perplexing. In fact, these unclear issues not only confuse the source of a commodity’s value with the standard for measuring the value of labor but also stem from a more fundamental problem that has not been resolved beforehand: What exactly is the amount of labor? In other words, without clarifying the definition of the amount of labor, the issues concerning the source of a commodity’s value and the standard for measuring labor value become even more confusing.
We see that William Petty lacked a definition for the amount of labor and conflated the source of value with the standard for measuring value. However, his idea of using “a certain area of land” to calculate the value of labor in commodities was an attempt to find a concrete physical measurement for the amount of labor. Although Petty’s choice of a physical unit to measure labor was incorrect, the effort to find a specific physical measurement for labor is inherently linked to defining the amount of labor. Therefore, Petty’s approach represents a valuable attempt at thinking about the definition of labor quantity.
Adam Smith’s Reflection: “Labor is the real measure of the exchange value of all commodities”
Adam Smith, a master of classical value theory and the founder of modern economics, also did not provide a precise or clear definition of the amount of labor. Although he believed that the amount of labor is related to the time spent working and considered “labor to be the real measure of the exchangeable value of all commodities,” he did not believe that anyone would create the same value in the same amount of labor time. Simple labor, skilled labor, and labor requiring ten years of training produce different values at the same time. He even explicitly stated that “an hour’s labor of a person who has studied for ten years may contain more labor than a month’s work of ordinary employment.” In his 1776 work The Wealth of Nations, Adam Smith wrote:
“Although labor is the objective measure of the exchangeable value of commodities, the value of all commodities is not usually estimated by labor. Determining the proportion between two amounts of labor is often difficult. The time spent on two tasks is not always the only factor that decides their proportion. Those measuring proportions should not forget the vastly different difficulty and skill levels involved. One hour of hard labor may contain more labor than two hours of easy work; one hour of a task requiring ten years of training may contain more labor than a month of ordinary work. It is not easy to find an accurate measure of difficulty and skill levels. However, when products of labor are exchanged, these two aspects must be given considerable attention. The regulation of such exchanges does not rely on any precise measure but instead on mutual agreement in the marketplace that benefits both parties. This agreement, while not perfectly accurate, suffices for daily use.
Moreover, commodities are more often compared with other commodities than with labor, and thus, labor comparisons are less frequent. Therefore, the exchangeable value of a commodity is better assessed by the amount of other commodities it can purchase rather than the amount of labor it can command. Additionally, speaking of a definite amount of another commodity is more straightforward than referring to a definite amount of labor. The former is a tangible object that can be clearly seen and touched, while the latter is an abstract concept. Although abstract concepts can be fully understood, they are not as straightforward and natural as concrete objects.” [2]24
Although Adam Smith’s statements are in line with objective reality—that the issue of labor amount is not something that must be resolved in specific economic activities—it is evident that the problem of labor amount is an issue that economic theory, especially value theory, cannot avoid. Undoubtedly, theories like “surplus value,” “class struggle,” and “proletarian revolution,” which have had a profound impact on human society, stem from a fundamental misunderstanding of the amount of labor and the source of commodity value, as well as the widespread dissemination of this misunderstanding. Consequently, in countries where the theory of surplus value predominates, the normal production and exchange of commodities cannot be effectively carried out.
On the one hand, Adam Smith emphasizes that “labor is the real measure of the exchangeable value of commodities”; on the other hand, he dismisses the necessity of “labor amount” in practice, describing it as “unclear” and “unnatural.” In fact, the reason “labor amount” appears unclear and unnatural is that it should not be “an abstract concept.” However, in Adam Smith’s view, labor amount is precisely an abstract concept. It is because “labor amount” is treated merely as an abstract concept that it becomes inconvenient or even impossible to use naturally in practical applications.
Adam Smith stated that “labor is the real measure of the exchangeable value of commodities,” but what exactly is the amount of labor? Adam Smith did not provide a definition either. However, his understanding of labor amount marked significant progress compared to William Petty. He did not believe that any person’s labor would necessarily create the same value within the same time period. Instead, he distinguished between “hard work” and “easy work” and differentiated between “work that requires ten years of training” and “ordinary tasks.” Because of these distinctions in types of labor, the same number of people working for the same duration cannot produce the same value. Recognizing that the amount of labor cannot be measured by merely counting people and time, Adam Smith concluded that other methods are needed to measure the amount of labor.
Adam Smith then stated:
“Equal amounts of labor, at any time or place, hold the same value for the laborer. If the laborer is of normal vigor, with usual levels of skill and technique, he must sacrifice an equal amount of comfort, freedom, and happiness. Regardless of the quantity of compensation he receives, the cost he pays remains the same. Although his labor may sometimes earn him more goods and other times fewer goods, this is due to changes in the value of the goods, not changes in the value of the labor required to purchase them. Wherever and whenever production becomes more difficult and requires more labor, the price of the goods will rise; where production becomes easier and requires less labor, the price will fall. Only the value of labor itself never changes. Only labor can consistently measure the value of various commodities at any time or place; only labor is the true standard of value. Thus, labor is the real price of commodities, while money is merely their nominal price. … Therefore, in common terms, labor can also be said to have a real price and a nominal price. The real price refers to a certain quantity of necessary and convenient goods paid as compensation for labor, while the nominal price refers to a certain amount of money paid as compensation for labor.” [2]25
Adam Smith believed that the real price standard for labor is “a certain amount of necessary and convenient things.” But what exactly is this standard? Is it the value or price of these “necessary and convenient things”? Certainly not. Adam Smith understood that their value and price, like those of gold and silver, are also subject to change. Clearly, the real standard Smith needed to measure labor is these “things” themselves, meaning a specific quantity of these things!
We know that William Petty attempted to measure the amount of labor using the size of land area, and now Adam Smith wants to use a certain amount of necessary and convenient things as the real price of labor—that is, the true standard of labor value. This, too, is a valuable attempt to define the amount of labor. However, it is unfortunate that Adam Smith’s exploration of a true standard for labor value ended there. He did not take the next step to establish a specific relationship between a certain quantity of these “things” and some measurable aspect of human labor. As a result, using “things” and their specific quantities to represent the amount of labor remains incomprehensible.
David Ricardo’s Regressive Return: “A million people can only ever produce the same value”
After Adam Smith, by the early 19th century, the views on the amount of labor held by classical value theorists had completely reverted to those of William Petty. William Petty stated, “The amount of labor performed by one person in a year is equal to that of one hundred people over ten years,” and David Ricardo echoed this by saying, “One million people can only ever create the same amount of value” [3]232-233. Their views were strikingly similar. Like William Petty, David Ricardo perhaps never even considered what this supposedly unchanging amount of value produced by one million people actually represents.
David Ricardo did not understand Adam Smith’s concept of using “a certain amount of necessary and convenient things” as the “real price” for the amount of labor. He criticized Adam Smith for what he considered a double standard in labor value. In the first chapter, “On Value,” of Principles of Political Economy and Taxation, Ricardo specifically criticized this supposed dual labor standard in Adam Smith’s work. After quoting Adam Smith’s idea from The Wealth of Nations that the amount of labor determines the value of commodities, Ricardo stated:
“Adam Smith so definitively determined the origin of exchange value and consistently asserted that the magnitude of value must be proportional to the amount of labor expended in production. Yet, he simultaneously established another standard of value, suggesting that the magnitude of value depends on how much of a standard thing it can be exchanged for. His so-called standard measure is sometimes grain and sometimes labor. However, the labor mentioned here is no longer the amount of labor expended during production, but rather the amount of labor commanded when exchanging the item. In his view, these two amounts of labor seem to differ little… Yet, in fact, these two amounts of labor are not equal.” [4]3
David Ricardo’s criticism of Adam Smith’s issue of dual value standards once significantly impacted the development of classical value theory. It was considered that David Ricardo had corrected Adam Smith’s error of value dualism and upheld the correct monistic labor theory of value. However, this assessment is entirely mistaken. From our perspective, the one in error is precisely David Ricardo himself, as he misunderstood the meaning of Adam Smith’s relevant views. The problem criticized by Ricardo as a dual labor standard actually involves two important points made by Adam Smith. The first is that labor expended (or invested) and labor commanded (or exchanged) share the same origin. The second is the measurement issue of the amount of labor itself as the standard of value for commodities.
Adam Smith asserted that expended labor and commanded labor share the same origin, and his reasoning is quite sound: “Goods produced by oneself are obtained through one’s own labor; goods acquired through money or trade are likewise purchased by labor. These monies or goods save us from equivalent toil. They contain the value of a certain amount of labor. With this value, we can exchange for other goods that, in an abstract sense, contain the same amount of value” [2]23. If we accept the proposition “goods produced by oneself are obtained through one’s own labor” as true, then “another’s goods are obtained through their own labor” must also be true. Thus, when one exchanges one’s labor-produced goods for another’s goods, it essentially becomes “labor exchanged for labor,” since others’ goods are fundamentally labor as well. Whether the amount of labor expended in production and the amount of labor commanded in exchange are equal may be uncertain (they only “abstractly contain the same amount of value”), but this does not change the essence of exchange as labor for labor. In other words, whether the amounts are equal or not, expended labor and commanded labor share an identical essence. David Ricardo’s argument that “these two amounts of labor are not equal” as a basis for denying their common essence is unfounded. Adam Smith used this perspective to establish his broader labor theory of value, thereby incorporating land rent (production materials) and capital profit into the value of commodities. These elements, seen as having the same significance as active labor, form part of exchange value, making his theory fully consistent with the realities of economic activity.[2]36-41
Adam Smith’s assertion that “labor is the real measure of the exchangeable value of all commodities,” followed by his statement that “the real price is a certain amount of necessary and convenient things given as compensation for labor,” is not about “establishing another standard of value.” Rather, it addresses the measurement issue that must be resolved for labor, the real measure of the exchangeable value of all commodities.
What is the amount of labor? If the amount of labor itself cannot be measured, how can it serve as the standard for measuring the value of all commodities? Adam Smith sought a “certain amount of necessary and convenient things” or “grain” to represent the amount of labor, emphasizing the specific quantity of the things themselves, not their price. Adam Smith was well aware that the price of anything could never remain constant. Therefore, Ricardo devoted almost an entire chapter to criticizing Adam Smith for using the variable price of “a certain amount of necessary and convenient things” or “grain” as another value standard. However, this criticism was based on Ricardo’s own misunderstanding. He confused two different issues: the source of a commodity’s value and the standard for measuring or assessing that value!
After criticizing Adam Smith’s dual value standard and the use of “a certain amount of necessary and convenient things” or “grain” as an unchanging standard of value, David Ricardo, in the sixth section of the chapter “On Value,” titled “On an Invariable Measure of Value,” stated: “It is impossible to find an absolutely invariable measure of value in this world.” He said: “Any commodity used to measure the value of other things is itself subject to value fluctuations. The amount of labor required to produce any product inevitably changes. Even if the necessary amount of labor remains unchanged, it still does not serve as a perfect standard of value or an invariable measure. As mentioned above, if the proportion of fixed capital required for producing the measuring commodity differs from the proportion required for producing other goods, wage fluctuations can cause relative changes in the value of the measuring commodity. If the durability of fixed capital is unequal, the same causes will produce the same effects. All these factors demonstrate that there cannot be a perfect measure of value in this world.” [4]20-22
David Ricardo argued that “any commodity used to measure the value of other things is itself subject to value fluctuations” and thus concluded that “it is impossible to find an absolutely invariable measure of value in this world.” But isn’t this precisely the issue Adam Smith contemplated? Adam Smith recognized that the value, and even the price, of all
goods—including those given as compensation for labor—are variable, making them merely nominal prices of labor, not real prices. This led him to seek something else to represent the actual price of labor, which he identified as “a certain amount of necessary and convenient things.” For example, during one period, a person might earn 100 pounds of grain for a day’s labor, while in another period, the same day’s labor might only yield 50 pounds of the same grain. Although the price of those 50 pounds of grain might be equal to the price of the previous 100 pounds—that is, the nominal price of labor has not changed—the real price of labor has indeed changed. Clearly, Adam Smith did not intend to measure the amount of labor using the price of grain but rather to use a “certain amount” of grain as the standard for measuring the amount of labor.
David Ricardo became fixated on the impossibility of an unchanging commodity value or price, failing to consider alternative methods for measuring the amount of labor. Moreover, he conflated the source of labor value with the evaluation of labor value (i.e., compensation), ultimately denying the existence of an “invariable standard of value” altogether. It must be said that, despite having a dedicated chapter on “Value Theory,” Ricardo’s views on value theory were regressive, reverting back to those of William Petty.
Karl Marx’s Dilemma: The ghostly “simple crystallization of undifferentiated human labor”
After David Ricardo, Karl Marx further elaborated on the issues of labor and the measurement of labor quantity. Let’s examine Marx’s discussion.
In the first chapter of Capital, titled “1. The Two Factors of a Commodity: Use-Value and Value (Substance of Value and Magnitude of Value),” after discussing that the value of a commodity is exchange value, Marx immediately states:
“Use-value or goods possess value solely because abstract human labor has been objectified or materialized in them. So, how is the magnitude of their value measured? It is measured by the amount of… labor they contain. The amount of labor itself is measured by the duration of labor, and labor time is then measured in definite units of time, such as hours or days.” [5]51
Clearly, Marx still does not provide a definition of the amount of labor here. However, he explicitly states that the amount of labor is measured by the duration of labor, and the unit of measurement for labor amount is the unit of time! As for the exact labor amount measured by time, we still do not know. What we do know for sure is that it should not simply be time! Marx does not define the amount of labor, but he does give a detailed description of labor—which he considers the only force capable of creating value. In the fifth chapter of Capital Volume I, while discussing the labor process, Marx states:
“The use of labor power is labor itself. The buyer of labor power consumes it by making the seller of labor power work. The seller of labor power thereby becomes, in reality, active labor power, becoming a worker, whereas before this, he was only potentially a worker.” [5]207
It is evident that Marx’s concept of “labor” refers to “the physical labor of workers” or “the labor power of a worker actively engaged in work.” Marx then goes on to describe the worker’s labor in greater detail:
“In order to appropriate natural substances in a form useful for his own life, man sets in motion the natural forces of his body—his arms and legs, his head and hands.” [5]208
It is evident that Marx has clearly described the worker’s labor as the “motion of the natural forces of the body—arms and legs, head and hands.” Although he mentions the “head,” it is clear that he is not referring to independent mental labor. Instead, he means the “mental activity” and “attention” necessary to command the movements of the body’s limbs during physical labor, as well as the “purpose” that must be present in the worker’s mind during physical labor. As Marx himself goes on to say:
“In addition to the exertion of the organs engaged in labor, there must be, throughout the entire labor time, a purposeful will expressed as attention. The more the content and the manner and method of labor fail to attract the worker, and the less the worker can take labor as a form of enjoyment of their physical and mental activity, the more this will is required.” [5]208
At this point, we can confirm that Marx measures labor using time as the physical labor of workers, which consists of the “motion of the natural forces of the body—arms and legs, head and hands” as well as “the purposeful will expressed as attention throughout the entire labor time.” However, despite all these explanations of labor and its details, Marx does not provide a clear physical definition of labor. We still do not know exactly what the amount of labor is.
Time is merely a marker for the progression of events. Just as time cannot be used as a measure of distance, kilometers, meters, centimeters, and millimeters are the actual units for measuring distance. Only with these units can we establish a relationship between the duration of an object’s motion and these units—namely, speed. With speed, the time of an object’s motion is then related to the distance traveled. Currently, although Marx has described the physical movements of a worker’s limbs and even the unwilling attention required during labor, he still has not identified a physical quantity to measure labor. Furthermore, there is no established relationship between the time spent on labor and the amount of labor expressed in concrete physical terms.
Clearly, Marx recognized the problem with using time to measure the amount of labor and thus posed the question himself:
“If the value of a commodity is determined by the amount of labor expended in its production, does that mean the lazier or less skilled a person is, the more valuable his commodity becomes?” [5]52
Marx’s answer is negative. He then explains:
The amount of labor measured in labor hours “has the character of socially average labor power, functioning as such socially average labor power, and thus, only the average necessary labor time or socially necessary labor time is used in the production of commodities. Socially necessary labor time is the labor time required to produce a given use-value under the prevailing socially normal conditions of production, with the average degree of skill and intensity of labor in society.” He further states: “Only socially necessary labor quantity, or the socially necessary labor time for producing a use-value, determines the magnitude of the value of that use-value. Therefore, products containing equal amounts of labor, or which can be produced in the same amount of labor time, have the same value.” [5]52-53
Marx introduced the concepts of “socially average skill level and labor intensity,” he should have provided specific descriptions and quantitative definitions for these concepts. Unfortunately, he did not do so.
Undoubtedly, “skill level” refers to the number of times a particular labor operation can be performed in a unit of time. In contrast, “labor intensity” refers to the amount of labor expended per unit of time. If we focus on labor intensity, then for it to have a quantitative definition, labor quantity must first be defined as a physical quantity. This physical quantity, when compared to time—meaning the amount of labor per unit of time—would then define labor intensity. Clearly, the physical quantity used to define labor should not be time itself. Otherwise, labor intensity would become a comparison of time against time, rendering the concept of labor intensity meaningless.
The amount of labor must be defined as a physical quantity, and this quantity cannot be time. Additionally, it should be applicable to any form of concrete labor and the specific products of any type of labor. The amount of labor should possess a common characteristic shared by all different forms of labor. On this point, Marx indeed had some reflections. Before making the statements mentioned earlier, he first said:
“If we leave aside the use-value of a commodity, the commodity itself retains only one property—that of being a product of labor. … If we abstract from the use-value of labor products, we also abstract from the material components and forms that make these labor products useful. … With the disappearance of the useful character of labor products, the useful forms of labor embodied in them also disappear, and the various concrete forms of labor vanish as well. What remains is not different types of labor but uniform human labor, abstract human labor.” [5]50-51
Marx then continued:”Now let us examine what remains of the labor products. What is left is a ghost-like object, merely the simple congealment of undifferentiated human labor—simply the congealment of human labor power expended, no matter the form in which it was expended. These things now only express that human labor power has been expended in their production and that human labor has accumulated. These things, as the crystallization of this shared social substance, are value—commodity value.” [5]50-51
Marx’s words indicate that he did indeed feel the need to find something that could represent the value of any different form of concrete labor and the products of any form of labor. This “something” is the “simple congealment of undifferentiated human labor.” But what is this “simple congealment”? Unfortunately, Marx describes it as a “ghost-like object”! In other words, what Marx measures with time is this ghost-like entity. The amount of labor thus becomes something ghostly, and the labor intensity—labor amount per unit of time—becomes equally elusive, making it difficult to grasp or comprehend.
A Step into the Realm of Science: Labor amount as the physical energy consumption during human labor
In fact, Marx’s description of the specific labor form performed by workers using only their limbs is necessary because human physical labor, or simple bodily labor, is the most fundamental form of human work. Abstracting from this concrete labor form to arrive at “the simple congealment of undifferentiated human labor,” shared by all types of human labor, is indeed appropriate. This line of thinking clearly surpasses that of his classical value theory predecessors. However, this “simple congealment of undifferentiated human labor” should not remain a philosophical abstraction, nor should it be a “ghost-like object.” Instead, this “simple congealment of undifferentiated human labor” is nothing other than the undifferentiated expenditure of human physical energy—heat energy!
From today’s perspective, the most general characteristic of human labor is the consumption of physical energy, which is heat energy. Despite the vast differences in the forms of human labor, the one commonality is the consumption of physical energy, which is undifferentiated heat energy. Modern human and food sciences clearly inform us that an adult man performing moderate-intensity labor consumes about 3,000 kilocalories of energy per day. This is determined by the basal metabolic rate of human physical energy consumption (i.e., the relationship between human life activities and heat energy consumption). Additionally, modern food science provides clear dietary guidelines for the specific amount of food required daily to sustain this level of energy consumption.
Therefore, the definition of the amount of labor is that the amount of labor is the physical energy consumed by human labor, which is heat energy. The unit for measuring the amount of labor is the unit of heat energy: joules, calories, kilocalories, etc. With heat energy—a physical quantity—as the measurement standard for the amount of labor, the ratio of this physical quantity to time—the amount of labor per unit time—is labor intensity. With labor intensity established, the relationship between time and the amount of labor is also defined. Given that humans have a generally similar basal metabolic rate and similar energy consumption under comparable labor conditions, a specific amount of heat energy has a consistent relationship with the amount of human labor. Thus, it can serve as a reliable measurement standard for the amount of labor, thereby resolving the issue of the “invariable standard of value” that classical value theory has long pursued but never fully addressed. (Since this issue is a separate topic in value theory, involving concepts such as absolute currency and absolute price and requiring substantial discussion, it is best reserved for another article.)
Since a specific amount of heat energy can represent a specific amount of labor, the food capable of producing that amount of heat energy—what Adam Smith referred to as “a certain amount of necessary and convenient things”—has a consistent relationship with a given amount of labor. From this perspective, Adam Smith’s idea of using “a certain amount of necessary and convenient things” as the actual price of labor and a standard for its measurement is correct. The only issue is that he did not identify “heat energy” as the bridge linking “the amount of human labor” with “a certain amount of necessary and convenient things.” Without this connection, the specific amount of necessary and convenient things could not be determined, and his true intent was easily misunderstood. Consequently, it could not serve as a consistent standard for measuring the amount of labor.
Marx’s “simple congealment of undifferentiated human labor” is already very close to a scientific definition of the amount of labor. He was just one step away from identifying this “simple congealment of undifferentiated human labor” as the physical energy consumed during human labor, namely heat energy.
Today, the idea that human “physical energy” is heat energy is well-known and common sense. However, in the 18th and 19th centuries, the mystery of energy, especially heat energy, had yet to be unveiled by scientists. In 1744 (32 years before Adam Smith published The Wealth of Nations), the Celsius temperature scale, with 0º and 100º corresponding to the freezing and boiling points of water, was only just proposed by Swedish astronomer Anders Celsius. It took another 103 years until 1847 for James Prescott Joule to complete experiments demonstrating the conversion of mechanical energy into heat energy. However, the unit “joule” had not yet been established (by this time, The Wealth of Nations had been published for 71 years, Principles of Political Economy and Taxation by David Ricardo for 30 years, and Karl Marx had already reached adulthood). Although the Watt steam engine had successfully utilized heat energy, propelling the Industrial Revolution forward, understanding heat energy was still in its infancy. In other words, even by the mid-19th century, scientists were only beginning to understand the relationship between mechanical energy and heat energy. The connection between human physical energy and heat energy remained unexplored. Ordinary people, including non-specialists like Marx, had limited knowledge of mechanical and heat energy, and an understanding of the relationship between human physical energy and heat energy was likely nonexistent. As a result, Marx described human physical energy as a “ghost-like object”! Given these circumstances in Marx’s time, it is no surprise that earlier classical value theorists, like David Ricardo (decades before Marx), Adam Smith (nearly a century earlier), and William Petty (more than two centuries earlier), could not identify what “the amount of labor” truly represented, even though it was something they observed daily. This historical context explains why classical value theory failed to recognize that human physical energy is heat energy.
The amount of labor is the heat energy consumed during human labor. This scientific definition of the amount of labor is the result of taking one more step forward from the concept of “undifferentiated human labor amount.” Now that we are in the 21st century, the physical sciences, life sciences, human sciences, food sciences, and other natural sciences necessary for understanding the amount of labor have far outpaced value theory. Taking one more step forward from the concept of “undifferentiated human labor amount” should now be an easy task. There is every reason to believe that this represents a crucial leap that economics, after a long historical detour, must finally take!
The amount of labor as the value of commodities and money, its scientific definition holds significant importance. It enables people to correctly understand the essence of commodity and monetary value, the true source of commodity value, and the laws governing its movement and change. Based on a correct understanding of these objective laws in economic and social operations, it allows for the comprehension of how different social systems determine a country’s destiny at its core. This understanding further encourages a rational commitment to and defense of political and economic systems that align with the laws of social and economic development. In light of this, the author has written a series of articles on the value of commodities and money, as well as the laws of economic and social operations reflected by the movement and changes in commodity value, based on the definition of labor amount as energy. The author hopes readers enjoy these articles and engage in discussions.
Note: The medical theory-related data and calculation formulas in the text are derived from publicly available sources.
Annotation:
By classical labor value theorists, we refer here to William Petty, the founder of classical economics and a 17th-century British economist; Adam Smith, the 18th-century pioneer of modern economics; David Ricardo, a British economist active in the late 18th and early 19th centuries; and Karl Marx, a key figure of the mid-19th century.
References:
[1] William Petty. Treatise on Taxes and Contributions [M]. Translated by Xue Dongyang, Wuhan: Wuhan University Press, 2011.3. [2] Adam Smith. The Wealth of Nations (Volume 1) [M]. Translated by Guo Dali, Wang Yanan, Shanghai: Shanghai Joint Publishing Company, 2009.3. [3] David Ricardo. Principles of Political Economy and Taxation [M]. Beijing: The Commercial Press, 1976. [4] David Ricardo. Principles of Political Economy and Taxation [M]. Translated by Guo Dali, Wang Yanan, Phoenix Publishing and Media Group, 2011.5. [5] Karl Marx. Capital (Volume 1) [M]. Beijing: People’s Publishing House, 2004.1.Author Brief Introduction
The author, Qinghui Deng, is a member of the 2nd, 3rd, and 4th sessions of the Shenzhen CPPCC (Chinese People’s Political Consultative Conference) and Chairman of Shenzhen Huihuang Electronics Co., Ltd. Born in December 1948 in Nanchang, Jiangxi Province, he earned a Bachelor’s degree in Electrical Automation from Jiangxi Institute of Technology in 1982. Before China’s reform and opening-up, starting in 1968, he worked as a farmer and laborer in various roles, including with the Seventh Regiment of the Jiangxi Production and Construction Corps, Pingxiang Steel Factory, and Nanchang Television Factory. After the reform, he attended university in 1978 and, upon graduating in 1982, returned to Nanchang Television Factory to work in technology and management.
In 1987, inspired by the reform m ovement, he ventured to Shenzhen and established Shenzhen Huihuang Electronics Co., Ltd., a private technology enterprise, where he has navigated the challenges of the market economy for over 30 years. His nearly five decades of hands-on experience in agriculture, industry, technology development, and business management span a period of significant change in China’s history. These vivid experiences and personal insights led him to study and contemplate economic theories, particularly value theory. The “value paradox” in value theory strongly attracted him, inspiring him to set aside routine obligations to explore the vast realm of knowledge. Decades of experience in economic work, reading, and reflection culminated in his substantial work, The Theory of Commodity Value.
It is especially worth mentioning that:
In the early stages of his entrepreneurial journey, the rapid growth and performance of his company quickly attracted the attention of many prominent media outlets. For instance, on August 11, 1988, People’s Daily published an article titled “Released Potential – Striving for Great Achievements,” which reported on the author and his successful company. On January 8, 1994, Shenzhen Business Daily featured a prominent front-page headline in bold red, “Worldcom Color TVs Enter Western European Market,” offering high praise for the author’s company. Additionally, numerous other publications, such as China Electronics News, Electronics Business News, and Shenzhen Special Zone Daily, also reported on his achievements.
In 1992, the author was honored with the title of “Outstanding Private Science and Technology Entrepreneur in China” by the State Science and Technology Commission of China, the China Association for Science and Technology, the All-China Federation of Industry and Commerce, and the China Private Science and Technology Industrialists Association.
In 2018, the author and his company, Huihuang, were featured in a lengthy report in the sixth episode, “City of Innovation,” of the eight-part TV documentary Shenzhen’s Story, produced by China Central Television (CCTV) to commemorate the 40th anniversary of China’s Reform and Opening-up. The documentary gave a highly positive evaluation.
The documentary can be viewed at the following web link: http://app.cctv.com/special/cbox/detail/index.html?guid=4c242516947c4bc882c80e160d1a89c7&mid=(null)&vsid=VSET100412909418&uid=55804202&from=singlemessage&isappinstalled=0
The author’s contact information:
Email: qinghuideng@gmail.com
US Address: 20425 68th Ave W, Apt G301, Lynnwood, WA 98036-7419
US Phone: +1 425-561-8605
Title image: On January 31, 2019, The Theory of Commodity Value (Volume 1) published by Sino-US Innovation Culture Media Publishing House was officially collected by Harvard-Yenching Library. The author of the book, Shenzhen entrepreneur Deng Qinghui, was invited by the publishing house to come to Harvard-Yenching Library from Shenzhen, China, and personally signed his book Theory of Commodity Value (Volume 1) on the spot and donated it to Harvard-Yenching Library for collection. Ma Xiaohe (left), the Chinese Studies Librarian and Director of the Chinese Department of Harvard-Yenching Library, who accepted the donation, expressed his heartfelt gratitude to Deng Qinghui (right) for signing and donating the book collection on behalf of Harvard Library, and had in-depth exchanges with him. (Photo by reporter Wen Youping)
