a simple barter situation. I have a commodity, you have a commodity. The relative value of my commodity is going to be expressed in terms of the value (the labor input) of the commodity you hold. So your commodity is going to be a measure of the value of mine. Turn the relationship around, and my commodity can be viewed as the equivalent value of yours. In simple barter situations of this sort, everybody who has a commodity has something with a relative value and looks for its equivalent in another commodity. Since there are as many commodities as there are people and exchanges, there are as many equivalents as there are commodities and exchanges. All Marx really wants to show here is that the act of exchange always has a dual character—the poles of relative and equivalent forms—in which the equivalent commodity figures “as the embodiment of abstract human labour” (150). The opposition between use-value and value, hitherto internalized within the commodity, “gets represented on the surface by an external opposition” between one commodity that is a use-value and another that represents its value in exchange (153).
In a complex field of exchanges like the marketplace, my commodity will have multiple potential equivalents, and conversely, everybody out there has relative values in a potential relation with my singular equivalent. An increasing complexity of exchange relations produces an “expanded form” of value that morphs into a “general form” of value (§b, 154–7, and §c, 157–62). This ultimately crystallizes in a “universal equivalent”: one commodity that plays the exclusive role of a “money commodity” (§d, 162–3). The money commodity arises out of a trading system and does not precede it, so it is the proliferation and generalization of exchange relations that is the crucial, necessary condition for the crystallization of the money-form.
In Marx’s time, commodities like gold and silver had emerged to play this crucial role, but it could in principle be cowry shells, cans of tuna or—as has sometimes happened in disruptive conditions of war—cigarettes, chocolate or whatever. A market system requires a money commodity of some sort to function effectively, but a money commodity can only come into being through the rise of market exchange. Money was not imposed from outside, nor invented by somebody who thought it would be a good idea to have a money-form. Even symbolic forms, Marx argues, have to be understood in this context.
This gives rise to an interesting interpretive question, one that crops up a number of times in Capital: is Marx making a historical argument or a logical argument? The historical evidence supporting his explanation of how the money commodity arose would now, I think, be regarded as rather thin. Quasi-monetary systems and commodities, religious icons and symbolic tokens and the like, have long been in existence, and while expressive of some sort of social relation, these have had no necessary primitive relation to commodity exchanges even as they gradually became mixed up in such exchanges. If we were to consult the archaeological and historical records, many would now probably hold that the money-form didn’t arise the way that Marx proposes at all. I am inclined to accept that argument, but then on top of it say the following—and this comes back to Marx’s interest in understanding a capitalist mode of production. Under capitalism, the money-form has to be disciplined to and brought into line with the logical position that Marx describes, such that the money-form reflects the needs of a system of proliferating exchange relations. But by the same token (forgive the pun), it is the proliferation of commodity-exchange relations that disciplines any and all preceding symbolic forms to the money-form required to facilitate commodity-market exchange. The precursors of the money-form, which can indeed be found in the archaeological and historical record of coinage, have to conform to this logic to the degree that they get absorbed within capitalism and perform the function of money. At the same time, it should be clear that the market could not have evolved without that disciplining taking place. Though the historical argument is weak, the logical argument is powerful.
This section as a whole establishes, then, the necessary relation between commodity exchange and the money commodity and the mutually determinative role that each plays in the development of the other. But there is much more going on in this section to which we need to pay close attention. At the very beginning of the section, Marx describes the way in which
the objectivity of commodities as values differs from Dame Quickly in the sense that ‘a man knows not where to have it’. Not an atom of matter enters into the objectivity of commodities as values; in this it is the direct opposite of the coarsely sensuous objectivity of commodities as physical objects. We may twist and turn a single commodity as we wish; it remains impossible to grasp it as a thing possessing value. However, let us remember that commodities possess an objective character as values only in so far as they are all expressions of an identical social substance, human labour, that their objective character as values is therefore purely social. From this it follows self-evidently that it can only appear in the social relation between commodity and commodity. (138)
This is an absolutely vital point that cannot be overemphasized: value is immaterial but objective. Given Marx’s supposed adherence to a rigorous materialism, this is, on the face of it, a surprising argument, and we have to wrestle a bit with what it means. Value is a social relation, and you cannot actually see, touch or feel social relations directly; yet they have an objective presence. We therefore have to carefully examine this social relation and its expression.
Marx proposes the following idea: values, being immaterial, cannot exist without a means of representation. It is, therefore, the rise of the monetary system, the rise of the money-form itself as a means of tangible expression, that makes value (as socially necessary labor-time) the regulator of exchange relations. But the money-form comes closer—step by step, given the logical argument—to expressing value only as commodity-exchange relations proliferate. There is, therefore, nothing universal out there called “value” that after many, many years of struggling finally gets to be expressed through monetary exchange. Rather, there is an internal and coevolving relation between the rise of the money-and the value-forms. The rise of monetary exchange leads to socially necessary labor-time becoming the guiding force within a capitalistic mode of production. Therefore, value as socially necessary labor-time is historically specific to the capitalist mode of production. It arises only in a situation where market exchange is doing the requisite job.
There are two conclusions and one major question that derive from Marx’s analysis. The first conclusion is that exchange relations, far from being epiphenomena expressive of the deep value structure, exist in a dialectical relation with values such that the latter depend on the former as much as the former depend on the latter. The second conclusion confirms the immaterial (phantom-like), but objective, status of the value concept. All attempts to measure value directly will fail. The big question mark concerns how reliable and accurate the money representation is of value or, in other words, how the relation between immateriality (value) and objectivity (as captured by the monetary representation of value) actually unfolds.
Marx works through the problem in a number of steps. He comments,
It is only the expression of equivalence between different sorts of commodities which brings to view the specific character of value-creating labour, by actually reducing the different kinds of labour embedded in the different kinds of commodity to their common quality of being human labour in general. (142)
Here we encounter a partial answer to the question of how the reduction from skilled and complex human labor to simple human labor occurs. But then he goes on to say: “human labour-power in its fluid state”—and it is striking how often Marx invokes the concept of fluidity in Capital—“or human labour, creates value, but is not itself value. It becomes value in its coagulated state, in objective form” (142). A distinction therefore needs to be made between the labor process and the thing that gets produced. This idea of a relationship between processes and things, along with the idea of fluidity, is important in Marx’s analysis. The more he invokes it, the more he moves away from dialectics as a formal logic to dialectics as a philosophy of historical process. Human labor is a tangible process, but at the end of the process, you get this thing—a commodity—which “coagulates” or “congeals” value. While the actual process is what is significant, it
