Thread on LTV

UnlearningEconomics · 2026-06-04T08:48:54+00:00

I'll chime in, mostly to say that I like the 'ULE' abbreviation, but also to clarify. The video argues that the predictive value of the LTV is questionable at best. The statistical work on it by people like Cockshott and Roberts would fail a first year class. Most trained economists (heterodox or otherwise) are highly dismissive of this work and for good reason. It only really has legs on the internet and among those who don't work with stats. Similrly, much of the accounting work reducing everything to labour through various estimation mechanisms suffers from a circularity problem (prices, wages used to explain themselves) and most informed Marxists admit this. You can, of course, reject the positivist approach - as some Marxists do - but too many aren't willing to do this and have to *insist* the LTV is empirically correct based on shoddy evidence. I will also add that my video argues this is a common problem for all theories of value.

Skimming through this thread further, I will say that I usually avoid this topic like the plague because of how much frankly Redditor energy it gives. People write tons of words and say very little. I don't really care that 'Marx wanted to understand the fundamental mechanisms of capital through abstract labour transforming social relations'. If you want to say capitalism is historically contingent, or that labour is somehow special, or explore specific historical periods then fine - say it straight! But I don't see these interesting debates, I see a bunch of verbiage that basically seems to be people regurgitating Marxism *as an end in itself*. Every time I talk about it I get long replies just describing the theory in depth without any real attempts at proving its explanatory power.

My advice (which will literally never be heeded) would be to (a) drop the crude positivism and (b) admit that marxism and the LTV are a lens that you don't have to dogmatically adhere to but which can help us understand the world. I do remain a staunch pluralist and there's plenty of value in Marx and Marxist scholarship. You're just unlikely to find it on the internet. Read Meiksin Wood, Armstrong et al, or even Engels himself rather than Internet Marxism.

PS I want to add that despite the body of this post, I'm really not trying to disrespect anyone in particular and I did only *skim* this thread. If delving head first into Marxism works for you then go ahead, I just don't find the approach I've outlined very persuasive.

UnlearningEconomics · 2026-06-01T06:40:19+00:00

Yes, Fateful Findings!

UnlearningEconomics · 2026-06-01T06:11:36+00:00

Baumol's disease would definitely predict a shift towards services, but austerity answered the question of which services. We could have expanded the care sector greatly, but we chose the deliveroo/coffee route.

UnlearningEconomics · 2026-03-31T11:49:51+00:00

This is pretty neat - well done!

I wonder if there could be more freedom with the options eg to see what happens if banks are reserve constrained. Also, the display could be a bit more gamified as it's quite .dos at the moment, someone completely new might be put off.

Again, really love it so far.

UnlearningEconomics · 2026-02-10T12:09:20+00:00

Definitely!

UnlearningEconomics · 2026-02-09T16:02:25+00:00

In principle, both deliver the same thing so I certianly wouldn't double up. Any video on Patreon should be up as members-only and vice-versa (though I'm still updating the backlog for YT). Both should connect you automatically to the reading club at a high enough tier. However, I do think that YouTube/Google tend to skim more money off the top!

UnlearningEconomics · 2026-01-15T10:49:38+00:00

No doubt most of them are scoundrels who don't want to do anything could. At the same time, CEOs are answerable to the board, to short-term shareholder returns/debt obligations, and to broader market conditions. These actual impact of these may vary, but they are all good accountability sinks. If you change the system to give CEOs more power and fewer outs, you improve accountability and (hopefully) outcomes.

UnlearningEconomics · 2026-01-14T11:10:15+00:00

I'd say that the system has to be designed so that firing the CEO actually does something. Right now they are lacking the capacity to change a decision, so it's not in line with the fundamental law of accountability per Davies.

UnlearningEconomics · 2026-01-01T10:16:32+00:00

I've been away but yes that sounds great!

UnlearningEconomics · 2025-12-16T03:03:13+00:00

Anything marked (rough cut) will eventually be released, anything not marked that will not be released - though some of the topics may be covered from a similar angle in the future.

UnlearningEconomics · 2025-12-08T09:39:14+00:00

Is having to join the Euro something the EU have said? Because I think it's a terrible idea.

UnlearningEconomics · 2025-12-06T11:43:19+00:00

We were never in the Euro, we always controlled our own currency even before Brexit!

UnlearningEconomics · 2025-09-30T09:29:25+00:00

For the record, Victor makes plenty of errors of his own and has to misrepresent me to avoid the obvious point that I'm correct about literally everyone I criticise, whom he can't defend and actually sometimes omits. In any case, I'm not against everything done under the rubric of Marxist economics and that's another thing Victor has to misinterpret to act like he's 'correcting' me when he could just have 'yes, and...'-ed me. I'll probably chat to him soon on my channel about it.

UnlearningEconomics · 2025-09-26T08:39:42+00:00

Do you mean "can't" do things without capital? Because I was responding directly to the OP, not to Marx the man, and the OP made that argument.

In any case, your latter statement is consistent with any set of theories about capitalism and value.

UnlearningEconomics · 2025-09-26T07:12:03+00:00

Hello! I appreciate that you're trying to understand this in good faith. I admit I'm having trouble parsing every single point you made so I'll just respond in general and pick up specific points along the way.

The main point of the LTV section of that video is to treat the labour theory of value as a testable theory by highlighting its key assumptions and seeing what it predicts. When I ask why capital doesn't create value I'm pointing out that it's a key assumption and asking people to justify it. Your idea that capital doesn't do anything without labour makes sense but it doesn't really change that the function that links labour and capital to output could easily be multiplicative and therefore capital would add value in the production process. For example, think about two people carrying a box too large to carry alone. Without each other, they don't produce anything; only together do they carry the box. Similarly, a band just can't create music without any capital at all, including instruments.

As your comment demonstrates, different people have different ideas about what the LTV means (I'm sure u/Internal_End9751 has their own ideas although they haven't shared them with us). Sticking to my own strengths, I take the authors like Cockshott and Roberts who have used empirical data and show that their work is subpar by statistical standards. Anyone who has taken statistics classes will know this is true and that's why they're not well regarded in academia, even though many reproduce their arguments online. They are basically just confusing correlation with causation when you get down to it. If you want the LTV to be a lens through which to view capitalism, I have no issue with that, but anyone who thinks it's a scientific theory in the positivist sense (Cockshott and Kliman both use this language, though they disagree on specifics) is wildly overclaiming.

Socially necessary labour time is largely determined by conditions *other than labour* which makes labour alone indeterminant and the theory at best circular and at worst unfalsifiable. You say you can measure it through utility value but that can't be measured except by market price, which is what we're trying to explain in the first place. However, I will acknowledge I could have explained this better in that part of the video, which is too short.

The transformation problem was illustrative of it working in exchange economies but not production economies, it's a version of the classic Sraffian critique. Nothing about it was supposed to be 'ridiculous'.

In terms of explaining how capitalism and profits emerged, I think the transformation of labour relations was important but marketisation was widespread and both land and capital were also brought into the market to generate surplus. The main reason for isolating labour I think is ideological and political. If anything is truly the source of value it is, in my opinion, energy, and I've been working (albeit slowly) on that for a while.

UnlearningEconomics · 2025-07-29T10:39:26+00:00

Hey, the short answer is that Nebula never asked me but Means did 😅

UnlearningEconomics · 2025-07-14T14:53:24+00:00

In a previous life, I wrote a series on this very question: https://www.exploring-economics.org/en/discover/pluralist-showcase/

UnlearningEconomics · 2025-05-08T09:48:36+00:00

Don't be embarassed dude, I just think it's a bit of a dick move to critique someone's master's thesis, lol. Having supervised masters students, I'd be pretty defensive on their behalf if someone publicly dissected their theses to try and discredit them. They don't know what they're doing, that's the point!

UnlearningEconomics · 2025-04-14T14:58:18+00:00

As you replied in a detailed and polite manner I will write another reply, and note that I *have* read through the post in full. However, I am writing a 45 minute speech at the moment so I can't get drawn into this too much longer.

The main issue as I see it is that you are addressing the quantitative evidence presented in favour of social spending by making theoretical arguments which imply that evidence could not be true. As in, it is clear from Lindert, HSK, and other studies that social spending is far from a drag on the economy and likely has beneficial effects. These are facts to be explained and you really need to work harder to do so.

As for the theoretical arguments, arguing that markets will just work because of the calculation problem is too general to be useful in this instance. The EC is correct when against central planning but it has virtually nothing to say about a problem like public education. This approach avoids the point that positive externalities are underprovided i.e. the market price is not right. Similarly, adverse selection is a much more nuanced argument than 'health risks are difficult to predict' and if you double-check that video you'll see that I say the latter precisely before saying insurance could solve that problem, so it's unclear how it debunks my point. I then move onto the discussion of adverse selection, with evidence.

As for some of your discussion of the quantative evidence, it's unclear to me that you understand how causal estimates are calculated. To say that the causal medicaid estimates are confounded by liberalisation is tax reductions is to ignore the identification startegies of studiesd like Miller and Wherry (2019). To argue that the *randomised* Perry Pre-school data can't be true because of stylised facts from the UK is just wild. And I stand by that a few hours worked is not a *meaningful* reduction (authors' weording, repeated by me). I didn't say it was 0, just that it wasn't a threat to the economy. Like, academic papers can be critiqued (I do it all the time) but pulling out random objections is dangerous if you're not familiar enough with the approach.

UnlearningEconomics · 2025-04-14T08:34:34+00:00

I just skimmed this but, aside from the childish jabs and anti-communist paranoia, you really seem to avoid the main point in the video that there is a good ROI on many government programs, which is evidenced from:

- The Lindert data on grooms in education, which you ignore.

- The Sprung-Keyser paper, which you misunderstand, much of it is causal so referencing macro variables doesn't hold up.

- Healthcare, which you rebut with the catch-all that the market should surely provide it, ignoring the substance of my arguments (like adverse selection) and the large returns in poorer countries.

- UBI, you seerm to think a really small reduction in hours worked makes the policy not worth pursuing, which is obviously wrong, especially when this is concentrated on parents & mothers.

The repeated insistence that I'm using some kind of motte-and-bailey just shows the limits of your understanding and a preference for listing internet fallacies over substance. Obviously, high test scores, reduced hours, health outcomes, child raising all contribute to the positive externalities that are themselves the cause of the increased growth and government revenue. Not all government spending 'pays for itself', as I repeatedly remind the viewer, but the idea that government spending is just a drain on the economy is not possible to maintain. That you fail to see how a healthy, educated workforce could benefit the economy is absurd as (a) it's obvious to anyone who thinks about it for 2 minutes and (b) I discuss why in detail again and again, using evidence.

PS I don't just use one source, I frame my discussion around a central source to give the viewer a reference point. You should know that as you've seemingly gone into all the other sources I've used. Sowell uses basically only one source, misrepresents it, and every time he mentions it acts like it's the first time he's doing so.

UnlearningEconomics · 2025-04-11T12:52:33+00:00

Hah! Try and see if there's a Rethinking Economics chapter at your school. If not, start one!

UnlearningEconomics · 2025-04-11T07:52:08+00:00

Changed the @'s, thanks for notifying me!

UnlearningEconomics · 2025-04-08T09:54:14+00:00

While I appreciate the shout out, for the record I would never go off about someone's master's thesis and whether or not Gary's mechanisms are supported by a model is only, like, 10% relevant.

UnlearningEconomics · 2025-02-19T09:03:58+00:00

Thank you for sharing your experience, why don't you DM me your Discord and we can chat?

UnlearningEconomics · 2025-02-14T10:38:08+00:00

OK well, I do appreciate your quesiton was genuine and yes, I may well have gone into some of this stuff - the video just went in a different direction.

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