by Michael Roberts
In the Oxford Handbook of Karl Marx,
Thomas Rotta and Rodrigo Teixeira have a chapter called the
commodification of knowledge and information. In this chapter, they
argue that knowledge is ‘immaterial labour’ and ‘knowledge commodities’
are increasingly replacing material commodities in modern capitalism.
“Examples of knowledge- commodities are all sorts of commodified
data, computer software, chemical formulas, patented information,
recorded music, copyrighted compositions and movies, and monopolized
scientific knowledge.”
According to Rotta and Teixeira, these knowledge commodities do not
have any value in Marxist terms because their reproduction tends to be
costless. Knowledge can be reproduced infinitely without cost.
Previous authors have claimed that because knowledge commodities have no
value, Marx’s law of value no longer holds. Rotta and Teixeira argue
that they can restore Marx’s law of value as an explanation of knowledge
commodities. And their solution is that, although knowledge
commodities have no value, the owners of such commodities through
patents and copyrights etc can extract rents from productive capitalist
sectors, in the same way, as Marx explained, rents were extracted by
landlords (through their monopoly of land) from productive capitalists.
They conclude by estimating the increased amount of value being
extracted in the form of ‘rents’ by ‘knowledge industries’.
Does Rotta and Teixeira’s apparent defence of Marx law of value in
relation to the information industry hold up? I don’t think so. Here’s
why. First, Rotta and Teixeira, like other authors before them (Negri
etc), misunderstand Marx’s value theory on this question. Just because
knowledge is intangible, it does not make it immaterial. Knowledge is
material. Both tangible objects and mental thoughts are material. Both
require the expenditure of human energy, which is material, as shown by
human metabolism.
More specifically, the expenditure of human energy that constitutes
the cognitive process, thinking, causes a change in the nervous system,
in the interconnections between the neurons of the brain. This is called
synapsis. It is these changes that make possible a different perception
of the world. So to deny that knowledge, even if intangible, is
material is to ignore the results of neuroscience. After all, if
electricity and its effects are material, why should the electrical
activity of the brain and its effect (knowledge) not also be material?
There is no ‘immaterial’ labour, despite the claims of all the
‘knowledge Marxists’ , including it seems Rotta and Teixeira. The
dichotomy is not between material and mental labour, but whether it is
tangible or not.
The second mistake that Rotta and Teixeira make is that because
knowledge is ‘immaterial’, it is unproductive labour that produces no
value. But productive labour is labour expended under the capitalist
production relation. Productive labour is not just what produces
physical goods. Productive labour also includes what mainstream
economists call services. As Marx explained: if a capitalist has a
servant, that is unproductive labour. But if he goes to a hotel and
uses a valet to take his luggage to the room, that valet delivers
productive labour because he/she is working for the capitalist owner of
the hotel for a wage.
Rotta and Teixeira give us the example of a live concert performance. “Hence, what we call a concert is in act
a bundle of several commodities, among them knowledge- commodities such
as musical compositions. The live performance is a combination of the
productive labor of musicians and technical staff, plus the unproductive
labor of those who composed the songs in the first place.” But
what is unproductive about the composer? He/she can sell that piece of
music as copyright and performance royalties on the market. Royalties
must be paid if the music is used in the concert. Surplus value is
created and realised.
Then there is the example of a smart phone. “When you buy a
smartphone, part of the phone price covers the production costs of the
physical components. But another part of the price remunerates the
patented design and the copyrighted software stored in the memory. The
copyrighted parts of the phone are therefore knowledge-commodities, and
the revenues associated with these specific components are
knowledge-rents.” But why are the revenues from copyright and
patents considered only rents? The idea, the design, and operating
system have all been produced by mental labour employed by capitalist
companies. The companies exploit that labour and appropriate surplus
value by selling or leasing the software. This is productive labour and
it produces value. It is no different from a pharma company employing
scientists to come up with a formula for a new drug which they can sell
on the market with a patent held for years.
For the same reason, the production of knowledge (mental labour) can
be productive of value and surplus value if it is mental labour
performed for capital. In this case, the quantity of new value
generated during the mental labour process is given by the length and
intensity of the abstract mental labour performed, given the value of
the labour power of the mental labourers. Surplus value, then, is the
new value generated by the mental labourers minus the value of their
labour power; and the rate of exploitation is that surplus value divided
by the value of their labour power.
The value of knowledge (and of any mental product) might be
incorporated in an objective shell or not. In both cases it is an
intangible but material commodity whose value is determined by the new
value produced plus the value of the means of production used. The
computer programmer or website maker is in principle just as productive
as the worker making the computer if both work for the computer
company. Thus, knowledge production implies production of value
and surplus value (exploitation) and not rent. Once produced, the
capitalists owners of mental products (knowledge) can then extract
‘rent’ from their intellectual property (the knowledge produced by
mental labourers for them) by applying to it intellectual property
rights. But there is production of value first. The difference between
production and appropriation is fundamental.
Also it is not correct to say that the value of mental labour and
knowledge commodities cannot be quantified. Rotta and Teixeira, to back
their claim that reproduction of knowledge has no value, quote Marx: “But
in addition to the material wear and tear, a machine also undergoes
what we might call a moral depreciation. It loses exchange- value,
either because machines of the same sort are being produced more cheaply
than it was, or because better machines are entering into competition
with it. In both cases, however young and full of life the machine may
be, its value is no longer determined by the necessary labour time
actually objectified in it, but by the labour time necessary to
reproduce either it or the better machine. It has therefore been
devalued to a greater or lesser extent.”
Rotta and Teixeira think this shows that, because the labour time to
reproduce a machine might fall below the value of the first machine due
to technical progress (moral depreciation), Marx is suggesting that
knowledge commodities will tend to have no value at all because
knowledge can be reproduced infinitely without labour time expended.
But this quote from Marx refers to the value of each new
production process where the labour time involved in the value of a
commodity (machine) falls. But that would not lead to a fall in the
profitability of capital invested right down to zero. The average rate
of profit is determined by the initial fixed capital costs and any
circulating capital costs involved in reproduction. Profitability would
still be determined by all the stages of production of the commodity,
even if the value of each newly produced commodity falls.
And knowledge commodities cannot be produced for nothing because they
are material. The productivity of physical, tangible commodities is
measured in units of output per unit of capital invested. This holds
just as much for mental production, or knowledge commodities, say, a
video game. The mental product can be contained in an objective shell (a
DVD). The DVDs produced can be counted. It can also be contained in a
digital file and be downloaded from a website to a computer and then
onto another. The number of downloads can be counted. In short, mental
output or knowledge commodities can be counted. On websites, the number
of hits can be counted. The reproduction becomes the numerator for
productivity and profitability.
The original capital invested, the denominator, can be also be
measured. First, there is the capital invested in the prototype. This
is not only fixed constant capital (computers, premises, facilities,
chips foundries, assembly plants, etc.). It is also circulating constant
capital (raw materials) and variable capital, wages, which go from very
high (for highly qualified developers) to low. Then there are the costs
of administration, of presale advertising and other marketing costs.
Then there is the additional capital invested in the reproduction of the
replicas of the prototype. In reality, the total value of the knowledge commodity can be high, not zero. The unit value
is then given by the total value divided by the number of replicas
made. It is directly proportional to the total value and inversely
proportional to the quantity of the replicas. The value of reproducing
such knowledge commodities won’t go towards zero because there are
always replication costs of the knowledge commodity in delivery to the
user.
Again, the reproduction of any knowledge commodity is no different
from the reproduction of a new drug by a pharma company. Built into the
price of the drug is the initial cost of employing mental labour,
testing the drug for humans etc, the production of the pills, liquids
plus any equipment for administering it and so on. Sure, the unit cost
of the production of each new pill may fall to a very low value, but
that does not mean that total value and unit value has fallen to zero.
In sum, knowledge is material (if intangible) and if knowledge
commodities are produced under conditions of capitalist production ie
using mental labour and selling the idea, the formula, the program, the
music etc on the market, then value can be created by mental labour.
Value then comes from exploitation of productive labour, as per Marx’s
law of value. There is no need to invoke the concept of rent extraction
to explain the profits of pharma companies or Google. The so-called ‘renterisation’ of modern capitalist economies
that is now so popular as a modification or a supplanting of Marx’s law
of value is not supported by knowledge commodity production.
Much of the arguments I have presented here were first
comprehensively and brilliantly created by Guglielmo Carchedi in his
paper, Old wine, new bottles and the internet, in Work, Organisation, labour and Globalisation, Volume 8, Number 1, Autumn 2Ol4.
His mental labour has been very productive, but as he did not patent
it, the reproduction of his arguments here have cost me little (zero?).
So any credit that I get will thus be a huge extraction of rent from
him.
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