DOCUMENT 18 Towards a History of the Text of the First Chapter of Marx's Capital (1929)

Isaak Il’ich Rubin

Source: ArkhivK. Marksa i F. Engel’sa, Volume 4,1929, pp. 63-91.

Introduction by the Editors

Most readers of this volume will agree with Isaak Rubin’s opening remark that ‘the first chapter of Capital is enormously difficult to understand...

It is generally understood that the Critique was the precursor to Marx’s Capital. That being the case, the problem that Rubin poses is how and why the two works differ so substantially when comparing Marx’s expositions of the theory of value. That Marx was not satisfied with his preliminary account in the Critique is demonstrated by the fact that he rewrote the work in the first three chapters of Capital, to which he also added numerous revisions of the first chapter in the second edition. The reason, explains Rubin, is that ‘in the Critique Marx did not yet draw a sharp distinction between value and exchange­value... [T]he Critique still lacks any teaching on the development of the poles of value (i.e. the relative and equivalent forms of value) and on development of the forms of value (i.e., the simple, expanded, general and monetary forms of value)’.

In the Critique Marx did not yet strictly distinguish the content of value from the form; he treated exchange-value quantitatively, whereas in Capital he added a qualitative dimension. Rubin demonstrates this point by reference to the distinction between the ‘value relation’ - relating the quantity of material­ised labour in one commodity to that in another - and the ‘value expression’, in which one commodity is expressed in terms of the use-value of another com­modity.

The need for such distinction arose from the fact that Ricardo did not differentiate between value and exchange-value. As Rubin comments, ‘the conversion of commodities into money seemed to him to be a purely formal and external act'. The result, however, was to create an ‘impassable abyss' between value and exchange-value, leading Samuel Bailey, a critic of Ricardo, to argue that the labour theory of value makes no sense. Bailey thought the value of any commodity is measured in terms of how much of any other commodity it exchanges for. There are as many types of value as there are commodities, and all values are purely relative: ‘A thing cannot be valuable within itself any more than a thing can be distant in itself without reference to another thing'. The result, as Marx objected, would be that exchange-value is something ‘accidental and purely relative'.^[1105] In that case, Rubin notes, there would remain ‘no objective lawfulness at the basis of exchange phenomena'. ‘If our goal is to reveal the lawfulness of exchange phenomena, we cannot regard the value of the commodity as something fortuitous and arbitrary, established anew with each act of exchange of a given commodity for another concrete commodity'.

In this scholarly and elegantly constructed argument, Rubin traces the devel­opment of Marx's thinking, both terminologically and conceptually, from the Critique to Capital.

In his concluding paragraph, Rubin provides a concise summary of the logical arrangement of his own thoughts. Since this document involves a level of complexity that rivals the first chapter of Capital itself, readers will find it helpful to begin with Rubin’s concluding comments in mind:

While the classics concentrated their attention on value and regarded the form of value as something external and inconsequential, Bailey fell into the opposite error. He turned his attention mainly to the multiplicity of value expressions and imagined that ‘by pointing to the multiplicity of the relative expressions of the same commodity-value he had obliterated any possibility of a conceptual determination of value’.^[1106] In order to deflect Bailey’s attacks, which threatened the entire theory of labour value, Marx had to draw a sharp distinction between ‘value’ and ‘value expressions’, from which logically followed the need to provide separate analyses of value and exchange-value. But it was only possible finally to overcome Bailey’s criticism by filling the gap left by Ricardo...As distinct from the classics, [Marx] supplements the doctrine of value with the [separate] doctrine of ‘the form of value, or exchange-value’... The need to arrange the investigation in these two opposing directions is what explains the unique structure of the first chapter of Capital.

Isaak Rubin on the First Chapter of Marx’s Capital

Marx’s supporters and opponents both recognise that the first chapter of Volume I of Capital is the cornerstone of the whole immense structure of Marx’s economic theory.

We know that Marx left us with three versions of the first chapter of Volume I of Capital: the version in the first edition of 1867; the version in the second edition of 1872; and finally the version in the French edition that appeared in parts from 1873-5.

We should also recall that Marx's Contribution to the Critique of Political Eco­nomy, published in 1859, represents nothing less than the first published ver­sion of the thoughts that later became the contents of chapters 1-3 of the first volume of Capital. Thus, we essentially have at our disposal four versions of the first chapter of Capital, written over a period of no less than 16 years.

As one might expect, we find the most obvious difference when comparing the first chapter of Capital with the first chapter of A Contribution to the Critique of Political Economy. More is involved here than a different sort of argumentation or a different form of exposition. In the first chapter of Capital we find a whole series of the most important concepts and terms that were either still missing from the Critique or else were encountered there only in embryonic form. Thus, leaving aside for the moment the variations that we encounter in the different editions of Capital, in this article we shall limit ourselves to comparing the exposition of the theory of value in the Critique and in Capital. In the first chapter of our article we shall find that in the Critique Marx did notyet drawa sharp distinction between value and exchange-value or give a detailed account of exchange-value. In particular, the Critique still lacks any teaching on the development of the poles of value (i.e.

1 Value and Exchange-Value in the Critique and in Capital

Marx’s Contribution to the Critique of Political Economy consists of two chapters: the first is devoted to ‘the commodity’ and the second to ‘money’. Each of these chapters, in addition to a theoretical exposition of the question, also includes special historical digressions in which Marx critically sets out doctrines on the particular question from economists who preceded him in the seventeenth to nineteenth centuries. The first chapter includes ‘Historical Notes on the Ana­lysis of Commodities’, and the second has two similar historical digressions: ‘Theories of the Standard of Money’ and ‘Theories of the Medium of Circu­lation and of Money’. As we know, Marx originally intended to provide each section of Capital - each being devoted to presenting a particular problem - with a special historical digression describing the development of economic ideas pertaining to the given problem. But Marx subsequently gave up on com­bining theory and history, the ponderous mode of presentation he had used in the Critique. Marx omitted most of his historical digressions from the text of Capital. The relevant notes by Marx were subsequently edited by K. Kautsky and published with the title Theories of Surplus-Value.

The change of plan for the presentation of Capital explains the absence from the first volume of Capital of the kind of historical digressions included in the Critique. Marx used the remaining material, representing the content of the Critique, as the basis for the first section of Volume I of Capital.^[1107] The first chapter of the Critique, dealing with the theory of value, corresponds to the first two chapters of Capital; the second chapter of the Critique, devoted to the theory of money, corresponds to the third chapter of Capital. The part referring to the theory of money was subject to the fewest changes, mainly in the form of abbreviation. In contrast, the part devoted to the theory of value was significantly expanded by Marx (by more than 2½ times if the historical digressions are excluded) and was also fundamentally reworked. It is precisely in the theory of value that Marx continued to seek new and more accurate formulations for his ideas.

As we have already noted, the first short chapter of the Critique contains the material that entered later, in expanded and reworked form, into the first and second chapters of Capital. Let us now attempt a more precise comparison between these chapters of the Critique and of Capital. In the second edition of Capital, the first chapter is divided into four sections, but from the point of view of internal content it can be divided into three parts: the first and second sections contain the teaching on value (and the labour that creates value); the third, the teaching on the form of value or exchange-value; and the fourth section, the doctrine of commodity fetishism. The second chapter, entitled ‘The Process of Exchange', shows the genesis of money from the process of exchange and, in particular, from the contradiction hidden in the commodity between value and exchange-value. Accordingly, the entire content of the first two chapters of Capital can be divided into four parts dealing with:

1. Value (the first and second sections of the first chapter),

2. The form of value or exchange-value (the third section of the first chap­ter),

3. Commodity fetishism (the fourth section of the first chapter),

4. The origin of money (the second chapter).

It is more difficult to specify the content of the first chapter in the Critique. The method of presentation that Marx used in the Critique makes it very complicated to separate the individual parts analytically and to isolate them strictly one from the other. Nevertheless, equipped with the conclusions to which we are led by the rigorous analysis that Marx gives in Capital, it is easy for us also to distinguish three different parts in the first chapter of the Critique. The first part (pages 1-15 of the German edition [Marx 1970, pp. 27-38], excluding the last paragraph on page 15),^[1108] includes the doctrine of value and runs parallel - notwithstanding all the differences in mode of exposition - to the first two sections of the first chapter of Capital. In the second part, including just four short pages (from the last paragraph of page 15 to the last paragraph of page 19 [Marx 1970, pp. 38-41]), we can discern, as we shall see below, a weak embryo of those ideas on exchange-value that later acquired from Marx a completely new development in the third section of the first chapter of Capital. Finally, the last part of the first chapter of the Critique (from the final paragraph on page 19 to page 32 [Marx 1970, pp. 42-52]) investigates the emergence of money from development of the contradiction between value and use-value and, in general terms, corresponds to the second chapter of Capital. As for the teaching on commodity fetishism (set out in detail in the fourth section of the first chapter of Capital), in the first chapter of the Critique it is given only a couple of pages (9-11 [Marx 1970, pp. 34-5]) in the first part, which is devoted to an analysis of value and the labour that creates value.

We can see that of the four points mentioned above, which Marx developed in detail in Capital, only the first and last points (i.e. the doctrine of value and the doctrine of the origin of money) were also more or less fully set out in the Critique. The teaching on commodity fetishism was only superficially and very briefly touched upon in the Critique even though its main ideas were set out quite clearly and correctly. Finally, as we shall see below, the greatest difference between the Critique and Capital is found in the teaching concerning the form of value and exchange-value. One can say that, in the treatment of the theory of value, the basic difference between the Critique and Capital is precisely the absence from the Critique of any clearly established difference between value and exchange-value, or, what amounts to the same thing, any clearly developed teaching on exchange-value. We must consider in more detail this essential dif­ference between the first chapter of the Critique and the first chapter of Capital.

Marx strictly distinguishes in Capital between the value of the commodity, representing a certain quantity of ‘materialised’ labour or labour time, and its exchange-value, i.e. value expressed in the use-value of another commodity. The first concept is denoted by the term Wert (value), the second by the term Tauschwert (exchange-value).

To denote the concept of value in the Critique of Political Economy, Marx still uses both terms, Tauschwert and Wert, without any distinction. Most often he uses the term Tauschwert, particularly in the first chapter, which is devoted especially to the theory of value. The term Wert is usually found when speaking of the magnitude of value. Both terms are often encountered side by side, replacing each other arbitrarily.^[1109]

Thus the terms Wert and Tauschwerl. still signify one and the same concept in the Critique. But precisely which concept is it that they denote, value or exchange-value? There is no doubt that in the Critique both of these terms denote value - a concept for which Marx subsequently, in Capital, used the term Wert. This is proven not only by the fact that in Capital Marx uses the term Wert in many places, while in the corresponding places in the Critique he still used the term Tauschwert. On every page of the Critique we find the term Tauschwert, in the sense of the value of a commodity, expressed as a certain quantity of labour. To cite only the clearest of examples, let us point out that on page 52 the Tauschwert of a quarter of wheat is expressed as 30 labour days at the same time as its price (Preis) is expressed as 1 ounce of gold.⁶ On page 14 we read: ‘The amount of labour-time contained in the commodity, i.e. its Tauschwert,¹ and so on.

If the term Tauschwert, like Wert, denotes the concept of value in the Cri­tique (i.e. corresponds to the term Wert that is used in Capital), then we can legitimately suppose that the concept of exchange-value, developed by Marx in Capital under the heading of Tauschwert, had not yet been sufficiently cla­rified in the Critique. Actually, a comparison of Marx's two works leads us to the following conclusion, which at first sight is paradoxical: although on the terminological side Tauschwert figures most prominently in the Critique, not Wert, Marx concentrated his attention here essentially on the analysis of value and did not give us a clearly developed concept of exchange-value. On the other hand, although the terminological novelty of Capital consists of the frequent usage of the term Wert in place of Tauschwert, the essential innovation that Marx gives us here consists of a clearly developed doctrine of exchange-value as distinct from value.

What we have said should not be understood to mean that in the Critique Marx ignored the fact that in a commodity economy the labour expenditures that determine the magnitude of a commodity's value are not expressed dir­ectly but only indirectly in the form of equating one commodity with another. In the Critique Marx understands by value not labour expenditure as such, but the equating of commodities with each other that is expressed in a specific social form. And that is not all. In the Critique, as distinct from Capital, he has in view from the very outset one specific form of value, namely, the most

mentioned and the following sentence speaks of Tauschwert einer Ware in the same sense. On page 50 (67 in the English translation) there is mention of Tauschwert des Goldes, and the following sentence refers to Wert einer Unze Gold, etc.

6 [Marx 1970, p. 69].

7 [Marx1970,p.37].

developed or monetary form of value.^[1110] But precisely because value appears from the outset in the Critique in this developed form, which is adequate for the content of value, Marx does not see any need for a special analysis of the form of value as distinct from the content. It is only in Capital, where Marx’s goal is to trace the development of forms of value from the simplest up to the money form - a development whose moving force is the contradiction between value and use-value - that the need to provide a separate analysis of the content of value and the form of value becomes apparent. On this point, as with many others, a characteristic distinction appears between Marx’s exposition in Cap­ital and his exposition in the Critique. In the Critique, the individual elements of the problem appear in a seamless or, more correctly, a cohesive manner. In Capital they are distinguished from each other and subject to separate analysis. Thanks to this fact, the analysis becomes more forceful, and the characteristic features of each element, taken separately, emerge more clearly. But for the unprepared reader there also emerges, on the other hand, a danger of detach­ing the individual elements of the problem from each other and of forgetting the inseparable bond that unites them. In particular, the reader must never for­get that in the first and second sections of the first chapter of Capital, although Marx gives an analysis of the content of value separate from its form, he con­stantly presupposes the latter.

We have reached the conclusion that in the Critique, for all intents and purposes, Marx understands Tauschwert as value. We find no clearly developed doctrine of exchange-value in the Critique. But does this mean that in the Critique we find no indications of the concept of exchange-value that Marx subsequently developed in more detail in Capital? This supposition would be all the more improbable since in the Critique, as we have already seen, Marx considers value from the very beginning in a specific form, namely, in the money form. It would be passing strange if we found in the Critique no reference to exchange-value even in its most external and obvious form, namely, in the form of a quantitative relation between the commodities being exchanged.

The fact is that we do encounter exchange-value, viewed in this most external and purely quantitative way, on the very first pages of the Critique. It even represents the starting point for Marx’s discussion: ‘Exchange-value seems at first to be a quantitative relation, the proportion in which use-values are exchanged for one another’.^{[1111] [1112] [1113] [1114] Marx also retains this famous sentence in Capital}0 However, Marx quickly adds in Capital that, insofar as we limit our investigation to the purely quantitative side of exchange-value, we can eas­ily get the false impression that exchange-value is something ‘accidental and purely relative’. It is precisely in order to show the falsity of this idea, which was defended by Bailey,11 that Marx thought it necessary in Capital, after the sentence we have cited, to direct the course of the investigation abruptly from exchange-value to the value concealed by it and to give a special analysis of the latter. In the Critique we do not find Marx clearly emphasising this same turning point in the investigation. It is as if Marx did not yet see or consider it necessary to underline all of the dangers concealed in a purely quantitative investigation of exchange-value. In Capital Marx underlines the lack of corres­pondence between exchange-value and the content it expresses; in the Critique he frequently notes a correspondence between them. Thus in Capital, after the sentence we have cited concerning exchange-value as a ‘quantitative relation’, Marx foresees the possibility that the reader might suppose exchange-value to be something ‘accidental and purely relative’. In the Critique, following the same sentence, he comes directly to the conclusion that the commodities being exchanged ‘take one another’s place in the exchange process, are regarded as equivalents, and despite their motley appearance have a common denomin- ator’.i2 In the Critique the unity of the substance of value, which is contained in all commodities, stands in the forefront, and it overshadows both the dif­ference in forms of value and the different roles of the two commodities that comprise the poles of the value expression. Thanks to this fact, the exposition in the Critique leads us smoothly and even imperceptibly, without any sharp dialectical transitions, from exchange-value, in the sense of a quantitative rela­tion between the commodities being exchanged, to their value. This transition is further facilitated by the fact, as we have already seen above, that the latter concept, i.e. the concept of value, is also denoted in the Critique by the term Tauschwert.}

If we encounter the concept of exchange-value in the Critique in the sense of a quantitative relation between commodities being exchanged, it is more difficult to answer the question of whether we also encounter there the concept of exchange-value viewed qualitatively. In order to answer this question more precisely, we must clarify exactly what exchange-value means in Capital, as distinct from value on the one hand and from the quantitative relation between commodities being exchanged on the other.

Insofar as we regard commodities as values, we ascertain the unity or iden­tity of their social nature. As values all commodities are completely equal one to the other. The external character of this equality is expressed in the ‘value equation’ (Wertgleichung): for example, 20 yards of linen = 1 coat. From this equation we learn the ‘quantitative relation’ or ‘value relation’ (Wertverhaltnis) of the two commodities. We see that the value of one yard of linen is twenty times less than the value of one coat, but we do not know precisely what the value of linen (or of a coat) is equal to.

Let us now suppose that we face the task of determining the value of linen on the basis of the same equation. For this purpose we must resort to the following example: we have to take the value of one commodity (the coat, for example) as a given magnitude and determine the value of the second commodity (linen) as a certain number of units of the first commodity. In this case we say that the value of 20 yards of linen = 1 coat, and we then have a special ‘value expression’ (Wertausdruck) for linen. It may appear at first glance that this ‘value expression’ differs in no way from the ‘value relation’ that we spoke of previously. But in fact there is an essential difference between them. Previously we noted that the value of 20 yards of linen is equal to the value of one coat, that is, the value of commodities figured on both sides of the equation. Now we are asserting that the value of 20 yards of linen is equal to 1 coat, i.e. to a given concrete item or use-value of another commodity. We now have a special ‘value expression' of one commodity (linen) in the use-value of another commodity (the coat).Whereas in the ‘value relation' both commodities played a completely identical role - and this equation expressed their equality as values - in the ‘value expression' each commodity plays a qualitatively different role.^[1115] Using the terminology that Marx employed in Capital, we must say that linen here has the ‘relative' form of value and the coat the ‘equivalent' form of value.

It may seem at first that the different roles fulfilled by the two commodities in the ‘value expression' eliminate their equality as ‘values'. In fact this is not the case. In a commodity economy the equality of products of labour is not established in advance by any social organ but is expressed by means of a complex process of movement in which product A appears without yet being equated with product B and is, therefore, in fact still not equated with it. In the doctrine of value we abstract from this intervening process and regard commodities in terms of their equality as values. But in the doctrine of exchange-value we study precisely this intervening process of equalisation in which the commodities necessarily fulfil different roles.

Let us now return to the Critique and pose the question of whether we can find there the doctrine of ‘value expression', ‘exchange-value' or the ‘form of value'. As for the latter term, it is not found anywhere in the Critique. The term ‘exchange-value' (Tauschwert) occurs quite frequently in the Critique, but we already know that this is to designate value, not exchange-value. It remains, therefore, to search in the Critique for some indication of the ‘value expression'.

And the fact is that in the previously mentioned second part of the first chapter of the Critique, which involves no more than four pages (15-19),^[1116] we do find the embryo of a doctrine of the ‘value expression’ or exchange-value.

After Marx considered commodities in the first part of the first chapter of the Critique in terms of their equality as values, he begins the second part with the following words:

The exchange-value (Tauschwert, which is understood in fact as value - i.r.) of a commodity is not expressed in its own use-value... The ex­change-value of one commodity thus manifests itself in the use-values of other commodities. In fact the exchange-value of one commodity, expressed in the use-value of another commodity, represents equival- ence.1⁵ If I say, for example, that one yard of linen is worth two pounds of coffee, then the exchange-value of linen is expressed in the use-value of coffee and is, moreover, expressed in a definite quantity of this use­value. Once this proportion is given, the value of any quantity of linen can be expressed in terms of coffee?⁶

In the passage just cited we have a direct indication that the value of a commod­ity is expressed in the use-value of another commodity, i.e. it takes the form of exchange-value. It was also clear to Marx already in the Critique that a change in the exchange-value of a commodity does not correspond quantitatively with a change of its value:

We have seen that the exchange-value of a commodity varies with the quantity of labour time directly contained in it. Its realised exchange­value, that is, its exchange-value expressed in the use-values of other com­modities, must also depend on the degree to which the labour time expen­ded on the production of all other commodities varies?⁷

The ‘exchange-value’ of commodity A depends solely on the quantity of labour expended on its production. But its ‘realised exchange-value’ can also change in accordance with a change of the quantity of labour expended on the pro­duction of commodity B, which is exchanged for commodity A. The ‘exchange­value' of commodity A may remain unchanged regardless of a change of its ‘realised exchange-value'. Evidently Marx here too understands the first term, as he does elsewhere, to mean essentially the value of the commodity, while the latter term signifies its exchange-value.

In these quotations we can see the embryo of the idea that the value of a commodity must be ‘realised' (realisiert) or ‘expressed' (ausgedruckt) in ‘the use-values of other commodities'. These expressions are frequently used in the same sense in the Critique.^[1117] Elsewhere in the Critique Marx uses other terms to express the same idea. The exchange-value of the commodity finds its ‘real expression' (realer Ausdruck) or ‘representation' (Darstellung) in the use-values of other commodities and ‘manifests itself' (manifestiert sich) in them.^[1118]

In the expressions that we have quoted we can see an embryonic doctrine of the distinction between exchange-value and value. In the Critique, however, this doctrine is still embryonic. Both value and exchange-value are still desig­nated here by one and the same term, by Tauschwert. Here the whole qualit­ative originality associated with the fact that the value of one commodity is expressed in the use-value of another commodity has not yet come to Marx's attention. The qualitatively different roles fulfilled by the two commodities in the expression of value are not yet clarified. Here the ‘value expression' is yet to be distinguished with sufficient clarity from the quantitative ‘value relation', which is expressed in the equality of commodities as values. The particular qualitative features of the category of exchange-value - as distinct from value on the one hand and from the ‘value relation' on the other - have yet to be clearly developed. Marx's thinking is oriented above all on the quantitative fea­tures of the ‘value expression'. ‘Once the proportion is given, the value of any quantity of linen can be expressed in terms of coffee'^{[1119] [1120] - this sort of purely quantitative conclusion is what interests Marx above all. Later, in the first edi­tion of Volume I of Capital?1 Marx himself realised that a predominant interest in the quantitative side of the question cannot lead to a correct understanding of exchange-value and of the need for a polar division of the different func­tions between the two commodities - a division that contains the nucleus of the need for the emergence of money.}

We have arrived at the conclusion that the concept of exchange-value is not yet clearly developed in the Critique. It is perfectly natural, for this reason, that in the Critique we still do not find any doctrine of the different forms of value, the teaching to which Marx devoted so much attention in Capital. In Capital, as we know, Marx investigates the different forms of value on the one hand (simple, expanded, general and monetary); and on the other hand, for each expression of value Marx in turn differentiates the two poles of relative value and equivalent value. In the Critique we still find neither a doctrine of the forms of value nor a doctrine of the poles of value. All we can point to are the weak embryos of ideas from which Marx later built his doctrine of the forms of value. As for the doctrine of the development of opposition between the poles of value, in the Critique we do not find even a suggestion of this idea.

Since value appears in the Critique from the very outset in its most developed form, in its universal or monetary form, it is understandable that there would be no point in looking here for a doctrine of the different forms of value. It is true that in the Critique, too, for purposes of illustration, Marx willingly takes examples of the exchange of one commodity for another commodity, but from the very beginning he regards this exchange as one moment of a multilateral exchange of a given commodity for all other commodities. To convince ourselves of this fact, let us follow the development of Marx’s thinking in the second of the three parts to which we have referred.

Turning in the second part to an investigation of exchange-value, Marx takes for example the exchange of one commodity for another commodity: ‘If one says, for instance, that one yard of linen is worth two pounds of coffee, then the exchange-value of linen (which, as we know, is understood to mean value - i.r.) is expressed in the use-value of coffee, and it is moreover expressed in a definite quantity of this use-value’.²² We know that in Capital Marx sets out this case of the exchange of one commodity for another commodity for detailed analysis under the heading of the simple form of value. In the Critique, without subjecting this equation to any special analysis, he quickly includes it in a whole system of equations that express the value of the same yard of linen in terms of an endless series of other commodities. ‘It is evident that the exchange-value of a commodity, e.g., linen, is not exhaustively expressed by the proportion in which a particular commodity, e.g., coffee, forms its equivalent... The exchange-value of this particular commodity (linen - i.r.) can therefore be exhaustively expressed only by an infinite number of equations’,^{[1121] [1122] namely in the following series:}

22

Marx 1970, p. 38.

1 yard of linen = ½ pound of tea,

1 yard of linen = 2 pounds of coffee, ιyard of linen = 8 pounds of bread, 1 yard of linen = 6 yards of calico, etc.

Speaking in terms of Capital, we could say that Marx has passed from the simple to the developed form of value. But whereas what is really involved in Capital is the dialectical (logical and historical) transformation of one form of value into another, in the Critique Marx limits himself to observing that the equation of two commodities (linen and coffee) involves nothing more than one instance of an entire system of equations expressing the value of linen. Whereas the equation of two commodities in Capital represents a particular form of value, having at least a very relative autonomy, in the Critique [the equation] appears from the very outset in the modest role of a subordinate member of a whole system of equations.

But Marx soon passes beyond this system of equations. ‘If the exchange­value of one yard of linen is expressed in ½ pound of tea, or 2 pounds of coffee, or 8 pounds of bread, or 6 yards of calico etc., it follows that coffee, tea, calico, bread etc. must be equal to one another in the proportion in which they are equal to a third magnitude, namely linen; and therefore linen serves as the common measure of their exchange-value’?⁴ To use the terms of Capital once again, Marx has passed here from the developed form of value to the universal. But, in this case too, one cannot speak of the dialectical transformation of one form of value into another. Whereas in Capital the developed form of value becomes (logically and historically) the universal form, in the Critique Marx limits himself to observing that the system of equations in question is nothing but the same system of equations inverted (i.e. in which the items on the left are moved to the right, and those on the right to the left). Here Marx does not show us the dialectical development of the different forms of value but provides only a logical analysis of exchange-value, which appears from the very beginning in its most advanced, universal form. In Capital the transition from developed to universal form of value is accompanied by a clear change in the social character of the commodity selected (linen), which remains on the right hand side of the equation in the role of universal equivalent. In the Critique, every commodity is regarded simultaneously as ‘the exclusive commodity, which serves as the common measure of the exchange-values of all other commodities’, and as ‘one of the many commodities in the series in which any other commodity directly expresses its exchange-value’.^{[1123] [1124] [1125] [1126]}

Thus in the Critique we have found only weak rudiments of the doctrine of forms of value. Marx here emphasises most forcefully the unity of the sub­stance of value and occludes the difference of forms of value. This is precisely what explains the absence from the Critique of any doctrine concerning the development of the forms and the poles of value.

In Capital, as we know, Marx draws a sharp distinction between the two poles of value. Commodity A, whose value is expressed in commodity B, has the relative form of value. Commodity B, in terms of which the value of commodity A is expressed, has the equivalent form of value or functions as the equivalent?⁶ In A and B, the two commodities that are being equated with each other, the substance of value (labour) is qualitatively identical and quantitatively of the same magnitude. But the two commodities play different roles in the expression of value and have different forms of value.

In the Critique this difference of form does not yet attract Marx’s attention. It is true that just as Marx regards value in the Critique in its most developed universal or monetary form, so he knows perfectly well the difference of the two poles of value in their more developed form, namely, in the form of the polar opposition between the commodity and money. But insofar as Marx remains within the limits of the theory of value (as distinct from the theory of money), the different roles fulfilled by the two commodities being equated is not yet clear to him. Here he still underlines the unity that characterises the two commodities being equated in the ‘expression of their equivalence’. Both of the commodities A and B, which figure in the given expression, are considered ‘equivalent’?⁷ Here equivalence is understood in most cases in the sense of being ‘equal in value’ - a feature that applies identically to both of the commodities being equated. This is what explains the unusual definition of equivalence that we find in the Critique: ‘In fact the exchange-value of one commodity expressed in the use-value of another commodity represents equivalence?⁶ Let us recall that in Capital Marx uses almost exactly the same words to characterise precisely the relative, not the equivalent, form of value: ‘The value of commodity A, thus expressed in the use-value of commodity B, has the form of relative value’.^[1127] At first sight the reader may suppose that what is called equivalent in the Critique is the same form of value as is called relative in Capital. But that would be a mistake. In the Critique Marx simply does not distinguish the two poles of value from each other and speaks identically of the commodity on the left side of the exchange equation and of the commodity on the right side as equivalent. On one and the same page we encounter the term ‘equivalent’ in both of these senses. On page 15 Marx gives a series of equations in which one and the same commodity, namely, one yard of linen, is equated with a whole series of other commodities. On this occasion Marx tells us that the use-values of all the other commodities form the equivalent of linen. Here the term ‘equivalent’ is used in the same sense as in Capital. But in the very next sentence we learn that in this series of equations linen is the ‘exhaustive expression for a universal equivalent’, i.e. a commodity equivalent to all other commodities.^[1128] Both the linen and the commodities in which its value is expressed are, therefore, called ‘equivalent’^[1129]

The evolution of the term ‘equivalent’ in Marx’s works is highly indicative. When Marx was mainly concerned with the equality of all commodities as values, the term ‘equivalent’ (or ‘equivalence’ in the sense of equal values) emphasised the equality of the commodities being exchanged. When Marx was concerned with the different roles played by two commodities in the value expression, the term ‘equivalent’ distinguished the role of one commodity from the other commodity, which assumed the relative form of value. In the first edition of Capital (1867) Marx still considered it necessary to recall this dual meaning of the term ‘equivalent’. Marx wrote:

We can also express the formula 20 yards of linen = 1 coat, or 20 yards of linen are worth 1 coat, in the following way: 20 yards of linen and 1 coat are equivalents, or both are values of equal magnitude. Here we do not express the value of either of the two commodities in the use-value of the other. Neither of the two commodities is hence set up in equivalent-form. Equivalent here means only something equal in magnitude, both things having been silently reduced in our heads to the abstraction value.^[1130]

In the Critique Marx applies the term ‘equivalent’ equally to both poles of the value expression, i.e. both to the pole that in Capital is denoted as equivalent and to the pole that in Capital is specifically called relative value. It is per­fectly understandable, therefore, that in the Critique the term ‘relative value’ can still not be found in the sense in which it is used in Capital. Indeed, while in Capital the relative value of commodity A is called its value, expressed in the use-value of another commodity (for example, commodity b), in the Critique it is a matter of the ‘relative value’ (relativer Wert) of two or several commodities (for example, commodities A and b), i.e. of the comparative magnitude of their values. While in Capital the term ‘relative value’ is applied only to one pole of the ‘value expression’ (Wertausdruck), in the Critique it is used to characterise the ‘value relation' (Wertverhaltnis) of both commodities. In order to explain this difference more clearly to the reader, let us recall what we said above con­cerning the distinction between the ‘value expression’ and the ‘value relation’. Suppose the relative value (i.e. the value relation) of tea and coffee is 4:1, that is, one pound of tea has four times more value than a pound of coffee. Here, by the ‘relative values’ of tea and coffee we understand the comparative magnitudes of their value; but in this case neither the value of tea nor the value of coffee has any special designation. It is a different matter when we say that the value of 1 pound of tea is equal to 4 pounds of coffee; here tea has the ‘relative form of value’ in the sense that its value receives specific expression in the use-value of coffee (and the latter commodity for this reason fulfils the role of equivalent). In this case the two commodities play different roles, whereas in the first case they were exactly the same.

The concept of relative value, as opposed to the equivalent form of value, is found only in Capital. The Critique speaks of relative values only in the first sense, i.e. in the same sense in which the concept of relative value is generally used by Ricardo. Thus in the Critique there is talk of the ‘relative value' of an endless variety of use-values and of the ‘relative value of the two metals' (gold and silver).^[1131]

As we see, the evolution of the term ‘relative value' runs perfectly parallel to the evolution of the term ‘equivalent'. At the beginning both terms emphasised the equality of two commodities exchanging for each other. Later they served to characterise the different and opposing roles that these commodities play in the act of exchange. It is true that in Capital Marx sometimes uses these terms in the former sense, but their new significance becomes ever more apparent as terms that signify the different and opposite poles of the value expression.

2 Marx and Bailey

As we explained in the first chapter, in the Critique of Political Economy Marx still does not make a clear distinction between value and exchange-value. Marx draws this distinction in clear and precise form in the first chapter of Volume I of Capital. What is it that convinced Marx to take a closer look at this question? Apparently he was persuaded to do so by the need to defend the theory of labour value against fierce attacks upon it by [Samuel] Bailey.

Bailey appeared as a decisive and zealous opponent of Ricardo's doctrine, which he subjected to sharp criticism in his work A Critical Dissertation on the Nature, Measure and Causes of Value (1825). This work provoked a great row and a heated polemic between its author and the supporters of Ricardo. Despite the fact that Bailey criticised Ricardo's theory from the viewpoint of superficial and vulgar [political] economy, he did succeed, as Marx noted,3^[1132] in disclosing its real weak points.

Ricardo claimed that the value of the commodity is determined by labour. But he was completely uninterested in the form of value, regarding it as second­ary and of no consequence. He did not distinguish value from exchange-value, and the conversion of commodities into money seemed to him to be a purely formal and external act^[1133] But in reality the value of the commodity appears in the form of exchange-value: it takes the form of the sum of money or a certain quantity of other commodities received in exchange for the given commod­ity. In Ricardo’s theory an impassable abyss opened between the value of the commodity, expressed in a certain quantity of labour, and its exchange-value, expressed in a certain quantity of other things; there was no bridge from the former to the latter, and Bailey directed his blows at this weak point.

If Ricardo, having concentrated his attention on value, ignored the form of value, Bailey took the opposite route. He considers phenomena in the form they take in the acts of market exchange. In exchange, however, the value of the commodity does not express itself apart from other commodities. It appears only in an external form, in a certain amount of other commodities (or a certain sum of money). Therefore, says Bailey, we can only speak of the relative value of a given commodity A in terms of another commodity B, c, D, E, etc. But it is foolish to speak of the value of commodity A in general without accurately specifying the concrete commodity for which commodity A is being exchanged and with which it is being compared. It is not possible to speak of the absolute value of commodity A, only of its relative value compared with commodity B (or c, D, E, etc.). ‘There are a thousand different types of value - as many types of value as there are commodities’.^[1134]

But relative value always presupposes a relation of two commodities and therefore must have a two-sided character. The relative value of commodity A in terms of commodity B, for instance 4:1 (i.e. a formula showing that one unit of commodity A has four times more value than a unit of commodity B), simultaneously expresses the relative value of commodity B in terms of commodity A, namely, 1:4. Thus any change of this formula of exchange, for instance its conversion into the formula 3:1, means not only a change of the relative value of commodity A but also a simultaneous change (in the opposite direction) of the relative value of B. On this basis Bailey denies the view of Ricardo’s supporters concerning the possibility of a change in the relative value of commodity A and commodity B in the absence of any change in the value of commodity B itself. Since Bailey rejects the concept of a given commodity’s absolute value, and since it is possible to speak only of the relative value of a commodity, Bailey’s conclusion is perfectly understandable - that any change in the value of commodity A (expressed in terms of b) means a simultaneous change in the value of commodity B (expressed in terms of A): ‘The value of commodity A cannot increase in relation to B without the value of B decreasing in relation to A’^[1135]

Rejection of the concept of absolute value leads Bailey to a whole series of errors of which we will note the most important. In the first place, we could not say that the value of a given commodity has changed while the value of the commodities for which it is exchanged remains constant. Second, the approach taken by economists in adding the values of different commodities to achieve a sum of values must be rejected. Third, we could not compare the value of a given commodity in different periods of time.

In order to defend the theory of labour value against Bailey's attacks, it was necessary to draw a clear distinction between value and exchange-value. It was precisely by ignoring this distinction that Ricardo created the opening for Bailey's attacks. Thus it is quite understandable that the main purpose of Marx's polemic against Bailey, in the third volume of Theories of Surplus-Value, is to show the distinction between the value of the commodity and the form of its appearance as exchange-value.

Above all Marx shows that consistently following Bailey's point of view must lead to complete denial of any law governing exchange. If we cannot speak of the value of commodity A in itself, then we are in no position to say whether the exchange of A for B corresponds with their values or not. We may note that in the given case a certain quantity of linen was in fact exchanged for a certain quantity of coffee. But we cannot say whether this exchange relation is legitimate and normal: ‘Then one could not speak of a relation in which it exchanges but only of a relation in which it is or has been exchanged’.^{[1136] [1137]}

If we do not wish to abandon knowledge of lawfulness at the basis of ex­change phenomena, then we must recognise that ‘objects are not exchanged in arbitrary proportions but as commodities, that is, as objects each of which has a value and which exchange with one another in proportion to their equivalence'A’ In other words, if our goal is to reveal the lawfulness of exchange phenomena, we cannot regard the value of the commodity as something fortuitous and arbitrary, established anew with each act of exchange of a given commodity for another concrete commodity.

Starting from this viewpoint, Marx comes to the conclusion that the value of the commodity must be distinguished from its exchange-value. His discussion proceeds as follows. A given commodity, linen for example, exchanges for many other commodities such as bread, coffee, a coat, etc. To assume that in each of these acts of exchange our linen assumes a different value would mean to deny any lawfulness in exchange phenomena. It is obvious that linen has a completely determined value that in one instance finds itself expressed in exchange for bread, in another in the exchange for coffee, etc. We must, therefore, distinguish the value of the linen, which remains identical in all these exchange acts, from the different forms of its manifestation in bread, coffee and so forth, that is, from its exchange-value.

This discussion is outlined in the first pages of Theories that Marx devotes to Bailey:

The value of the same commodity can, without changing, be expressed in infinitely different quantities of use-values, always according to whether I express it in the use-value of this or that commodity. This does not alter the value, although it does alter the way it is expressed. In the same way, all the various quantities of different use-values in which the value of the commodity A can be expressed, are equivalents and are related to one another not only as values, but as equal values, so that when these very unequal quantities of use-value replace one another, the value remains completely unchanged, as if it had not found expression in quite different use-values.^[1138]

In another place Marx briefly summarises these considerations in the following words:

Although the commodity has a thousand different kinds of value [expres­sions], or a thousand different prices, all these thousand expressions always express the same value. [This is] the best proof that all these differ­ent expressions are equivalents which not only can replace one another in this expression, but do replace one another in exchange itself^[1139]

In these quotations from Marx we find a difference more precisely drawn between value and its mode of expression: one and the same value has a mul­titude of different kinds of expression, or is expressed in the most diverse use­values. From this we can draw the reverse conclusion: if a particular quantity of one use-value is equated in exchange with a particular quantity of another use-value, then they must both be equal to a third quantity, namely, the value that inheres in each of them. The equality of two use-values in exchange presupposes that they are both equal in a third sense, or that there is within them both something that is common, namely, value of a certain magnitude. This reverse conclusion is already indicated by Marx in both of the excerpts that we have quoted, and it is expressed even more clearly in another place:

He (Bailey) even forgets the simple consideration that if y yards of linen = x pounds of straw, this [implies] a parity between the two unequal things - linen and straw - making them equal magnitudes. This existence of theirs as things that are equal must surely be different from their existence as straw and linen. It is not as straw and linen that they are equated, but as equivalents. The one side of the equation must, therefore, express the same value as the other. The value of the straw and linen must, therefore, be neither straw nor linen, but something common to both and different from both commodities considered as straw and linen.^[1140]

In other words, the equation of commodity A with commodity B is possible only on condition that ‘there exists a common element for A and B, or if A and B are different representations of the same element’^{[1141] [1142]}

Marx illustrates these arguments with a geometric example. In order to make a comparison of different geometric figures, for example a triangle and a parallelogram, they must be reduced to something common, namely, the product of the base and the heights

A reader who is quite familiar with Marx’s Capital will probably have noticed already that the excerpts we have cited correspond perfectly with certain argu­ments by Marx on the first pages of the first volume of Capital. In order to leave the reader without a shadow of doubt on this account, we think it necessary to quote here in full the corresponding three paragraphs from the first volume

of Capital. We shall cite the text from the first edition of Capital (1867), where the similarity is most obvious between Marx’s comments and his arguments against Bailey in the third volume of Theories of Surplus-Value:

Any commodity, for instance a quarter of wheat, is exchanged in differ­ent proportions with other commodities. Nevertheless, its exchange-value remains constant, whether it is expressed in x cotton, y silk, z gold, etc. It must, therefore, be something different from its various kinds of expres­sion.^[1143]

Let us take the example of two commodities, e.g., wheat and iron. The proportions in which they are exchangeable, whatever those proportions may be, can always be represented by an equation in which a given quantity of wheat is equated to some quantity of iron: e.g., 1 quarter of wheat = x cwt. of iron. What does this equation tell us? It tells us that one and the same value exists in two different things, in 1 quarter of wheat and in x cwt. of iron. The two things must therefore be equal to a third, which in itself is neither the one nor the other. Thus, each of them, insofar as it is an exchange-value, must be reducible apart from the other to this third.

A simple geometrical illustration will make this clear. In order to calculate and compare the areas of rectilinear figures, we decompose them into triangles. But the area of the triangle itself is expressed by something totally different from its visible figure, namely, by half the product of the base and the height. In the same way the exchange-values of commodities must be capable of being expressed in terms of something common to them all, of which they represent a greater or lesser quantity.^[1144]

The similarity between these three paragraphs from the first volume of Capital with the excerpts above from Theories of Surplus-Value is striking. The first paragraph repeats the position that Marx develops in detail in his polemic against Bailey: the value of a given commodity can be expressed in the most diverse use-values. Beginning with this basic position, in the second paragraph Marx draws the opposite conclusion, also seen in Theories of Surplus-Value: two use-values that are equal to each other are equal to some third thing.^[1145] Finally, in the third paragraph Marx uses the geometric example with which we are already familiar.

Our comparison of these two texts by Marx throws clear light upon the origin and meaning of the arguments developed by Marx in the three paragraphs from the first volume of Capital - arguments that have been subject to every conceivable misinterpretation and to this day provoke sharp objections from Marx's critics. The direct purpose of these arguments was to defend the theory of labour value against attacks from Bailey, and that meant it was necessary to draw a clear distinction between the value of the commodity and its exchange­value, expressed in terms of other commodities. That this is precisely the goal that Marx was pursuing in the initial pages of Capital could be assumed even without comparing this text with the section of the third volume of Theories of Surplus-Value devoted to Bailey. To convince oneself, it is enough just to read in Capital the paragraph that precedes the three paragraphs we have quoted:

Exchange-value appears first of all as the quantitative relation, the pro­portion in which use-values of one kind exchange for use-values of another kind. This relation changes constantly with time and place. Hence exchange-value appears to be something accidental and purely rel­ative, and consequently an intrinsic value, i.e. an exchange-value that is inseparably connected with the commodity, inherent in it, seems a con­tradiction in terms. Let us consider the matter more closely^[1146]

After this come the three paragraphs that we quoted from Marx. Obviously, Marx's objective was to reveal the error of regarding exchange-value as some­thing ‘accidental and purely relative', and the clearest representative of that sort of view was precisely Bailey. Now that we have compared Marx's two texts, we may say with even greater conviction and precision not only that posing the problem of value in the first pages of Capital was dictated by the need to deflect Bailey’s attacks, but also that Marx’s corresponding argument was first set out in the section of Theories of Surplus-Value devoted to Bailey. If we compare the text of the Critique of Political Economy with the text of the first volume of Capital, we see that in the first couple of pages of both works Marx’s expositions approximately correspond. Beginning, however, with the paragraphs quoted above, the text of Capital gives us something new in principle when compared to the text of the Critique of Political Economy, namely, a sharper distinction between value and exchange-value.^[1147]

In order to disclose more clearly the difference between the ‘value itself’ of the commodity and the ‘expression’ of this value in the use-values of other com­modities, in the same section of Theories that Marx devoted to Bailey he shows that a change in the ‘expression’ of value frequently does not correspond with a change of the value itself. For instance, suppose that the quantity of commod­ities received in exchange for commodity A is reduced, i.e. the exchange-value of commodity A declines ‘insofar as it is realised in other commodities, that is, its exchange-value expressed in the use-values of all other commodities’.^{[1148] [1149] [1150]} But this reduction in the ‘realised exchange-value’ of commodity A may have been the result of two different and opposing causes: either a reduction of the quantity of labour time required for production of commodity A or an increase of the labour time necessary for production of the other commodities. ‘The same phenomenon occurs in both cases although from completely opposite causes’. Accordingly, the changed ‘expression’ of commodity A’s value still does not show that the value ‘itself’ has changed.

Essentially, these considerations by Marx just repeat ideas that he had already developed in The Critique of Political Economy?¹ But in the polemic against Bailey Marx focuses his thinking in a specific direction. In The Critique of Political Economy he simply wanted to show that changes of ‘realised exchange­value, i.e. expressed in the use-values of other commodities’,5² can be caused not only by changes of the labour time required to produce the given com­modity but also by changes of the labour time required to produce the other commodities. Although in the Critique Marx did not essentially confuse this ‘realised exchange-value’ of commodity A with its ‘exchange-value’ (by which he meant its value), he did not consider it necessary to emphasise their distinc­tion, still less to present them as opposites. In the polemic against Bailey, Marx focuses the same thoughts in precisely this direction and summarises this way: ‘From this it obviously follows that the rate at which commodities exchange with one another as use-values, although it is an expression of their value, their realised value, is not their value itself, since the same proportion of value can be represented by quite different quantities of use-values’.^{[1151] [1152] [1153] [1154]}

It is interesting to note that the focus of Marx’s thought in this direction continues and becomes even more emphatic in Capital. The reasoning that we have been considering, which is encountered both in The Critique of Political Economy and in Theories of Surplus-Value, is carried over by Marx to the first volume of Capital, where it is developed in even greater detail in the third section of the first chapter in the paragraph on ‘Quantitative Determination of the Relative Form of Value’. Marx summarises this point as follows:

Thus real changes in the magnitude of value are neither unequivocally nor exhaustively reflected in their relative expression, or, in other words, in the magnitude of the relative value. The relative value of a commod­ity may vary, although its value remains constant. Its relative value may remain constant, although its value varies; and finally, simultaneous vari­ations in the magnitude of its value and in the relative expression of that magnitude do not by any means have to correspond at all points.5⁴

The content of this summation by Marx allows us to conclude quite convin­cingly that it is aimed precisely at Bailey, who continuously confused value with exchange-value. In a footnote to the summation^ Marx polemicises with the economist [John] Broadhurst, whose arguments correspond with those of Bailey. 5^(>

Finally, we also find included at the end of the first chapter of Capital signs of the arguments that Marx developed against Bailey in the third volume of Theories.

Bailey accused Ricardo of transforming value from a relation between things into something absolute:

As we cannot speak of the distance of any object without implying some other object, in relation to which the first stands at some distance, so we cannot speak of the value of a commodity but in reference to another commodity with which it is compared. A thing cannot be valuable in itself without reference to another thing, any more than a thing can be distant in itself without reference to another thing.^[1155]

Marx appropriately makes the following notation to these words by Bailey: ‘Is social labour, to which the value of a commodity is related, not another thing?’.5^[1156] Marx means to say that by recognising value as an expression of social labour we do not in the slightest transform it, as Bailey thinks, from something relative into something absolute. We only relate it to social labour rather than to other commodities.

Marx returns more than once to Bailey’s objections against ‘absolute’ labour value, not only elsewhere in the third volume of Theories of Surplus-Value but also in the second volume of that work, in an analysis of Ricardo’s theory, where Marx again has to take into account Bailey’s criticism^^[1157]

Marx comes to the conclusion, as a result of his reasoning, that Bailey’s denunciation of the imaginary absolute character of the concept of labour value is completely unfounded:

It is quite incorrect to say that the value of a commodity is thereby trans­formed from something relative into something absolute. On the contrary, as a use-value the commodity appears as something independent. On the other hand, as value it appears as something merely relative (gesetztes), something determined by its relation to socially necessary, equal, simple labour time.^[1158]

It is Bailey himself, thanks to his denial of value as an expression of social labour, who falls into a fetishistic representation of value as a property of the things themselves - although, it is true, not of things viewed in isolation from one another but rather in their relation to one another.^{[1159] [1160] [1161] [1162] [1163] In order to prove this, Marx quotes the following words by Bailey: ‘Riches are the attribute of men; value is the attribute of commodities. A man or a community is rich; a pearl or a diamond is valuable’^2}

The polemic that we have set out by Marx against Bailey on the question of the ‘absolute’ character of value is also reflected in Capital. If the three paragraphs that we quoted earlier from the initial pages of Capital contain a veiled polemic against Bailey, in the middle and at the end of the first chapter of Capital Marx comes out openly against him.6³ He mercilessly discloses the fetishistic character of Bailey’s ideas, which is revealed with utmost clarity in the sentence just quoted,6⁴ and in a corresponding footnote Marx briefly summarises his thoughts on the absolute character of value:

Both the author of Observations etc., and S. Bailey accuse Ricardo of con­verting exchange-value from something relative into something absolute. The reverse is true. He has reduced the apparent relativity which these things (diamonds, pearls, etc.) possess to the true relation hidden behind the appearance, namely their relativity as mere expressions of human labour. If the followers of Ricardo answer Bailey somewhat rudely, but by no means convincingly, this is because they are unable to find in Ricardo’s own works any elucidation of the inner connection between value and the form of value, or exchange-value^⁵

We have traced in the first chapter of Capital the direct or hidden echoes of Marx’s polemic against Bailey. It can be said, more or less certainly, that it was precisely Bailey’s critical arguments, aimed at Ricardo, that encouraged Marx to become more closely concerned with the question of the difference between value and exchange-value. It is most probable that it was precisely in his objections to Bailey, which occurred in the third volume of Theories of Surplus-Value, that Marx first outlined the course of thought that was later famously formulated in the three paragraphs from the first pages of Capital. Apparently it was against Bailey that Marx honed the conclusions at the end of his paragraph on ‘Quantitative Determination of Relative Value’. And finally, Marx’s polemic against Bailey, who claimed that supporters of the theory of labour value converted the concept of value into something ‘absolute’, was also reflected in the first chapter of Capital.

Bailey’s critical argumentation, despite all the superficiality of the author’s initial point of view, did partly stumble upon genuine weaknesses in Ricardo’s theory. Consequently, it was impossible to overcome Bailey’s critical objec­tions to Ricardo without overcoming Ricardo’s own theory, i.e. without a new and more profound basis for the theory of labour value. Indeed, the two anti­podes, Ricardo and Bailey, suffered from the same error: confusing value with exchange-value. Marx pointed out that Ricardo confused value with ‘the exchange-value of the commodity, as it manifests itself appears in the process of commodity exchange’.^[1164] On the other hand, he accused Bailey of confus­ing ‘the form of value with value itself’^[1165] The difference between Ricardo and Bailey lay in the fact that the former ignored the form of value, while the latter thought it possible to manage without the concept of value. With the aid of a clearly stated distinction between value and exchange-value, Marx simultan­eously eliminated the errors - which at first appeared to be opposites but had a single foundation - of these two economists.

Although, as we have seen, Marx’s construction simultaneously overcame the one-sidedness of both Bailey and Ricardo, it was necessary for him to arrange his presentation in two opposing directions. Insofar as Marx respon­ded to Bailey’s blows, he had to demonstrate that in order to explain various ‘expressions of value’, i.e. exchange-value, we must turn to ‘value itself’^[1166] Con­versely, insofar as his goal was to deepen and transform Ricardo’s theory, he had to uncover the ‘various aspects’ of the development of the concept of value,6⁹ ‘the different instances of definitions of value, which are not explained by Ricardo but only occur de facto and are confused with one another’?⁰ In the first chapter of Capital Marx also arranged his presentation in these two dir­ections. In the first section of this chapter (to which the second is added as a supplement), he shows that the analysis of exchange-value necessarily leads us to formation of the concept of value; thus Marx cuts the ground out from under Bailey. In the third section he shows that value necessarily takes on determin­ate form, and he gives a detailed analysis of these forms, thereby filling the gap in Ricardo's teaching. Marx emphasises that both of the stages that we have noted are inseparably connected. In the first section he indicates to the reader that ‘The progress of the investigation will lead us back to exchange-value as the necessary mode of expression, or form of appearance, of value'.^{[1167] [1168] [1169] [1170] On the other hand, when Marx turns to the second half of his investigation at the beginning of the third section, he again reminds the reader of its inseparable tie with the first half of the study: ‘In fact we started from exchange-value, or the exchange relation of commodities, in order to track down the value that lay hidden within it. We must now return to this form of appearance of value'?2}

It is understandable that it is precisely in the first part of Marx's investiga­tion that we find more obvious signs of the argumentation that he developed against Bailey in the third volume of Theories. Indeed, it is precisely in the first part that Marx showed the necessity of forming a concept of value, against which idea Bailey aimed all of his blows. In the second part we find Marx's teaching on the forms of value - the doctrine representing the most original part of the Marxist theory of value, which is completely missing in Ricardo and Bailey but cannot be regarded as a direct refutation of Bailey's ideas. This is explained by the interesting fact that in Marx's notes against Bailey, in the third volume of Theories of Surplus-Value, we find the argumentation that he developed later in the first section of the first chapter of Capital, but we do not yet find the ideas that lie at the basis of the third section, namely, the doctrine of the different forms of value and of the poles of value?³ In the section of The­ories that he devotes to Bailey, Marx still has in view only the most developed, universal or monetary form of value and has yet to clarify the development of the poles of value.

But if the polemic against Bailey did not yet lead Marx directly to analysis of the different forms and poles of value, it did, in any event, prepare the way. The basic defect of Bailey's conception was, first, that he confused value with exchange-value, and second, that he directed his attention exclusively to a quantitative definition of exchange-value?⁴ Bailey's first error was already revealed by Marx in Theories, where he drew a sharp distinction between ‘value' and the various ‘value expressions'. This clear distinction necessarily led Marx to give a separate analysis of value on the one hand, and of exchange-value on the other. It is true that in Theories Marx devoted his attention mainly to the first task, which he subsequently developed further in sections 1-2 of the first chapter of Capital. In Theories Marx did not yet give a special analysis of the different forms of value or ‘value expressions’. But the need for that analysis flowed directly from the general way in which Marx posed the problem in the polemic against Bailey. A special analysis of value had to be supplemented by a special analysis of exchange-value, which Marx provided later in the third section of the first chapter of Capital. We may suppose that when Marx turned to a special analysis of exchange-value, he focused his attention mainly on getting beyond the second mistake that he saw in Bailey, who limited the investigation to the quantitative aspect of exchange-value. As opposed to Bailey, Marx put the qualitative aspect of exchange-value in the forefront and thus came to his teaching on the poles of value and the different forms of value.

At one essential point in Marx’s notes against Bailey we can see the clear embryo of ideas that Marx later developed in his teaching on the forms of value.

The main objective of the analysis of different forms of value that Marx gives in the third section of the first chapter of Capital was to prove that ‘The simple commodity form is therefore the germ of the money-form’.^{[1171] [1172] [1173] In a letter to Engels on 22 June 1867, underlining the great importance of the section on forms of value, Marx added: ‘The economists have hitherto overlooked the very simple fact that the equation 20 yards of linen = 1 coal is but the primitive form of 20 yards of linen = £2?^ Here Marx points out that in Capital, for the first time, he provided an analysis of the simple form of value that was missing from The Critique of Political Economy.^n}

If we acknowledge that Marx’s goal in the third section of the first chapter of Capital was to reduce the money form of value, in which the commodity is equated with the universal equivalent, to the simple form of value, in which one commodity is equated with another, then we can find a faint suggestion of this thought in Marx’s notes against Bailey. Bailey asserted that it is only the daily habit of expressing the value of all commodities in terms of money that can give rise to the impression that commodities have absolute value. If we compared linen not with a certain sum of money but with another concrete commodity, for instance, a coat, bread, coffee, etc., then, according to Bailey, we would easily convince ourselves of the purely relative character of value. This reasoning by Bailey evokes the following rebuff from Marx:

Mr. Bailey is of the opinion that if one were to consider only two commod­ities - in exchange with one another - one would automatically discover the mere relativity of value in his sense. The fool. As if it were not just as necessary to say in connection with two commodities that exchange with one another - two products that are related to one another as commodit- les - as it would be in the case of a thousand commodities, why they are identical.^{[1174] [1175]}

As we see, the polemic against Bailey pushed Marx towards posing the problem of the exchange of two commodities for each other, i.e. towards analysis of the ‘simple form of value'. However, Marx was reluctant in his thinking to move in this direction. Marx did not yet consider it necessary to single out for special analysis the case of exchange of two commodities for each other (or the simple form of value). Such a special analysis, apparently, still seemed redundant to him from both an historical and a logical point of view. From the historical point of view, Marx could not help but understand that the random exchange of two products for each other preceded the development of commodity economy and of exchange-value. Immediately following the words that we have quoted, Marx adds: ‘For that matter, if only two products existed, the products would never become commodities, and consequently the exchange-value of commodities would never evolve either'?⁹ Insofar as Marx's goal was to understand the laws of a developed commodity economy and of developed exchange-value, he obviously still considered it necessary to begin his research with the comprehensive exchange of commodities and not with the exchange of two products for each other.

Thus, at the time of his polemic against Bailey, Marx still viewed a special analysis of the exchange of two commodities for each other as redundant from the historical point of view. As for the logical worth of such an analysis, in this period Marx apparently still thought such analysis could provide us with little that was new by comparison with analysis of the exchange of one commodity for ‘a thousand' other commodities (or for a certain sum of money). In both cases we have to answer the same question as to ‘why they (the commodities) are identical', i.e. we must reveal the identity of their social character, their unity as values. The identical social content of all the listed acts of exchange still obscured from Marx's vision their difference of form. Fully absorbed in looking for the single substance of commodities, i.e. value, Marx did not pay sufficient attention to the difference in forms of value:

... how can one express x cotton in y money? The question resolves itself into this - how is it at all possible to express one commodity in another, or how to present commodities as equivalents? Only the elaboration of value, independent of the representation of one commodity in another, provides the answer.^{[1176] [1177]}

Here Marx comes very close to formulating the question of the link between money and the simple forms of value. True, even here he is still inclined to focus on the unity of their content by comparison with their differences of form, but nevertheless the question of the difference of these forms was already posed, and its solution required a special analysis of ‘the form of value, or exchange- value’8¹ that Marx later worked out in Capital.

We can now summarise our conclusions. The unique structure of the first chapter of Capital consists of the fact that Marx analysed value and exchange­value separately. Marx evidently came to this strict demarcation of concepts in the course of his polemic against Bailey. Marx counted Bailey among those ‘few economists who have concerned themselves with the analysis of the form of value’^[1178] While the classics concentrated their attention on value and regarded the form of value as something external and inconsequential, Bailey fell into the opposite error. He turned his attention mainly to the multiplicity of value expressions and imagined that ‘by pointing to the multiplicity of the relative expressions of the same commodity-value he had obliterated any possibility of a conceptual determination of value’^[1179] In order to deflect Bailey’s attacks, which threatened to overturn the entire theory of labour value, Marx had to draw a sharp distinction between ‘value’ and ‘value expressions’, from which logically followed the need to provide separate analyses of value and exchange­value. But it was only possible finally to overcome Bailey’s criticism by filling the gap left by Ricardo. Marx therefore faced a dual task. First, behind the multiplicity of value expressions he had to uncover the unity at their base, i.e. value (and ultimately labour), and secondly he had to show how one and the same value can be expressed in the most diverse forms of value. In contrast with Bailey, in sections 1-2 of the first chapter of Capital Marx moves in his investigation from exchange-value to value. As distinct from the classics, he supplements the doctrine of value with the doctrine of ‘the form of value, or exchange-value', which is set out in the third section of the same chapter. The need to arrange the investigation in these two opposing directions is what explains the unique structure of the first chapter of Capital.

I. Rubin