MARX & MMT, PART 6 – The Temporal MELT

In recent parts of the series, we have been considering the temporal single-system interpretation (TSSI) of Marx’s theory of value. We have considered how, in the TSSI, the values of constant capital and variable capital depend upon the prices that prevail when inputs and labor power enter production. In contrast, the values and prices of output are only determined once production is complete and the commodities are ready for sale on the market. This conception of value and price determination requires a more general formula for the MELT (or ‘monetary expression of labor time’). The basic meaning of the MELT remains the same. It is still the amount of monetary value attributable to an hour of socially necessary labor or, conversely, the amount of labor, represented in commodities, that a unit of the currency can command. But there is now a need to account not only for the rate at which living labor creates monetary value but also the rate at which monetary value is transferred from the means of production to final output. In the TSSI, the method for calculating the MELT needs to be modified under most circumstances.

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