Editing Exchange value (section)

== Exchange value and price according to Marx ==
{{Marxian economics|concepts}}
Marx regards exchange-value as the proportion in which one commodity is exchanged for other commodities. For Marx, exchange-value is not identical to the money price of a commodity. Actual money prices (or even [[equilibrium price]]s) will only ever roughly correspond to exchange-values. The relationship between exchange-value and price is analogous to the relationship between the exact measured temperature of a room and the everyday awareness of that temperature from feeling alone. Thus, Marx did not consider the divergence between exchange-value and market outcomes as a refutation of his theoretical framework. Certain contemporary Marxian scholars have underscored this perspective, often citing the pronounced discrepancies between exchange-value and actual monetary prices in [[Fixed capital|fixed assets]], such as housing, as evidence of the existence and dynamics of [[fictitious capital]].<ref>Goodell Ugalde, Elliot. [[“In Defence Of Marx’s Labour Theory Of Value: Vancouver’s Housing ‘Crisis.”|https://ojs.library.ubc.ca/index.php/clogic/article/view/199490]] Cultural Logic: A Journal of Marxist Theory and Practice, 26 (2024): 69-101. University of British Columbia Press.</ref>

The value of a good is determined by the [[socially necessary labour time]] required to produce it.

Marx believed that an understanding of exchange-value was necessary to explain fluctuations in price.<ref>Steele, David Ramsay. From Marx to Mises: Post Capitalist Society and the Challenge of Economic Calculation. Open Court, 2013.</ref>

Exchange-value does not need to be expressed in money-prices ''necessarily'' (for example, such as in [[countertrade]]: ''x'' amount of goods ''p'' are worth ''y'' amounts of goods ''q''). Marx makes this abundantly clear in his [[Marxist dialectic|dialectical]] derivation of the forms of value in the first chapters of ''[[Das Kapital]]'' (see [[value-form]]).

It was only in the 13th century AD when the word ''[[wikt:price|price]]'' came into use in [[Western Europe]], its Latin root being ''[[wikt:pretium|pretium]]'', meaning "reward, prize, value, worth", referring back to the notion of "recompense", or what was given in return, the expense, wager or cost incurred when a good changed hands. Its verb meaning "to set the price of" was used only from the 14th century onwards.

Its evolving [[linguistic meaning]]s reflect the early history of the growing cash economy and the evolution of commercial trade. Nowadays the meaning of ''price'' is obvious and self-evident, and it is assumed that prices are all one of a kind. This is with respect to how money has become used ubiquitously for nearly all transactions.

But in fact there are many different kinds of prices, some of which are actually charged, and some of which are only "[[Real prices and ideal prices|notional prices]]". Although a particular price may not refer to any real transaction, it can nevertheless influence economic behavior, as people have become accustomed to valuing and calculating exchange-value in terms of prices, using money (see [[real prices and ideal prices]]).

Elliot Goodell Ugalde, in 2024,<ref>Goodell Ugalde, Elliot. “In Defence Of Marx’s Labour Theory Of Value: Vancouver’s Housing ‘Crisis.” Cultural Logic: A Journal of Marxist Theory and Practice, 26 (2024): 69-101. University of British Columbia Press.</ref> extends this analysis through Marxian economics by emphasizing that the significant divergence between market price and exchange value, as seen in housing and other forms of [[fixed capital]], is a hallmark indicator of [[fictitious capital]]. This distortion not only inflates asset values beyond their productive basis but also destabilizes broader economic systems. Such conditions foster speculative bubbles, exacerbate wealth inequality, and create barriers to access for essential resources like housing.