Editing Labour power (section)

==The value of labor power==
Labour power is a peculiar commodity, because it is an attribute of living persons, who own it themselves in their living bodies. Because they ''own'' it within themselves, they cannot ''permanently'' sell it to someone else; in that case, they would be a slave, and a slave does not own himself. Yet, although workers can hire themselves out, they cannot "hire out" or "lease" their labour, since they cannot reclaim or repossess the labour at some point after the work is done, in the same way as rental equipment is returned to the owner. Once labour has been expended, it is gone, and the only remaining issue is who benefits from the results, and by how much.

Labour power can become a marketable object, sold for a specific period, only if the owners are constituted in law as [[legal]] subjects who are free to sell it, and can enter into labour contracts. Once actualised and consumed through working, the capacity to work is exhausted, and must be replenished and restored.

In general, Marx argues that in capitalism the value of labour power (as distinct from fluctuating market prices for work effort) is equal to its ''normal or average (re-)production cost'', i.e. the cost of meeting the established human needs which must be satisfied in order for the worker to turn up for work each day, fit to work. This involves goods and services representing a quantity of labour equal to [[necessary labour]] or the [[necessary product]]. It represents an average cost of living, an average living standard.

The general concept of the "value of labour power" is necessary because both the conditions of the sale of labour power, and the conditions under which goods and services are purchased by the worker with money from a salary, can be affected by numerous circumstances.<ref>Francis Green, "The relationship of wages to the value of labour-power in Marx's labour market". ''Cambridge Journal of Economics'', Vol. 15, No. 2, June 1991, pp. 199-213.</ref> If, for example, the state imposes a tax on consumer goods and services (an indirect tax or consumption tax such as [[value-added tax]] or goods and services tax), then what the worker can buy with his wage-money is reduced. Or, if price inflation increases, then again the worker can buy less with his wage money. The point is that this can occur quite ''independently'' of how much a worker is actually paid. Therefore, the ''standard of living'' of a worker can rise or fall quite independently of how much he is paid—simply because goods and services become more expensive or cheaper to buy, or because he is blocked from access to goods and services.

Included in the value of labour power is both a ''physical'' component (the minimum physical requirements for a healthy worker) and a ''moral-historical'' component (the satisfaction of needs beyond the physical minimum which have become an established part of the lifestyle of the average worker). The value of labour power is thus a ''historical norm'', which is the outcome of a combination of factors: productivity; the supply and demand for labour; the assertion of human needs; the costs of acquiring skills; state laws stipulating minimum or maximum wages, the balance of power between [[social classes]], etc.

Buying labour power usually becomes a ''commercially'' interesting proposition only if it can yield more value than it costs to buy, i.e. employing it yields a net positive return on capital invested. However, in Marx's theory, the value-creating function of labour power is not its ''only'' function; it also importantly ''conserves'' and ''transfers'' capital value. If labour is withdrawn from the workplace for any reason, typically the value of capital assets deteriorates; it takes a continual stream of work effort to maintain and preserve their value. When materials are used to make new products, part of the value of materials is also transferred to the new products.

Consequently, labour power may be hired not "because it creates more value than it costs to buy", but simply because it ''conserves the value of a capital asset'' which, if this labour did not occur, would decline in value by an even greater amount than the labour cost involved in maintaining its value; or because it is a necessary expense which ''transfers the value of a capital asset'' from one owner to another. Marx regards such labour as "[[Unproductive labor|unproductive]]" in the sense that it creates no new net addition to total capital value, but it may be essential and indispensable labour, because without it a capital value would reduce or disappear. The larger the stock of assets which is neither an input nor an output to real production, and the wealthier society's elite becomes, the more labour is devoted only to ''maintaining'' the mass of capital assets rather than increasing its value.