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Commentary on Jean Cartelier’s
“Marx’s theory of value, exchange and surplus value:
a suggested reformulation”


The most serious criticisms of Karl Marx’s Capital tend to focus on the opening and closing arguments of his three volume work. This fact is easily understood. The rigorous logic deployed by Marx makes it difficult to dispute once one has gained proper entry into the system by having accepted its initial premises. This observation holds even of those focusing on the exit from Marx’s system: the critique of the final sections of Volume 3, where Marx brings various lines of complex, overdetermined argumentation together into a final transformation of values into prices of production, is usually made by Marxist economists who have fully accepted the initial premises and who are accordingly directing their efforts toward the system’s improvement. But whereas the literature around the so-called ‘transformation problem’ is dominated by the initiated, those that find the first chapters of Volume 1 problematic form a much more diverse class of critics. These commentators span a full range, from Marxist sympathizers suggesting slight adjustments to the initial formulations, to those who outright reject the very basis of Capital – Marx’s value theory – to better clear the way for their own ‘bourgeois’ agendas. Jean Cartelier’s article “Marx’s theory of value, exchange and surplus value: a suggested reformulation” is unique in that he consciously aligns himself with Marx’s project, yet does so by rejecting Marx’s initial argumentation at crucial points. As the title suggests, in its place he offers a reformulated model. However, what Cartelier sketches out in the final pages of his article is not a mere reformulation, but something that amounts to a completely different theory, what he calls a ‘monetary approach.’ (Cartelier 1991: 257) In our view, his proposal only superficially resembles Marxist theory and only so because of its nominal use of a similar notation used by Marx. Our examination will accordingly not be so concerned with the details of this questionable model. Rather, this paper will primarily seek to demonstrate that Cartelier is mistaken to dismiss Marx’s arguments in the first two parts of Capital, thereby showing that there is no need to offer an alternative framework with which to ground Marx’s critique of capitalist political economy.

In his opening remarks, Cartelier self-reflectively characterizes his own project as vulnerable to attack for not being Marxist, in that the ‘reading of Marx... deployed here is a conceptual one, and the argumentation is purely logical’ which is a break from the actual ‘historical and dialectical’ analysis Marx supposedly used. Such ‘polemics aside,’ his concern is to submit Marx’s theory ‘to the usual tests of internal consistency’ and to the same criteria which are ‘currently applied (by Marxists as well) to ordinary economic theory.’ (ibid) Despite the appearance of a bourgeois critique, he insists in his concluding remarks that his aim has been otherwise. He tells us that the results of such a method of examination have lead him to reformulate matters that preserve Marx’s fundamental critical reflections on the failure of mainstream economic theories to adequately represent the workings of the market. (ibid 269) Thus, we must note from the onset an overall tension in his article between the examination of Marx via non-Marxist criteria (which is held to be a better, more equitable and neutral standard than Marx’s own dialectical criteria), all couched within an explicitly stated Marxist disposition. But it seems setting aside polemics is not so easily accomplished. Essentially we suspect that Cartelier disavows his true bourgeois agenda: believing to be acting on behalf of Marx’s cause despite his exclusive utilization of the non-dialectical logic of ordinary economic theory, he dismisses Marx’s arguments for deficient reasons in order to clear the way for an alternative model that is not needed. Marx’s own analysis is sound, as we shall see.

The tension in his article apparently was evident enough to have generated two direct responses which seek to improve on Cartelier’s dismissals of Marx. The first supplements Cartelier with an additional dialectical/historical critique (Williams 1992), while the second refocuses discussion on a newly uncovered ‘second’ theory of value supposedly hidden within Capital (Dixon & Kay 1995). Neither of these two responses offers viable alternatives to Cartelier’s argument since they are concerned with putting forth their own equally questionable reformulations of Marx. They more or less operate with the same flawed method, that of coming to the aid of Marx’s analysis, but with such tools that can only result in its wholesale dismissal. Nevertheless, we will enlist their work to better bring out Cartelier’s actual objections to Marx’s first six chapters of Capital, as Cartelier’s method of exposition in his own article is ambiguous and not well presented.

So what, exactly, does Cartelier take issue with in Marx’s opening argumentation? Perhaps the best way to illustrate what Cartelier finds fault with is by making use of Dixon & Kay’s schema of Marx’s overall argument in Parts I and II. Below is their non-contentious presentation of that argument ‘as a series of value relations connecting exchange’ in seven steps, from the simple form of value to that form found in fully developed capitalist production:

C–Cʹ simple (1)
C–Cn expanded (2)
Cn–C general (3)
Cn–M universal or money (4)
C–M–Cʹ simple circulation (5)
M–C–Mʹ capital (6)
M–CLP,MP..P..Cʹ–M industrial capital (7)

...where Cn stands for all commodities other than C. (Dixon & Kay 1995: 509–10) In brief, Cartelier’s ‘main contention’ concerns ‘an internal criticism of Marx’s theory of exchange and surplus value’ with which he finds great ‘logical inconsistencies.’ Accordingly, he deals with each theory in the two corresponding sections of his article. (Cartelier 1991: 257–8) In order to examine his claims in a manageable fashion, we can simplify matters somewhat by condensing Cartelier’s critique of Marx with reference to three areas in the above schema. His severe questioning of Marx’s theory of money would lead him to reject the two movements from (2) to (3) and from (5) to (6), while his great difficulty in accepting labor-power as a commodity would have him reject the form of value taken in line (7) since he would not consider CLP a legitimate term. The remainder of this paper will deal with these three areas in turn.

Cartelier’s first objection is the severest. He tells us that Marx’s theory of value is nothing short of ‘the weakest link in the long chain of reasoning that starts from the presupposition of the particular division of labour and culminates in the formal possibility of crisis.’ (ibid 258) He believes this is due to Marx’s failure to derive the concept of money from the exchange relationship because any exchanges that take place must necessarily presuppose the existence of money. Although he charges Marx with ‘trying to escape this issue,’ Cartelier apparently does not, leading him to offer up his own ‘monetary approach… to give more consistency to Marx’s theory.’ (ibid 260–1) One of the difficulties with following Cartelier’s analysis is that he alternatively defines Marx’s derivation of money as one from the ‘exchange relationship’, at other times as derived from the ‘commodity’ (as it first appears in simple commodity society) and finally as that which is derived from the ‘commodity form.’1 These are not, strictly speaking, the same. Granted, his point that all actual exchanges of commodities in the past must have necessarily presupposed some universal equivalent (ie, money) is well-made, so that if Marx were attempting an historical account in Chapter 1, we would have to agree with Cartelier and charge Marx with logical inconsistency. But it is not the case that Marx is laying out an historical account in theoretical terms, or even intends to back up his conceptual claims with empirical evidence. In fact, there are convincing arguments that Marx may not be attempting a deduction of money in any manner whatsoever within the opening pages of Capital. (eg, Fine et. al. 2008: 169; Reichelt 2007: 43) The doubt expressed here surrounding an actual derivation should be seen as an effort to refocus attention to Marx’s text at the very end of Chapter 1, where he charges his predecessors in political economy, particularly Ricardo, with neglecting the form of value and their treatment of it as something external to the nature of the commodity. (Marx 1977: 173–7) More specifically, Marx believes his crucial insight was to be the first to ask (and answer) why it is that labor is expressed in value and why its measure – socially necessary labor time – is expressed in sums of money. Only by showing how value as such is necessarily expressed as exchange value is it possible to consider how value is expressed as a sum of money. In a word, value form implies the money form, so Marx’s theory of value is simultaneously his theory of money. Cartelier’s focus on Marx’s supposed failed ‘derivation’ of money is simply misleading and overshadows an important methodological strategy taken by Marx in opposition to his predecessors in political economy. This advantageously prepares the reader for his later key insights surrounding the extraction of surplus value as the specific way exploitation takes place under capitalism.

As we noted above, Cartelier’s contention is that the movement from (2) to (3) or from the expanded form to the general form is illegitimate. In his own simplified schema, he emphasizes Marx’s ‘logical flaw’ in moving from the elementary form (defined as ‘the Relative value form ↔ Equivalent form’) to the universal equivalent and any such link should be conceptually deleted. (Cartelier 1991: 260, cf. Fig. 2) In other words, as he emphatically informs us, the ‘reversal of the expanded form does not generate anything but the expanded from itself!’ (ibid 259) This reflects a critical assumption which underscores his entire paper: what Marx analyzes for simple commodity society cannot be legitimately expanded to capitalist society without serious logical flaws. This will become important to note when considering his objections to labor-power being a commodity, as we shall see below. For now, it suffices to observe that for Cartelier, the universal equivalent must ‘be part of the basic assumptions on the same footing as the commodity division of labour.’ (Ibid 260, original emphasis) What he means is that the movement from (2) to (3) is not a substantial change of value relation, but rather a simple parallax shift of perspective. He picks up on the fact that Marx himself says, in Chapter 2, that to the owner of a commodity, every other commodity appears as the particular equivalent of his own commodity. So a problem arises: as this applies to every owner, ‘there is in fact no commodity acting as universal equivalent, and the commodities possess no general relative form of value under which they can be equated as values and have the magnitude of their values compared. Therefore they definitely do not confront each other as commodities, but as products or use-values only.’ (Marx 1977: 180) For Cartelier, this is a definitive statement, in Marx’s own words, of an inescapable error in logic: in no way can money arise from an inversion of the expanded to the general form (and thus onto the universal-money form).

However, Marx immediately follows this commentary with his own answer (which is categorically rejected by Cartelier) that commodity owners ‘think like Faust: “In the beginning was the deed.” They have therefore already acted before thinking.’ What Marx is getting at is two-fold. First, there is the theoretical account of the dialectical necessity of a single commodity being set aside. If commodity A expresses its value in innumerable other commodities, then all of these commodities simultaneously express their value in commodity A. Commodity A differentiates each commodity from its own use value and from all other use values. Its natural form expresses a commonality across all commodities and more so: the natural form of the universal equivalent is the form assumed in common by the values of all commodities, a visible representation of all labor. The analysis thus arrives at the money form and almost imperceptibly, Marx’s discussion turns to a brief and highly persuasive account of why precious metals are particularly suited for this function. Marx usually refers to the money-commodity as gold, but importantly notes that historically, the universal equivalent form which ‘sticks’ to particular kinds of commodities such as gold only do so at first by accident. He further argues that the natural properties of precious metals such as gold make them particularly suited to function as the measure of pure exchange value. These properties include their durability, uniformity and divisibility. (Marx 1977: 183–4) Thus, alongside the theoretical account, there is an ‘historical’ commentary, but in no way is the latter to be privileged.

Given Marx’s perfectly credible account found in these pages of why gold has emerged as the socially accepted general equivalent,2 one wonders why Cartelier is so troubled over Marx’s ‘derivation’ of the money form of value. Perhaps it is simply because he refuses to consider that Marx is using a dialectical method, a method that will not be adequately understood if one limits oneself to the purely logical procedure of ‘ordinary economic theory.’ But Marx was not a classical economist3 in the same way as Smith or Ricardo, despite his theory’s many similarities with the latter. He used an overdetermined logical method and at one extreme, perhaps best represented by someone like Althusser, Marx’s Capital represents a sharp (epistemological) break with the classicals.4 For less radical Marxists, ‘it is essential to grasp why many of the objections to the initial steps of Marx’s argument are simply misplaced and based on a reading that sees the analytical movement unfolded in those pages through the lenses of formal-logical methodologies.’ (Starosta 2008: 315) While Starosta does not specifically cite Cartelier’s work, clearly such sentiment is meant for any analysis such as his that overlooks the dialectical method at play in the very structure of exposition of Chapter 1. Of course, Cartelier’s intention is, in a sense, readily apparent as much as his explicit concern is to provide a justification for his alternative ‘monetary approach’ model. By judging Marx’s ‘derivation’ of money form as problematic at the (2) to (3) juncture, he accomplishes a great step in that direction by thereby putting money at the very outset of the analysis. Certainly, a disruption in Marx’s chain of reasoning at such an early stage should predictably have a disruptive effect in the latter stages, as we shall see.

So given that he has problems with how Marx introduces the money-commodity, we can understand Cartelier’s corresponding difficulties as Marx’s analysis proceeds. Once gold emerges, Marx tells us, it begins to play other roles besides that of a simple measure of value, such as the medium of circulation, as an immobilized hoard of value, as means of payments and as universal money. Perhaps most importantly, as the medium of circulation, money mediates the exchange of commodities and we thereby arrive at line (5) above: C–M–Cʹ or simple circulation. It is with Marx’s account of how this value relation transitions to the following line (6), the general formula for capital, that Cartelier begins his critique of Marx’s theory of surplus value.

As indicated above, Cartelier feels that the locus of Marx’s value theory is limited to simple commodity society because Marx failed to extend that theory to capitalism as money must logically be presupposed from the very beginning of the analysis, and not derived from it. In Part II of his article, he endeavors to further illustrate the so-called unbridgeable gap between simple commodity and capitalist production by highlighting an often quoted passage from the opening remarks in Chapter 4. There, Marx simply tells us that ‘alongside’ the direct form of the circulation of commodities, there exists another series – M–C–M – which together with the first series makes up the two antithetical series of transactions in the sphere of capitalist circulation. (Marx 1977: 247–8) For Cartelier, this is the extent of Marx’s reasoning, so that ‘[t]here is, in fact, no theoretical foundation for M–C–Mʹ. It is, however, in taking M–C–Mʹ as a starting point that Marx endeavours to raise and solve the surplus value puzzle.’ (Cartelier 1991: 261) We will turn to Marx’s solution to this puzzle and Cartelier’s corresponding critique shortly. But first we need to demonstrate that Marx’s reasoning was not limited to such a simple statement of fact and thus cannot be so easily dismissed as lacking proper argumentation. On the contrary, he was well aware of the difficulties in articulating a foundation for the movement from (5) to (6) and did address the problematic nature of this issue. In Chapter 5 where he specifically addresses the contradictions in the general formula, for instance, he tells us that

‘[C]apital cannot therefore arise from circulation, and it is equally impossible for it to arise apart from circulation. It must have its origin both in circulation and not in circulation. We therefore have a double result. The transformation of money into capital has to be developed on the basis of the immanent laws of the exchange of commodities, in such a way that the starting-point is the exchange of equivalents. The money-owner, who is as yet only a capitalist in larval form, must buy his commodities at their value, sell them at their value, and yet at the end of the process withdraw more value from circulation than he threw into it at the beginning. His emergence as a butterfly must, and yet must not, take place in the sphere of circulation. These are the conditions of the problem.’ (Marx 1977: 268–9)

This passage demonstrates many important points. First, in order to understand this ‘double result,’ where capital must have its origin simultaneously in and not in circulation, there requires a consideration that Marx is, in fact, using a dialectical method. Cartelier invalidates or at best ignores such methodology, so a passage such as this will be dismissed and Marx will be accused of not addressing such difficulties. Second, Marx clearly recognizes the difficulty in treating (capitalist) production in abstraction from circulation. He is not trying to cut any corners by analyzing production and circulation separately, in isolation from each other. Rather, these two are intimately intertwined in capitalism and the key to their interrelation is a peculiar commodity, labor-power, which is the third point to take away from this passage. Labor-power is the solution to the ‘surplus value puzzle’ Marx lays out for us and must be understood as not only one commodity among others factoring into production, as per line (7) above, but as the very key to the transition from (5) to (6) as well. For this reason Marx immediately follows this passage with Chapter 6, ‘The Sale and Purchase of Labour-Power,’ the title of which underscores the fact that labor-power qua commodity is (also) to be critically considered as something bought and sold. It is to be treated as something in circulation as well as in production.

It is surrounding this point that we can observe the most obvious failure of Cartelier’s analysis. Because of his mainstream economic bias, he exclusively treats labor-power as a mere factor of production, so his ‘reformulated model’ includes a theory of wage determination quite unlike that of Marx. To see this, consider Marx’s argument for the movement from (5) to (6). In order for M–C–Mʹ to make sense, we need to have Mʹ > M, but this does not seem possible, for if exchange were not the exchange of value equivalents, value would not thereby be created – there would be a mere transference of value from loser to gainer. But if value equivalents are exchanged, how precisely is money made? Marx resolves this by focusing on labor-power as a unique commodity whose use value has the property of creating more value than it itself possesses. Labor-power can bought and sold like any other commodity and because it has this particular property, when its value-creating potential is bought by the capitalist and subsequently used up in the production process, it adds more value to those produced commodities than originally went into their production. When those finished commodities are placed back into circulation, they can be sold for more money (Mʹ) than what initially was advanced to procure the inputs into their production (M). Hence, the puzzle of surplus value is ‘solved.’

One of the results of this theory is that if labor-power is a commodity, its value in wages is determined ultimately by the value of the commodities which workers need to regenerate that labor-power potential so that it can be re-sold to the capitalist. (Marx 1977: 274–5) Dixon & Kay speak for themselves as well as for Williams and Cartelier in their dismissal of this ‘idea... [as] not worth defending.’ (Dixon & Kay 1995: 513) All three articles thus have convoluted proposals within their alternative models on how wages are else wise to be determined because they find Marx’s own determination suspect. But Cartelier and Williams go further and completely reject Marx’s claim that labor-power is a commodity. Cartelier does so for two reasons, both equally specious. The first reason again reminds us of his belief of the importance that Marx’s theory be limited to simple commodity production. Labor-power cannot be a commodity because its owners – workers – are effectively compelled to offer it on the market because they lack the means of production. That is, workers are essentially not members of a commodity society since they do not have complete freedom to sell or not to sell. (Cartelier 1991: 263) Cartelier accomplishes two things with this move. One, he widens the gap between simple commodity exchanges and capitalism, showing how Marx’s analysis is not logically compatible with the latter. Two, labor-power cannot be a commodity because ‘[w]orkers do not have the choice’ but to sell it, an ‘assumption which violates the general conditions for the existence of commodities.’ (ibid) Consistent with his neoclassical economic bias, Cartelier discussion of freedom throughout his article is pitched exclusively in terms of choice. Of course, it is arguable that Marx, having roots in the German idealist tradition, would seriously consider freedom simply in these terms.

His second reason for why labor-power is not a commodity is equally incredible and demonstrates a colossal failure at conceiving a fundamental difference between labor and labor-power. Cartelier’s contention is that labor-power cannot be alienated in exchange ‘since [the owner of labor-power] cannot be separated from himself!’ He continues to argue that because of this, ‘there would be no room for any surplus value. In short, the mystery of surplus value is not yet brought to an end.’ (ibid) Dixon & Kay provide the obvious counterargument that this is precisely what a contract of employment entails: a worker agrees to place his capacity for labor at the disposal of the capitalist for a wage, which effectively alienates his labor-power from himself because of his forfeiture of rights to the product of his labor. (Dixon & Kay 1995: 514) Perhaps Cartelier so strongly links labor-power with Marx’s value theory (which he rejects for other reasons, as we saw above) that he overlooks the naivety of his own argument. Certainly, he would know that Marx first made the labor/labor-power distinction to resolve an inconsistency he discovered in Ricardo’s theory of value. But as Skillman argues, while Marx uses the distinction to explain how surplus value arises from the circuit of capital despite all commodities exchanging at their respective labor values, one can easily understand the distinction between labor and labor-power independent of Marx’s value theory. (Skillman 1996: 427–8) Thus, simply because Cartelier has difficulty with understanding Marx’s value theory, he should still be able to conceive that when Marx speaks of labor-power, he is referring to a capacity or a potential, rather than the actual exercise of human productive powers to alter the use value or even to add value to commodities. This capacity is the use value of labor-power and when the worker sells it, labor is extracted from labor-power. The value of which is then added onto the finished product above the wage paid to the worker for the use of that capacity.

Thus, for these two reasons, Cartelier claims ‘a logical contradiction between making labour power a commodity (and its owner a member of the commodity society) on the one hand and the general conditions of the commodity division of labour on the other.’ (Cartelier 1991: 263, original emphasis) But denying that labor-power is a commodity has disastrous consequences for understanding Marx. No longer a commodity, it is removed from the circulation of other commodities and thus the key link established by Marx between simple commodity exchanges and capitalist production is severed. For his own project, Cartelier is now free and clear to begin building his abstract model of capitalist production independent from the sphere of circulation. This, as we saw above, is precisely what Marx explicitly said was the path not to be taken. Marx closely linked the circulation of commodity exchanges with capitalist production through his theory of value which is precisely a labor theory of value.

Effectively what Cartelier tries to accomplish is a complete rewriting of Marx. Not being able to see how M–C–Mʹ arises because he rejects Marx’s argument from (2) to (3) and (5) to (6) and because he believes labor-power cannot be treated as a commodity, he concludes that ‘[f]rom these criticisms stems a different way of interpreting Marx’s ideas which leads to a restatement in terms of monetary analysis.’ (ibid 262) He thus believes he is more faithful to Marx’s own analysis than Marx himself when he proposes his alternative ‘monetary model’ which treats money as the starting point. We can certainly sympathize with Cartelier’s monetary focus and his eagerness to place it front and center. One of the most readily observable phenomena in our own late capitalist society is that money functions as an end in itself, prized in its own right rather than in terms of what it can purchase. It without question dominates the sphere of production. But as we saw, Cartelier’s criticisms of Marx’s theory overlook its strategic and dialectical methodology in accounting for this phenomenon, and his rejection of labor-power qua commodity – even by his own non-dialectical standards – is doubtful at best.

Overall, it seems hard to believe that Marx could be in error in so many key areas in the opening passages of Capital. We therefore conclude that there is no need to develop an alternative model. Rather, we find that Marx’s discussion of commodities, money, exchange, circulation, capital and labor-power in Parts I and II of Volume 1 is logically consistent and provides a solid basis from which to launch a radical critique of political economy across the remainder of the three volumes.

1 We can add to this list a supposed derivation of money from the value-form. (Williams 1992: 439)

2 Against the charge that Marx’s analysis is dated, we should be reminded that many of the world’s currencies are still today tied to gold in some manner. Even the most developed economies, despite having formally left the gold standard almost 40 years ago, often can be observed taking refuge in the precious metal during economic downturns, during inflationary periods or whenever currency fluctuations prove too unpredictable.

3 For an interesting account of Marx’s debt to Hegel’s dialectical method which underscores his great departure from Ricardo and other classical political economists in theorizing the money commodity, see Nelson (2001). Particularly interesting is the point by point comparison of Marx’s value-form with Hegel’s discussion of ‘measure’ found in his Science of Logic. (ibid 56–8)

4 See Milios (2009), whose recent work further extends Althusser’s contention that Marx’s value theory constitutes a radical break from Ricardo’s notion of value. Milios maintains that Althusser overlooked the radicality of the value-form analysis and accordingly argues that the true center of the break be located in Part I of Capital.


Cartelier, Jean. “Marx’s theory of value, exchange and surplus value: a suggested reformulation,” Cambridge Journal of Economics, Vol. 15, No. 3 (1991) 257–269

Dixon, William and Kay, Geoffrey. “Marx’s theories of value: a response to Cartelier and Williams,” Cambridge Journal of Economics, Vol. 19, No. 4 (1995) 509–522

Fine, Ben and Saad-Filhob, Alfredo. “Production vs. Realisation in Marx’s Theory of Value: A Reply to Kincaid,” Historical Materialism 16 (2008) 167–180

Marx, Karl. Capital, Vol.1, trans. Ben Fowkes (New York: Vintage Books, 1977)

Milios, John. “Rethinking Marx’s Value-Form Analysis from an Althusserian Perspective,” Rethinking Marxism, Vol. 21, No. 2 (April 2009) 260–274

Nelson, Anitra. “Marx’s Theory of the Money Commodity,” History of Economics Review, No. 33 (Winter 2001) 44–63

Reichelt, Helmut. “Marx’s Critique of Economic Categories: Reflections on the Problem of Validity in the Dialectical Method of Presentation in Capital,” Historical Materialism 15 (2007) 3–52

Skillman, Gilbert L. “Marxian Value Theory and the Labor-Labor Power Distinction,” Science & Society, Vol. 60, No. 4 (Winter 1996) 427–451

Starosta, Guido. “The Commodity-Form and the Dialectical Method: On the Structure of Marx’s Exposition in Chapter 1 of Capital,” Science & Society, Vol. 72, No. 3 (July 2008) 295–318

Williams, Michael. “Marxists on money, value and labor-power: a response to Cartelier,” Cambridge Journal of Economics, Vol. 16, No. 4 (1992) 439–445