Marx or Ricardo?—A Mild Critique on the Quantitative Testing of the Labor Theory of Value

This paper examines the understanding of the labor theory of value by economists from Ricardo to Marshall, and argues that the essence of the labor theory of value in classical economics is the production expenses theory of value, which is fundamentally different from Marx's labor theory of value. However, the understanding of Marx's "law of value" is still unconsciously influenced by classical economics, especially Ricardo. The standard model of the Marx's labor theory of value is actually a Ricardianized one. Empirical research on the labor theory of value tests the "price of production expense of wages" rather than the "labor value", and the results depends on the data features of the input-output table rather than the general theoretical relationship. This paper uses China's 1992—2020 input-output table to calculate three kinds of prices of production expenses, and finds that on average "price of production expense of wages" are closest to market prices, but are not fundamentally different from the other two kinds of prices of production expense. In sum, the test of the labor theory of value demonstrates a classical rather than a Marxian labor theory of value.