AM09 Marg Prod

This covers chapter 8 of Hill & Myatt on Marginal Productivity theory, which says that you get paid what you are worth. That is, all factors receive payment according to their contribution to production. This argument is very wrong for many reasons. These reasons are discussed in the Anti-Textbook, and further explained in the lecture.

Sample Question for Final: A meta-theory is a theory about theories. Meta-theories about justice -- whether laborers and capitalists DESERVE what the earn -- lead to the differences between Marx's labor theory of value, and neo-classical theory of marginal productivity. NOTE, some questions go BEYOND the lecture coverage, and will require you to think for yourself and perhaps do some additional research (especially question 4)

• 1. Explain Marx's Labor theory of value, and how it leads to the conclusion that capitalists exploit laborers.

  2. Explain the neoclassical theory of marginal productivity and how it leads to the opposite conclusion.

  3. Provide TWO theoretical defects in the neoclassical theory.

  4. Consider the argument on a META-LEVEL -- how can we argue about whether or not capitalists receive a fair reward for their contribution to the productive process