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l o u r n d aJLlbrrrnnon Sud8er. Vol. 2. No. 4, pp. I l l - 1%.

a Pcrsamon Prerr Lld. 1918. Printed in Crcat Britain.



Deparlmenr o/ Economics, George Mason University

It is taken for granted by most economists and not always be as important as how he was later
political philosophers that John Locke was in interpreted, we must discover the former in
some sense a precursor of the labor theories of order to accurately understand and appreciate
value of the nineteenth century British Classical the latter. Hence, in the following pages I will
School and of Karl Marx, yet there is a wide attempt to supply the missing detailed analysis
divergence of opinion on how Locke's work an- of John Locke's "labor theory of value".
ticipated and influenced the work of later It is not surprising that there should be such a
political economists. In large part this dif- variety of interpretations on the subject of
ference of opinion stems from a disagreement Locke and the labor theory of value. On the
among historians of economic thought over one hand, Locke himself was ambiguous about
how to interpret Locke himself on the subject what he meant by both value and labor in the
of labor and economic value. The only point of Second Treatise (as we shall see below), and on
agreement is that, in his major political essay, the other, there is no uniform agreement among
the Second Treatise of Government,[" Locke economists as t o what constitutes a labor theory
developed a theory of property which showed of value and who, if anyone, ever espoused
some relationship between labor and economic such a theory.[31It seems appropriate, then, to
value. Historians of economic thought cannot define how the term labor theory of value will
agree on the significance of this relationship or be used in this paper.
on how Locke's ideas on labor and value are There are three possible meanings of a labor
related to his supply and demand theory of theory of value that are relevant to Locke's
market price in his economic writings. It has writings: a labor theory of value may identify
been argued, for example, that Locke had the labor as the source of use-value or utility (the
beginnings of a theory of the exploitation of reason people desire a good in the first place), it
labor, that he provided a labor theory of value may attempt t o explain the determination of
in the long run to supplement his supply and de- relative prices (the exchange value of goods)
mand theory of price in the short run, that he based on some measure of labor inputs, or it
presented the "metaphysical justification" for may claim that labor provides the only
the nineteenth century labor theory of value, justifiable claim to receiving the exchange value
and that he had no labor theory of value at of the goods it produces. A labor theory of
all.'" value in the first sense states that the usefulness
What is characteristic of these and most of goods and services demanded and consumed
other evaluations of Locke's statements about by individuals is created either exclusively or
labor and economic value is that they are principally by the labor that goes into produc-
generally brief mentions of this aspect of ing them. Almost all economists would identify
Locke's thought in the context of larger works labor as a contributor to the use-value of com-
on much broader topics. There has been no modities, but the idea that labor is solely
detailed analysis to discover whether or not responsible for this use-value is unusual and
Locke can be said to have had a labor theory of probably only found in the writings of Karl
value in any sense of the term. While in the Marx.[" While explanations of the ultimate
history of ideas, what a man actually said may cause of value have concerned economists for

151 where in All discussions of Locke's "labor theory of the absence of scarce land and capital. it is as a theory in the determination of price in either the long run the second sense. his defini- modity to another and the quantity of labor tion of labor was such that the ethical conclu- which has gone into producing each of them. and it was in this nor.'s1 Such theory of value at all. [p. some argue. The most obvious (and perhaps only) example of a pure labor theory of exchange value is found in Adam Smith's beaver . a conclusion which Locke sought to and value will be a major concern of this paper. however. a labor theory of or the short run with the labor used t o produce value most often means a theory about the rela. It is there that Locke presents his hunting them. being normative rather than of nature before governments had come into positive. . ' although it is society. in order to survive. Or. but by natural law. ' ~Hence. and any pat.deer LOCKE'S LABOR THEORY OF PROPERTY example in the Wealth of Nations. a product.312 KAREN I . and (c) while he did hold a labor tionship between the relative value of one com. avoid. theory of value in an ethical sense. However. mankind who once shared in the original com- economists mean when they speak of a labor munistic ownership of these resources. where the just It was Locke's problem. and the problem of reward depends upon the price at which the seventeenth century political philosophers in product is sold. It is also possible to construct a famous justification for private ownership of labor theory of value that admits capital as a goods and land on the basis of the effort o r productive agent but still shows changes in labor which individuals expend to produce relative prices to be determined by changes in goods or to cause the land to produce goods of labor as. clothe and shelter themselves. when most economists source of use-value. this consent could be withdrawn or not strictly a question of economic theory. the ex. men all had common access to the might hold. he argued that private property The following pages will attempt to show (a) was established in the state of nature not by the that Locke did identify labor as the primary consent of mankind. A normative labor theory of value existence. The structure of The third sense in which a labor theory of Locke's defense of private property is un- value is often understood is different from the doubtedly familiar to most readers. for example. although God should exchange for each other. In the state other two. it might instead attempt to define men had to appropriate some of these resources the just reward for the services of the labor that to feed.['] value to human beings. 3041 goes into producing a product. Grotius and Pufendorf had and the labor theory of value in both the both argued that private property was establish- economics and political philosophy literature. did David Ricardo. that mative sense that the Ricardian socialist^^'^ and since property only existed at the consent of Karl Marx read L o ~ k e . to explain how these appropriated the just price and the just wage are not unique resources became legitimate private property to labor theories of value. While the ethical questions of general. individual unjust. That is. produces. (b) that he did not connect discuss a labor theory of value. that two goods which earth and the fruits thereof which God had pro- take the same amount of labor to produce vided for their use. a theory of property implied. ed in the state of nature by the cansent of all Indeed. it is this normative form that most non. Instead. had given all men an equal right to use the tern of prices that deviates from this norm is earth's resources. which excluded other men from having any tions have been closely associated with Locke claim upon them. VAUGHN two thousand years. sions he arrived at were generally favorable to Such a theory tries to establish an exclusive capitalism as he knew it and to the private pro- relationship between the effort (or time) of the perty system upon which that capitalism was laborer and relative price of the commodity he based. value" ultimately refer to the theory of property change rate of a beaver and deer is equal to the he develops in Chapter V of the Second inverse of the labor time which has gone into Treatise. the modified by the society which sanctioned it ethical implications of Locke's ideas on labor originally. these ethical ques.

as when he says. The labor of his body. Whatsoever skins or moss. contributes almost nothing to value when theory of property as implying some kind of compared to labor since land. that the im- man had a natural right to self ownership provement of labor makes the far greater paR of the which. For 'tis labor indeed that puts the differenceof value Locke's insistence on the overwhelming im- on every thing. because they provide for more of the owning the land itself. work (this is the usual connotation of the word [p. The question now arising is the nature of the cludes the common right of other men. [p. to the launching of a com. enjoy in this world". "labor" to include any act of appropriation of 3181 It is objective in the sense that there is im- natural resources. ing fallow land "waste" to emphasize the pared to labor in the production of valuable smallness of its contribution to value in his goods. and cloth or silk than leaves. It k i n g by him the far greatest part of the value of things we removed from the common state nature placed it in. Locke terpretation by citing Locke's many statements pointedly refers to the Spanish practice of call- about the relative unimportance of land com. For this value which labor creates. and he concludes that "labor makes and joyned to it something that is his own. . 3151 it hath by his labor something annexed to it. . and left it In. this sense. 3111 Thus. and cloth than plicated process of production which involves silk. Although there is labor being the unquestionable property of the laborer. on the other Those who have interpreted Locke's labor hand. 308-3091 Anytime "conveniences of life". by itself. permitted him to create private proper- ty where none previously existed: Locke repeats this theme of "unassisted Though the Earth. Land. which depends only on that private property is justified through hard [something's] usefulness to the life of man". of value Locke has in mind when he pended in purposeful action. and thereby makes it his property. Locke's basic premise is that nature by eyes. when Locke is once joyned to. can labor theory of value usually support their in. no matter how trivial. . [p. LABOR AS THE SOURCE OF VALUE the common pool of resources. [pp. [p. himself. he usually as good left in common for others. for example. 3191 and rails labor was necessary to justify all types of ac. 3141 survive. Indeed. This no body has any right to but whatever bread is more worth than acorns. and that each a n acre of the same land lying in common without any husbandry upon it. or sugar. no man but he can have a right to what that some ambiguity in his usage. we mav sav. although he does not claim itself provides very little that is of value to that land creates no value. an "in- Although the above passage seems to imply trinsick value. and all inferior creatures k com- nature" providing very little that is valuable mon to all men. so that. when coupled with his right and duty to value. [p. [p. and he will find. 3171 It is this kind any human effort. is ex. 3121 Labor is primarily responsible nature. and access to God's earthly resources. hands. he hath mixed h ~ labor s with. 3121 He also refers to this kind of value as "labor"). against the desire men have for more than they quisition of unowned resources in the state of need. [p. "For own person.. 305 -3061 means some kind of objective utility. that is wholly owing to labor and then he removes out of the state that nature hath provided. . sown with wheat or barley. and speaks of value created by labor. While this very general definition of useful to the life of man". the value it does mankind unless it is combined with labor: create is minimal when compared to labor. plied a common standard of usefulness for all ding over and picking up acorns which have people. at least where there is enough. what the oortance of labor comoared to land in the oro- difference is between an acre of land planted with duction of valuable gdods might be somewhat . satisfy few of man's needs. are orooerlv his. industry". yet every man has a property in his again and again. it had important implications for for creating products which are more useful in Locke's view of economic value. and the work of his wine than water. Locke makes clear that he means the "real use and necessary support of life". [pp. bread is objec- fallen to the ground. from the simple act of ben. and let anyone consider. and hence labor creates "most of the value" of things we enjoy in this world. . tively more valuable than acorns. JOHN LOCKE AND THE LABOR THEORY OF VALUE 313 Natural law dictated that all men had common tobacco. that ex. it is defined as characterizes gold and silver as being "little labor. [p.

[p. conveniency went together". when one considers the context in tills. mankind for its legitimacy. men would be living makes the earth more supportive of human life. source of use value.3151 In this limited sense. his purpose is to exchange value (or price) although the two emphasize these utilitarian implications of ideas may be found in the work of one man. he argued that while private property is the they merely lived off the products of inevitable moral consequence o f men laboring "unassisted nature". This is obvious when one considers and thus. in an effort to make his theory of property In fact. what might serve for food. Locke perceived that it was more modity explained its exchange value. than several nations o f the Americans are o f Locke believed that labor was the primary this. In ef. apt to produce in abun. mon stock t o provide for their support than if fect.e. inclose it from the in the creation of value because he was attemp. and poor in all the cam. the source of value in all commodities that While it is not difficult to accept that one could be increased in supply and then attemp- should "own" the water one draws from a ted to develop a theory of value in which the stream or the wheat one grows on otherwise quantity of labor necessary t o produce a com- fallow land. While land by itself was forts o f life. and once labor is pur- not one hundreth part o f the conveniences we enjoy. may truly which did not depend upon the consent of be said to give ninety acres to mankind". natural law guarantees one's right to pro- perty. improves. cultivates. and a king o f a large and fruitful territory there posefully applied to land. goods people consume. they need less of thecom- from the institution of private property. "right and common stock left over to support others. lodges. when men choose to mix their to point out the beneficial effects that flow labor with the earth. in- that: cluding those who d o not own land. while he land and has a greater plenty of the conve- argued that the right to own property apart niences of life from ten acres. with the materials o f plenty. Locke did have a labor theory of value.314 KAREN 1 VAUGHN puzzling in view of the common seventeenth difficult to justify owning the land itself. than he could from the common was a result o f natural law have from an hundred left to nature.'"' Smith. the products of land dance. Thus. He by place. he also took pains 3121"'' That is. [p. 2 n d can use which the discussion of land and labor takes the product of. however. private property. and alone could not be enjoyed by humans without delight. whom nature having furnished as responsible for a small part of the use value of liberally as any other people. [p. in this case. 3081 What makes ownership of ting to demonstrate conclusively to his readers the land itself palatable. Thus. are the exter- how "the property of labor should be able to nal benefits accruing to mankind in general overbalance the community of land". The puzzle evaporates. England. there is a dramatic in- feeds. i. Locke minimized the role of land his labor does. but in this case natural law is especially easy to comply with since it coincides with the LABOR AS A MEASURE O F VALUE self-interest of all mankind. as savages. plants. [pp. as it were. when Identifying labor as the source of use value is Locke says that labor makes the greatest part of not the same thing as making it the measure of the value of things we enjoy. is also the activity which less" natural resources. so much is his property. for example. In fact. then. have the application of labor. 3201 Without Thus. claimed that labor was theory of economic value. ownership applies: "As much land as a man however. labor. rayment. [p. Locke argues that "he that incloses more acceptable to his audience. T o recapitulate so far: it is obvious that There cannot be a clearer demonstration o f any thing. yet for want o f improving it by labour. 3141 even when land ownership is limited to a few. fruitful sail. century view of land and labor as co-equal although he claimed that the same principle of sources of value. Hence. private property rather than to enunciate a Ricardo. and is clad worse than a day laborer in crease in the usefulness of the products created. common". who are rich in Land. and there is then more to support themselves. property is beneficial to everyone. 314. . the activity by which men acquire the conscious application of labor to "worth.

but the portance to Locke to be able to measure how market price at which it can be sold. however. is implied in a passage we have already quoted while the actual measure of that benefit is the in part: market price of the thing in question. would do the like. But yet the benefit mankind receives from theone. [p. Therefore. wine parently. with the modities at all times and at all place^". problem of comparing the value of goods pro. If this interpreta- values? Bread and wine may be more useful (or tion is correct. then what Locke believes is that desirable) than acorns and water. . . . of the same natural. goods are not valuable simply because Evidence that Locke at least considered the labor has gone into producing them. and "the only measure by which we m a n . mankind receives" from it. if all the profit an indian received from it is consistent with the value theory he presents in were to be valued. 3151 ductive while the Indian did little more than But how does one go about computing these gather the bounty of nature. would receive only 1/1000 of the income an sions which our industry and pains prepare for us. the intrinsic value of a thing seems to pare the exchange value of goods? The problem be only a potential it has to benefit mankind. without which some writers that Locke presents two inconsis- it would scarcely be worth anything. the other provi. 3121 This definition was also can compare the values of different com.^"^ But further implication that the intrinsic value of did Locke. there is no reason to duced with differing amounts of labor is found suspect that Locke believed there to be any in the following passage: causative connection between the amount of An acre of land that bears here twenty bushels of labor used to produce a good and its market wheat. which men will value (and are willing to pay ed by labor? for). but also the fact that it penny. that is wholly owing to labor and industry. It has been suggested by greatest part of the value upon land. but he did claim that labor was "the real dance with common usage. intrinsick value. Perhaps the most economic value he developed in his economic striking has to do with the way he contrasts the writings also informed his discussions of value "intrinsick" value of land with the "benefit in his political essay. same husbandry. . and sold here. I may truly say. from this passage at least. For the when anyone hath computed. " . current market prices in England. the Indian The one of these being the food and rayment which unassisted nature furnishes us with. ". could in some way be used to measure and com. 3161 tent value theories in his political and his There are several interesting inferences that can economic writings. comparable piece of land in England. Tis labor then which puts the his economic writings. Ap- For whatever bread is more woRh than acorns. which. who identified labor as the primary something could (and often was) different from source of use-value. one would think it of vital im. siderations of the Consequences of Lowering . Englishman would receive from the output of a which how much they exceed the other in value. In the above passage. are. earlier in the Second Treatise. Locke is saying that if all the output than water. used in Locke's economic writings. and cloth or silk than leaves. the of valuable goods also results in the creation of measure of that value is not the amount of ownership rights. view of labor and value so appealing is not only is worth 51. How then does Locke plication is clear: men labor to produce goods propose to compare the value of goods produc. not 1/1000. labor which goes into producing it. did not identify labor as a source of sic value of goods had been defined. [p. in accor- value. at least. in a year. only on their usefulness to the life of modities". but close examination of be made from this passage about Locke's ideas both works suggests that the theory of on labor and economic value. also believe that labor its market value. JOHN LOCKE AND THE LABOR THEORY OF VALUE 315 in contrast."41 The im- much value labor creates. he will then see. how much labor makes the far greatest part of the value Englishman had labored to make his land pro- of things we enjoy in this world. but how while labor creates the "greatest part of the much more valuable? In a world where creation value of things we enjoy in this world". [p. as depending measure of the exchangeable value of all com. As we have alreadq Locke's major economic essay. skins or from an Indian's land in America were sold at moss. the intrin. and another in America. "Some Con- noted. and from the other possibly not worth a its internal consistency. without What makes this interpretation of Locke's doubt. with the price.

that water is more decreases as its quantity increases. . without restraint or inclosure. and most useful things are commonly the cheapest. his essay deals more with the subject of answer this question satisfactorily by market value and money than it does with the distinguishing total from marginal utility. This orooortion in all commodities. and yet these have generally no price at all. and therefore is nowhere of any price) comes anywhere What we see in this passage is Lockegrapp. [pp. which depends upon their objective usefulness the price they will pay depends upon the quanti- in supporting human life. guarantees that people want a good. The change of this marketable value of any they will be willing to pay a price for it: commodity in respect of another commodity or in respect of a standing common measure. or. nor yield which the commodity bears to something else. who first formulated the question: the best. as convenience. 5. The marketable value of any assigned quan. as to make any assigned quantity of i t constantly worth any assigned quantity of mine". i s the greater than their vent in most places of the world. and we find Locke Locke only approached the correct answer by stating very clearly what he believes to be the recognizing that the exchange values of goods relationship between intrinsic value and market depend not only on their usefulness in general. the usefulness of something does consists in its fitness to supply the necessities or serve help to determine its price. price. thermore. economists would finally be able to result. but the alteration of some proportion. because. yet the Bounty of Providence has made their usefulness and its exchange value? Locke grants production large. or opi- 2. increases as its quantity is reduced and ween stating. [p. theory of value: quantities which are subject t o change.316 KAREN l VAUGHN the Interest Rate and Raising the Value of tled value in anything. Hence it is. demand for the good. but "The vent of anything depends upon its yet. . He says that there is no "natural set. and the mare affects the vent (or demand) for the product. . Locke perceives that there is a difference bet. the being or well-being of men. any money: because their quantity i s immensely .1"' It is useful than wheat in the abstract. but only insofar as it the conveniences of human life. to be reduced into any proportion to its consump- ling with a problem which had troubled tion. or the more i t con- tributes to our well-being the greater i s its worth. Locke if they are both useful and if their capability t o found it necessary to explain how prices were in support human life doesn't change? Two cen- fact determined in the marketplace. . and is economic thinkers at least from the time of sometimes sold dearer than wine. In addition. subject stated in the title. the less important the use which the additional . but the Logical question interest from 6% to 4%. [pp. not that 4. i t begins presently to have a price. necessity or usefulness. . i s not the What more useful or necessary things are there to altering o f any intrinsick value or quality in the com. furthermore. though their consumption be what is the relationship between a good's great. yet he does not ty of the good proportional to its vent. as believe that this usefulness determines the price this is commonly interpreted. But as soon as ever water (for air still offers itself 66 . on the supply and at which specific quantities of goods exchange. and that in water always exchange for two bushels of wheat general prices can not be dictated by law. equal. . that Aristotle.["' Fur- 1.671 everywhere. proportion of their quantity to their vent. usefulness is not invariable but is determined by 3. 63-611 (as he also did in the Second Treatise) that Given that the quantity of a good is sufficiently goods have an "intrinsick natural worth" limited that people will pay some price for it. of wheat.l"l was published in 1692 to oppose a quantity of it constantly worth any assigned bill before Parliament to lower the legal rate of quantity of another". than air and waler modity . He says. As a turies later. and suitable to it. 461 but notice here that a thing's another. when they will exchange one for suming the good. the subjective evaluation of the individuals con- tities of two or more commodities are pro hic and nun?. for example. The price. That the intrinsick natural worth of anything. In order to support his t o ask is why not? Why doesn't a gallon of contention that interest is a price. in a concise summary of his but also on the quantities which are available. and saying tempting to argue that Locke was saying that that one gallon of water is "worth" two bushels the greater the quantity of any good available. . as to make any assigned Money". That there i s no such intrinsick natural settled nion guided by fancy or fashion shall deter- value in anything. necessary i t i s to our being. usefulness only another.

by receiving in exchange for contexts of the statements. or was he just resorting to uheteof ldbor )el makes. and wealth to be unequally distributed. (Recall that one interpretation of the use of money on the distribution of proper- Locke is that he believed the labor used in pro. and car- tributions of labor and land and the price of the r i a ~ e . he means that when This is the only place in his writings where men expend productive effort. how the more likely explanation considering the a man may fairly possess more land than he himself can use the product o f . but since both are in the Second Treatise. o f man in proportion t o food. product in mind."'] Thus. or if stream. Locke sidestepped the question of why ship between the quantity of labor (or land) re- the greater the quantity. the greater While it appears so far that Locke believed their vent (or demand) and the higher their that the "benefit" mankind received from price. The market operates according to supply his numerical examples was that the greater the and demand: why this is so was not a question amount of labor mixed with land. was measured by its ship to price but only by creating utility market price and that the market price was reflected in demand for the goods it creates. Yet Locke has no means clear. He says: the goods it produces. I I IS pldin i h d ~men haie agreed I" jhpruporuunatc hyperbole to emphasize the importance of labor and uncqudl p o w c w o n o f the earth. Did Locke have some ac- But since gold and silver. ing. 9 9 / 1 0 0 . gold and silver. and voluntary consent found out a way. but imputing such a market price than goods which require little sophisticated understanding of diminishing labor? O n the other hand. for here Locke value. which Locke was directly interested in answer. ty in society. might have considered labor in some way to be Locke is arguing that the use of money allows related to the selling price of a product. [p. the more useful the resulting goods produced. or its value. JOHN LOCKE A N D T H E LABORTHEORY O F VALUE 317 unit will serve and therefore the lower the price more labor to produce command a higher people will pay for it. Chapter V where he is discussing the effect of modities.lml the more useful the goods produced.has its value only from the consent of men. One is not sure if he means to defined labor to be merely picking up acorns say that labor is in great part the measure of the from the ground or drawing water from a consent of men t o use gold and silver. they produce Locke refers to labor as the measure1"' (italics things which people value more highly than the his) of value. If the first reading without any labor being expended. the lower the market quired to produce a good and its market price. the) h w n a bb to the creation of value? While the latter seems a tacit. The first is men have agreed among themselves to use several statements that labor is responsible for money. In great part.)t"' actually uses the term measure in connection There are only two indications that Locke with labor and value. determined by supply and demand. This instance is to be taken more duction of a good measures its long run seriously than the previous one. price. and just asserted that this is in fact the It appears that all Locke intended to say with case. labor does bear some relation- something. the overplus. In this disputed passage. same thing as asserting a predictable relation- Instead. Is he not is correct. we still The second indication that Locke may have must question whether he also believed market believed that labor could be used as a measure price to be somehow influenced by the labor of value is in the penultimate paragraph of which goes into producing valuable com. 3061 This means that no consumed labor is in great part the measure of the value of goods can be the products of nature alone the gold and silver men use. he is saying no more than that the then implicitly saying that goods requiring degree to which men consent to value gold and . or 999/1000[20'of the value of this result. and what he means by this is by things offered by nature alone. being little useful to the life tual numerical relationship between the con. I k n m r o 5 u r r . the idea of a rela. in general. which may be hoarded tionship between labor and price cannot be up without injury to anyone. there is nothing inherently immoral in 9/10. It is undoubtedly true that when ing or decaying in the hands o f the possessor. [p. rayment. these metals not spoil- airily dismissed. 3191 he claims the value of things useful to the life of man is 99/100 due to labor. this is not at all the marginal utility t o Locke would be misplaced.

meant by this strange passage. then he must have thought there for not perceiving fully the implications of his was some relationship between labor and the theory of property for wage labor. The second possible somewhat eccentric interpretation. may very well be applicable to Locke held labor to be the measure of the value Locke's thought.'"' many people cooperate t o produce a valuable good. We have already argued that there is to the valuing of these otherwise worthless no indication that Locke believed that prices metals in proportion to thedegree to which they should in any way reflect labor-time in either an had labored to acquire property. in fact. mill. In a production process that involves more than one laborer. The problem arises when even in the long run. The problem argues that the act of creating property is with this interpretation is that there is no cor. There this man have a right to everything he creates? is no way to know for certain what Locke The whole purpose of the Second Treatise. oven. This is a analytic or ethical sense. and the baker's sweat. Since Locke believed that sistence on quantity and vent as the only deter- one of the main reasons for forming civil minants of market price (the only kind of price governments was to protect the unequally he discussed).318 KAREN 1 silver is the degree to which they have labored viously is not what Locke believed. Man roboration for it anywhere in the rest of his mixes hi body with God's resources to produce writings. This ob. Yet in "Some Con. yet once production moves beyond the of its tortuous reasoning is the correct one. it has appeared to some Locke scholars one dependent clause to support the view that that he ignores the property rights of some men Locke had an analytic labor theory of value. it is simple form of one man subduing nature to his obvious that there is not enough evidence in this will. the while the second is a theory of the "just" wage. money depends upon the goods that it can Locke's theory of property is highly buy. reaper's and thresher's toil. or goods should equal these real costs. but even if we which a labor theory of value can be production of goods to illustrate the productivi- interpreted. and given his view that the value distributed property resulting from the use of of labor depends upon the market value of Phe gold and silver as money. who owns the final pro- A NORMATIVE INTERPRETATION duct and how is that ownership determined? It OF LOCKE'S LABOR THEORY OF is evident that Locke expects his theory of pro- VALUE perty to apply to such situations. it must also so. responsible for creating economic value. by political philosophers and economists alike If this is true. produces. the laborer is entitled to receive the siderations". is to answer "yes" to this ques- assume that the second interpretation with all tion. is The former holds that the real value of to be counted into the bread we eat. He tells us: is fundamentally a theory of the "just" price For 'tis not barely the plough-man's pains.lZalwhich leads us to believe that if labor amenable to this kind of argument. to acquire property. ethical implication of a labor theory of value. the labor o f something is what it costs in terms of human ef. Locke has said that the value of full value of the output as his just reward. since he uses We have identified a third way . that however. who digged and wrought the iron and stones. and there is no way to determine what something new and uniquely his own. there are two kinds of ty of labor and the public benefits of property ethical arguments on labor and value: the first ownership. it is not unreasonable goods it produces and not the other way to assume that he believed men would consent around. The more common one is the second. given his in. which are vast number. requisite . in favor of others. and therefore the prices of timber imployed about the plough. those who broke the ethical the fact of many laborers cooperating in the sense . any other utensils. that he has frequently beencriticized measure the value of the things money can buy. So much measures the value of money.[2s' Locke market price of commodities. This is the argument that of gold and silver and not the measure of men's since labor creates the value of the output it consent to value the metals. however. In fact. Does not Locke thought this relationship might be. who felled and framed the forts to produce.

this in no way implies consis- mon with others. able to negotiate with the employer for a wage He states precisely this when he describes how which represents his entire claim to the property men establish property in what was originally created by his work. . which begins lheproperly. In another context later in the Second sells his output for a price to the individual who Treatise he discusses the limits of the power of is engaged in the next stage of production. Locke did not believe that wage earners were in has complained that in the above passage Locke danger of being "exploited" by employers. JOHN LOCKE AND THE L ABOR THEORY O F VALUE 319 to this corn. of wage rate determination in his economic This passage has generated a good bit of writings. more than one when he explains: person must work to produce the good. in exchange for wages he is to owns the product created? receive: and though this commonly puts him into the family o f his Master. a laborer (or servant) and his employer as a tion process. Pascal Larkin. Ihe turfs portion of the market value of the product. Needless to say. must all be charged o n the account o f fect. without which the common is o f labor of others: each receives part of the value n o use. and present and the effort of the one who directs the removing it out of the state nature leaves it in. creates value and undertakes t o do. how does the labor theory of property a p p both factors of production (much the same as a ly in a society where production takes place modern economist would treat capital and through a division of labor? One might con. Locke gives wage labor no labor. porary power over him. wage labor. Locke sees the relationship between infer that he would argue that in any produc. and under the ordinary While Locke does not discuss ownership discipline thereof. my servonl has cul [italics mine] and the ore I have dug in any place where I have a right to them in com. guaranteed wage rather than an unspecified moners. Locke does put wage labor on the same functional level as a horse insofar as they are Yet. it would be easier to claim that employer labor. with the wage earner receiving a depend o n the express consent o f all the Com. and n o greater than what is there are several indications that the problem contained in the contract between 'em. Who.'"' This is only partly materials. for example. In has put a human being on the same functional the absence of a theory of wage determination. [p. . 3071 tent exploitation of wage labor at the hands of In so far as servants can be taken to represent employers. which remain s o by compact. yet it gives the master but a tem- rights under the division of labor specifically. If it could be shown that Locke believ- comment in the literature on Locke's political ed that wages depended upon something other philosophy as being evidence of Locke's view than a two party contract between employer that wage labor was somehow inferior to and employee. [p. the individual producer labor. [p. then. Locke is saying that the fact that a Locke's attitude toward the property rights laborer worked to produce a product does not of wage laborers would be more satisfying if he lead automatically to the establishment of that had addressed himself directly to the problem product as the property of the laborer. and received as an effect o f that: nature and the Earth furnished only the almost worthless property rights at all. . Thus the grass my horse has bit. least sometimes. 3401 would not have troubled him. In ef- made bread. becomes my property. there would be an employer by selling him far a certam time. and at For a Free-man makes himself a servant t o another. we can Obviously. And the taking o f this or that part. Although it is labor that part of the common stock by referring to the creates property. Yet a n employer over the behavior of his employee in at least some of these stages. In fact. Larkin argues. in- medieval commons: cluding the effort of those who in the past pro- We see in Commons. does not he creates. yet it is unfair to ceive of an organizing principle where at each say that he neglects the property rights of wage stage of production. as in themselves. labor as substitutable inputs). 3161'''' true. the owner of the output produced contractual arrangement where the laborer is is the employer who directed the production. from being seed to be sown t o its being for as little pay as he can get away with. duced the capital goods used by laborers in the that 'tis taking any part o f what is common. level as a man's horse and implies that the Locke is still open to Larkin's criticism that employer can therefore extract as much work employers are entitled to pay employees as little . labor refers to all effort. the service he and an employee.

we recall. Instead.'"] a fact that to Locke argued there were enough common resources of com- for the necessity of keeping England's money parable quality remaining for anyone who supply. rent. or what the consequences to the employer. For Marx.'~']The first European countries to avoid suffering an condition guaranteed that the second would ob- emigration of English laborers.we1In addition. Locke believed that some peo- . "capitalist expropriation" of what rightfully cantilist idea. Even under these conditions of equal oppor- tion of a market wage rate. the source of exploita- their employers: wage earners. thereby also injuring the long as two conditions held: that no one took suffering farmer. The in times of scarce labor could negotiate for right to own private property was unlimited so ruinously high wages. and rents are analyzed as prices in Locke's even if this is what Locke meant.320 KAREN I. just as interest employee agrees to the wage rate. who suffer and was perpetuated in civil ~ociety. interest. To Marx. i t might just perty as they created by their joint labor. however. Thus. since ship emerges in the first place. wages are referred tunity. he just accepts this typically mer. Of course. no matter no just reward. in order for labor to be exploited. however. earners earn little is not presented as the fault of According to Marx.[''] Wage earners of various more than he could use without allowing any of kinds were portrayed as moving in response to his property to spoil or go to waste. is that Locke described a wage as they can get away with. Furthermore. it is upsetting economics. Locke describes private property in the state of nature. in Locke's essay tion in Locke's system is the unequal distribu- are usually farm workers just barely worse off tion of wealth that arose in the state of nature than their tenant farmer employers.employee relation- This is no "iron law of wages". the fact that wage belongs to labor. while tain in the early stages of the state of nature. all people had an equal right to mix their labor dlemen. one didn't favored the employer and sometimes favored have to postulate the existence of evil employers the employee. For some reason. and therefore wage rates. the occasions Locke asserts that laborers live relevant question was not whether employers "from hand to mouth" or that they generally are fair in their dealings with employees. And to him. and that higher wages. And while it is still technically true to one's sense of justice only if one believes that both employer and employee are able employees to be weak and inefficient legitimately to negotiate for as much of thepro- bargainers relative to employers. then. the he gives no analytic reason why this should be fact that such relationship exists implies so. however. exploitation There is no direct treatment of wages in was inherent in the system which permitted un- "Some Considerations". either wage. there is no specific discussion of the determina. yet profit. which differed from that determined by sympathies so generally run toward the wage the market. a group whose usefulness Locke did with common."" earner that this argument seems never to have occurred to anyone. There is some evidence that earners by malevolent wage payers. but on three separate equal property ownership. Karl Marx Locke actually believed wage contracts were nevertheless saw in Locke the beginnings of a constrained by a market rate which sometimes theory of surplus value. VAUGHN as they can get away with as long as the to as if they are market prices. Locke argued that the hardship caused by "brokers" or mid. yet Locke himself did not make any consistent exploitation of poor wage this assumption. but earn little more than a subsistence income. equal to other wanted to create his own pr~perty. they as correctly be argued that Locke's theory of are both constrained by a market wage. both in at least one circumstance where farm workers consumable goods and in the land itself.[~'J In the from the vagaries of the marketplace and from Second Treatise. unowned resources to create not recognize."" rather why the employer . The property entitles wage earners to extract as high crucial point. it is usually assumed that wage earners will almost MARX ON LOCKE always get the worst of any deal made with Although Locke certainly did not envision wage-payers.

[pp. And indeed it was troduction of money are significant (and have a foolish thing. as well as dishonest. of wealth to perpetuate and increase in size. Again. he ~~- miaht heaD uo as much of these durable things he plc&d. And if wealth and exhaustion of the common stock are he also bartered away plums that would have rotted also important (and more to the point of this in a week. 3181 Marx is less and less of the common stock left for called the results of this agreement a "political newcomers to mix their labor with. [p. as long as but which arises out of an undesigned social everyone took only what he could use before it p r o c e s ~ . The most important economic conse- eating a whole year. poire\\ion. in spoiled. so that it perished not uselessly in his possession. As a government. or wool for a with property. [pp. the demand for common resources in- money as an "agreement among men to place creases and resources finally become "scarce an imaginary value on an otherwise worthless and of some value". themselves than others. 310-3111 vent of an acceptable money-commodity. t ~M ~ ]a x was correct. or exchange his sheep for shell. some lasting thing that men might keep without spoiling. however. they Here h s perty in jeopardy. but becoming wage earners. Locke describes the origin of result. its evolution can hardly be surplus value created by the worker and ex- called a political invention. If he gave away a consequences of the resultant inequality of part to any body else. if he would are not lucky enough to be born into a family give his nuts for a piece of metal. otherwise put the enjoyment of legitimate pro- ples. thc ciceeding of ihc hound5 of hts j u t pro- ~~ and/or capital) owned by others to create their own property. but perishable supports of life. had lhacb) a pruwrly in ihum. as we have already the perlrhlng uf anylhmg urelcsrl) In i t . It is at this point of Surplus Value. and invention" contradicting the law of nature on disputes between property owners and non- which private property was founded (Theories owners become more frequent. In this case. will have to find some way of sparkling pebble or a diamond. 3091 and would create more property for acceptance for its existence and continuance. it The introduction of money plays a pivotal becomes possible for the more industrious to role in Locke's state of nature in that it marks a increase their wealth relative to the less in- transition period leading inevitably to a more dustrious without running up against the complex economy and to the creation of civil spoilage limitation to property ownership. JOHN LOCKE AND THE LABOR THEORY O F VALUE 321 ple would be more "industrious and rational" nature of a convention depending upon social [p. ur ap. and robbed others. until money comes into found consequences for society. 3081 who would He Ihat gathered a llundred hu>hcl. for nuts that would last g w d far his paper). Hence money enables the inequality might possibly be a means by which men at. noted. p. the economic more than he could make use of. and that and borrowing land and capital to finance their by mutual consent men would take in exchange for own enterprises."" goods as soon as gathered. and keep those by mixing their labor with the resources (land him all his life. It is more in the propriated by the property owner and hence . he wasted not the common stock. there substance [precious metals]". They can do this either by pert) no1 bing in the largeness of hi. That is. He was only to look that While the political consequences of the in- he used them before they spoiled. With the ad- use. and tempt to subvert natural law). pleased with its color. destroyed no part of the portion quence is that after the exhaustion of the com- of goods that belonged to others. they would then the truly useful. these he also made use of. the diversity in property ownership believing that the use of money implies pro- would be small. have to pay the owners a fee (rent and/or in- 318-3191 terest) for the use of the property. Marx claim- While there is an element of agreement in the ed that interest and rent were evidence of origin of money. However. Locke actually government provides a means by which proper- describes money as the result of an evolutionary ty owners protect themselves against the "quar- process conforming exactly with natural law: relsome and contentious" [p. [p. it property. 365). or by in essence acting as entrepreneurs And thus came in the use of money. those who want to earn a living but perished uselessly in his hands. he invaded not the right of others. to hoard up been too sketchily treated here). Although Locke's that men decide to enter into a contract to form use of the term "agreement" seems to imply a civil government to protect and regulate their consciously formulated contract (and if so. he did no injury. so long as nothing mon stock. else he took more than his share. 3171 Eventually. 01 acorn.

but on the writings. and these include the activities of of owners and borrowers. as Marx would money to drive his trade. While Locke did believe that labor was the ma- equitable in the paying of interest and rent. The measure of the argue. if labor is indeed labor it contained. return for a specified payment. they are contractual ar. prising. argued that diving made the pearls more useful siderations". how can he conclude that dictum: "It is not that pearls fetch a high price rents and interest are legitimate in his economic because men have dived for them. . that the unequal distribu. Marx didn't have a point in usefulness and scarcity and not the amount of his reading of Locke. As for the ethical arguments to wage labor also apply to interest and rent that labor should receive as its reward the value payments."'~'' However. as Locke did. Locke would have agreed the major source of value as Locke argues in completely with Archbishop Whately's famous the Second Treatise. of the output it created. in view of Locke's labor or price of a thing was dependent upon its theory of property. is as equitable SUMMARY and lawful. ["Some Considerations". interest and to the "capitalist" or landowner. and get a livelihood. however. and t o the benefit of those who clear the land. usefulness of a thing was the price it would sell tion of property which gives rise to interest and for in the competitive market place. Locke argues: productive activities of others. short run (concepts that were foreign t o withstanding) that the same rules which apply Locke's thought). but then what has hap. p. saw creation of the property that forms the payment the matter differently. but as argue (and as Smith on occasion argued). one jor creator of economic value. and the constitution of human society. either in the long run or the left to infer (the preceding quotation not. VAUGHN illustrated the exploitation of the non. they perform a goods useful to human life (and therefore function which operates to the mutual benefit desirable). 55. While both payments had their origin but all purposeful acts leading to thecreationof in unequal property ownership. this was in fact the sub- rangements that permit non-property owners to ject of all of Chapter V in the Second Treal~se. If we recall rents were market means of allocating resources Locke's broad definition of labor. since they "by compact transfer that contrary. as receiving rent for land . unavoidable to some men. but has not money rents (and profits) are not deductions from the enough to exercise it. however. we from the less enterprising to the more enter. . There is no rent developed naturally and justly in the state indication that Locke believed there would be of nature and became institutionalized as part any relationship between the market price of of the social contract. but that also to receive profit for the loans of money. the relativevalue wonders if perhaps. Locke.) Does one rule of value t o the life of men because it made them more creation and ownership apply in the state of readily available. . That is. has not only reason to borrow value created by direct labor. T o Locke. some time to the value of o u t ~ u t . . - KAREN I. who having skill in husbandry but no land of h ~ owns to component costs of production which represent employ it in. something and the amount of labor that went pened t o the labor theory of property? One is into its production. as he. remember that it includes not only direct laber. 57. . p. but much reason to pay use for that money. p. enjoy the benefits of the property of others in Since individuals mixed their bodies in the form . That he that has skill in traffick. that labor plays no role in the Surplus Value.1 In summary. the following can be concluded about Locke and the labor theory of value. ' ~ " Borrowing money upon use is not only by the necessity of affairs. Hence interest. This does not propertied class by the propertied (Theories of mean. Pearls on land are more nature and another in a politically and useful and hence more valuable than pearls in economically complex society? One could the bottom on the ocean. has not only reason to rent land but to payments to all those who have contributed at pay money for the use of it . he would also have into another man's pocket"? ("Some Con. While it appears that Locke saw nothing in. men dive for them because they fetch profit that was the reward of one man's labor a high pri~e. who produce in- society in general by increasing its productive termediate goods for sale. and who direct the output. That is. 365).

With this basic human capital. Locke's Two Treorises of Civil Govern- ment. Peter Laslett ed. Marx their labor by selling it as a commodity on the epitomized Locke's philosophy as "the expres. Furthermore. and claimed that it sewed as but especially for the talented and industrious. Locke saw freedom.exploitation of workers forced to "alienate" fortunately. The concept of self-ownership is clearly something new which was indisputably their not only a cornerstone of individualism and property. liberalism of Smith and the British classical privileges and. provided a short description can serve as a concluding philosophical justification for the economic statement here. interest and rent. but also an invitation to created the whole value of the property. social and economic mobility.others who may not have as great a share of ploitation either stated or implied in Locke's vision or pp. the "basis for all the ideas of the whole of It was in this way. social mobility sion of the bourgeois concept of right as against and improved economic opportunities for all. to the highest bidder. to a great degree. one market determined rewards for past labor doesn't need a pool of common resources or the which served the purpose of allocating property benefits of gentle birth in order to aequire real to the most industrious user in a complex property and wealth: one can do so through economy characterized by scarcity of resources. which provides him with a source of in- tion of property ownership. means of the concept of property in one's own Hereafter referred to as Second Trealise. (2nd ed. Cambridge: Cam- feudal limitations of wealth and station by bridge University Press. rather than the labor of all who efforts. John Locke. Hence.of resources to those who can make them most duced and the reward to wage labor. JOHN LOCKE AND THE LABOR THEORY OF VALUE 323 of their labor with free resources. That imperfectly and incompletely. In his endeavor. in a commercial ex- writing on labor and value. It was just this kind of resource stead defined property-creating labor to be the mobility that Locke's labor theory of property labor of the person directing the value-creating and his theory of market value justified. were treated as come. resources are allocated through a system optimistic view of the possibilities open to all of merit rather than family. one's status. but the value of that property was happened to work at some project. change economy based on Lockean property Locke's labor theory of property implied an rights. . in a society received was most likely determined by the characterized by resource scarcity. were determined by a network of interlocking feudal one's wealth school more than a century later.system. 1967). un. Wage labor determined by the market. self- market as were all other prices in Locke's ownership implies that everyone has some basic economic thought.. property endowment. century.profitable. some stock of human both payments originating in unequal distribu. they created person. and can flow to "industrious and rational" people in the those who are most able to use them for their emerging capitalist economy of the seventeenth own (and society's) benefit. perhaps. there was no theory of ex. and ownership of capital in exchange for giving up any property rights in could rival land as a source of personal wealth the final product. This did not imply that wage labor personal freedom. feudal privilege". ultimately tied to land tenure. 283-446. then. But it was Locke's intent to present a NOTES theory of property which transcended the 1. where the wage earner settled in advance the land belonged by right not to a noble family but reward he was entitled to receive for his efforts. Similarly. If anything. While land owner- was considered to be a contractual arrangement ship could be an important source of wealth. one's own efforts and the borrowed property of Needless to say. Locke in. In feudal society. one earned property through one's own trepreneur. Where Marx saw self-ownership in terms of In a flash of tantalizing insight (which. albeit subsequent English political economy". that Locke. one might almost say the en. nor did it imply that there should be Commercial economy thrives on the transfer any specific relationship between the value pro. The amount of the wage he (and status). however. he never elaborated upon).

I. in combination with his theories of interest and rent as 4. 1940). the Hutory of Ewnorna's (Chicago: Un~rcrrity of 14. 5) Prentice-Hall. a position supported by Ronald 1937). Colin Macpherson. 1973). ~~ ~ . Smith years ago. implying exploitation of labor. Illinois: Libertarian Press. No. Evervman's Librarv Economics(New York: Norton and Co. LO.Y. 8. . 6. of value to Locke on the basis of Chapter V of the Se. 1956). pp. labor theory of value. The Principles of Political Economy and Tarolion. See. That there is some doubt that anyone. pp. 1930). Hannah Robie Sewall.the accommodation of an European prince does not credit Locke with an economic labor theory of not always so much exceed that o f a n industrious and value. was the Labor Theory of Value". pp. The Liberal Polilics of John Locke past labor. Spiegel. and Joseph Schumpeter. interpreted Locke's labor theory of property value". by modern usage. In these passages. For a discussion that contrasts Locke's view of original cost of production theory in the long run in which the ownership with that of Grotius and ~ u f e n d o r f rsee cost factors were labor and capital where capital was Martin Seliger. . p. Cannan notes that the idea is also found Meek. previously existed for their support. p. p. 1911).: Modern Library. Theories of Surplus Value (Moscow." Ricardo.188. 81 . is unjustified". Werner Stark. despite Locke saw arising from property ownership. 5 .Y. (New York: Longmans.342. pp.117. no. 365 -367. 365 . 2 materialized in it. American Economic Progress Publishers. Samuel Hollander has recently argued per.421. p. although he does " . 1%2). Economic Thought (New York: Oxford University Inc. i. who claims that von BahpBawerk.129. Locke d o never meant to espouse a true labor theory of value had no concept of marginal productivity. ever held a labor theory of value.367. ceeds that of many a n African king. 116. N. 59. . Another implication is that the marginal product o f the Ch~cagoP r r s . 45. however. TheGrowth from two sources: from their scarcity. 1937). 76. A History ofEconomic Ideas Press.32.: J . the absolute p. Economic Idem (New York: Harper and Row. and Eugen Review (May. The great alttntmn psid lo ihc 12. Studies in the the other hand. 1973). The most extreme posi. Capital and Interest. A History ofEconomic frugal peasant. M. believes that the Second Treatisecontained a 9. Othmar Spann.. . 1954). Illinois: Richard D. 1959). or a1 While it is common to discuss the "labor theories" of least not to the loss. pp. almost twenty 13. George Stigler argued in "David Ricardo apparently was (a) enunciating a real cost theory of and the 93% Labor Theorv of Value". Green and Co. Edilion ondo don. in The Principles of 1901).td. Irwin. 28-29 would. societv* to benefit from orivate orowrtv. as we Economy. 140and Henry W. or useful article. identical pieces of land with and without labor applied tion. Economic Theory in cond Trealise. 120 simply states without elaboration that Locke's master of the lives and liberties of ten thousand naked theory of property had nothing to do with a n economic savages". (South "no major economist of the classical period heldwhat Holland.. The History of Polilical Economv a n d Tarolion.324 KAREN I. Theorier o f Value and Distribulion his subjective value theory in his economic writings. . Lawrence and Wishart. 1958). (New York: The Modern Library. Capital (New York: The Modern Library. Series 3. 1965). nd). mentaries . p. can be illustrated benefits of enclosure assumes "that the increase in the by two examples: Adam Smith and David Kicar. In fact. Locke's argument. No "distribution" [hat Sm~1h. in The Economics ofAdam Smilh (Toronto: more raw materials for the rest of mankind rhan had Heinemann Educational Books. Since Adam smith ( ~ a m b r i i g e Cambridge : University while Edmund Whitaker. "What to it. "Ause-value. It is interesting to note that Adam Smith echoed this p. c l a m 4 that "poi\ersing ulillty (use Theory of Money 1690. " (p. Similarly. worker is 999/1000 of the output. ... l959). has misinterpreted this impor- 3. (Cannan edition. 180.: Praeger. The IdealFoundationr of Retrospect (Homewood. especially pp. on and more recently Douglas Vickers. t ~ o nto the mam rase. where he says tion for the labor theory of value". . 1971). 326 . Mark Blaug. 47. 419. p. Gordon. 1959) pp. American value and (b) using labor as an index number to Economr Kevrew (June. therefore. New Jersey: quantity of labor required to obtain them". pp. 1959). except possibly tant passage and thereby misunderstood the benefits Karl Marx. hasvalueon- The Theocv of Value Before Adam Smith (American ly because human labor has been embodied o r Economic Association Publications. attributes to Locke "The metaphysical justifica. whole product will be distributed to the benefit.1776 (Philadelphia: Chilton valuc) rommodit~rr derivr their exchangeable u l u c Co. and from the ofEconomic Though1 (Engkwood Cliffs. 212). 31. labor quantity and labor cost theories of value in com. be called a labor theory of and 242. Dcnt &Son. Theories 01 Surplus Value. of those left without enough both these major figures in Classical Political land . Studies in the Labor Theory of Value (London: in Mun and Mandeville. The Wealth ofNalions. 12. is taken by Donald F. in his unorthodox treatment of of this paper is that Schumpeter was essentially correct Locke's political philosophy in ThePoliliral Theory of and that Meek's position comes closest to the one Passessive Individunlirm: Hobbes to Locke (Oxford: presented here. holds that the very act of enclosure releases suasively. have seen.rlabor theory of valuc in i h i i r l y slate *a\ of the products of enclosed land need take place for a 'summary rtatemcnl ilrarly dcsigned as an 1nrrodu2. 106. that Va. . idea in Chapter i of Wealth ofNalions. 1944) argues that Locke had an objective theory 7. . p. VAUGHN 2. 166 all attribute a labor theory 5. for example. p. 462-472. p. Of course. reprmted in Er. 1962). 1%9). The theme 11. Both Karl Marx.w)r m measure real wealth. 21 -22. Robert Lekachman. A Hislory of (N. (p. Macpher- the usual textbook accounts of the labor theory of son argues that Locke's statement about the supposed value of the British Classical school. 137. Press. This was especially true of Thomas Hodgskin. 1963). See of value in the Second Treatise which contrasted with Maurice Dobb. as the accommodation of the latter ex- Anolysis (New York: Oiford University Press. to measure the "contribution" of labor. but it is still but rather had an empirical hypothesis about the major interesting to note his attempt to compare the output of determinants of long run price. Clarendon Press. pp.

see Karen Vaughn. p. - that if orices rise. While finding an objective measure of value the cncult which #he money goes. On p. Locke says of at length in my John Locke: Economist and Social gold and silver. Social Scientist (forthcoming. Philosophy and Polirical Economy. his waees useful but without making any connection between must rlse proporlionately or hc uill not be able to s u p usefulness and exchange value. and they procuring what we want or desire. 23. constantly-varying proportion and use. JOHN LOCKE AND THE LABOR THEORY O F VALUE 325 IS. 21 where he calls n ~ . Ob. larger. ex. Property in the 18th Century with Special one would expect. On p." p. ~~~. On p. imolvinc . Interest and Tmde. and therefore in a plenty of them "Some Considerations". rf ur wtll ing from "hand to mouth". and im- be the measure of value. that things must be left to find their own price. he managed lo University Press. The mull~plymg money the "common measure" of the value of com. then. and what to labor. p. analyrlng iheeffecti of asales lax. the only other instance of Locke discussing a laborers lived at subsistence. Heargues that "the comes to a similar conclusion with respect to these poor laborer and handicraft man" cannot bear the passages. 34. Larkin." (p. He gives as reason for 24. Among political 17. Locke describes the laborer as liv- of man. 1deal with Locke's concept of just price and just profit silver is twice as valuable as one ounce). John Locke: Economist and Social Scienlirl. Hcrealtcr cited as "Somc Considera. value of gold and silver used in commerce is nothing 16. which will 25. 37. Besides that. Bonar. port his family. labor" in anticipation of the classical doctrine. 79.' 29. weare asking if he thought the proverishing the landholder whose interest is chiefly to prices of goods were related to the labor that went into be takencare of. and Pascal of price changes on quantity supplied as well. we shall tion was such that he spent all of his income between find that in most of them 99/100 are wholly to be but on the account of labor. . Macpherson. In fact. argues that 18. 31. . 14. 93. changeability of market price. not if he wanted to use labor hours to ment in the commonwealth. the context is an nghlly estmxatethmgs as they iamc toour we. Reprinted in Everal Papers Relating to Money. there is some the impossibility of price fuing the following. the only measure of the 31. implying that they Value of Money" (1695) in Several Papers Relaring lo are vew m r . See and it is impossible in this. The imphcat~onhcrc is definitely that 22. or demand curve and movements along ihai c u n e uas forctgn to Lockr. 1980). 1922). Philosophy and Political Economy . "Some Considerations". Lockeexplicit- "measure of value" at all was in his second essay. Posressive Individuolism. andcast attempt to estimate the average cash balances held by up the several expenses about them. In addition to Sewall and Vickers already mentioned and would subsume them under the category of "past (note 2)." conveniences of life." Furthermore. ~. "Gold and silver they must be humored. . . p. although both writers under- explam prcc dclcrm~nalwnlolcrably well wilhoul l h ~ s stand this in a moral rather than an analytic sense. value. 30. "For there being a want of day-laborers in the country. "For they having as money no other Scienlisl. 316.~ - ~eriodsand therefore saved nothin~. 120.. of value has not come down to us accurately. 314) See also p. 66. that of the oraducts of the earth useful to the life 28. chanees in a sumlv. p. always regulate their value. evidence that Locke's paragraph on labor as a measure " . 92. 94. tis evident. Money. I 15. John Locke: Economisr and in favor of the emerging "capitalist classes".There is ~ no impltralion lhal (he laborers uerc parlicularly poor 21. criticized Locke for calling market price rather than 0. 9/10 arc #heeffects of labour: nay." "Some Considerations". He interprets Locke as saying that labor adds burden of the tax because "he iust lives from hand to t o the intrinsic value of things by making them more mouth alreadv". oavment .only lhal they saved nolhing. or else they will neither work though they serve for few yet they command all the for you. . to the prejudice of trade. labor cost the natural value of goods. SO that the returns must necessarily interested in explaining what determines the economic be slower and scantier. " ~ o m e ~ ~ o n s ~ d e r a t ~p o42. value of goods as reflected in their money prices. when we ask if Locke believed labor to of trade by that means slarving the laborer. Chapter V. 92. consists riches. they eat up too great a share of the gains viously. distinction." compare the economic value of two goods. human foresight to set rules and bounds to their p. only by their quantity. In addition to the above arguments. 111. but as pledges to procure. James Bonar. Kelley. John Locke's Theory of supply although occasionally he described the effects Propeny (Oxford: Clarendon Press. t h e mode& distinction between Reference lo England and John Locke (Cork: Cork . as Larkin. "Some Considerations". of broker5 hmdcrs the tradcof any counlry. . Chicago: University of 26. that the intrinsick tions". what one wanu or reresr and Trade. "I think it will be but a very modest computation to 27. pp. Locke viewed capital goods as intermediate products 19. It seems reasonable to conclude from this passage that Chicago Press. what in them is different groups in society where the laborer's condi- purely owing to nature. P. On p.. l950). iocke generally treated changes in quantity as shifts in theorists both James Gough. Locke was more circuit more stops. their constant mutability for Laslett's comment on the text of the Second Treatise. (l%9l (New York: Auguslus M. ly uses the term "bare subsistence" to describe the "Further Considerations Concerning Raising The general level of laborers' incomes. In. . desires. ". it being a settled unmoveableconcern- producing them. For a fuller treatment of Locke's theory of economic Locke deliberately suppressed the rights of wage labor value. 1930) have assumed that Locke had a labor theory of value. nor take you commodities for their labor. p. Lwkc is (London: George Allen & Unwin Ltd. Chapter 1932). 320. Chapter 11. Properly in the 18th Century.121. Locke is quite insistent about the relativity and but their quantity. by making modities. 51. 20. this position is also implied by Lewis Haney. say. While. etc.. value of money is its quantity (that is two ounces of 32. . and in thal may have been a concern of Petty's. p. See my History ofEconomic Thought (New York: Macmillan. l%8). 34 and p.

This is a very hasty summary of my interpretation of . Sfale a n d Ulopiu (New 34. but to the conveniences and comforts of life.e pried to. Here.the arose in a spontaneous but orderly process." (o. and . that when their oarents leave the not o f human design". Scienrisr. argument on childrens' right. Srudies in Philosophy. Anarchy. as Hayek as far as the conditions of their parents can afford. sistence. is dants of those who labored in the past arealso just re- mare than his share and belonm to others. 1953). "As much as anyone can make use of to any ad.h~ldreneeascs. ~ u o t e din Eric Roll.t uhcre there is enough. 306. efleslr 18 arc to ritcnd as far as posstbly they can. VAUGHN 33.a the :arc due to t h e ~ rr.ommon lor ulhers " Serond Irzurrre. 225-228.105. p. A. at lka. vantage of life before it spoils." ~ & o n d the Firsr Trealise. A ~ i r r & of ~ c o n o m i cThought same idea (although he is understandably inaccurate in (Englewood Cliffs. N. understood to be intended as nature requires they 96.326 KAREN I. lustration of an institution which arose. so much he may by his 37. Nothine was quires a theory of inheritance. For adetailed dood lefl in . . Marx's discussion o f Locke is found primarily in his attributing a conventional theory of money to Locke). the laborer. 225). 1974). he bases his Trearise. as the "result of human action but "Hence it comes. which Lockeprovides in made by God for man to spoil and destroy. Theories o/Surplus Vdue cited above. p. See F. Hayek. pp. . see my John Lmke: Economisl a n d Social . to argue that current rewards t o the descen- labor fix a property in. Whatever is beyond this. 1967).: Prentice Hall. an institution which uorld. See Robert Nozick. . and as Locke's theory of the origin of the state. note 2. would describe it. "For this labor being the unquestionable property of York: Basic Books. Polirics ondEconomics and the pro\~sionsthey h a \ e made in their l f e lime. no man but he can have a rieht . The origin of money in Locke's system is a good il. 18-22.J. Of course. pp. are (Chicago: The University of Chicago what is 36. 339. Nozick has mare recently used the term "in. should. 308. That is. visible hand explanation" t o describe essentially the 38. for their children. not only t o a bare sub- 35. p analysis. pp. Chapter IV.: 0n.