What Does the Labor Theory of Value Do?

Abstract

This article is a response to two other articles in this symposium by Tiago Camarinha Lopes and David Laibman. The article focuses mainly on the important question that both Camarinha Lopes and Laibman address in their articles: what does the labor theory of value do that other theories cannot do? In other words, what important phenomena of capitalist economies can Marx’s theory based on the labor theory of value explain that other theories, especially Sraffian theory, cannot explain? Sections 1 and 2 discuss Camarinha Lopes’ article, Section 3 discusses Laibman’s article, and Section 4 presents my answer to this important question of what does the labor theory of value do.