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Re: [ox-en] Re: Value of software



On Sun, 7 Jul 2002, Stefan Merten wrote:

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Hi Graham and list!

Of course every commodity has some development costs, i.e. the
immaterial labor needed to develop it. The labor needed for that is
fixed / constant for a given product because it is all done when the
development process has come to an end. (Is this similar to the fixed
capital of Marx? I don't know.)
I am saying that it is NOT similar. However, it might be possible to make
an argument that it is: AFAIK, Marx never considered this point 
explicitly, and the parts of his writings which deal with related topics
(especially Theories of Surplus Value) are ones where he seems to me to 
be going in circles without finding answers he was really satisfied with.
So I don't think it's possible to do 'argument by quotation' in the old 
Soviet style on this subject.
The reason I think it is not similar, is that fixed capital has value, and 
part of this value is transmitted to the product (financially, as 
depreciation; physically, as wear-and-tear). Produce more of the same 
product, and the fixed capital wears out more quickly. Design (whether
of software or anything else) does not wear out physically. Whether you
produce 500 or 5 million copies of a design is irrelevant. So, if the
design had value (like fixed capital) this value would never be 
transmitted to the product itself, and value without realization on a
market does not exist.


And in addition every commodity has a production cost being the labor
needed to actually produce it. If you're looking from the information
side of the product it would be the reproduction cost BTW.

The fundamental - not to say: historical - shift here is that the
reproduction cost drops relative to the development cost. And software
is the most exteme example.

Is this what you're saying, basically?

Yes. But there are two ways of looking at this fact. I believe that the
most important thing here (as you said) is that reproduction costs have
dropped hugely, while development costs have stayed static or fallen less
than reproduction costs (because they are more labour intensive).

The pharmaceutical companies/Hollywood/Microsoft would have us believe
that the basis of the change is that development costs have INCREASED
hugely. This is the whole basis for their justification of more
restrictive IP laws. But there are many pressures (tax in particular) that
make them inflate their development costs so that the figures that are
available cannot be trusted.

Graham
 
. > 

						Mit Freien Grüßen

						Stefan

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