COMMODITY PRODUCTION. THE LAW OF VALUE.

I. Remember the pronunciation of the following words. Translate them and learn their meanings.

disintegration [dIs,Int{;greISn] primary [;praIm{rI]

consumption [k{n;s[mpS ({) n]raw [rO:]

specialise [;speS{laIz] average [;@v{rIdZ]

analyse [;@n{laIz] encourage [In;k[rIdZ]

identical [aI;dentIk{l] exchange [Iks; tSeIndZ]

coincide [,k{uIn;saId] excess (n) [Ik;ses]

supply [s{;plaI] (adj., n) [;ekses]

 

II. Remember how the following words are formed. Read and translate them.

 

to own - owner - ownership

to consume - consumer - consumption

to produce - producer - production - product

to classify - classification

to include - inclusion

to express - expression

 

III. Read and understand the text given below:

 

Commodity production arises during the period of the disintegration of feudalism. This is the type of the economic organisation of society in which products are made for sale rather than for consumption by the producers themselves. Everything, including man’s labour power takes the form of commodity. Labour power is sold to the owner of the means of production, so the products of the worker’s labour don’t belong to the worker but to the owner of an industrial enterprise, who sells the products of labour on the market for money and receives profit.

For the product of labour to become commodities, it is necessary, first of all, to have a division of labour whereby a person produces not everything he needs for his own consumption but specialises in some one kind of production. Secondly the means of production must be owned by individuals or a group of individuals (or by a state). When these two conditions exist, the sale and purchase of commodities become economic necessity.

Commodities can be classified as “consumers’ goods” (goods that have reached the people who actually want them in the form in which they wish to have them), and “producers’ goods” (goods which are not wanted for their own sake, but only for the assistance they give to further production). Commodities can also be classified as “primary products” (raw materials and foodstuffs) and “secondary products” (manufactured goods). The total volume of production comprises consumers’ goods and producers’ goods together with armaments and services.

The economic law of commodity production - the law of value - means that in commodity economy one commodity is exchanged for another according to their value, i.e., the commodities which are exchanged contain an identical amount of socially necessary labour and are equivalents. Consequently, the price (which is a monetary expression of value) paid for a commodity should correspond to the value. But in actual fact, the prices of commodities are either higher or lower than the value of the commodities because of the influence of supply and demand. It is a well-known fact that the less there is of a commodity on the market, and the more the demand is in excess of supply, the higher will be the price and vice versa.

It is necessary to mention, however, that there are some commodities that are fixed in supply, so that whatever the price, no more can be offered on the market. If different prices paid over a long period of time for any commodity are analysed, we find that on the average prices coincide with value.

The amount of a commodity that will be supplied at a price depends on the cost of production. If the market price is low, only those firms with low costs of production will continue to produce, but when the market price is high firms with high costs will come into production. The higher price will also encourage low-cost firms to expand their output. Here the law of value serves as a regulator of production, operating through market competition.

 

IV. Find the correct translation of words and word combination.

 

A. 1) profit, 2) primary product, 3) foodstuffs, 4) cost(s) of production, 5) commodity production, 6) purchase, 7) producer’s goods, 8) consumption, 9) the law of value, 10) to fix, 11) to encourage, 12) sale, 13) labour power, consumer(’s) goods, 15) manufactured goods, 16) secondary products, volume, 18) disintegration, 19) to receive, 20) to exist.

 

B. 1) покупка, приобретение; 2) первичный продукт; 3) получать; 4) продажа, сбыт; 5) издержки производства, затраты на производство; 6) поощрять, стимулировать; 7) товарное производство; 8) прибыль, доход; 9) существовать; 10) распад; 11) потребительские товары; 12) пищевые продукты, продовольствие; 13) устанавливать, назначать (цену, скидку, ставки); 14) потребление; 15) объем; 16) закон стоимости;17) вторичный продукт; 18) промышленные товары; 19) товары производственного назначения; 20) рабочая сила.

 

V. Read the following words and word combinations and give their Russian equivalents.

1) to expend output, 2) total volume of production, 3) commodity economy, 4) consequently, 5) to supply at a price, 6) vice versa, 7) whereby, 8) economic necessity, 9) socially necessary labour, 10) monetary expression (of), 11) to correspond (to).

 

VI. Increase your vocabulary.

 

A. a) own (adj.;v) - 1. собственный, 2. иметь в

собственности;

признавать, допускать

to have nothing of one’s own - ничего не иметь

to own outright - владеть полностью

b) owned (p.p.) - находящийся в собственности (напр.

государства), принадлежащий

privately owned - находящийся в частном владении,

являющийся частной собственностью

publicly owned - принадлежащий государству или

местным органам власти

c) owner (n) - собственник, владелец

owner of labour - собственник рабочей силы

owner of real estate - владелец недвижимости

ownerless - бесхозный, бесхозяйный

d) ownership (n) - 1. собственность, право

собственности, 2. владение

ownership of capital - собственность на капитал

ownership of land - собственность на землю

ownership of means of production - собственность на средства

производства

to ban private ownership of smth - запретить частное владение

чем-либо

to change ownership - перейти в собственность; поменять

собственника

to pass into the ownership - перейти в собственность

to transfer ownership - передавать право собственности

 

B. Read and translate the following sentences:

 

1. The country has its own gas and doesn’t need to buy any.

2. Planned economies are sometimes called “command economies” because the state commands the use of resources that are used to produce goods and services as it owns factories, land and natural resources.

3. Since all firms are privately owned they try to make the largest profits possible.

4. The state sector was reduced during the 1980s and 1990s owing to policies of privatization, or denationalization, of publicly owned corporations.

5. People who own or use a factor of production are expecting a “return or reward”.

6. The large scale transfer of ownership of industry from the public sector to the private sector has led to an important increase in the individual ownership of shares.

7. The multinational enterprise not only seeks to earn profits for its owners; it also generates income for suppliers in more than one country.

8. About one third of Canadian business is owned by foreign firms and such industries as transportation, equipment, rubber, chemicals and tobacco are more than three fourths foreign owned.

 

C. Fill in the gaps with the words given below:

own (adj.; v.), owner, ownership

 

1. A general partnership has got several....

2. In a free market individual people are free to pursue their... interests.

3. Kuwait... sizable resources of oil which provides a new potential for capital formation.

4. Firms, which are privately..., see the opportunity of increased profits and produce the new fashionable and favoured products.

5. An individual business is... by one person.

6. The large-scale privatization has brought about private... which has caused the appearance of private property.

 

VII. Form nouns from the following verbs:

 

disintegrate, assist, consume, exist, regulate, compete, pay, express,

correspond, operate, encourage.

 

VIII. Analyse the morphological structure of the following words; state to what

part of speech they belong.

 

Economic, specialize, secondly, armament, higher, actually, condition,

consequently, consumption, industrial, necessity, socially, different.

 

IX. Check your grammar.

 

The + comparative..., the + comparative....

e.g. the sooner the better

 

Translate the following sentences:

 

1. The more you practise English, the faster you’ll learn.

2. The longer the telephone call, the more you have to pay.

3. The more expensive the hotel, the better the service.

4. The more electricity you use, the higher your bill will be.

5. The more goods you sell, the more profit you’ll make.

6. The less there is of a commodity on the market, the higher willl be the price and vice versa.

7. The higher (is) the price, the greater (is) the incentive to produce and sell the product.

8. The more goods and services that can be produced from the limited resources, the higher the standard of living enjoyed by the country’s citizen.

9. The more money you have to invest, the higher the return you can expect.

10. The more narrowly we define a commodity, the larger will be the price elasticity of demand.

 

X. a) Fill each gap with a suitable word from the box.

 

produce comprise instruments

gradually material productive

hammers automatic as follows

human robots spheres

comprehensive form operation

process production transformation

 

PRODUCTIVE FORCES

The totality of ____1___ and human factors which interact to _____2____ material and cultural benefits or services required by society, are termed ____3____ forces. The productive forces_____4____ the means of production, first and foremost, the _____5____ of labour, that is, all kinds of tools and implements, from primitive hand ones, such as hoes, spades, and _____6____, to sophisticated mechanical and _____7____ ones, such as computerised machine-tools, _____8____, nuclear reactors, the equipment of modern petro-chemical industries, plus the people who, through their work and skills, put the means of production into _____9____.

The entire history of _____10____ civilisation can be seen as the development of society’s productive forces. Originally slow and then _____11____ accelerating, it eventually took on the _____12____ of the present-day scientific and technological revolution. What is meant by the scientific and technological revolution is a radical qualitative _____13____ of the productive forces on the basis of the conversion of science into the main factor in the development of social production, the _____14____ that started in the middle of this century. The main areas of this revolution are _____15____: comprehensive automation of _____16____, control and management through a large-scale application of computers; the use of new types of energy; the development of new types of construction materials; the setting up of biological industries and _____17____ utilisation of the latest achievements of science and technology in various _____18____ of economy and every-day life.

 

b) Sum up the text in 5-7 sentences.

 

XI. Find definition to each of the given terms:

 

1) product a) the amount by which the price received is greater

than the cost; the difference between business income

and expenses.

2) production b) all goods that are made with the intention of using

them to produce other goods

3) producer’s goods c) the exchange of goods for money

4) profit d) the making, bringing into existence, of useful goods

and services which are scarce and have a price

5) sale e) a thing that is made, manufactured, brought

into existence

 

XII. Ask each other questions on the main issues of the text. In your answers to

the questions use the expressions given below:

 

As far as I know...; if I’m not mistaken...; as a matter of fact...; in fact...; it is necessary to mention (that...); it is a well-known fact (that...).

 

XIII. Translate the following sentences into English.

 

1.При товарном производстве все товары изготавливаются для продажи, а не для личного потребления. 2. Когда возникает разделение труда? 3. Продукты питания относятся к первичным товарам. 4. Правда ли, что в целом цена совпадает со стоимостью? 5. Закон стоимости действует через рыночную конкуренцию. 6. В какой степени цена зависит от производственных затрат? 7. Товары, которые можно обменять, считаются эквивалентными. 8. Рабочая сила также принимает форму товара и может быть продана собственнику средств производства.

 

XIV. Get ready to speak about commodity production and the law of value.