Dynamic model reveals how market prices and labor costs align perfectly.
This article explores how human labor and money interact in the economy by looking at classical economic theories. It addresses issues with the classical labor theory of value and proposes a new, more general theory to solve these problems. The new theory sheds light on concepts like money-capital, standard commodities, and the role of labor in the economy. The research suggests that in a capitalist system, market prices tend to stabilize around natural prices due to competition for profit. By using a dynamic model, the study shows how prices and labor costs reach a balanced state over time, supporting the classical law of value.