Labour time versus alternative value bases: A research note

This paper provides empirical support for the 'law of value', understood as the proposition that embodied labour time is conserved in exchanges of commodities. Market prices are well correlated with the sum of direct and indirect labour content. Is it possible to produce equally good correlations by taking the sum of direct and indirect x-content, where x is some input other than labour time? We repeat the analysis for electricity, iron and steel, and oil and show that the answer is no. The high correlations in the case of labour time are, therefore, not a statistical artefact.