This post continues the story of quantum economics, which began here. There is a summary of posts to date at the end of this post.
Can you please note when reading this post and others in the series that I am not suggesting that quantum physics and economics are akin to each other. Instead, I am exploring how quantum thinking might help build new economic narratives, which is quite a different goal.
The Photon Question — Labour as the Quantum of Value
“Labour was, it must be remembered, the first price, the original purchase-money that was paid for all things.” – Adam Smith, The Wealth of Nations
Physics has its quantum: the photon. A discrete packet of light, indivisible, the building block of energy transfer.
Does economics have its equivalent? Is there a basic “quantum of value” underpinning exchange? The classical economists thought so. They argued that labour was that quantum: the necessary element embedded in every good and service, the one input without which nothing else had value.
Modern economics abandoned this idea, preferring the subjectivity of marginal utility. Value, it claimed, lies in the eye of the beholder, not in the sweat of the worker. Prices, not labour, became the measure.
But in losing the quantum, economics lost its anchor. Without a photon of value, the system floats on abstractions, vulnerable to bubbles, manipulation, and delusion. To rebuild economics, we need to ask again: is labour the indivisible unit of value?
First: the classical view
Smith, Ricardo, and Marx all recognised labour as fundamental. Land and capital mattered, but labour was universal. Every good required human effort. Even raw materials had to be found, extracted, and processed.
For Marx, labour was not just input but essence: surplus value arose because workers produced more than they were paid. Exploitation was measurable in units of labour time.
The labour theory of value gave economics a quantum, a grounding in reality. Prices might fluctuate, but beneath them was a substance: hours of human effort.
Second: the neoclassical turn
In the late nineteenth century, economists turned away from labour. Marginalism reframed value as utility: the satisfaction derived from consumption.
Labour became just another factor, its price set by supply and demand. No deeper anchor existed. Value was whatever the market said it was.
This shift suited capital. It erased exploitation from theory. It justified inequality as preference. It detached economics from reality.
Third: labour as quantum today
Despite this, labour remains the universal substrate of value.
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Machines must be designed, built, and maintained by people.
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Energy systems must be constructed and managed by workers.
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Even digital goods require programmers, designers, and infrastructure.
Every flow of goods and services embeds human effort. Without labour, the system stops.
Like photons, labour units may vary in energy (skill, intensity, productivity). But the packet exists. Every product embodies labour, directly or indirectly.
Fourth: quantum analogy — labour as frequency
In physics, the energy of a photon is proportional to its frequency. Different frequencies produce different colours, but the quantum remains indivisible.
In economics, labour functions similarly. Different skills and contexts produce different value intensities, but the quantum is still time: an hour of effort.
The value of that hour varies, just as frequency varies. But the underlying unit — the indivisible act of human effort — is constant.
Fifth: why losing the quantum matters
Without a grounding in labour, economics becomes untethered.
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Bubbles. If value is just price, speculation can inflate endlessly. Labour offers no anchor.
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Exploitation. Without labour as measure, the extraction of surplus disappears from view. Inequality is treated as natural.
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Policy failure. If value is subjective, governments have no standard to judge real productivity. Financial engineering can be mistaken for wealth creation.
The result is economics adrift: a system of numbers divorced from human effort.
Sixth: MMT and labour
Modern Monetary Theory describes how money works. It shows spending comes before taxation, and that government cannot run out of its own currency.
But MMT also needs an anchor. If money is unlimited, what constrains it? Resources, do, and most specifically, labour. A government can create as much money as it likes, but if there are no nurses to hire, no teachers to train, no builders to construct houses, then the money is meaningless.
Labour is the photon that turns money's potential into reality. Without labour, promises remain empty.
Seventh: automation and the labour question
Some argue automation makes labour obsolete. Machines can produce without people. AI can write, design, and analyse.
But machines require energy, materials, and — crucially — labour to build, maintain, and guide them. Automation displaces some tasks but creates others. It shifts the frequency of labour but does not abolish the quantum.
Even in a highly automated world, human effort remains essential. The question is not whether labour matters, but how it is organised and rewarded.
Eighth: policy implications
Recognising labour as the quantum of value reshapes policy.
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Employment as a priority. Full employment is not just social justice. It is economic necessity. Idle labour is wasted quantum, lost energy.
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Wages as a distribution. Fair wages are not charity. They are how value is shared. Suppressed wages distort the system, trapping energy at the top.
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Public investment. Training, education, and skills are investments in the quantum itself. Expanding the capacity of labour expands the system's energy.
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Tax justice. Taxing wealth and speculation redirects resources to mobilise labour. Idle assets are nothing without human effort.
Ninth: the politics of labour
Acknowledging labour as the photon of value is politically explosive. It challenges capital's dominance. It reveals exploitation. It demands redistribution.
No wonder neoclassical economics buried the idea. But ignoring it has consequences: inequality, instability, and the devaluation of human life.
A politics of labour would centre on work, skills, and human dignity. It would treat people not as costs to be minimised, but as the foundation of value.
Conclusion
Physics has its photon. Economics has its quantum too: labour.
Without labour, nothing is produced. Without recognising labour, economics floats in abstraction. With labour as anchor, we can measure value, expose exploitation, and ground policy in reality.
Labour is the packet of value, the indivisible unit, the photon of economics. To rebuild economics, we must restore it to the centre.
And only then can we fund the future.
Previous posts in this series
- Discussing quantum economics, accounting, money and more
- Quantum economics, part 1: Why Quantum Thinking Matters for Economics
- Quantum economics, part 2: Money as Particle and Flow
- Quantum economics, part 3: Entanglement and Double-Entry Bookkeeping
- Quantum economics, part 4: Quantum Uncertainty and Economic Forecasts
- Quantum economics, part 5: Speculation, Potential, and Energy
- Quantum economics, part 6: Infinite Promises, Finite Energy (MMT and constraint)
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OK, these are forming up nicely into coherent statements, that have a certain consistent symmetry between them. Reading them makes ideas bounce out of your head. Well, mine anyway. Here’s two:
1. The Henry Ford Question: Arguably, without labour, no output can be consumed? How will contemporary economics solve that in an equitable, sustainable way?
2. The Mark Carney Question: If AI is making people lose their jobs, and the savings from the cost of labour banked by capital/the producer, how are the societal effects of this loss being recorded and accommodated (acknowledged) in the accounts and what actions will result?
Enjoy your down time.
Excellent questions. Answers, tomorrow, maybe….
You have triggered whole chains of thought.
Thanks, it beats getting angry.
>Bubbles. If value is just price, speculation can inflate endlessly. Labour offers no anchor.<
Labour offers an anchor surely – or have I misunderstood?
Let me have a look….
Thank you, now I understand “Labour as value”.
On the fickleness of prices, esp in wartime, this is from the Wylye valley in Wiltshire, part of my old stamping ground – https://www.hiddenwiltshire.com/post/of-bread-stones-and-oak-apples
I often felt, without knowing why, that the message of the stones would have been even more useful if the stones had priced the bread by the hour (of a basic farm labourer at the time). The time I was working in the area was the late 1970’s, with much higher inflation and interest rates. The miller, stonemason and accountant would have been kept busy putting a new stone up every month, which English Heritage might have objected to!
It is strange that the fact that labour is the critical and fundamental basis of economics, a no brainer you might say as recognised by Smith and Ricardo. That the following classical and neoliberals tie themselves in knots trying to discredit Marx’s labour theory of value is laughable. Let alone his study of alienation and exploitation that’s is now running rife in all economies.
Stephen Keen says in De-Bunking Economics only a small devoted band of Marxists accept his labour theory of value. He spends a whole chapter ( chapter 17) explaining why but he does say “don’t worry if you find this hard to understand’ which me feel a bit less stupid.
But he does find value in Marx if not in the labour theory.
“Marx’s dialectical theory of value may yet play a role in the reform of economic theory. non-neo-classical schools of thought have no coherent theory of value as an alternative to the neo-classical school’s flawed subjective theory of value.”
“Properly understood Marx’s theory of value liberates classical economics from its dependence on the labour theory of value. ”
I expect he’s right. I am going to do some colouring in. I can manage that.
The next instalment adds a twist, as you will see. I like this argument, but realised it could not be a complete answer. So it broadens next time.
FYI Steve Keen explains the flaws in Marx’s Theory of Value
https://www.youtube.com/watch?v=2b1JETZ6-Ck
https://www.youtube.com/watch?v=9KjFH9_Zm88
https://www.researchgate.net/profile/Steve-Keen/publication/227355905_The_Misinterpretation_of_Marx%27s_Theory_of_Value/links/0c96051b9fcca4b994000000/The-Misinterpretation-of-Marxs-Theory-of-Value.pdf
https://www.exploring-economics.org/media/uploads/2021/10/27/keen-1993-marxs-fallacious-labor-theory-of-value.pdf
Hi Richard,
Great stuff again.
A couple of comments (and this isn’t intended to correct your physics, but to hopefully add another dimension, or enrich your metaphors)
I like the idea of labour as wavelength. The human-hour is easily recognisable as a quantum of effort, and its ‘energy’, rather than intensity, is dependant on the H-H wavelength. I pedantically use energy, rather than intensity, because energy could be tied to specialism, whereas intensity would be the number of humans working on the same thing at once. Much like you can use a microwave to heat stuff up, but you couldn’t give yourself sunburn with it, because the wavelength is too long to cause UV-esque damage.
The other thought that popped into my head, was that photons belong to a family of particles: bosons. Bosons are the exchange particles that are responsible for fundamental force interactions. In the photon’s case, that is electro-magnetism. Maybe we could coin a term for the exchange particle of human labour? The labouron, or the workon. I’m not sure I really like either of these, but they illustrate the idea
Either way, more thought provoking stuff. Enjoy your well earned rest day 🙂
Let me offer this for now, generated by AI, I admit, but in a directed and generated fashion, as was this whole series.
1. Why this analogy is powerful
In physics, bosons are the mediators of forces – photons carry the electromagnetic force, gluons bind quarks, W and Z bosons manage the weak force, and so on. They don’t constitute matter itself (fermions do that) but they make matter interact.
If we apply that metaphor to economics and society: human labour is not just “stuff” (like goods, capital, or even money) – it is the interaction that makes the economy cohere and function. Without labour, there is no production, no exchange, no organisation.
So: imagining a “labour boson” – a fundamental exchange particle that mediates human economic activity – has conceptual bite.
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2. Possible names
“Labouron” or “workon” both convey the particle idea, but I see why you feel they don’t quite land. Here are some alternatives:
• Ergon – from the Greek for work/energy (Aristotle used ergon to mean the characteristic activity of something).
• Praxeon – from praxis, meaning purposeful human activity.
• Doleon – from doleo, Latin “to toil.”
• Taskon – straightforward and modern, but carries the right sense of discreteness.
• Hieron – from hieros (sacred), suggesting the deep social value of labour.
Of these, ergon or praxeon might sit best: they link both to energy and to purpose.
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3. What would the “labour boson” do?
If we extend the analogy:
• It mediates between human needs and material resources.
• It binds people into cooperative structures – firms, households, states.
• It transmits value, because labour embodies and expresses what people want to prioritise.
• It interacts with other “forces”: capital, land, technology, institutions.
In other words, just as photons make the invisible force of electromagnetism visible through interaction, the “labour boson” would make the invisible social force of work visible through action.
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4. Extending the metaphor
We could build a small “particle table” of economics:
• Moneyon (currency as medium of exchange, a unit particle of trust).
• Crediton (the particle of deferred exchange).
• Labouron/Praxeon (the particle of human effort).
• Needon (the driver particle, representing demand or necessity).
You’d then have an economic “field theory,” where interactions between these exchange particles generate the larger structures we see as markets, institutions, and crises.
(Part 2 follows)
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Part Two
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5. Why it matters politically
This is not just whimsy. By treating labour as the mediator of forces, you place people – their energy, creativity, and care – at the very centre of the economic model. That’s a direct challenge to neoliberal economics, which sidelines labour in favour of abstract capital flows or equilibrium equations.
The metaphor says: without the “labour boson,” the system collapses. Without people at the heart, economics is sterile mathematics.
Thank you, Richard, for such a comprehensive reply!
That’s a really cool continuation of the labour boson metaphor. I’ve many following thoughts to sort through now.
KUTGW!
‘Wages as a distribution. Fair wages are not charity. They are how value is shared. Suppressed wages distort the system, trapping energy at the top’
How would such an economics based on labour as the quantum value labour and price wages? What would be the ingredients/constraints? Would regulation be needed?
Clearly I need to develop this. Remember all this is the beginning of a process
This is a topic I have mused upon from time to time. I too think labour was the original quantum of value. However, I think that over time, as less is done by hand, that the labour embodied in things has been supplanted by the energy embodied. Maybe value in the industrialised world is irreducibly the sum of both components, labour and energy, although in some particular examples one or the other is de minimus.
There is more to come on this, maybe tomorrow. That might depend on the weather.
Labour is just a cost of production, it has no actual bearing upon the value of an object beyond the need to break even. It is only a factor if the person making the commodity is also the one selling it.
Attitudes like yours explain little everything wrong with Britain, our society, and our economy.
I hope you have never managed anyone.
Do you know how stupid you are?
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