Cost-of-production theory of value

The cost can comprise any of the factors of production (including labor, capital, or land) and taxation.

The theory makes the most sense under assumptions of constant returns to scale and the existence of just one non-produced factor of production.

[citation needed] Piero Sraffa, in his introduction to the first volume of the "Collected Works of David Ricardo", referred to Smith's "adding-up" theory.

Ricardo sets this theory at the start of the first chapter of his Principles of Political Economy and Taxation, but contextualizes it as only relating to commodities with elastic supply.

Nevertheless, it seems undeniable that all the major classical economics and Marx explicitly rejected the labor theory of price[3]([1]).

Yoshnori Shiozawa presented a modern interpretation of Ricardo's cost-of-production theory of value.

Since that time, it has been most often associated with Marxian economics, while among modern mainstream economists it is considered to be superseded by the marginal utility approach.