John Gray (19th century socialist)

John Gray (1799–1883) was a British socialist economist.

Very little personal information about John Gray is available. He lived mostly in Edinburgh. According to his own account, he was a poor student who dropped out of school early, went to London and took up factory work as a youngster. His hardships first convinced him of the ills of the economic system and drove him to read the writings of Adam Smith, David Ricardo and other economists, and to take an interest in various schemes of social reform. Gray was involved in the newspaper business and is said to have been a failed businessman. He was an admirer of the social reformer Abram Combe. Gray was for a while associated with the co-operative movement of Robert Owen and was one of the so-called Ricardian socialists, along with Thomas Hodgskin and John Francis Bray. Named after the economist David Ricardo, the Ricardian socialists asserted that labour was the source of value. The Ricardian socialists argued that the equilibrium exchange value of commodities in elastic supply tend to coincide with producer prices, which represent the labour embodied in the commodities. Profit, interest and rent are deducted from this value and are, in the view of the Ricardian socialists, illegitimate for that reason. Gray argued that the producers receive only about a fifth of the value of their products, whereas their labour creates 100% of that value. He also argued that competition hampered the economy's productivity because, under free-market competition, incomes remain low, limiting demand and therefore production. To overcome the limits competition places on social production, the hardships it imposes on all competitors and the injustice of the extraction of surplus value from labour (as he saw it), Gray proposed a central bank which would issue a 'labour currency', to be used as a generalised medium of exchange of equivalent amounts of labour value, as well as a system of co-operative associations to organise supply and demand. These would be co-ordinated by a central 'National Chamber of Commerce'.

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