This is not the less true for capital as well as labour being employed in production; for capital is hoarded labour.
When equal quantities of any two articles require an equal amount of labour to produce them, they exchange exactly against one another. If one requires more labour than the other, a smaller quantity of the one exchanges against a larger quantity of the other.
If it were otherwise, no one would bestow a larger quantity of labour for a less return; and the article requiring the most labour would cease to be produced.
Exchangeable value, therefore, naturally depends on cost of production.
Naturally, but not universally; for there are influences which cause temporary variations in exchangeable value.
These are, whatever circumstances affect demand and supply.
But these can act only temporarily; because the demand of any procurable article creates supply; and the factitious value conferred by scarcity soon has an end.
When this end has arrived, cost of production again determines exchangeable value.
Its doing so may, therefore, stand as a general rule.
Though labour, immediate and hoarded, is the regulator, it is not the measure of exchangeable value: for the sufficient reason, that labour itself is perpetually varying in quality and quantity, from there being no fixed proportion between immediate and hoarded labour.