Online Education Blog

Theory of Surplus Value

Following Adam Smith, Marx distinguished in a commodity, two aspects: they have a use-value and an exchange value. A commodity is an article, which can satisfy one or the other human need, is a use value. But a commodity is not just a useful article, which is to be produced and sold in the market, but to be exchanged with other commodities. How to measure the exchange value of commodities which have different use-values? What do wheat and linen have in common? One is produced by a peasant, other by a weaver.

They are the products of different types of useful labor. What they have in common is that they are both products of human labor in general, what Marx calls “abstract human labor”. On both products a certain amount of human labor has been spent.

That determines their exchange-value. The exchange-value or simply the value, as distinguished from the use-value, consists of the abstract labor incorporated in the commodity. The measure is not the time which the individual laborer may have spent which may be above or below average, but the average time needed on a given level of productivity, what Marx calls the “socially necessary labor-time”.

Capitalist production becomes possible when along with other commodities labor-power can be bought as a commodity. As any other commodity labor power has a use-value for the buyer and an exchange-value for the seller. For the buyer, (the capitalist), it has the use-value that it can work (produce). He uses, he consumes it for this purpose and pays the price — strange enough only afterwards – in the form of wages. For the worker his labor power has only an exchange value. He cannot use it for his own purposes, because he has no means of production. But he can sell it in order to make a living. The exchange value is determined as in the case of every other commodity by the labor-time necessary for its production or reproduction; that means, in this case by the cast of the “means of subsistence” needed to maintain the worker and his children, the future workers. The level of subsistence and of essential needs varies from situation to situation according to the level of development and other factors.

Emergence of Classes

When humanity first developed fire, it took thousands of years to complete the process — being able to turn heat back into motion. The same kind of process can be seen in the development of classes. When humans began to organize themselves in accordance with their relations of production (the division of labor), classes in society formed based on the different positions and roles humans found and created themselves in. What once was a society with little or no class structure, i.e. tribal or nomadic society, became a society that split and divided itself into a diversity of classes fulfilling a broad range of productive roles.

The motion of nature, dialectics, applies in class development as it applies in all things. As the productive forces of humans increased, and class distinctions deepened and divided further, soon the advancement of the productive forces reached such heights that certain classes were no longer necessary. The small craftsperson and shop owner were pushed out of existence by the advancement of modern industries that could produce a much greater quantity at much lower cost.

Karl Marx and Fredrick Engel’s explained the processes of change brought forth by Industrial revolution just beginning to unfold in a particular direction:

“Modern Industry has converted the little workshop of the patriarchal master into the great factory of the industrial capitalist. Masses of laborers, crowded into the factory, are organized like soldiers. As privates of the industrial army, they are placed under the command of a perfect hierarchy of officers and sergeants. Not only are they slaves of the bourgeois class, and of the bourgeois state; they are daily and hourly enslaved by the machine, by the over-looker, and, above all, in the individual bourgeois manufacturer himself. The more openly this despotism proclaims gain to be its end and aim, the more petty, the more hateful and the more embittering it is”.