Contents
How surplus value is the main economic law of capitalism?
The production of surplus value constitutes the basis for the entire mechanism of the fundamental economic law of capitalism and engenders the permanent tendency of capital to lengthen the workday, to reduce wages and the share of wage labor in the national income, and to enslave and plunder the peoples of other …
What does surplus value mean in a circuit of capital?
Surplus value is the difference M ‘ – M, the profit that the capitalist makes at the end of the money circuit. Instead of hoarding this profit, as would a miser, the capitalist reinvests it in a new, enhanced circuit of money.
What is surplus value according to Karl Marx?
Surplus value, Marxian economic concept that professed to explain the instability of the capitalist system. The capitalist pays his workers less than the value their labour has added to the goods, usually only enough to maintain the worker at a subsistence level.
How is the rate of surplus value determined?
Surplus value is therefore the ratio of necessary labor to surplus labor. If a capitalist employs me for 8 hours today, and I reproduce my wage in 4 hours, then the rate of surplus value is 50%. In other words, surplus value is the difference between the value paid to the worker and, on the other side, by the total value the worker produces.
Why does capital want to extract surplus value?
Because of the centrality of LP in extracting surplus value, capital will always be driven to increase labor productivity and extract more value from labor, which generates a fundamental conflict with labor’s needs to earn enough to make a decent living.
Who is the owner of the surplus value?
The capitalist owns the surplus value. To the employer, labor power has a very clear use value: it earns the capitalist a profit. This is the basic inequality built into the capitalist system. As long as one small class of owners controls the surplus value created by the working class, there will always be rich and poor, wealth and poverty.
Why was surplus value important to Karl Marx?
That is also the reason why Marx attached so much importance to treating surplus-value as a general category, over and above profits (themselves subdivided into industrial profits, bank profits, commercial profits etc.), interest and rent, which are all part of the total surplus product produced by wage labour.