| This question <503|535> overall <527|530> BHales: <404|546>; Desk: <420|89>. |
| Term Paper 602: Essay about Chapter Sixteen: Absolute and Relative Surplus Value |
| [529] BHales and Desk: Chapter 16 Termpaper. : : P : Desk and BHales |
| The Working Day… |
| The mystery of surplus value is one that has been studied many times throughout history, according to Frederich Engels: |
| Whence comes this surplus-value? It cannot come either from the buyer buying the commodities under their value, or from the seller selling them above their value. For in both cases the gains and the losses of each individual cancel each other, as each individual is in turn buyer and seller. Nor can it come from cheating, for though cheating can enrich one person at the expense of another, it cannot increase the total sum possessed by both, and therefore cannot augment the sum of the values in circulation. (...) This problem must be solved, and it must be solved in a purely economic way, excluding all cheating and the intervention of any force — the problem being: how is it possible constantly to sell dearer than one has bought, even on the hypothesis that equal values are always exchanged for equal values?[1] |
| Understanding surplus value is essential when looking at the working day. As Marx explains, the capitalist uses his money (M) to purchase two commodities (C) Labor Power (LP) and Means of Production (MP). The laborers transform the means of production into a new commodity (C), that are sold for more money (M1). Marx refers to surplus value as the difference between M1 and M. Surplus value is the source of profit. |
| Surplus value does not arise directly from exchange. Although some may be able to profit by exchange by simply marking up the price, this is not possible for all sellers. For example, all sellers are also buyers and if he chooses to charge 15% to his buyers, his gains would be lost to his supplier and no one would profit from the exchange. Also, competition tends to increase in any industry where large profits are present; this eliminates the ability to raise prices to gain profits because there are so many sellers that a buyer would just purchase the commodity from another seller. Marx continues to explain that, “Capitalistic production is not merely the production of commodities, it is essentially the production of surplus value.” Capitalists aren't so much concerned with the quantity of products they are producing; rather the amount of surplus value that workers are creating. Surplus value is the difference between the value added by the workers and the value of their labor power. |
| Since the new value is not due to unequal exchange, it must exist due to new value created during production. Surplus value can also be derived as the difference between the value of the output and the value of the inputs. Lets take the example of a clock factory; the parts, electricity, and machinery come together to form a clock. The inputs, by themselves do not add new value, but once fused together, new value is created. As Marx says, a new commodity that's value is to create new value. Value is not something that exists within a commodity; rather value is a social relation between commodity producers that appears as exchange value. |
| Surplus value is comprised of two types of value, absolute and relative surplus values. Absolute and Relative Surplus Value are very important when looking at the working day. If we look at absolute value according to Marx, it can be tied with increasing the amount of time worked per worker in a specefic pay period. Absolute surplus value occurs where the working day is prolonged past the point where the worker has produced the equivalent of his labor power. Marx periodically emphasizes and discusses the length of the working day or week, but this day and age the concern is about the number of hours worked per year. Most employers will look at the ratio of the effective hours worked to the hours needed to supply a day's labor. For example, in Argentina before the revolution, as productivity rose, the working classes forced a reduction in the workweek, from 60 hours to 50, 40 etc, yet were expected to get the same amount of work done. Marx explains that absolute surplus value “forms the groundwork for the capitalist system, and the starting point for production of relative surplus value.” |
| Another important point to address is the importance of wages. Relative surplus value is obtained by reducing wages or increasing productivity amongst workers, although relative surplus value is generally temporary. For example if wages fall below a certain level, eventually the capitalist will not be able to find sufficient labor power. A new technology may enable a worker to become more productive. Thus the capitalist may temporarily see increases in relative surplus value, until this technology spreads to other capitalists throughout the industry and this relative surplus value will cease to exist. The exploitation of workers in order to extract surplus value causes class struggle. This will eventually lead to a strike, unhappiness in a community or even warfare as we have seen many times before. |
| Marx simply states it as such in Capital Chapter 16… |
| Relative surplus-value is absolute, since it compels the absolute prolongation of the working-day beyond the labor-time necessary to the existence of the laborer himself. Absolute surplus-value is relative, since it makes necessary such a development of the productiveness of labor, as will allow of the necessary labor-time being confined to a portion of the working-day. But if we keep in mind the behavior of surplus-value, this appearance of identity vanishes. Once the capitalist mode of production is established and become general, the difference between absolute and relative surplus-value makes itself felt, whenever there is a question of raising the rate of surplus-value. Assuming that labor-power is paid for at its value, we are confronted by this alternative: given the productiveness of labor and its normal intensity, the rate of surplus-value can be raised only by the actual prolongation of the working-day; on the other hand, given the length of the working-day, that rise can be effected only by a change in the relative magnitudes of the components of the working-day, viz., necessary labor and surplus-labor; a change which, if the wages are not to fall below the value of labor-power, presupposes a change either in the productiveness or in the intensity of the labor. |
| It has been stated various times that Marx himself considered his theory of surplus-value his most important contribution to the progress of economic analysis. It is because of Marx's contributions and studies that his array of sociological and historical thought enables him the ability to place the capitalist mode of production in his historical context, and to find the root of its inner economic contradictions and its laws of motion in the specific relations of production on which it is based. (Marx letter to Engel) This is one of Marx's greatest pieces of work throughout Capital. |
| Sources: |
| 1. Theories of Surplus Value (1863) |
| Hans: This is a good essay, but you are a little shaky about the difference between relative and extra surplus-value, and you do not say enough about chapter 16 (except a long unexplained quote). |
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