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Unit-9: Origin of Capitalism, Theories of Capitalistic Development Surplus Value and Process of Capitalism

similar to all, and that is the produce of objects by labour. That is the reason that an useful object has notes
value, because human–labour was used in its production. Then how should we measure the quantity
of this value? Obviously by the factor that created that value by labour which is inherent in that object.
The quantity of labour is measured by the time–span, and measurement–table of labour–time is based
on weeks, days and hours .... it is clearly seen that the value of an object is based on that particular,
which is the labour–time, or the quantity of labour that is necessary for its production, from a social
viewpoint. To arrive at the ratio of the value of two objects, we have to find the ratio of the labour–time
spend on them, on which their value–ratio is based.”
In this way, according to Marx, the value of an object is based on necessary labour–time used in its
production. Therefore it is clear that the if two days are spend in the production of an object, and four
days in the production of another, then the value of the second object will be higher (double) than the
value of the first. Many people do not agree on the basics of this argument, that how can the value of
an object be fixed on its labour–time, because the raw material used in its production too have value.
While fixing the value of any object, the producer adds not only the labour–time, but also the cost
of raw–materials etc. If this was not so, then how does a gold ring made within a few hours is more
valuable than a wooden table which was made in three–four days? In reply to this, Marx present the
argument that, “The value of gold is the gift of nature. In creation of its value, man has no to say. It
is only one objects made by the man’s attempts, that is the result of man’s labour.”
It is clear from the above discourse, that Marx’s labour–value theory, asks tells us what is the real
value of an object. After answering this question (that value can only be created by labour) Marx has
presented his ideas related to the hoarding of capital. It is true that labour creates value, but labour
by itself does not have the capability to produce value; to do so it needs raw materials, tools, etc. The
first form of capital is ‘wealth’, (money), but wealth can obtain, raw materials, tools, machine etc.
This capital just does not mean ‘wealth’, but raw material, tools, machine etc. Without using all these
or in brief ‘capital’, labour cannot produce. But the value of labour theory cannot be proved false,
inspite of this. Where did capital come from? In answer to this query Marx says that in its final form
“Capital” is the creation of labour, and in this form that the labour produces value or “wealth”, and
“wealth” procures raw material, tools, machines etc, uses them for production that is capital. Not just
this, but the capitalist buys the labour of the poor workers by the power of his wealth, and uses them
in production activities. But the worker produces labour value through these production activities.
Very little of this value is given to the workers (in the form of salary for his labour) and most of it is
grabbed by the capitalist. Depriving the workers of their real rights is exploiting them. Through this
exploitation, the capitalist gathers and collects and stores capital. It is the view of some that capitalist
are economical and spend their wealth after much practical thinking and therefore capital is stored
and collected. But according to Marx, this is a laughable and meaningless argument. Capitalist have
always led a luxurious and easy life, and in reality are used to spending their life in leisure and
pleasures – where and when have they been economical?
Marx has explained the methods of exploiting workers by capitalist on the basis of “the theory of
surplus value”. Many writers before Marx have presented various beliefs in numerous forms on
those values, that workers produce, but the salary they receive is always less than the value that they
produce. Some economists produced the above idea, based on agriculture–production. According to
their belief, agriculture produces so much that even after deducting the use of land and payment for
the labours of farmers–workers, there is still a big savings that remains. Reccardo expressed the view
the profit in industries is based on what surplus remains after paying off the salaries of workers.
It is in the background of the above ideas, that Marx expressed his theory of surplus value. He brought
to the forefront the exploitative rights of capitalists and stated where the surplus value was created.
According to Marx, surplus value is born where the capitalist misappropriates that part of the labour of
the working class for which he does not have to pay the salary. What is surplus value? The value born

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