Key Concepts in Marxist Theory: Capital, Labor, and Value
Capital: Expanding Value
In Marxist theory, capital is an expanding value. Initially, capital takes the form of a sum of money. Its use in the capitalist production process allows the owner to obtain a larger amount than the initial investment. This money is used to purchase machinery and raw materials (constant capital) on one hand, and labor (variable capital) on the other. Once equipped with constant and variable capital, the capitalist can organize the production of a given asset. The value of a unit of that good must be greater than the sum of the parts of constant and variable capital used in its production.
Thus, when all acquired constant and variable capital has been spent—machines are worn out, raw materials are consumed, and workers’ contracts expire—the money from the sale of the produce must be greater than the original investment. In this sense, Marxism argues that capital is inherently an expanding value.
Labor Force: A Unique Commodity
The labor force is the set of physical and mental capabilities that exist in a person and are put into action to produce goods of any kind. In capitalist society, according to Marxist theory, the labor force becomes a commodity. Because they lack access to the ownership of the means of production, individuals, in order to survive, are forced to sell their ability to work as a commodity.
The labor force is a unique commodity whose use value is work, and whose exchange value is the wage. Marx argued that economists prior to him had conflated the concepts of work and labor force. While the labor force is merely a capacity, work is the materialization of this capacity in a given product.
Surplus Value: The Source of Profit
Surplus value is the part of the value generated by the worker’s labor—the use of their labor force—that is retained by the capitalist, according to Marxist analysis. The labor force is a unique commodity whose exchange value (the wage) is less than the value it adds to the product. The difference between the wage paid to the worker and the value they add to the product is called surplus value.
For Marxism, the labor force is the only source of surplus value, the only creator of new value. Raw materials and machinery merely transfer their existing value to the new product; they do not increase it. During the working day, the worker must create enough value to cover their wage and generate surplus value for the capitalist. The time it takes to create the value equivalent to their wage is the necessary labor time, while the time spent generating surplus value is the surplus labor time.
Infrastructure and Superstructure: Base and Reflection
The superstructure encompasses the totality of juridical and political phenomena, as well as the ideology and institutions that represent them. The state, law, ideologies, religions, artistic expressions, etc., are social facts that fall within the context of a society’s superstructure. The economic base (infrastructure) of society always determines the superstructure.
Marx and Engels posited that the study of society should not be based on what people say, imagine, or think, but on how they produce the material goods necessary for life. The determination of the superstructure by the infrastructure should not be seen as a mechanical process, but rather as a determination in the last instance—that is, economic conditions ultimately determine the superstructure, but other levels of society also play a role.
Value: Socially Necessary Labor Time
The value of an asset is determined by the amount of socially necessary labor required to produce it. The amount of labor a property holds is measured by the working time spent producing it. This does not mean that goods have more value the more unskilled the worker is or the longer it takes to produce them. Hence, we speak of socially necessary labor time, which represents the average time required to produce a good under normal conditions with average skill and intensity.
Alienation: Loss of Self in Capitalism
The word alienation comes from the Latin alienus, meaning “alien” or “strange.” It originally referred to the act of transferring property from one person to another. In German idealist philosophy, the word acquired a new meaning, something like the removal of a person from themselves, a loss of authenticity.
In Marxism, alienation signifies the loss of a person’s control over their products or intuitions. It also refers to the historical situation in which individuals find themselves within the capitalist labor process, failing to recognize their agency over the material conditions of production. There are five types of alienation: economic, philosophical, political, religious, and social.