Rate of surplus-value

[ex_next_worker]

Hey,
I'm reading ch9 of Capital and I'm curious whether this application of necessary and surplus labor is correct:

8h workday
wage = 40$ per day
raw materials, rent, etc. = 5$ per day
price of the product produced in the same workday = 800$
surplus-value = 755$

So the degree of exploitation is 755/40 = 1887,5 % ?

How do I calculate the hours of necessary and surplus labour-time? And why does Marx put means of production to 0$?

[FSL]

Hey,
I'm reading ch9 of Capital and I'm curious whether this application of necessary and surplus labor is correct:

8h workday
wage = 40$ per day
raw materials, rent, etc. = 5$ per day
price of the product produced in the same workday = 800$
surplus-value = 755$

So the degree of exploitation is 755/40 = 1887,5 % ?

How do I calculate the hours of necessary and surplus labour-time? And why does Marx put means of production to 0$?


If constant capital is only 5$ then that seems correct. But remember, you need to take into account all costs, for example the depreciation of capital employed in production.
The ratio of surplus to necessary labour is the same as the ratio of surplus value to variable capital. So you'd have

SL/NL = s/v-->
SL/NL =755/40=1887,5%-->
SL=1.887,5% x NL or roughly SL = 18,9NL

With Total Labour being 8hours you get

TL= SL+NL= 19.9NL-->
NL= 8/19.9=0,4 hours or about 25 minutes The rest 7,6 hours in this case are surplus labor. With this numbers the ratio is SL/NL= 7,6/0,4=1900% which is a bit off since I didn't bother with the fractional part in decimals.

[ex_next_worker]

Thanks. What about this:


At first sight it appears a strange proceeding, to equate the constant capital to zero. Yet it is what we do every day. If, for example, we wish to calculate the amount of England’s profits from the cotton industry, we first of all deduct the sums paid for cotton to the United States, India, Egypt and other countries; in other words, the value of the capital that merely re-appears in the value of the product, is put = 0.

I don't understand this exactly. So if a company buys a computer as means of production, how does it re-appear as value of the product?

[FSL]

Thanks. What about this:



I don't understand this exactly. So if a company buys a computer as means of production, how does it re-appear as value of the product?



What creates new value is living labor. That is the work done by people at that time. In cotton industry you can get raw materials -cotton- but nothing will happen to it without work. Raw materials or machinery represent "dead" labor during production. Work done by someone in the past. As they 're used up to create something new, their value passes on to that. Something that needs expensive raw materials to be manifactured will be more expensive then something that uses equal amounts of something cheaper.

Same thing with using a computer. Means of production though aren't fully expended during production. Instead, they wear out. For example, a computer can go on for 500 workdays. After that time, it breaks down. This computer costs 1000$ to buy. So after every day of work, 2$ of its value are passed to the product. This is what depreciation is and companies acknowledge this "loss" and its exact size as a reduction in the value of their assets.

What Marx is trying to here is calculate the rate of surplus value, or profits. When a company sells 100 units of a product, like 100 cups for a dollar each, that's the company's income not its profit. He first deducts that part of the cost that isn't wages. So out of an income of 100$, you deduct 80$, which can be the sum of how much your raw materials cost and how much the machinery used has worn out. This is how you end up with 20$, a part of which is wages and the other part is profit. When you know how much the wages are you can find the rate of surplus value.

[Vladimir Innit Lenin]

FSL, forgive me if I am mistaken (I have only read the first two chapters of Capital and so am not totally familiar with this theory), but I was of the understanding that Socialists do not value depreciation into their calculations? Or is this just a necessary tool to use for making calculations within a Capitalists economy?

[Dave B]

I haven’t got much time for this as I just about to go out.

But constant capital includes depreciated fixed capital.

Or in other words the C is the sum of the value of the raw material plus the value or embodied labour of the used up bit of the fixed capital in a turnover. The value and embodied labour of the used up fixed capital is ‘transferred into’ the value of the finished product.

I think Karl used the example of used spindles or something for this.

I suppose the ‘portion’ of the finished product that contains the labour of the used up fixed capital is sold to purchase and replace the used up fixed capital to start the process over again.

But leaving out the value of, and the fixed capital, out of the equation was a mistake that had a dramatic effect on the rate of profit that Fred spotted and he applied a quick patch in volume three.

[FSL]

From Capital, Vol 1 ch 8


Yet another interesting phenomenon here presents itself. Suppose a machine to be worth £1,000, and to wear out in 1,000 days. Then one thousandth part of the value of the machine is daily transferred to the day’s product. At the same time, though with diminishing vitality, the machine as a whole continues to take part in the labour-process. Thus it appears, that one factor of the labour-process, a means of production, continually enters as a whole into that process, while it enters into the process of the formation of value by fractions only. The difference between the two processes is here reflected in their material factors, by the same instrument of production taking part as a whole in the labour-process, while at the same time as an element in the formation of value, it enters only by fractions

[Vladimir Innit Lenin]

Simple straight line depreciation then?

Capitalism requires the referencing of 'depreciation tables', the origin of which I do not know. Worked out by 'experts'. :rolleyes:

[Dave B]

In the absence of data and calculation etc accountants work on a rule of thumb capital depreciation of 10% per year apparently.