Capital II, Chapter 3 - Part 3

In the circuit of commodity capital beginning with the end product C', it is assumed that the reproduction of the commodities (MP + L), which enable the production of the end product, can occur, but this requires them to exist. If these commodities, for whatever reason, have themselves not been produced, then the circuit breaks down.

Money capital, within the circuit of an industrial capital does not presume money capital in general. A capitalist firm might be the first ever capitalist firm. The same is true of the Productive Capital. But, C', does presume the existence of commodity capital outside the particular capital. That is because means of production and labour power are themselves sold as commodities. Even if the means of production are produced by non-capitalists, they are bought by merchants, and form their commodity capital.

“But just because the circuit C' ... C' presupposes within its sphere the existence of other industrial capital in the form of C (equal to L + MP) — and MP comprises diverse other capitals, in our case for instance machinery, coal, oil, etc. — it clamours to be considered not only as the general form of the circuit, i.e., not only as a social form in which every single industrial capital (except when first invested) can be studied, hence not merely as a form of movement common to all individual industrial capitals, but simultaneously also as a form of movement of the sum of the individual capitals, consequently of the aggregate capital of the capitalist class, a movement in which that of each individual industrial capital appears as only a partial movement which intermingles with the other movements and is necessitated by them. For instance if we regard the aggregate of commodities annually produced in a certain country and analyse the movement by which a part of it replaces the productive capital in all individual businesses, while another part enters into the individual consumption of the various classes, then we consider C' ... C' as a form of movement of social capital as well as of the surplus-value, or surplus-product, generated by it.” (p 99-100)

Partly for that reason, it is impossible to examine the circuit of commodity capital of one firm without also examining the intermingling with the circuits of commodity capital of other firms.

“Since in C' ... C' the starting-point is the total product (total value), it turns out that (if foreign trade is disregarded) reproduction on an extended scale, productivity remaining otherwise constant, can take place only when the part of the surplus-product to be capitalised already contains the material elements of the additional productive capital; that therefore, so far as the production of one year serves as the premise of the following year’s production or so far as this can take place simultaneously with the process of simple reproduction within one year, surplus-product is at once produced in a form which enables it to perform the functions of additional capital. Increased productivity can increase only the substance of capital but not its value; but therewith it creates additional material for the self-expansion of that value.” (p 101-2)

In other words, the production of surplus value itself cannot enable expanded reproduction to take place. The surplus value, must also meet in the market place an increased quantity of means of production and labour-power. There must also have been created a physical, surplus-product which is the equivalent of this surplus value.

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