Tuesday, 31 December 2013

Capital II, Chapter 11 - Part 2

Marx says, from the perspective of the organic composition of capital, it doesn't matter whether the constant capital is made up of lots of instruments of labour and few materials, or few instruments of labour and lots of material. What is significant is the proportion of constant capital to labour-power.

This is not inconsistent with, but could be read as not exactly tallying with what he said in Volume I. There he makes clear that what is important is the Technical Composition of Capital i.e. the physical quantity of Constant Capital as against the physical amount of labour-power. In Chapter 25 he writes,

“The composition of capital is to be understood in a two-fold sense. On the side of value, it is determined by the proportion in which it is divided into constant capital or value of the means of production, and variable capital or value of labour power, the sum total of wages. On the side of material, as it functions in the process of production, all capital is divided into means of production and living labour power. This latter composition is determined by the relation between the mass of the means of production employed, on the one hand, and the mass of labour necessary for their employment on the other. I call the former the value-composition, the latter the technical composition of capital.

Between the two there is a strict correlation. To express this, I call the value composition of capital, in so far as it is determined by its technical composition and mirrors the changes of the latter, the organic composition of capital. Wherever I refer to the composition of capital, without further qualification, its organic composition is always understood.”

So, it is the technical composition that is determinate. That is so, because of its implication for the employment of labour-power. As he says in defining what he means by the expansion of capital,

“Growth of capital involves growth of its variable constituent or of the part invested in labour power...

Accumulation of capital is, therefore, increase of the proletariat.” (ibid)

So, when Marx says it doesn't matter whether the constant capital is made up of lots of instruments of labour or lots of material, he is still stressing that it is this physical relation between constant and variable capital, not the value relation that is significant.

For example, a large number of instruments implies a large number of workers, even if each worker uses many instruments. They may require relatively little material by comparison, if the large range of instruments signifies a complicated labour process. On the other hand, an equally large number of workers might process a large amount of material using just one or two instruments, where the labour process is more straightforward. In either case, it is the technical relation between the physical amount of constant capital, and variable capital that determines how many workers are employed, and to what extent that number will rise as capital expands. As Marx puts it,

“Growth of capital involves growth of its variable constituent or of the part invested in labour power. A part of the surplus-value turned into additional capital must always be re-transformed into variable capital, or additional labour fund. If we suppose that, all other circumstances remaining the same, the composition of capital also remains constant (i.e., that a definite mass of means of production constantly needs the same mass of labour power to set it in motion), then the demand for labour and the subsistence-fund of the labourers clearly increase in the same proportion as the capital, and the more rapidly, the more rapidly the capital increases...” (ibid)

By the same token, in looking at fixed and circulating capital, it doesn't matter whether the latter is made up of much materials and little labour-power or vice versa. But, in Ricardo's analysis, raw material and auxiliary material appear neither as fixed nor circulating capital.

“It disappears entirely; for it will not do to class it with fixed capital, because its mode of circulation coincides entirely with that of the part of capital laid out in labour-power. And on the other hand it should not be placed alongside circulating capital, because in that event the identification of the antithesis of fixed and circulating capital with that of constant and variable capital, which had been handed down by Adam Smith and is tacitly retained, would abolish itself. Ricardo has too much logical instinct not to feel this, and for this reason that part of capital vanishes entirely from his sight.” (p 220-21)

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