Thursday, 13 March 2014

Capital II, Chapter 15 - Part 4

Marx then gives a third example, where the working period is 6 weeks and the circulation period 3 weeks. £100 is advanced each week. We would then have.

 Working Period Weeks Circulation Time Financed By 1 1 - 6 7 - 9 £600 Capital 2 7 - 12 13 - 15 £300 Capital + £300 (sale week 9) 3 13 - 18 19 - 21 £300 (sale week 9) + £300 (sale week 15) 4 19 - 24 25 - 27 £300 (sale week 15) + £300 (sale week 21) 5 25 - 30 31 - 33 £300 (sale week 21) + £300 (sale week 27) 6 31 - 36 37 - 39 £300 (sale week 27) + £300 (sale week 33) 7 37 - 42 43 - 45 £300 (week 33) + £300 (sale week 39) 8 43 - 48 49 - 51 £300 (week 39) + £300 (sale week 45) 9 49 - 54 55 - 57 £300 (week 45) + £300 (sale week 51)

With a 9 week turnover period, this gives 6 turnovers in the 54 weeks. In each turnover period, except the first, £900 is returned = output of 1.5 working periods.

Put another way,

“In other words during 9 working periods (54 weeks) a total of 600 times 9 or £5,400 worth of commodities are produced. At the end of the ninth working period the capitalist has £300 in money and £600 in commodities which have not yet completed their term of circulation.” (p 266)

Its only in example 2 that the original capital, for working period 1, plus the second capital advanced for working period 2 coincide with the capital returned at the end of the turnover period, and that is because the same period of time was set for the working period and the circulation time. In all other cases, they will overlap so that a portion will be returned to finance some of the next working period, leaving an amount left over, equal to the additional capital, to finance part of the following working period.

“The capital operating during the circulation time of the commodity-capital is not identical, in this case, with the capital II originally advanced for this purpose, but it is of the same value and forms the same aliquot part of the total capital advanced.” (p 266)

The capital advanced as productive capital lies idle, as commodity-capital during the circulation period. So, in example 2,

“Therefore the entire time during which capital I lies idle here amounts to one half of the year. It is the additional capital II that appears during this time having, in the case before us, also in its turn lain idle half a year. But the additional capital required to ensure the continuity of production during the time of circulation is not determined by the aggregated amount, or sum total, of the times of circulation during the year, but only by the ratio of the time of circulation to the period of turnover.” (p 266-7)

For instance, in example 1, it was equal to 25%, and in example 3 a third. In example 1, 25% of total capital was required as additional capital, and in example 3 a third of total capital required as additional capital.