The majority of those exchanging their labour against revenue rather than against capital, and consequently unproductive rather than productive labourers will be providers of personal services, and only a small minority such as “cooks, seamstresses, jobbing tailors and so on” will produce material use values. This is the basis of Smith's confusion, and a further confusion where he makes a distinction between such material production and production which disappears immediately.
“This does not prevent, as Adam Smith remarks, the value of the services of these unproductive labourers being determined and determinable in the same (or an analogous) way as that of the productive labourers: that is, by the production costs involved in maintaining or producing them.” (TOSV 1, p 159)
The labour-power of both the productive and unproductive labourer is a use value whose value is equal to the labour-time required for its production. But, the productive labourer produces commodities for the buyer of their labour-power, and those commodities contain a surplus value, precisely because they contain a quantity of labour-time greater than that for which the capitalist has paid. The unproductive labourer does not produce a commodity for the buyer of their labour, but produces a use value, i.e. something which the buyer requires for their own consumption. Moreover, even if the buyer were to sell this use value as a commodity, it would not realise for them a surplus value, because they could only obtain for it, the same value which they have given for it.
“For example, the workman employed by a piano maker is a productive labourer. His labour not only replaces the wages that he consumes, but in the product, the piano, the commodity which the piano maker sells, there is a surplus-value over and above the value of the wages. But assume on the contrary that I buy all the materials required for a piano (or for all it matters the labourer himself may possess them), and that instead of buying the piano in a shop I have it made for me in my house. The workman who makes the piano is now an unproductive labourer, because his labour is exchanged directly against my revenue.” (TOSV 1, p 160)
But, if I then sell the piano I will not realise a surplus value, as a consequence. If the materials cost £100, and the worker spends ten hours in its construction, with each hour creating £10 of new value, the piano will have a value of £200, which is what I will have paid for it, and what I would get for it, if I sold it.
In other words, the buyer of the materials, and the labour-power here would be in exactly the same position as any other buyer of commodities.
It is the fact that capitalist development leads to a situation where all commodities are produced capitalistically, as it brings about a simultaneous rise in productivity, whilst it is only those personal services, which with minor exceptions, comprise only labour, which leads Smith to introduce these additional and incorrect conceptions into his definition of productive labour.
Describing this train of thought of Smith, Marx writes,
“It (the labour of the unproductive labourer) is “unproductive of […] value”, “adds to the value of nothing”, “the maintenance” (of the unproductive labourer) “never is restored”, “[it] does not fix or realise itself in any particular subject or vendible commodity”. On the contrary, “his services generally perish in the very instant of their performance, and seldom leave any trace or value behind them for which an equal quantity of service could afterwards be procured”. Finally, his labour “does not fix or realise itself in any permanent subject or vendible commodity”.” (TOSV 1, p 161)
As Marx says, Smith's terminology here is different from that he used initially. Rather than productive of surplus value being the determinant, it is merely productive of value. Now, productive means only then an amount of new value is created equal to what the worker has received as wages.
“In this case it is the same as if the labourer himself owned his conditions of production. He must each year deduct the value of the conditions of production from the value of his annual product, in order to replace them. What he consumed or could consume annually would be that portion of the value of his product equal to the new labour added to his constant capital during the year. In this case, therefore, it would not be capitalist production.” (TOSV 1, p 162)
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