Capital III, Chapter 50 - Part 8

This is the importance of Marx's analysis of social reproduction in terms of examining the components of national output, not in terms of their historic cost, but in terms of their current reproduction cost, so as to understand what proportion of total output, of total social labour-time and consequently of total value, must be allocated to the reproduction of these components.

Were we to examine the above on the basis of historic cost, we would get a completely different and false picture of the situation. It would measure the value of the gross output, and of the value of the constant and variable capital on the basis of the prices paid for it, based on the level of output and productivity of the previous year (or indeed year's further back in history to that). In so doing, it would grossly understate the proportion of the total output, social labour-time and value that must be set aside from this year's output to reproduce the capital and would grossly overstate, for the same reason the proportion left over as surplus value, and consequently also the rate of surplus value and rate of profit.

“The given number 100 always remains the same, whether it is divided into 50 + 50, or into 20 + 70 + 10, or into 40 + 30 + 30. The portion of the value of the product which is resolved into these revenues is determined, just like the constant portion of the value of capital, by the value of the commodities, i.e., by the quantity of labour incorporated in them in each case. Given first, then, is the quantity of value of commodities to be divided among wages, profit and rent; in other words, the absolute limit of the sum of the portions of value of these commodities. Secondly, as concerns the individual categories themselves, their average and regulating limits are likewise given. Wages form the basis in this limitation. They are regulated on the one hand by a natural law; their lower limit is determined by the physical minimum of means of subsistence required by the labourer for the conservation of his labour-power and for its reproduction; i.e., by a definite quantity of commodities. The value of these commodities is determined by the labour-time required for their reproduction; and thus by the portion of new labour added to the means of production, or by the portion of each working-day required by the labourer for the production and reproduction of an equivalent for the value of these necessary means of subsistence.” (p 858-9)

There are then two regulating physical limits here. Firstly, for social reproduction to continue, on the same scale – and this is also required before extended reproduction can occur – the constant capital must be physically reproduced, and this requires a specific proportion of social output/labour-time, determined by current reproduction costs, themselves determined by current levels of productivity and technology. Secondly, the variable capital must be physically reproduced, which again requires a specific proportion of social production/labour-time.

But, wages vary according to time and place, because although they have a minimum limit, determined by that physical minimum of commodities required for the reproduction of the worker, this minimum itself varies. Social development creates a set of minimum needs that the producers require that increases over time. Capitalism itself requires that this range of needs increases, because it requires workers that are themselves more culturally and educationally developed, that have greater skill and so on. 

But, it also requires workers to develop a wider range of needs, because it is only in doing so that these workers create an ever expanding market for the commodities produced on an ever more mass scale, and without which there would be no means for capital to realise the surplus value contained within these commodities.

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