1. Productive Labour from the Standpoint of Capitalist Production: Labour Which Produces Surplus-Value
Smith's analysis of productive labour, like other aspects of his analysis, Marx says, demonstrates the same two-sided approach, where both approaches, one correct the other incorrect, are jumbled together. Its necessary to separate these approaches from within the jumble, to analyse what is correct and what is incorrect.
The correct approach of Smith, which flows from his analysis of surplus value, as arising in production, is that that labour is productive which produces surplus value. For labour to produce surplus value, in this capitalist sense, it must be wage-labour, which exchanges with capital. Wage labour may be exchanged with revenue, but this labour is not productive; it is not bought for the purpose of creating surplus value, but solely for the purpose of providing the buyer with a use value. Similarly, labour, whether it is wage-labour or not, produces surplus value to the extent that the new value it produces is greater than the value of the labour-power consumed in its production.
The peasant's or artisan's labour, divides into necessary labour and surplus labour, the same as that of the wage labourer. The necessary labour is that required to reproduce the value of their labour-power, equal to the wage of the wage labourer. The surplus labour is the new value created in excess of that. As Marx sets out, it is only because of this fact that wage labour can be productive labour, i.e. it is not because it is wage labour that it produces a surplus value, but the fact that once labour reaches a certain level of productivity, it is able to produce a greater quantity of new value, during the day, than is required to reproduce the value of the labour-power consumed.
The significance of wage labour is that the surplus value is appropriated by capital, and not by the labourer. The peasant producer or artisan produces a surplus value, because the new value they create is greater than the value of their labour-power, i.e. they undertake surplus labour in excess of necessary labour. But, the value they obtain in selling the product of their labour, is only equal to the labour they have expended. That is not the case with capital and wage labour. The capitalist lays out one amount of value, and, as a result of the production process, and the surplus value created within it, they obtain a greater amount of value, an amount of value for which they have given no equivalent.
In the case of wage labour that exchanges with revenue not with capital, the wage labourer sells a commodity - labour-power - just as they do when selling it to capital, and consequently they sell this commodity at its value, but the buyer of this commodity does not thereby obtain any surplus value to realise, and with which to expand their capital. That was the situation with retainers, for example. It has to be distinguished from those conditions whereby workers sell not their labour-power, but the product of their labour, or provide a labour service.
“Productive labour, in its meaning for capitalist production, is wage-labour which, exchanged against the variable part of capital (the part of the capital that is spent on wages), reproduces not only this part of the capital (or the value of its own labour-power), but in addition produces surplus-value for the capitalist.” (p 152)
The existence of capital, and a class of capitalists, depends not on the absolute but relative productivity of labour. That is, all labour that is expended on the production of use values is productive of value, but it is only if this labour reaches a level of productivity that is sufficient to produce a quantity of value greater than the value of the labour-power that produces it, that a surplus value is possible.
“Productivity in the capitalist sense is based on relative productivity—that the worker not only replaces an old value, but creates a new one; that he materialises more labour-time in his product than is materialised in the product that keeps him in existence as a worker. It is this kind of productive wage-labour that is the basis for the existence of capital.” (p 153)