Theories of Surplus Value, Part II, Chapter 8 - Part 51

If it were the case then that the exchange-value of agricultural products were lower than their price of production, there would be no surplus profit, as a basis for ground-rent, and so the persistence of any rent would have to be explained on some other grounds.

However, even on the basis of the existence of such surplus profits, this is not a sufficient condition, because such surplus profits in other spheres simply results in an influx of capital, and a reduction in market prices to the price of production. The agricultural ground-rent requires an explanation of why agriculture differs, in this respect, from any other industry.

“This is to be explained simply by property in land. The equalisation takes place only between capitals, because only the action of capitals on one another has the force to assert the inherent laws of capital. In this respect, those who derive rent from monopoly are right. Just as it is the monopoly of capital alone that enables the capitalist to squeeze surplus-labour out of the worker, so the monopoly of land ownership enables the landed proprietor to squeeze that part of surplus-labour from the capitalist, which would form a constant excess profit. But those who derive rent from monopoly are mistaken when they imagine that monopoly enables the landed proprietor to force the price of the commodity above its value. On the contrary, it makes it possible to maintain the value of the commodity above its average price; to sell the commodity not above, but at its value.” (p 94) 

Marx sees this as an advance over the position of Ricardo, who saw no economic consequence of land ownership, and explained rent only in terms of Differential Rent, denying the possibility of Absolute Rent. But, this begs a question for Marx too. If the lower organic composition in agriculture is only a “historical difference”, which may disappear, along with it disappears the economic basis of absolute rent. But, there is no more reason that the monopoly owner of land will sell its use value to a capitalist farmer for free than there is that the owner of money-capital will sell its use value to the industrial capitalist for free.

But, Marx has shown that both rent and interest are not additional costs that increase the price of commodities, but are, thereby, deductions from surplus value. If surplus profit disappears in agriculture, so that agricultural products sell at their price of production, then the payment of rent must reduce the profit of enterprise of the capitalist farmer below the average, just as any payment of interest by an industrial capitalist pushes their profit of enterprise below the average.

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