Tuesday, 9 October 2018

Theories of Surplus Value, Part II, Chapter 18 - Part 12

Even as the value of that material itself falls, Marx argues, the physical mass of it, relative to the mass of labour, rises at a faster rate than the fall in its unit value, so that, although it does not rise as fast as the rise in the technical composition of capital, the organic composition of capital itself does still rise. Moreover, in addition to this, the process involves a continual increase in the fixed capital stock itself. More and more machines get employed, as they replace hand tools. As the population rises, more machines are now introduced, rather than more hand tools, for these additional workers to work with. 

Again, this is a contradictory process. On the one hand, as more machines are introduced, a greater quantity of value, in the shape of wear and tear, is absolutely transferred to the value of output. However, because the machine significantly increases the volume of output, the amount of value attributable to wear and tear of fixed capital, as a proportion of the value of output continually falls, whilst the proportion attributable to the value of materials continually rises. In addition, continual improvements in technology means that the efficiency and productivity of machines continually increases. If machine A has a value of £100, and 10 such machines are in production, each processing 100 kilos of cotton with a value of £1,000, into yarn, the fixed capital is £1,000, the material is £10,000, and the value is £11,000, with fixed capital constituting 9.09%. If machine B is introduced, with a value of £100, but is capable of processing 200 kilos of cotton, then 5 such machines will now replace 10 of machine A. Now fixed capital is only £500, with material still £10,000, and value falls to £10,500, with fixed capital now constituting only around 5%. Not only does this affect the value transferred to output of these new B machines, but it means a moral depreciation of all the remaining A machine fixed capital stock. 

And, besides this, the improvement in technology and resultant rise in productivity also reduces the value of machines, because less labour-time is required for their production. And, this also affects the durability of the fixed capital. It is likely to have a longer lifespan, so that a smaller proportion of its value is transferred to output, as wear and tear. 

So, again, a contradictory process takes place. To raise productivity, more machines are introduced. By raising productivity, a smaller proportion of fixed capital value is transferred to the value of output, relative to the value of material. A greater absolute value of fixed capital (wear and tear) is transferred to the value of output, but the value of output rises at a faster pace, so that the relative value of fixed capital (wear and tear) transferred to the value of output continually falls, as Marx sets out in Capital III, Chapter 6. The rise in productivity itself reduces the value of machines, and other fixed capital, so that even as the quantity of fixed capital expands, the value of that fixed capital expands at a slower pace, and that also, thereby, reduces the portion of value of fixed capital transferred to the value of total output. 

Finally, the very improvements in technology that bring about the rise in productivity also mean that one new machine replaces several older machines. If the level of output were held constant, the physical quantity and the value of the fixed capital stock would thereby continually fall. But total output does not remain constant. It grows at an accelerating pace. Consequently, the fixed capital stock grows in physical quantity, and in total value, but, as with labour, its share as a proportion of the total output value, continually falls

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