The total value of commodities can rise for two basic reasons. Firstly, more commodities, in total are produced, with more labour, thereby, being expended. In other words, assuming no change in productivity, there is just an increase, in total, of the amount of labour employed, in the production of this greater mass of commodities. Unit values of those commodities remain constant. Secondly, the total number of commodities produced may remain constant, but a fall in social productivity means that each one of them, on average, requires more labour for its production. In that case, the average unit value of commodities rises. Put another way, if productivity falls, but the amount of social labour-time remains constant, fewer commodities are produced, and the unit value of each rises. A combination of these two causes may also occur.
In both cases the total amount of social labour-time expands, but in the first, there is no change in unit values, whereas, in the second, unit values rise.
What is the consequence of this in relation to money and prices. Money is the equivalent form of value. It is another way of expressing the total value of commodities, indirectly, or put another way is the monetary expression of total social labour-time. Because the total value of commodities rises, i.e. total social labour-time rises, the total value of money also rises. But, money, initially takes the form, itself, of a commodity, for example, cattle, and later gold. It is as a quantity of this money commodity that the values of all other commodities are expressed as prices, for example, the value of 100 litres of wine may be expressed as equal to one head of cattle. Price is just the same as exchange-value, but exchange-value in relation to a specific money commodity. If 100 litres of wine has a value of 1,000 hours of labour, and one head of cattle has a value of 1,000 hours of labour, it is this equality of value that is expressed in their quantitative relation to each other.
If gold is the money commodity, this same 1,000 hours of labour may be equal to 1 gram of gold, and it is then this 1 gram of gold, which represents the money price of the 100 litres of wine. But, gold, like cattle or wine, is itself a commodity, and its own value changes, as social productivity changes. So, a change in social productivity that causes unit values of commodities, in general, to rise, may cause the value of gold, also, to rise.
Suppose the total value of commodities is equal to 1 million hours of labour, in which case, here, its equivalent, in money, is 1,000 grams of gold. If, 10,000 commodities are produced, the average unit value of each is 100 hours of labour, and the average price is equal to 0.10 grams of gold. If social productivity falls, so that these 10,000 commodities, now, require 1.1 million hours of labour to produce, total value rises. However, ceteris paribus, the value of gold would also rise, now, requiring 1,100 hours of labour to produce a gram. So, the relation between gold and other commodities would remain unchanged. The 10,000 commodities would still be represented by 1,000 grams of gold, and the average unit price of a commodity would remain 0.10 grams of gold. This is the simplest illustration that an increase in unit value is not the same thing as an increase in unit price.
However, if social productivity remains constant, and the total value of commodities/social labour-time rises, simply because more labour is employed, and more commodities are produced, the total value of money will also rise in proportion, but will, also, now be represented by an increased quantity of the money commodity. In other words, if 11,000 commodities are produced, with an average unit value of still 100 hours of labour, the total value of money also rises to 1.1 million hours of social labour-time, and is represented by 1,100 grams of gold. In that case, unit values and prices remain constant, whilst the total of prices and values rises to 1.1 million hours of labour, and 1,100 grams of gold respectively. If the 1 gram of gold is given the name £1, then the average unit price is £0.10, and the total of prices is £1,100.
But, as Marx sets out, in the above work, although this physical quantity of the money commodity, starts off as the basis of the standard of prices, over time, the name of the standard of prices remains the same, but what it comprises continually changes. A Pound might begin as being equal to 1 gram of gold, but, as seen above, if the value of gold changes, then the amount of social labour-time represented by a gram of gold changes along with it. The money commodity is the only commodity whose own value and changes in that value, affects the prices of all other commodities. So, when new gold discoveries occurred, which meant that the value of gold fell, the effect was to cause the prices of all other commodities to rise relative to it. Each gram of gold represented less social labour-time, and so, also, more gold currency had to be thrown into circulation.
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