Karl Marx/Capital1/Part2

This is a resource about the second part of the first volume of Capital by Karl Marx, entitled "The Transformation of Money into Capital".

This part holds three chapters:

• Chapter 4: The General Formula for Capital
• Chapter 5: Contradictions in the General Formula
• Chapter 6: The Sale and Purchase of Labour-Power

This part follows the first part of the first volume of Capital, in which Marx treated Commodities, Exchange and Money. The book started with a model of exchange based on barter of commodities. It is important to note, that at the time when Marx wrote his work, anyone was familiar with the (Ricardian) labour theory of value. Marx does not spend many words proving its correctness. So he simply assumes that exchange is based on the socially necessary labour time. Marx moves from this C-C relation to the form of exchange, mediated by money, C-M-C. Finally the M-C-M circulation is explained: money becoming the aim and object of exchange.

It is easy to understand that M-C-M only makes sense if it results in an increment of value: M-C-M+ΔM. The increment of value is called surplus-value, and the problem is of course, where surplus-value comes from, if the M-C and C-M transactions are exchanges of equivalents. Only if a commodity can be found, that has the capacity to produce more value than it itself has, the mystery can be unveiled. "This is the broad transitional story told in these three chapters. The focus begins to shift form commodity exchange to capital circulation."

Sources

• Harvey, David (2010). A Companion to Marx's Capital. London / New York: Verso. ISBN 978 1 84467 359 9.