Surplus Value

Definition

Surplus value is a central concept in Marxist economic theory that refers to the difference between the value created by a worker's labor and the wages they are paid. It is the amount of value that the capitalist extracts from the worker and appropriates for their own profit.

5 Must Know Facts For Your Next Test

1. Surplus value is the foundation of the Marxist critique of capitalism, as it demonstrates how the capitalist class extracts value from the working class for their own profit.
2. Marx argued that the capitalist's ability to pay workers less than the full value of their labor is the source of their profits and the driving force behind the accumulation of capital.
3. The extraction of surplus value is what allows the capitalist class to grow wealthy at the expense of the working class, leading to the inherent class conflict in capitalist society.
4. Surplus value is realized when the capitalist sells the commodities produced by the worker for more than the cost of production, including the wages paid to the worker.
5. Marxists believe that the only way to eliminate the exploitation of workers is to abolish the private ownership of the means of production and establish a socialist or communist system.

Review Questions

• Explain how the concept of surplus value is central to the Marxist critique of capitalism.
  • According to Marx, the concept of surplus value is central to the Marxist critique of capitalism because it demonstrates how the capitalist class extracts value from the labor of the working class for their own profit. The capitalist pays workers less than the full value of their labor, appropriating the surplus value for themselves. This exploitation of workers is the foundation of the capitalist system and the source of the inherent class conflict between the bourgeoisie and the proletariat. Marxists argue that the only way to eliminate this exploitation is to abolish private ownership of the means of production and establish a socialist or communist system.
• Describe the relationship between the labor theory of value and the concept of surplus value.
  • The labor theory of value, a key tenet of Marxist economic theory, states that the value of a commodity is determined by the amount of socially necessary labor time required to produce it. This theory is closely linked to the concept of surplus value, as it is the basis for Marx's argument that workers are not paid the full value of their labor. The capitalist is able to pay workers less than the full value of their labor and appropriate the surplus value for themselves, leading to the exploitation of the working class. The connection between the labor theory of value and surplus value is central to the Marxist critique of the capitalist system and its inherent class conflict.
• Analyze how the Marxist concept of surplus value relates to the broader philosophical framework of dialectical materialism.
  • The Marxist concept of surplus value is closely tied to the broader philosophical framework of dialectical materialism, which views social and historical change as the result of the conflict between opposing material forces. The exploitation of workers through the extraction of surplus value is seen as a fundamental contradiction within the capitalist system, one that will inevitably lead to its downfall. Dialectical materialism posits that this class conflict between the bourgeoisie and the proletariat, driven by the capitalist's appropriation of surplus value, will ultimately be resolved through a socialist revolution that abolishes private ownership of the means of production. In this way, the concept of surplus value is not just an economic critique, but a key component of the Marxist dialectical materialist analysis of the inherent contradictions and historical development of capitalist society.

Related terms

Labor Theory of Value: The Marxist theory that the value of a commodity is determined by the amount of socially necessary labor time required to produce it.

Exploitation: The act of utilizing someone's labor without fair compensation, as the capitalist does by appropriating surplus value from the worker.

Dialectical Materialism: The Marxist philosophical framework that views social and historical change as the result of the conflict between opposing material forces.