The Degree Of Exploitation Under Capitalism

The absolute amount of surplus value realized by the capitalist employer represents his absolute exploitation or robbery of the worker. Marx sought the most accurate way of expressing surplus value as a percentage so that the degree of exploitation of the worker could be calculated in individual instances as well as in society as a whole.

Although the details of these calculations are not essential to an understanding of the theory of surplus value, it is interesting to note that marx felt that the customary way of expressing profits as a percentae of all the funds owned by the capitalist was very misleading and yielded an understatement of the degree of exploitation.

Marx divides the capital used in production into two parts. One consists of all funds going into the purchase of fixed equipment and raw materials, the other of funds used as wages to pay for labor power.

The former he calls constant capital and the latter variable capital. He then argues that the only fair way to compute the percentage of surplus value realized is to compare it with the amount of variable capital. This relationship, he holds, qill represent the real degree of exploitation of labor by the capitalist employer because it is this which shows you the real ratio between paid and unpaid labor.