Introduction
Capitalism is just one stage in the natural evolution of economic systems. Marx asserts that every society is divided into social classes, with members of one having more in common with members of the other. The value of commodities is determined by economic laws, as shown by the social link between wages and prices. Profits lost as a result of wage increases cannot be recovered only by increasing prices. As a consequence, profit is defined as the surplus value generated by labor above and beyond the amount needed for reproduction, as represented by wages and their buying power, such as the price of commodities, which is at the heart of this argument, particularly necessities (Lebowitz, 2016). This paper will show how Marx argues on Value, Price, and Profit under capitalism perspectives. Therefore, this paper depicts that Marx argues that the maximum profit is limited because of the actual remuneration that workers get and a workday physical maximum.
The Relationship between Wages and Labor Power
Labour power is a one-of-a-kind commodity since it is a characteristic of a living person. They would be slaves in this state, since slaves do not own themself. According to Lebowitz (2016), labour-power is the sum of a person’s mental and physical skills, which he employs anytime he creates anything of worth. Sweezy (2017) continues to argue that it is only through work does labour-power becomes a reality; only through effort does labour-power become a reality. Consequently, muscle, nerve, and brain are all gone and must be restored through an act of payment known as wage. Labour power may only be sold for a limited period by legally recognized individuals who can freely sell it and participate in labor contracts. The sale of labour-power is banned if the proprietors are not legally recognized as legal entities (Lebowitz, 2016). Once it has been actualized and wasted via work, it must be replenished and restored.
Marx’s Theory of How Profit, or Surplus-Value, is Generated
Marxian economics spells that the surplus value is calculated by subtracting materials, equipment, and labour costs from sales proceeds. According to Sweezy (2017), surplus value is the value produced by workers over and above their labour costs, from which the capitalist benefits when goods are sold. When economic surpluses are transformed and represented in money, wealth growth becomes possible on a more significant and larger scale (Lebowitz, 2016). Throughout that period, he or she does actual work, producing goods and services. Capitalists may sell these goods and services and profit from the gap between their wages and their value. Therefore, profits and surplus value are generated by creating value to solve a specific economic market gap.
How the Length of the Working Day Determines the Amount of Profit Generated
The length of a working day is the primary determinant of profits to be generated. As a consequence, Marx had to assume that all enterprises exploit surplus value equally. This implies that work hours must be consistent regardless of where this rate of exploitation occurs. It is self-evident that the absolute surplus-value cannot grow forever. All employees have a finite capacity for labour (Sweezy, 2017). However, destroying labour-power via excessive labour is incompatible with the maximization of exploitation. According to Lebowitz (2016), nearly all adult male workers favoured creating a legal limit on working hours, as had previously been done for women and children. The ambitions ran against employers’ attempts to maximize hours worked and, therefore, excess value. Reduced exploitation should be in the workers’ best interests.
Conclusion
Capitalism has transformed labour into a marketable commodity. Workers attempt to sell their labour to employers in exchange for a wage or payment. Success in this trade – the only alternative being unemployed – requires a period of submission to the capitalist’s control. In the nineteenth century, the enormous growth in wealth and population due to workers’ competitive attempts to maximize their surplus value resulted in an equal increase in productivity and capital resources. Additionally, “profit” is the amount remaining after paying the worker for his or her job and subtracting a certain percentage from the total amount. The more people sell their labour, the more value is generated, so as the profits. Therefore, the maximum profit is limited because of the physical minimum of wages and the physical maximum of the working day.
References
Lebowitz, M. A. (2016). Marx’s conceptualization of value in capital. Beyond Capital: Marx’s political economy of the working class. Oxford Publishers.
Sweezy, P. M. (2017). Value, price, and profit. Theory of capitalist development: Principles of Marxian political economy. Amazon publishing services.