The Capital A Critique of Political Economy [1867]

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Preface to the
First German Edition

The work, the first volume of which I now submit to the public, forms the continuation of my Zur Kritik der Politischen Oekonomie (A Contribution to the Criticism of Political Economy) published in 1859. The long pause between the first part and the continuation is due to an illness of many years’ duration that again and again interrupted my work.

The substance of that earlier work is summarised in the first three chapters of this volume. This is done not merely for the sake of connexion and completeness. The presentation of the subject matter is improved. As far as circumstances in any way permit, many points only hinted at in the earlier book are here worked out more fully, whilst, conversely, points worked out fully there are only touched upon in this volume. The sections on the history of the theories of value and of money are now, of course, left out altogether. The reader of the earlier work will find, however, in the notes to the first chapter additional sources of reference relative to the history of those theories.

Every beginning is difficult, holds in all sciences. To understand the first chapter, especially the section that contains the analysis of commodities, will, therefore, present the greatest difficulty. That which concerns more especially the analysis of the substance of value and the magnitude of value, I have, as much as it was possible, popularised. [1] The value-form, whose fully developed shape is the money-form, is very elementary and simple. Nevertheless, the human mind has for more than 2,000 years sought in vain to get to the bottom of it all, whilst on the other hand, to the successful analysis of much more composite and complex forms, there has been at least an approximation. Why? Because the body, as an organic whole, is more easy of study than are the cells of that body. In the analysis of economic forms, moreover, neither microscopes nor chemical reagents are of use. The force of abstraction must replace both. But in bourgeois society, the commodity-form of the product of labour — or value-form of the commodity — is the economic cell-form. To the superficial observer, the analysis of these forms seems to turn upon minutiae. It does in fact deal with minutiae, but they are of the same order as those dealt with in microscopic anatomy.

With the exception of the section on value-form, therefore, this volume cannot stand accused on the score of difficulty. I presuppose, of course, a reader who is willing to learn something new and therefore to think for himself.

The physicist either observes physical phenomena where they occur in their most typical form and most free from disturbing influence, or, wherever possible, he makes experiments under conditions that assure the occurrence of the phenomenon in its normality. In this work I have to examine the capitalist mode of production, and the conditions of production and exchange corresponding to that mode. Up to the present time, their classic ground is England. That is the reason why England is used as the chief illustration in the development of my theoretical ideas. If, however, the German reader shrugs his shoulders at the condition of the English industrial and agricultural labourers, or in optimist fashion comforts himself with the thought that in Germany things are not nearly so bad; I must plainly tell him, “De te fabula narratur!” [It is of you that the story is told. – Horace]

Intrinsically, it is not a question of the higher or lower degree of development of the social antagonisms that result from the natural laws of capitalist production. It is a question of these laws themselves, of these tendencies working with iron necessity towards inevitable results. The country that is more developed industrially only shows, to the less developed, the image of its own future.

But apart from this. Where capitalist production is fully naturalised among the Germans (for instance, in the factories proper) the condition of things is much worse than in England, because the counterpoise of the Factory Acts is wanting. In all other spheres, we, like all the rest of Continental Western Europe, suffer not only from the development of capitalist production, but also from the incompleteness of that development. Alongside the modern evils, a whole series of inherited evils oppress us, arising from the passive survival of antiquated modes of production, with their inevitable train of social and political anachronisms. We suffer not only from the living, but from the dead. Le mort saisit le vif! [The dead holds the living in his grasp. – formula of French common law]

The social statistics of Germany and the rest of Continental Western Europe are, in comparison with those of England, wretchedly compiled. But they raise the veil just enough to let us catch a glimpse of the Medusa head behind it. We should be appalled at the state of things at home, if, as in England, our governments and parliaments appointed periodically commissions of inquiry into economic conditions; if these commissions were armed with the same plenary powers to get at the truth; if it was possible to find for this purpose men as competent, as free from partisanship and respect of persons as are the English factory-inspectors, her medical reporters on public health, her commissioners of inquiry into the exploitation of women and children, into housing and food. Perseus wore a magic cap down over his eyes and ears as a make-believe that there are no monsters.

Let us not deceive ourselves on this. As in the 18th century, the American war of independence sounded the tocsin for the European middle class, so that in the 19th century, the American Civil War sounded it for the European working class. In England the process of social disintegration is palpable. When it has reached a certain point, it must react on the Continent. There it will take a form more brutal or more humane, according to the degree of development of the working class itself. Apart from higher motives, therefore, their own most important interests dictate to the classes that are for the nonce the ruling ones, the removal of all legally removable hindrances to the free development of the working class. For this reason, as well as others, I have given so large a space in this volume to the history, the details, and the results of English factory legislation. One nation can and should learn from others. And even when a society has got upon the right track for the discovery of the natural laws of its movement — and it is the ultimate aim of this work, to lay bare the economic law of motion of modern society — it can neither clear by bold leaps, nor remove by legal enactments, the obstacles offered by the successive phases of its normal development. But it can shorten and lessen the birth-pangs.

To prevent possible misunderstanding, a word. I paint the capitalist and the landlord in no sense couleur de rose [i.e., seen through rose-tinted glasses]. But here individuals are dealt with only in so far as they are the personifications of economic categories, embodiments of particular class-relations and class-interests. My standpoint, from which the evolution of the economic formation of society is viewed as a process of natural history, can less than any other make the individual responsible for relations whose creature he socially remains, however much he may subjectively raise himself above them.

In the domain of Political Economy, free scientific inquiry meets not merely the same enemies as in all other domains. The peculiar nature of the materials it deals with, summons as foes into the field of battle the most violent, mean and malignant passions of the human breast, the Furies of private interest. The English Established Church, e.g., will more readily pardon an attack on 38 of its 39 articles than on 1/39 of its income. Now-a-days atheism is culpa levis [a relatively slight sin, c.f. mortal sin], as compared with criticism of existing property relations. Nevertheless, there is an unmistakable advance. I refer, e.g., to the Blue book published within the last few weeks: “Correspondence with Her Majesty’s Missions Abroad, regarding Industrial Questions and Trades’ Unions.” The representatives of the English Crown in foreign countries there declare in so many words that in Germany, in France, to be brief, in all the civilised states of the European Continent, radical change in the existing relations between capital and labour is as evident and inevitable as in England. At the same time, on the other side of the Atlantic Ocean, Mr. Wade, vice-president of the United States, declared in public meetings that, after the abolition of slavery, a radical change of the relations of capital and of property in land is next upon the order of the day. These are signs of the times, not to be hidden by purple mantles or black cassocks. They do not signify that tomorrow a miracle will happen. They show that, within the ruling classes themselves, a foreboding is dawning, that the present society is no solid crystal, but an organism capable of change, and is constantly changing.

The second volume of this book will treat of the process of the circulation of capital (Book II.), and of the varied forms assumed by capital in the course of its development (Book III.), the third and last volume (Book IV.), the history of the theory.

Every opinion based on scientific criticism I welcome. As to prejudices of so-called public opinion, to which I have never made concessions, now as aforetime the maxim of the great Florentine is mine:

“Segui il tuo corso, e lascia dir le genti.”
[Follow your own course, and let people talk – paraphrased from Dante]

Karl Marx
July 25, 1867

Table of Contents

Prefaces and Afterwords

Volume I
Book One: The Process of Production of Capital

Part I: Commodities and Money

Ch. 1: Commodities
Ch. 1 as per First German Edition
Ch. 2: Exchange
Ch. 3: Money, or the Circulation of Commodities

Part II: The Transformation of Money into Capital

Ch. 4: The General Formula for Capital
Ch. 5: Contradictions in the General Formula of Capital
Ch. 6: The Buying and Selling of Labour-Power

Part III: The Production of Absolute Surplus-Value

Ch. 7: The Labour-Process and the Process of Producing Surplus-Value
Ch. 8: Constant Capital and Variable Capital
Ch. 9: The Rate of Surplus-Value
Ch. 10: The Working-Day
Ch. 11: Rate and Mass of Surplus-Value

Part IV: Production of Relative Surplus Value

Ch. 12: The Concept of Relative Surplus-Value
Ch. 13: Co-operation
Ch. 14: Division of Labour and Manufacture
Ch. 15: Machinery and Modern Industry

Part V: The Production of Absolute and of Relative Surplus-Value

Ch. 16: Absolute and Relative Surplus-Value
Ch. 17: Changes of Magnitude in the Price of Labour-Power and in Surplus-Value
Ch. 18: Various Formula for the Rate of Surplus-Value

Part VI: Wages

Ch. 19: The Transformation of the Value (and Respective Price) of Labour-Power into Wages
Ch. 20: Time-Wages
Ch. 21: Piece-Wages
Ch. 22: National Differences of Wages


Part VII: The Accumulation of Capital

Ch. 23: Simple Reproduction
Ch. 24: Conversion of Surplus-Value into Capital
Ch. 25: The General Law of Capitalist Accumulation

Part VIII: Primitive Accumulation

Ch. 26: The Secret of Primitive Accumulation
Ch. 27: Expropriation of the Agricultural Population from the Land
Ch. 28: Bloody Legislation against the Expropriated, from the End of the 15th Century. Forcing down of Wages by Acts of Parliament
Ch. 29: Genesis of the Capitalist Farmer
Ch. 30: Reaction of the Agricultural Revolution on Industry. Creation of the Home-Market for Industrial Capital
Ch. 31: Genesis of the Industrial Capitalist
Ch. 32: Historical Tendency of Capitalist Accumulation
Ch. 33: The Modern Theory of Colonisation



Book II: The Process of Circulation of Capital

Part One:
The Metamorphoses of Capital and their Circuits

Chapter 1: The Circuit of Money-Capital

1. First Stage. M-C
2. Second Stage. Function of Productive Capital
3. Third Stage. C’-M’
4. The Circuit as a Whole

Chapter 2: The Circuit of Productive Capital

1. Simple Reproduction
2. Accumulation and Reproduction on an Extended Scale
3. Accumulation of Money
4. Reserve Fund

Chapter 3: The Circuit of Commodity-Capital

Chapter 4: The Three Formulas of the Circuit

Natural, Money and Credit Economy
The Meeting of Demand and Supply

Chapter 5: The Time of Circulation

Chapter 6: The Costs of Circulation

1. Genuine Costs of Circulation

(a) The Time of Of Purchase and Sale
(b) Book-keeping
(c) Money

2. Costs of Storage

(a) Formation of Supply in General
(b) The Commodity-Supply Proper

3. Costs of Transportation

Part Two:
The Turnover of Capital

Chapter 7: The Turnover Time and Number of Turnovers

Chapter 8: Fixed Capital and Circulating Capital

1. Distinctions of Form
2. Components, Replacement, Repair and Accumulation of the Fixed Capital

Chapter 9: The Aggregate Turnover of the Capital Advanced. Cycles of Turnover

Chapter 10: Theories of Fixed and Circulating Capital
The Physiocrats and Adam Smith

Chapter 11: Theories of Fixed and Circulating Capital. Ricardo

Chapter 12: The Working Period

Chapter 13: The Time of Production

Chapter 14: The Time of Circulation

Chapter 15: Effect of Turnover Time on Magnitude of Advanced Capital

1. The Working Period Equal to the Circulation Period
2. The Working Period Greater Than the Period of Circulation
3. The Working Period Smaller Than the Circulation Period
4. Conclusions
5. The Effect of Change of Prices

Chapter 16: The Turnover of Variable Capital

1. The Annual Rate of Surplus-Value
2. The Turnover of an Individual Variable Capital
3. The Turnover of Variable Capital from the Social Point of View

Chapter 17: The Circulation of Surplus-Value

1. Simple Reproduction
2. Accumulation and Reproduction on an Extended Scale

Part Three:
The Reproduction and Circulation of the Aggregate Social Capital

Chapter 18: Introduction

1. The Subject Investigated
2. The Role of Money-Capital

Chapter 19: Former Presentations of the Subject

1. The Physiocrats
2. Adam Smith

(a) Smith’s General Points of View
(b) Adam Smith Resolves Exchange-Value into v+s
(c) The Constant Part of Capital
(d) Capital and Revenue in Adam Smith
(e) Recapitulation

3. Later Economists

Chapter 20: Simple Reproduction (Part 1 of 4)

1. The Formulation of the Question
2. The Two Departments of Social Production
3. Exchange Between the Two Departments: I(v+s) against IIc
4. Exchange Within Department II. Necessities of Life and Articles of Luxury
5. The Mediation of the Exchange by the Circulation of Money

(Chapter 20: Simple Reproduction (Part 2 of 4))

6. The Constant Capital in Department I
7. Variable Capital and Surplus-Value in Both Departments
8. The Constant Capital in Both Departments
9. A Retrospect to Adam Smith, Storch and Ramsay
10. Capital and Revenue: Variable Capital and Wages

(Chapter 20: Simple Reproduction (Part 3 of 4))

11. Replacement of the Fixed Capital

(a) Replacement of the Wear and Tear Portion of the Value in the Form of Money
(b) Replacement of Fixed Capital in Kind
(c) Results

(Chapter 20: Simple Reproduction (Part 4 of 4))

12. The Reproduction of the Money Material
13. Destutt de Tracy’s Theory of Reproduction

Chapter 21: Accumulation and Reproduction on an Expanded Scale (part 1 of 2)

1. Accumulation in Department I

(a) The Formation of a Hoard
(b) The Additional Constant Capital
(c) The Additional Variable Capital

2. Accumulation in Department II

(Chapter 21: Accumulation and Reproduction on an Expanded Scale (part 2 of 2))

3. Schematic Presentation of Accumulation

(a) First Illustration
(b) Second Illustration
(c) Replacement of IIc, in Accumulation

4. Supplementary Remarks



The Process of Capitalist Production as a Whole

Part I
The Conversion of Surplus-Value into Profit and of
the Rate of Surplus-Value into the Rate of Profit

Ch. 1: Cost-Price and Profit
Ch. 2: The Rate of Profit
Ch. 3: The Relation of the Rate of Profit to the Rate of Surplus-Value
Ch. 4: The Effect of the Turnover on the Rate of Profit
Ch. 5: Economy in the Employment of Constant Capital
Ch. 6: The Effect of Price Fluctuations
Ch. 7: Supplementary Remarks

Part II
Conversion of Profit into Average Profit

Ch. 8: Different Compositions of Capitals in Different Branches of Production and Resulting Differences in Rates of Profit
Ch. 9: Formation of a General Rate of Profit (Average Rate of Profit) and Transformation of the Values of Commodities into Prices of Production
Ch. 10: Equalisation of the General Rate of Profit Through Competition. Market-Prices and Market-Values. Surplus-Profit.
Ch. 11: Effects of General Wage Fluctuations on Prices of Production
Ch. 12: Supplementary Remarks

Part III
The Law of the Tendency of the Rate of Profit to Fall

Ch. 13: The Law as Such
Ch. 14: Counteracting Influences
Ch. 15: Exposition of the Internal Contradictions of the Law

Part IV
Conversion of Commodity-Capital and Money-Capital into Commercial
Capital and Money-Dealing Capital (Merchant’s Capital)

Ch. 16: Commercial Capital
Ch. 17: Commercial Profit
Ch. 18: The Turnover of Merchant’s Capital
Ch. 19: Money-Dealing Capital
Ch. 20: Historical Facts about Merchant’s Capital

Part V
Division of Profit into Interest and Profit of Enterprise.
Interest-Bearing Capital.

Ch. 21: Interest-Bearing Capital
Ch. 22: Division of Profit. Rate of Interest. Natural Rate of Interest.
Ch. 23: Interest and Profit of Enterprise
Ch. 24: Externalisation of the Relations of Capital in the Form of Interest-Bearing Capital
Ch. 25: Credit and Fictitious Capital
Ch. 26: Accumulation of Money-Capital. Its Influence on the Interest Rate.
Ch. 27: The Role of Credit in Capitalist Production
Ch. 28: Medium of Circulation and Capital; Views of Tooke and Fullarton
Ch. 29: Component Parts of Bank Capital
Ch. 30: Money-Capital and Real Capital. I
Ch. 31: Money-Capital and Real Capital. II
Ch. 32: Money-Capital and Real Capital. III
Ch. 33: The Medium of Circulation in the Credit System
Ch. 34: The Currency Principle and the English Bank Legislation of 1844
Ch. 35: Precious Metal and Rate of Exchange
Ch. 36: Pre-Capitalist Relationships

Part VI
Transformation of Surplus-Profit into Ground-Rent

Ch. 37: Introduction
Ch. 38: Differential Rent: General Remarks
Ch. 39: First Form of Differential Rent (Differential Rent I)
Ch. 40: Second Form of Differential Rent (Differential Rent II)
Ch. 41: Differential Rent II — First Case: Constant Price of Production
Ch. 42: Differential Rent II — Second Case: Falling Price of Production
Ch. 43: Differential Rent II — Third Case: Rising Price of Production
Ch. 44: Differential Rent Also on the Worst Cultivated Soil
Ch. 45: Absolute Ground-Rent
Ch. 46: Building Site Rent. Rent in Mining. Price of Land.
Ch. 47: Genesis of Capitalist Ground-Rent

Part VII
Revenues and their Sources

Ch. 48: The Trinity Formula
Ch. 49: Concerning the Analysis of the Process of Production
Ch. 50: Illusions Created by Competition
Ch. 51: Distribution Relations and Production Relations
Ch. 52: Classes

Frederick Engels.
Supplement to Capital, Volume Three

A) Introduction
B) The Law of Value and Rate of Profit
C) The Stock Exchange


Source: Progress Publishers, Moscow 1956, translated by I. Lasker;

Re-edited by Tanmoy Bhattacharyya 2017