Surplus labour

Surplus labor () is a concept used by Karl Marx in his critique of political economy. It means labor performed in excess of the labor necessary to produce the means of livelihood of the worker ("necessary labor"). The "surplus" in this context means the ''additional'' labor a worker has to do in their job, beyond earning their own keep. According to Marxian economics, surplus labor is usually uncompensated (unpaid) labor. Marx's first analysis of what surplus labor means appeared in ''The Poverty of Philosophy'' (1847), a polemic against the philosophy of Pierre-Joseph Proudhon. A much more detailed analysis is presented in the volumes of '' Theories of Surplus Value'' and ''Das Kapital''.

Origin

Marx explains the origin of surplus labor in the following terms:

The historical emergence of surplus labor is, according to Marx, also closely associated with the growth of trade (the economic exchange of goods and services) and with the emergence of a society divided into social classes. As soon as a permanent surplus product can be produced, the moral-political question arises as to how it should be distributed, and for whose benefit surplus-labor should be performed. The strong defeat the weak, and it becomes possible for a social elite and its army to gain control over the surplus-labor and surplus product of the working population; they can live off the labor of others.

Labor which is sufficiently productive so that it can perform surplus labor is, in a cash economy, the material foundation for the appropriation of surplus-value from that labor. How exactly this appropriation will occur, is determined by the prevailing relations of production and the balance of power between social classes.

According to Marx, capital had its origin in the commercial activity of ''buying in order to sell'' and ''rents'' of various types, with the aim of gaining an income (a surplus value) from this trade. But, initially, this does not involve any capitalist mode of production; rather, merchant traders, state functionaries, religious authorities and rentiers are ''intermediaries'' between non-capitalist producers. During a lengthy historical process, the old ways of extracting surplus labor are gradually replaced by ''commercial'' forms of exploitation and private industrial enterprises.

Historical materialism

In Das Kapital Vol. 3, Marx highlights the central role played by surplus labor:

This statement is a foundation of Marx's historical materialism insofar as it specifies what the class conflicts in civil society are ultimately about: an economy of time, which compels some to do work of which part or all of the benefits go to someone else, while others can have leisure-time which in reality depends on the work efforts of those forced to work.

In modern society, having work or leisure may often seem a choice, but for most of humanity, work is an absolute necessity, and consequently most people are concerned with the real benefits they get from that work. They may accept a certain rate of exploitation of their labor as an inescapable condition for their existence, if they depend on a wage or salary, but beyond that, they will increasingly resist it. Consequently, a morality or legal norm develops in civil society which imposes ''limits'' for surplus-labor, in one form or another. Forced labor, slavery, gross mistreatment of workers etc. are no longer generally acceptable, although they continue to occur; working conditions and pay levels can usually be contested in courts of law.

Unequal exchange

Marx acknowledged that surplus labor may not just be appropriated directly in ''production'' by the owners of the enterprise, but also in ''trade''. This phenomenon is nowadays called unequal exchange. Thus, he commented that:

In this case, more work effectively exchanges for less work, and a greater value exchanges for a lesser value, because some possess a stronger market position, and others a weaker one. For the most part, Marx assumed equal exchange in Das Kapital, i.e. that supply and demand would balance; his argument was that even if, ideally speaking, no unequal exchange occurred in trade, and market equality existed, exploitation could nevertheless occur within capitalist relations of production, since the value of the ''product'' produced by labor power exceeded the value of labor power itself. Marx never completed his analysis of the world market however.

In the real world, Marxian economists like Samir Amin argue, unequal exchange occurs all the time, implying ''transfers'' of value from one place to another, through the trading process. Thus, the more trade becomes "globalised", the greater the ''intermediation'' between producers and consumers; consequently, the intermediaries appropriate a growing fraction of the final value of the products, while the direct producers obtain only a small fraction of that final value.

The most important unequal exchange in the world economy nowadays concerns the exchange between agricultural goods and industrial goods, i.e. the terms of trade favour industrial goods against agricultural goods. Often, as Raul Prebisch already noted, this has meant that more and more agricultural output must be produced and sold, to buy a given amount of industrial goods. This issue has become the subject of heated controversy at recent WTO meetings.

The practice of unequal or unfair exchange does not presuppose the capitalist mode of production, nor even the existence of money. It only presupposes that goods and services of unequal value are traded, something which has been possible throughout the whole history of human trading practices.

Criticism of Marx's concept of surplus labor

According to economist Fred Moseley, "neoclassical economic theory was developed, in part, to attack the very notion of surplus labor or surplus value and to argue that workers receive all of the value embodied in their creative efforts."

Some basic modern criticisms of Marx's theory can be found in the works by Pearson, Dalton, Boss, Hodgson and Harris (see references).

The analytical Marxist John Roemer challenges what he calls the "fundamental Marxian theorem" (after Michio Morishima) that the existence of surplus labor is the necessary and sufficient condition for profits. He proves that this theorem is logically false. However, Marx himself never argued that surplus labor was a ''sufficient'' condition for profits, only an ultimate ''necessary'' condition (Morishima aimed to prove that, starting from the existence of profit expressed in price terms, we can deduce the existence of surplus value as a logical consequence). Five reasons were that:

*profit in a capitalist operation was "ultimately" just a financial claim to products and labor services made by those who did not themselves produce those products and services, in virtue of their ownership of private property (capital assets).
*profits could be made purely in trading processes, which themselves could be far removed in space and time from the co-operative labor which those profits ultimately presupposed.
*surplus labor could be performed, without this leading to any profits at all, because e.g. the products of that labor failed to be sold.
*profits could be made without ''any'' labor being involved, such as when a piece of unimproved land is sold for a profit.
*profits could be made by a self-employed operator who did not perform surplus labor for somebody else, nor necessarily appropriated surplus labor from anywhere else.

All that Marx really argued was that surplus labor was a ''necessary feature'' of the capitalist mode of production as a general social condition. If that surplus labor did not exist, other people could not ''appropriate'' that surplus labor or its products simply through their ownership of property.

Also, the amount of unpaid, voluntary and housework labor performed outside the world of business and industry, as revealed by time use surveys, suggests to some feminists (e.g. Marilyn Waring and Maria Mies) that Marxists may have overrated the importance of industrial surplus labor performed by salaried employees, because the very ability to perform that surplus-labor, i.e. the continual reproduction of labor power depends on all kinds of supports involving unremunerated work (for a theoretical discussion, see the reader by Bonnie Fox). In other words, work performed in households—often by those who do not sell their labor power to capitalist enterprises at all—contributes to the sustenance of capitalist workers who may perform little household labor.

Possibly the controversy about the concept is distorted by the enormous differences with regard to the world of work:

*in Europe, the United States, Japan and Australasia,
*the newly industrialising countries, and
*the poor countries.

Countries differ greatly with respect to the way they organise and share out work, labor participation rates, and paid hours worked per year, as can be easily verified from ILO data (see also Rubery & Grimshaw's text). The general trend in the world division of labor is for hi-tech, financial and marketing services to be located in the richer countries, which hold most intellectual property rights and actual physical production to be located in low-wage countries. Effectively, Marxian economists argue, this means that the labor of workers in wealthy countries is valued higher than the labor of workers in poorer countries. However, they predict that in the long run of history, the operation of the law of value will tend to equalize the conditions of production and sales in different parts of the world.

See also

* Abstract labor and concrete labor
*Capital accumulation
* Capitalist mode of production
*Economic surplus
* labor power
*labor theory of value
* Productive and unproductive labor
* Reserve army of labor
*Spatial mismatch
* Surplus product
*Surplus value

Notes

References

''Capital'', Volume I
* ttp://www.marxists.org/archive/marx/works/1894-c3/ch47.htm ''Capital'', Volume III*Karl Marx, "The character of surplus labor

*George Dalton (February 1961). "Economic theory and Urgesellschaft, primitive society". ''American Anthropologist'', LXIII, no. 1, 1–25.
*
*Emmanuel D. Farjoun, Moshé Machover and David Zachariah, ''How Labor Powers the Global Economy: A Labor Theory of Capitalism''. Cham, Switzerland: Springer, 2022.
*
*
*Marvin Harris, Cultural Materialism: The Struggle for a Science of Culture. Random House 1979.
*Geoffrey Hodgson, Capitalism, Value and Exploitation (Martin Robertson, Oxford, 1982).
*Ernest Mandel, Marxist Economic Theory, Vol. 1. London: Merlin Press, 1968.
*Karl Marx, Das Kapital.
*Bonnie Fox (ed.), Hidden in the Household: Women's Domestic labor Under Capitalism, Women's Press, 1980.
*Stephen A. Resnick and Richard D. Wolff, Knowledge and Class: A Marxian Critique of Political Economy (University of Chicago Press, Chicago, 1987).
*Jill Rubery and Damian Grimshaw, The Organization of Employment; An International Perspective. Palgrave Macmillan, 2003.
* Fred Moseley paper

*Harry W. Pearson, "The economy has no surplus" in "Trade and market in the early empires. Economies in history and theory", edited by Karl Polanyi, Conrad M. Arensberg and Harry W. Pearson (New York/London: The Free Press: Collier-Macmillan, 1957).
*John Roemer, ''Analytical foundations of Marxian Economic Theory''. Cambridge University Press, 1981.

{{Marxist & Communist phraseology

Labour economics
Marxian economics