Surplus Value
Marx's concept that workers produce more value in a working day than they receive as wages, the difference, appropriated by capitalists as profit, being the structural mechanism of exploitation in capitalism.
Surplus value is the core of Marx's critique of capitalism. The argument: a worker hired to produce $200 worth of goods in a day is paid $100 in wages. The remaining $100, the surplus value, is appropriated by the capitalist as profit. This is not fraud; it is the structural logic of capitalist production.
The labor theory of value (inherited from Ricardo and Smith) holds that the value of a commodity is determined by the labor required to produce it. If that's true, then the entire value of production belongs, morally, to labor. Capital contributes nothing, it is accumulated labor from previous exploitation. Profit is therefore not a legitimate return but unpaid labor extracted from workers.
Marx distinguished between use value (what a thing is actually worth to the person who uses it) and exchange value (what it fetches in the market). This distinction allows him to show how capitalism systematically privileges exchange value over use value, creating the perverse situation where things that have high use value (water) may have low exchange value, while things with low use value (diamonds) may have high exchange value.
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Frequently asked questions
What is Marx's surplus value? ＋
Workers produce more value in a day than they receive as wages; the difference, surplus value, is appropriated by capitalists as profit. This is not individual greed but the structural logic of capitalist production that makes exploitation systemic.
What is the difference between use value and exchange value? ＋
Use value is a thing's practical utility to the user (water is high use value); exchange value is its price in the market (water is low exchange value). Marx argues capitalism systematically distorts reality by making exchange value the only measure of worth.