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This article is about the economic concept. For the book, see Capital, vol. 1 (1867).

Capital is any wealth, usually in the form of money, used for the purpose of producing more wealth.[1] The major difference between capital and money is the form of circulation. While money is commonly used for buying commodities for personal consumption (C-M-C),[a] capital is money used to generate more money (M-C-M').[2]

Capital as a Social Relation

As stated above, Capital is the dominate Means of production at this moment in Human history. This is conditional. A social relation, in particular, a bourgeois relation of production. Without those conditions and social relations, it is no longer Capital whatever it may be. Humans, as any and all animals do, perform work on their environments in the process of production. They also perform work on each-other, however. Human individuals, interacting with each other, are in reality performing work on each-other. We are, as individuals, a part of the environment of every other individual. Consider a lone hunter-gatherer during the paleolithic. It is extremely difficult for them to survive alone, and impossible for them to thrive. One hundred percent of the individual's time is taken so that they can sustain themself with food, find fresh and potable water, and live in shelter so they are not exposed to the ambient temperatures and conditions of their environment. They must make sure they do not expend more energy than they obtain from food. They must make sure the water they drink is not poisonous. They must, if they can not find any suitable shelter, fashion it from raw resources strictly by hand. Their life is wretched and short.

Yet, what if they were not alone?

Humans, capable of performing work together, are then capable of leading evermore fulfilling and comfortable lives. Now, whatever energy you would have expended sustaining yourself with food is instead expended among however many people exist in your community. Now, everyone can make sure that potable water is available, and they can help provide shelter too. This is, of course, only possible because you have entered into a social relationship with these people.

A social relation of production. A collective of individual forms, and it is within the comprising relationships that production in this advanced form may occur; permeable, however, as all things are the social relations of production, are altered, transformed, with the change and development of the material means of production. These relations of production have another name, moreover, and it is, to be as concise as possible: Society. A society at a definitive stage of development in the history of mankind. Most relevant, contemporarily, is the advance from Feudal Society, to Capitalist or Bourgeoisie society.

It is from this society that we derive Capital. We have come full-circle.

There is one more thing we need to explain when analyzing Capital. Exchange values. Capital invariably consists of commodities. You can not unsubjugate Capital from this condition, yet, commodities themselves are not invariably Capital. Why? Consider what makes a commodity Capital. Yet, first, a presupposition is needed. Capital is a social relation of production, and a Capitalist one, so we necessarily require a class which possesses nothing but the ability to work. We will call this the working class. We will also necessarily require a class which possesses everything, which they may lend to the working class to perform work with. We will call this the Capitalist class. We readily realize that this leads to a very special social relation of production - that of Capital, of its dominion and dominating presence over labor. Labor]] becomes subordinate to Capital, which accumulated through past labor, and exists now as a monolith that we have stamped with the character of Capital.

How then does a sum of commodities, of exchange values, become capital? If it preserves itself and multiplies by exchange with direct, living labor-power. Capital is defined by the need for living labor, subordinated to it, to be the means by which it can preserve and multiply the exchange values which comprise the commodities consisting of Capital. It is not, ultimately, concerned with accumulated labor serving living labor as a means for new production.

Lastly, we realize the form of capital may transform, while capital itself does not cease to exist. It does not become something else - it is always capital. Similarly, a commodity will always be a commodity, and only under certain conditions, certain social relations of production aforementioned does it become capital. Whether or not we exchange bread among ourselves in pennies or dimes, quarters or dollars, its status as a commodity is unaltered. The quantity of which only informs us of its price, and not its character. Slice it so that it may be sliced bread, it will be bread, albeit sliced, and it will still be a commodity that exists as an exchange value.

Further Reading & Listening

For a more humorous explanation see this YouTube Video here,[1] courtesy of Luna Oi and her husband.


  1. “The simple circulation of commodities – selling in order to buy – is a means of carrying out a purpose unconnected with circulation, namely, the appropriation of use-values, the satisfaction of wants. The circulation of money as capital is, on the contrary, an end in itself, for the expansion of value takes place only within this constantly renewed movement. The circulation of capital has therefore no limits.”

    Karl Marx (1867). Capital, vol. I: 'The transformation of money into capital; The general formula for capital'.
  2. “The simplest form of the circulation of commodities is C-M-C, the transformation of commodities into money, and the change of the money back again into commodities; or selling in order to buy. But alongside of this form we find another specifically different form: M-C-M, the transformation of money into commodities, and the change of commodities back again into money; or buying in order to sell. Money that circulates in the latter manner is thereby transformed into, becomes capital, and is already potentially capital.”

    Karl Marx (1867). Capital, vol. I: 'The transformation of money into capital; The general formula for capital'.


  1. An example would be a worker selling his labour power (commodity) in order to receive wages (money) to buy food (commodity), fulfilling the simple circulation of commodities, C-M-C.