Exchange Value: Karl Marx on Capitalism

Forming value does not cease to function within a single relation in a system of exchange. Rather, an expansion of numerous relations leads to a formulation of many commodity value affiliations.

For example, where 1 sugar cane = 5 cups of sugar = 10 pieces of candy, it is induced also that 1 sugar cane = 10 pieces of candy. Adaptation to a universal monetary unit, when included in the vast formulation of value affiliations, ultimately allowed for a universal equivalence for all commodities to exist in the form of money. A commodity's exchange value became synonymous to the equivalent amount of money it represented in value form. Therefore we see in the system of exchange, that through the interaction of two commodities in the process of redefining one by means of another, the original value of the commodity slowly being masked with each consecutive value formation. Value, as the product of human labor, is consequently hidden from a clear conception through the disguised expression of equivalent relations.

The introduction of money in the system of exchange led to two contrasting end-goals in the circulation of a commodity. The first involved selling commodities to gain money to buy other commodities (C->M->C, where C = commodity and M = money). The second involved buying commodities in order to sell and make additional money (M->C->M +^M, where ^M = surplus value). In the capitalist society, the laborer finds himself following the former model to maintain his own sustenance. In contrast, the capitalist seeks the latter with the objective of making more money (surplus value) than when he initiated his operation. Yet from where did surplus value arise? As Marx points out: "[Surplus value] cannot therefore arise from circulation, and it is equally impossible for it to arise apart from circulation. It must have its origin both in circulation and not in circulation."