Capital II. Chapter 3: The circuit of commodity capital

This chapter opens with a series of comparisons between the circuit of commodity capital, and the circuits of money capital and productive capital. In these notes, I will draw out some of the characteristics of the circuit of commodity capital. As with his opening of Capital, volume I with a discussion about commodities, Marx returns to the centrality of commodities in the capital-relation in Chapter 3. Here, the notion of movement is central. Unlike the other circuits, this circuit completes an entire rotation before it is interrupted by production (C’-M-C … P … C’). Why is this significant?

On the commodity-form. If we understand commodities as the elementary form of capital, what Marx does in this chapter is demonstrate further how commodities need other commodities to valorize capital (175). For example, productive capital’s composition in labour-power and means of production.

In setting out the structure of Capital II, Marx notes in chapter I that, “commodities become commodity capital as the functional form of existence of the already valorized capital value that has arisen directly from the production process itself” (122). And that a “commodity can only function as capital only so far as it brings this character with it from the production process, before its circulation begins” (122).

The circuit begins with C’, not C. C’ represents “expanded capital value in the commodity form” (168). The circuit of commodity capital has a dual aspect in that it has a use-value as well as having capital-value (surplus value is produced in the production process) (169). Thus, surplus value is presumed in the first step of this circuit, it is included in C’.

On movement. The commodity capital circuit is the only circuit that valorizes capital value, and not the original capital that is yet to be valorized (173). In that sense, it can be thought about as capital in movement. Since capital is all about values in motion, how can we understand the notions of movement that Marx elaborates in these three circuits? Marx writes, “in forms I and II, the overall movement presents itself as a movement of the capital value advanced. In form III, the valorized capital, in the shape of the total commodity product, forms the starting point, and possesses the form of capital in movement, commodity capital” (174).

On money. This transformation implies a change in the value and use-value of the commodities from the beginning to what is left at the end. Money enables capital-value to be quantified, and divided up from an object (C) that would otherwise not be divisible. C’ is separated off from C “before surplus value is realized, before C’ is realized as a whole” (169). The function of money is important, for it is following C’s (read: Cprime’s) “transformation into money that this movement splits up into movement of capital and movement of revenue” (174).

On consumption. Individual and productive consumption is assumed in this circuit (173), but there will also be a reproductive fund reinvested (174). Total value composition of any given commodity is its capital value, ie. it is divided into payments for constant capital and variable capital, with the presumption that there will still be some capital value left over, that is consumed as surplus revenue. Its interesting that Marx draws out the class condition that is most clearly observed in this circuit: workers consume in order for labour-power to be produced (consumption subject to limits) and capitalists consume outside of necessity in what Marx calls a “social act” (173).

*Repetition of production (M-C). Repetition of consumption (m-c).


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Reading Capital in Sydney records reading notes on Marx's Capital I, II and III, and other bits and pieces.

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