CHAPTER XXIV.
CONVERSION OF SURPLUS-VALUE INTO CAPITAL.
Hitherto we have investigated how surplus-value emanates from capital; we have now to see how capital arises from surplus-value. Employing surplus-value as capital, reconverting it into capital, is called accumulation of capital.[1]
First let us consider this transaction from the standpoint of the individual capitalist. Suppose a spinner to have advanced a capital of £10,000, of which four-fifths (£8000) are laid out in cotton, machinery, &., and one-fifth (£2000) in wages. Let him produce 240,000 lbs. of yarn annually, having a value of £12,000. The rate of surplus-value being 100%, the surplus-value lies in the surplus or net product of 40,000 lbs. of yarn, one sixth of the gross product, with a value of £2000 which will be realized by a sale. £2000 is £2000. We can neither see nor smell in this sum of money a trace of surplus-value. When we know that a given value is surplus-value, we know how its owner came by it; but that does not alter the nature either of value or of money.
In order to convert this additional sum of £2000 into capital, the master spinner will, all circumstances remaining as before, advance four-fifths of it (£1600) in the purchase of cotton, &c., and one-fifth (£400) in the purchase of additional spinners, who will find in the market the necessaries of life whose value the master has advanced to them. Then the new
- ↑ “Accumulation of capital; the employment of a portion of revenue as capital.” (Malthus: Definitions, &c., ed. Cazenove p. 11.) “Conversion of revenue into capital” Malthus: Princ. of Pol. Econ., 2nd Ed., Lond., 1836, p. 319.)
