From various quarters we have been reproached for neglecting to
portray the economic conditions which form the material basis of the present struggles
between classes and nations. With set purpose we have hitherto touched upon these
conditions only when they forced themselves upon the surface of the political conflicts.
It was necessary, beyond everything else, to follow the development of the class
struggle in the history of our own day, and to prove empirically, by the actual and daily
newly created historical material, that with the subjugation of the working class,
accomplished in the days of February and March, 1848, the opponents of that class -- the
bourgeois republicans in France, and the bourgeois and peasant classes who were fighting
feudal absolutism throughout the whole continent of Europe -- were simultaneously
conquered; that the victory of the "moderate republic" in France sounded at the
same time the fall of the nations which had responded to the February revolution with
heroic wars of independence; and finally that, by the victory over the revolutionary
workingmen, Europe fell back into its old double slavery, into the English-Russian
slavery. The June conflict in Paris, the fall of Vienna, the tragi-comedy in Berlin in
November 1848, the desperate efforts of Poland, Italy, and Hungary, the starvation of
Ireland into submission -- these were the chief events in which the European class
struggle between the bourgeoisie and the working class was summed up, and from which we
proved that every revolutionary uprising, however remote from the class struggle its
object might appear, must of necessity fail until the revolutionary working class shall
have conquered; -- that every social reform must remain a Utopia until the proletarian
revolution and the feudalistic counter-revolution have been pitted against each other in a
world-wide war . In our presentation, as in reality, Belgium and Switzerland were
tragicomic caricaturish genre pictures in the great historic tableau; the one the model
State of the bourgeois monarchy, the other the model State of the bourgeois republic; both
of them, States that flatter themselves to be just as free from the class struggle as from
the European revolution. 
But now, after our readers have seen the class struggle of the year 1848 develop into
colossal political proportions, it is time to examine more closely the economic conditions
themselves upon which is founded the existence of the capitalist class and its class rule,
as well as the slavery of the workers.
We shall present the subject in three great divisions:
- The Relation of Wage-Labor to Capital, the Slavery of the Worker, the Rule of the
- The Inevitable Ruin of the Middle Classes and the so-called Commons 
under the present system.
- The Commercial Subjugation and Exploitation of the Bourgeois classes of the various
European nations by the Despot of the World Market -- England. 
We shall seek to portray this as simply and popularly as possible, and shall not
presuppose a knowledge of even the most elementary notions of political economy. We wish
to be understood by the workers. And, moreover, there prevails in Germany the most
remarkable ignorance and confusion of ideas in regard to the simplest economic relations,
from the patented defenders of existing conditions, down to the socialist wonder-workers
and the unrecognized political geniuses, in which divided Germany is even richer than in
duodecimo princelings. We therefore proceed to the consideration of the first problem.
WHAT ARE WAGES?
If several workmen were to be asked: "How much wages do you
get?", one would reply, "I get two shillings a day", and so on. According
to the different branches of industry in which they are employed, they would mention
different sums of money that they receive from their respective employers for the
completion of a certain task; for example, for weaving a yard of linen, or for setting a
page of type. Despite the variety of their statements, they would all agree upon one
point: that wages are the amount of money which the capitalist pays for a certain period
of work or for a certain amount of work.
Consequently, it appears that the capitalist buys their labor with money, and that for
money they sell him their labor. But this is merely an illusion. What they actually sell
to the capitalist for money is their labor-power. This labor-power the capitalist buys for
a day, a week, a month, etc. And after he has bought it, he uses it up by letting the
worker labor during the stipulated time. With the same amount of money with which the
capitalist has bought their labor-power (for example, with two shillings) he could have
bought a certain amount of sugar or of any other commodity. The two shillings with which
he bought 20 pounds of sugar is the price of the 20 pounds of sugar. The two shillings
with which he bought 12 hours' use of labor-power, is the price of 12 hours' labor.
Labor-power, then, is a commodity, no more, no less so than is the sugar. The first is
measured by the clock, the other by the scales.
Their commodity, labor-power, the workers exchange for the commodity of the capitalist,
for money, and, moreover, this exchange takes place at a certain ratio. So much money for
so long a use of labor-power. For 12 hours' weaving, two shillings. And these two
shillings, do they not represent all the other commodities which I can buy for two
shillings? Therefore, actually, the worker has exchanged his commodity, labor-power, for
commodities of all kinds, and, moreover, at a certain ratio. By giving him two shillings,
the capitalist has given him so much meat, so much clothing, so much wood, light, etc., in
exchange for his day's work. The two shillings therefore express the relation in which
labor-power is exchanged for other commodities, the exchange-value of labor-power.
The exchange value of a commodity estimated in money is called its price. Wages
therefore are only a special name for the price of labor-power, and are usually called the
price of labor; it is the special name for the price of this peculiar commodity. which has
no other repository than human flesh and blood.
Let us take any worker; for example, a weaver. The capitalist supplies him with the
loom and yarn. The weaver applies himself to work, and the yarn is turned into cloth. The
capitalist takes possession of the cloth and sells it for 20 shillings, for example. Now
are the wages of the weaver a share of the cloth, of the 20 shillings, of the product of
the work? By no means. Long before the cloth is sold, perhaps long before it is fully
woven, the weaver has received his wages. The capitalist, then, does not pay his wages out
of the money which he will obtain from the cloth, but out of money already on hand. Just
as little as loom and yarn are the product of the weaver to whom they are supplied by the
employer, just so little are the commodities which he receives in exchange for his
commodity -- labor-power -- his product. It is possible that the employer found no
purchasers at all for the cloth. It is possible that he did not get even the amount of the
wages by its sale. It is possible that he sells it very profitably in proportion to the
weaver's wages. But all that does not concern the weaver. With a part of his existing
wealth, of his capital, the capitalist buys the labor-power of the weaver in exactly the
same manner as, with another part of his wealth, he has bought the raw material -- the
yarn -- and the instrument of labor -- the loom. After he has made these purchases, and
among them belongs the labor-power necessary to the production of the cloth he produces
only with raw materials and instruments of labor belonging to him. For our good weaver,
too, is one of the instruments of labor, and being in this respect on a par with the loom,
he has no more share in the product (the cloth), or in the price of the product, than the
loom itself has.
Wages, therefore, are not a share of the worker in the commodities produced by himself.
Wages are that part of already existing commodities with which the capitalist buys a
certain amount of productive labor-power.
Consequently, labor-power is a commodity which its possessor, the wage-worker, sells to
the capitalist. Why does he sell it? It is in order to live.
But the putting of labor-power into action -- i.e., the work -- is the active
expression of the laborer's own life. And this life activity he sells to another person in
order to secure the necessary means of life. His life-activity, therefore, is but a means
of securing his own existence. He works that he may keep alive. He does not count the
labor itself as a part of his life; it is rather a sacrifice of his life. It is a
commodity that he has auctioned off to another. The product of his activity, therefore, is
not the aim of his activity. What he produces for himself is not the silk that he weaves,
not the gold that he draws up the mining shaft, not the palace that he builds. What he
produces for himself is wages ; and the silk, the gold, and the palace are resolved for
him into a certain quantity of necessaries of life, perhaps into a cotton jacket, into
copper coins, and into a basement dwelling. And the laborer who for 12 hours long, weaves,
spins, bores, turns, builds, shovels, breaks stone, carries hods, and so on -- is this 12
hours' weaving, spinning, boring, turning, building, shovelling, stone-breaking, regarded
by him as a manifestation of life, as life? Quite the contrary. Life for him begins where
this activity ceases, at the table, at the tavern, in bed. The 12 hours' work, on the
other hand, has no meaning for him as weaving, spinning, boring, and so on, but only as
earnings, which enable him to sit down at a table, to take his seat in the tavern, and to
lie down in a bed. If the silk-worm's object in spinning were to prolong its existence as
caterpillar, it would be a perfect example of a wage-worker.
Labor-power was not always a commodity (merchandise). Labor was not always wage-labor,
i.e., free labor. The slave did not sell his labor-power to the slave-owner, any more than
the ox sells his labor to the farmer. The slave, together with his labor-power, was sold
to his owner once for all. He is a commodity that can pass from the hand of one owner to
that of another. He himself is a commodity, but his labor-power is not his commodity. The
serf sells  only a portion of his labor-power. It is not he who
receives wages from the owner of the land; it is rather the owner of the land who receives
a tribute from him. The serf belongs to the soil, and to the lord of the soil he brings
its fruit. The free laborer , on the other hand, sells his very self, and that by
fractions. He auctions off eight, 10, 12, 15 hours of his life, one day like the next, to
the highest bidder, to the owner of raw materials, tools, and the means of life -- i.e.,
to the capitalist. The laborer belongs neither to an owner nor to the soil, but eight, 10,
12, 15 hours of his daily life belong to whomsoever buys them. The worker leaves the
capitalist, to whom he has sold himself, as often as he chooses, and the capitalist
discharges him as often as he sees fit, as soon as he no longer gets any use, or not the
required use, out of him. But the worker, whose only source of income is the sale of his
labor-power, cannot leave the whole class of buyers, i.e., the capitalist class , unless
he gives up his own existence. He does not belong to this or that capitalist, but to the
capitalist class ; and it is for him to find his man -- i.e., to find a buyer in this
Before entering more closely upon the relation of capital to wage-labor, we shall
present briefly the most general conditions which come into consideration in the
determination of wages.
Wages, as we have seen, are the price of a certain commodity, labor-power. Wages,
therefore, are determined by the same laws that determine the price of every other
commodity. The question then is, How is the price of a commodity determined?
BY WHAT IS THE PRICE OF A COMMODITY DETERMINED?
By what is the price of a commodity determined?
By the competition between buyers and sellers, by the relation of the demand to the
supply, of the call to the offer. The competition by which the price of a commodity is
determined is threefold.
The same commodity is offered for sale by various sellers. Whoever sells commodities of
the same quality most cheaply, is sure to drive the other sellers from the field and to
secure the greatest market for himself. The sellers therefore fight among themselves for
the sales, for the market. Each one of them wishes to sell, and to sell as much as
possible, and if possible to sell alone, to the exclusion of all other sellers. Each one
sells cheaper than the other. Thus there takes place a competition among the sellers which
forces down the price of the commodities offered by them.
But there is also a competition among the buyers; this upon its side causes the price
of the proffered commodities to rise.
Finally, there is competition between the buyers and the sellers: these wish to
purchase as cheaply as possible, those to sell as dearly as possible. The result of this
competition between buyers and sellers will depend upon the relations between the two
above-mentioned camps of competitors -- i.e., upon whether the competition in the army of
sellers is stronger. Industry leads two great armies into the field against each other,
and each of these again is engaged in a a battle among its own troops in its own ranks.
The army among whose troops there is less fighting carries of the victory over the
Let us suppose that there are 100 bales of cotton in the market and at the same time
purchasers for 1,000 bales of cotton. In this case, the demand is 10 times greater than
the supply. Competition among the buyers, then, will be very strong; each of them tries to
get hold of one bale, if possible, of the whole 100 bales. This example is no arbitrary
supposition. In the history of commerce we have experienced periods of scarcity of cotton,
when some capitalists united together and sought to buy up not 100 bales, but the whole
cotton supply of the world. In the given case, then, one buyer seeks to drive the others
from the field by offering a relatively higher price for the bales of cotton. The cotton
sellers, who perceive the troops of the enemy in the most violent contention among
themselves, and who therefore are fully assured of the sale of their whole 100 bales, will
beware of pulling one another's hair in order to force down the price of cotton at the
very moment in which their opponents race with one another to screw it up high. So, all of
a sudden, peace reigns in the army of sellers. They stand opposed to the buyers like on e
man, fold their arms in philosophic contentment and their claims would find no limit did
not the offers of even the most importunate of buyers have a very definite limit.
If, then, the supply of a commodity is less than the demand for it, competition among
the sellers is very slight, or there may be none at all among them. In the same proportion
in which this competition decreases, the competition among the buyers increases. Result: a
more or less considerable rise in the prices of commodities.
It is well known that the opposite case, with the opposite result, happens more
frequently. Great excess of supply over demand; desperate competition among the sellers,
and a lack of buyers; forced sales of commodities at ridiculously low prices.
But what is a rise, and what a fall of prices? What is a high and what a low price? A
grain of sand is high when examined through a microscope, and a tower is low when compared
with a mountain. And if the price is determined by the relation of supply and demand, by
what is the relation of supply and demand determined?
Let us turn to the first worthy citizen we meet. He will not hesitate one moment, but,
like Alexander the Great, will cut this metaphysical know with his multiplication table.
He will say to us: "If the production of the commodities which I sell has cost me 100
pounds, and out of the sale of these goods I make 110 pounds -- within the year, you
understand -- that's an honest, sound, reasonable profit. But if in the exchange I receive
120 or 130 pounds, that's a higher profit; and if I should get as much as 200 pounds, that
would be an extraordinary, and enormous profit." What is it, then, that serves this
citizen as the standard of his profit? The cost of the production of his commodities. If
in exchange for these goods he receives a quantity of other goods whose production has
cost less, he has lost. If he receives in exchange for his goods a quantity of other goods
whose production has cost more, he has gained. And he reckons the falling or rising of the
profit according to the degree at which the exchange value of his goods stands, whether
above or below his zero -- the cost of production.
We have seen how the changing relation of supply and demand causes now a rise, now a
fall of prices; now high, now low prices. If the price of a commodity rises considerably
owing to a failing supply or a disproportionately growing demand, then the price of some
other commodity must have fallen in proportion; for of course the price of a commodity
only expresses in money the proportion in which other commodities will be given in
exchange for it. If, for example, the price of a yard of silk rises from two to three
shillings, the price of silver has fallen in relation to the silk, and in the same way the
prices of all other commodities whose prices have remained stationary have fallen in
relation to the price of silk. A large quantity of them must be given in exchange in order
to obtain the same amount of silk. Now, what will be the consequence of a rise in the
price of a particular commodity? A mass of capital will be thrown into the prosperous
branch of industry, and this immigration of capital into the provinces of the favored
industry will continue until it yields no more than the customary profits, or, rather
until the price of its products, owning to overproduction, sinks below the cost of
Conversely: if the price of a commodity falls below its cost of production, then
capital will be withdrawn from the production of this commodity. Except in the case of a
branch of industry which has become obsolete and is therefore doomed to disappear, the
production of such a commodity (that is, its supply), will, owning to this flight of
capital, continue to decrease until it corresponds to the demand, and the price of the
commodity rises again to the level of its cost of production; or, rather, until the supply
has fallen below the demand and its price has risen above its cost of production, for the
current price of a commodity is always either above or below its cost of production.
We see how capital continually emigrates out of the province of one industry and
immigrates into that of another. The high price produces an excessive immigration, and the
low price an excessive emigration.
We could show, from another point of view, how not only the supply, but also the
demand, is determined by the cost of production. But this would lead us too far away from
We have just seen how the fluctuation of supply and demand always bring the price of a
commodity back to its cost of production. The actual price of a commodity, indeed, stands
always above or below the cost of production; but the rise and fall reciprocally balance
each other , so that, within a certain period of time, if the ebbs and flows of the
industry are reckoned up together, the commodities will be exchanged for one another in
accordance with their cost of production. Their price is thus determined by their cost of
The determination of price by the cost of production is not to be understood in the
sense of the bourgeois economists. The economists say that the average price of
commodities equals the cost of production: that is the law . The anarchic movement, in
which the rise is compensated for by a fall and the fall by a rise, they regard as an
accident. We might just as well consider the fluctuations as the law, and the
determination of the price by cost of production as an accident -- as is, in fact, done by
certain other economists. But it is precisely these fluctuations which, viewed more
closely, carry the most frightful devastation in their train, and, like an earthquake,
cause bourgeois society to shake to its very foundations -- it is precisely these
fluctuations that force the price to conform to the cost of production. In the totality of
this disorderly movement is to be found its order. In the total course of this industrial
anarchy, in this circular movement, competition balances, as it were, the one extravagance
by the other.
We thus see that the price of a commodity is indeed determined by its cost of
production, but in such wise that the periods in which the price of these commodities
rises above the costs of production are balanced by the periods in which it sinks below
the cost of production, and vice versa. Of course this does not hold good for a single
given product of an industry, but only for that branch of industry. So also it does not
hold good for an individual manufacturer, but only for the whole class of manufacturers.
The determination of price by cost of production is tantamount to the determination of
price by the labor-time requisite to the production of a commodity, for the cost of
production consists, first of raw materials and wear and tear of tools, etc., i.e., of
industrial products whose production has cost a certain number of work-days, which
therefore represent a certain amount of labor-time, and, secondly, of direct labor, which
is also measured by its duration.
BY WHAT ARE WAGES DETERMINED?
Now, the same general laws which regulate the price of
commodities in general, naturally regulate wages , or the price of labor-power. Wages will
now rise, now fall, according to the relation of supply and demand, according as
competition shapes itself between the buyers of labor-power, the capitalists, and the
sellers of labor-power, the workers. The fluctuations of wages correspond to the
fluctuation in the price of commodities in general. But within the limits of these
fluctuations the price of labor-power will be determined by the cost of production, by the
labor-time necessary for production of this commodity: labor-power.
What, then, is the cost of production of labor-power?
It is the cost required for the maintenance of the laborer as a laborer, and for his
education and training as a laborer.
Therefore, the shorter the time required for training up to a particular sort of work,
the smaller is the cost of production of the worker, the lower is the price of his
labor-power, his wages. In those branches of industry in which hardly any period of
apprenticeship is necessary and the mere bodily existence of the worker is sufficient, the
cost of his production is limited almost exclusively to the commodities necessary for
keeping him in working condition. The price of his work will therefore be determined by
the price of the necessary means of subsistence.
Here, however, there enters another consideration. The manufacturer who calculates his
cost of production and, in accordance with it, the price of the product, takes into
account the wear and tear of the instruments of labor. If a machine costs him, for
example, 1,000 shillings, and this machine is used up in 10 years, he adds 100 shillings
annually to the price of the commodities, in order to be able after 10 years to replace
the worn-out machine with a new one. In the same manner, the cost of production of simple
labor-power must include the cost of propagation, by means of which the race of workers is
enabled to multiply itself, and to replace worn-out workers with new ones. The wear and
tear of the worker, therefore, is calculated in the same manner as the wear and tear of
Thus, the cost of production of simple labor-power amounts to the cost of the existence
and propagation of the worker. The price of this cost of existence and propagation
constitutes wages. The wages thus determined are called the minimum of wages. This minimum
wage, like the determination of the price of commodities in general by cost of production,
does not hold good for the single individual , but only for the race. Individual workers,
indeed, millions of workers, do not receive enough to be able to exist and to propagate
themselves; but the wages of the whole working class adjust themselves, within the limits
of their fluctuations, to this minimum.
Now that we have come to an understanding in regard to the most general laws which
govern wages, as well as the price of every other commodity, we can examine our subject
THE NATURE AND GROWTH OF CAPITAL
Capital consists of raw materials, instruments of labor, and
means of subsistence of all kinds, which are employed in producing new raw materials, new
instruments, and new means of subsistence. All these components of capital are created by
labor, products of labor, accumulated labor. Accumulated labor that serves as a means to
new production is capital. So says the economists. What is a Negro slave? A man of the
black race. The one explanation is worthy of the other.
A Negro is a Negro. Only under certain conditions does he become a slave. A
cotton-spinning machine is a machine for spinning cotton. Only under certain conditions
does it become capital . Torn away from these conditions, it is as little capital as gold
is itself money, or sugar is the price of sugar.
In the process of production, human beings work not only upon nature, but also upon one
another. They produce only by working together in a specified manner and reciprocally
exchanging their activities. In order to produce, they enter into definite connections and
relations to one another, and only within these social connections and relations does
their influence upon nature operate -- i.e., does production take place.
These social relations between the producers, and the conditions under which they
exchange their activities and share in the total act of production, will naturally vary
according to the character of the means of production. With the discover of a new
instrument of warfare, the firearm,the whole internal organization of the army was
necessarily altered, the relations within which individuals compose an army and can work
as an army were transformed, and the relation of different armies to another was likewise
We thus see that the social relations within which individuals produce, the social
relations of production, are altered, transformed, with the change and development of the
material means of production, of the forces of production. The relations of production in
their totality constitute what is called the social relations, society, and, moreover, a
society at a definite stage of historical development, a society with peculiar,
distinctive characteristics. Ancient society, feudal society, bourgeois (or capitalist)
society, are such totalities of relations of production, each of which denotes a
particular stage of development in the history of mankind.
Capital also is a social relation of production. It is a bourgeois relation of
production , a relation of production of bourgeois society. The means of subsistence, the
instruments of labor, the raw materials, of which capital consists -- have they not been
produced and accumulated under given social conditions, within definite special relations?
Are they not employed for new production, under given special conditions, within definite
social relations? And does not just the definite social character stamp the products which
serve for new production as capital?
Capital consists not only of means of subsistence, instruments of labor, and raw
materials, not only as material products; it consists just as much of exchange values. All
products of which it consists are commodities. Capital, consequently, is not only a sum of
material products, it is a sum of commodities, of exchange values, of social magnitudes.
Capital remains the same whether we put cotton in the place of wool, rice in the place of
wheat, steamships in the place of railroads, provided only that the cotton, the rice, the
steamships -- the body of capital -- have the same exchange value, the same price, as the
wool, the wheat, the railroads, in which it was previously embodied. The bodily form of
capital may transform itself continually, while capital does not suffer the least
But though every capital is a sum of commodities -- i.e., of exchange values -- it does
not follow that every sum of commodities, of exchange values, is capital.
Every sum of exchange values is an exchange value. Each particular exchange value is a
sum of exchange values. For example: a house worth 1,000 pounds is an exchange value of
1,000 pounds: a piece of paper worth one penny is a sum of exchange values of 100 1/100ths
of a penny. Products which are exchangeable for others are commodities. The definite
proportion in which they are exchangeable forms their exchange value, or, expressed in
money, their price. The quantity of these products can have no effect on their character
as commodities , as representing an exchange value , as having a certain price. Whether a
tree be large or small, it remains a tree. Whether we exchange iron in pennyweights or in
hundredweights, for other products, does this alter its character: its being a commodity,
or exchange value? According to the quantity, it is a commodity of greater or of lesser
value, of higher or of lower price.
How then does a sum of commodities, of exchange values, become capital?
Thereby, that as an independent social power -- i.e., as the power of a part of society
-- it preserves itself and multiplies by exchange with direct, living labor-power.
The existence of a class which possess nothing but the ability to work is a necessary
presupposition of capital.
It is only the dominion of past, accumulated, materialized labor over immediate living
labor that stamps the accumulated labor with the character of capital.
Capital does not consist in the fact that accumulated labor serves living labor as a
means for new production. It consists in the fact that living labor serves accumulated
labor as the means of preserving and multiplying its exchange value.
RELATION OF WAGE-LABOR TO CAPITAL
What is it that takes place in the exchange between the
capitalist and the wage-labor?
The laborer receives means of subsistence in exchange for his labor-power; the
capitalist receives, in exchange for his means of subsistence, labor, the productive
activity of the laborer, the creative force by which the worker not only replaces what he
consumes, but also gives to the accumulated labor a greater value than it previously
possessed. The laborer gets from the capitalist a portion of the existing means of
subsistence. For what purpose do these means of subsistence serve him? For immediate
consumption. But as soon as I consume means of subsistence, they are irrevocably lost to
me, unless I employ the time during which these means sustain my life in producing new
means of subsistence, in creating by my labor new values in place of the values lost in
consumption. But it is just this noble reproductive power that the laborer surrenders to
the capitalist in exchange for means of subsistence received. Consequently, he has lost it
Let us take an example. For one shilling a laborer works all day long in the fields of
a farmer, to whom he thus secures a return of two shillings. The farmer not only receives
the replaced value which he has given to the day laborer, he has doubled it. Therefore, he
has consumed the one shilling that he gave to the day laborer in a fruitful, productive
manner. For the one shilling he has bought the labor-power of the day-laborer, which
creates products of the soil of twice the value, and out of one shilling makes two. The
day-laborer, on the contrary, receives in the place of his productive force, whose results
he has just surrendered to the farmer, one shilling, which he exchanges for means of
subsistence, which he consumes more or less quickly. The one shilling has therefore been
consumed in a double manner -- reproductively for the capitalist, for it has been
exchanged for labor-power, which brought forth two shillings; unproductively for the
worker, for it has been exchanged for means of subsistence which are lost for ever, and
whose value he can obtain again only by repeating the same exchange with the farmer.
Capital therefore presupposes wage-labor; wage-labor presupposes capital. They condition
each other; each brings the other into existence.
Does a worker in a cotton factory produce only cotton? No. He produces capital. He
produces values which serve anew to command his work and to create by means of it new
Capital can multiply itself only by exchanging itself for labor-power, by calling
wage-labor into life. The labor-power of the wage-laborer can exchange itself for capital
only by increasing capital, by strengthening that very power whose slave it is. Increase
of capital, therefore, is increase of the proletariat, i.e., of the working class.
And so, the bourgeoisie and its economists maintain that the interest of the capitalist
and of the laborer is the same. And in fact, so they are! The worker perishes if capital
does not keep him busy. Capital perishes if it does not exploit labor-power, which, in
order to exploit, it must buy. The more quickly the capital destined for production -- the
productive capital -- increases, the more prosperous industry is, the more the bourgeoisie
enriches itself, the better business gets, so many more workers does the capitalist need,
so much the dearer does the worker sell himself. The fastest possible growth of productive
capital is, therefore, the indispensable condition for a tolerable life to the laborer.
But what is growth of productive capital? Growth of the power of accumulated labor over
living labor; growth of the rule of the bourgeoisie over the working class. When
wage-labor produces the alien wealth dominating it, the power hostile to it, capital,
there flow back to it its means of employment -- i.e., its means of subsistence, under the
condition that it again become a part of capital, that is become again the lever whereby
capital is to be forced into an accelerated expansive movement.
To say that the interests of capital and the interests of the workers are identical,
signifies only this: that capital and wage-labor are two sides of one and the same
relation. The one conditions the other in the same way that the usurer and the borrower
condition each other.
As long as the wage-laborer remains a wage-laborer, his lost is dependent upon capital.
That is what the boasted community of interests between worker and capitalists amounts to.
If capital grows, the mass of wage-labor grows, the number of wage-workers increases;
in a word, the sway of capital extends over a greater mass of individuals.
Let us suppose the most favorable case: if productive capital grows, the demand for
labor grows. It therefore increases the price of labor-power, wages.
A house may be large or small; as long as the neighboring houses are likewise small, it
satisfies all social requirement for a residence. But let there arise next to the little
house a palace, and the little house shrinks to a hut. The little house now makes it clear
that its inmate has no social position at all to maintain, or but a very insignificant
one; and however high it may shoot up in the course of civilization, if the neighboring
palace rises in equal of even in greater measure, the occupant of the relatively little
house will always find himself more uncomfortable, more dissatisfied, more cramped within
his four walls.
An appreciable rise in wages presupposes a rapid growth of productive capital. Rapid
growth of productive capital calls forth just as rapid a growth of wealth, of luxury, of
social needs and social pleasures. Therefore, although the pleasures of the laborer have
increased, the social gratification which they afford has fallen in comparison with the
increased pleasures of the capitalist, which are inaccessible to the worker, in comparison
with the stage of development of society in general. Our wants and pleasures have their
origin in society; we therefore measure them in relation to society; we do not measure
them in relation to the objects which serve for their gratification. Since they are of a
social nature, they are of a relative nature.
But wages are not at all determined merely by the sum of commodities for which they may
be exchanged. Other factors enter into the problem. What the workers directly receive for
their labor-power is a certain sum of money. Are wages determined merely by this money
In the 16th century, the gold and silver circulation in Europe increased in consequence
of the discovery of richer and more easily worked mines in America. The value of gold and
silver, therefore, fell in relation to other commodities. The workers received the same
amount of coined silver for their labor-power as before. The money price of their work
remained the same, and yet their wages had fallen, for in exchange for the same amount of
silver they obtained a smaller amount of other commodities. This was one of the
circumstances which furthered the growth of capital, the rise of the bourgeoisie, in the
Let us take another case. In the winter of 1847, in consequence of bad harvest, the
most indispensable means of subsistence -- grains, meat, butter, cheese, etc. -- rose
greatly in price. Let us suppose that the workers still received the same sum of money for
their labor-power as before. Did not their wages fall? To be sure. For the same money they
received in exchange less bread, meat, etc. Their wages fell, not because the value of
silver was less, but because the value of the means of subsistence had increased.
Finally, let us suppose that the money price of labor-power remained the same, while
all agricultural and manufactured commodities had fallen in price because of the
employment of new machines, of favorable seasons, etc. For the same money the workers
could now buy more commodities of all kinds. Their wages have therefore risen, just
because their money value has not changed.
The money price of labor-power, the nominal wages, do not therefore coincide with the
actual or real wages -- i.e., with the amount of commodities which are actually given in
exchange for the wages. If then we speak of a rise or fall of wages, we have to keep in
mind not only the money price of labor-power, the nominal wages, but also the real wages.
But neither the nominal wages -- i.e., the amount of money for which the laborer sells
himself to the capitalist -- nor the real wages -- i.e., the amount of commodities which
he can buy for this money -- exhausts the relations which are comprehended in the term
Wages are determined above all by their relations to the gain, the profit, of the
capitalist. In other words, wages are a proportionate, relative quantity.
Real wages express the price of labor-power in relation to the price of commodities;
relative wages, on the other hand, express the share of immediate labor in the value newly
created by it, in relation to the share of it which falls to accumulated labor, to
THE GENERAL LAW THAT DETERMINES
THE RISE AND FALL OF WAGES AND PROFITS
We have said: "Wages are not a share of the worker in the
commodities produced by him. Wages are that part of already existing commodities with
which the capitalist buys a certain amount of productive labor-power." But the
capitalist must replace these wages out of the price for which he sells the product made
by the worker; he must so replace it that, as a rule, there remains to him a surplus above
the cost of production expended by him, that is, he must get a profit.
The selling price of the commodities produced by the worker is divided, from the point
of view of the capitalist, into three parts:
- First, the replacement of the price of the raw materials advanced by him, in addition to
the replacement of the wear and tear of the tools, machines, and other instruments of
labor likewise advanced by him;
second, the replacement of the wages advanced; and
third, the surplus leftover -- i.e., the profit of the capitalist.
While the first part merely replaces previously existing values, it is evident that the
replacement of the wages and the surplus (the profit of capital) are as a whole taken out
of the new value,which is produced by the labor of the worker and added to the raw
materials. And in this sense we can view wages as well as profit, for the purpose of
comparing them with each other, as shares in the product of the worker.
Real wages may remain the same, they may even rise, nevertheless the relative wages may
fall. Let us suppose, for instance, that all means of subsistence have fallen 2/3rds in
price, while the day's wages have fallen but 1/3rd -- for example, from three to two
shillings. Although the worker can now get a greater amount of commodities with these two
shillings than he formerly did with three shillings, yet his wages have decreased in
proportion to the gain of the capitalist. The profit of the capitalist -- the
manufacturer's for instance -- has increased one shilling, which means that for a smaller
amount of exchange values, which he pays to the worker, the latter must produce a greater
amount of exchange values than before. The share of capitals in proportion to the share of
labor has risen. The distribution of social wealth between capital and labor has become
still more unequal. The capitalist commands a greater amount of labor with the same
capital. The power of the capitalist class over the working class has grown, the social
position of the worker has become worse, has been forced down still another degree below
that of the capitalist.
What, then is the general law that determines the rise and fall of wages and profit in
their reciprocal relation?
They stand in inverse proportion to each other. The share of (profit) increases in the
same proportion in which the share of labor (wages) falls, and vice versa. Profit rises in
the same degree in which wages fall; it falls in the same degree in which wages rise.
It might perhaps be argued that the capitalist class can gain by an advantageous
exchange of his products with other capitalists, by a rise in the demand for his
commodities, whether in consequence of the opening up of new markets, or in consequence of
temporarily increased demands in the old market, and so on; that the profit of the
capitalist, therefore, may be multiplied by taking advantage of other capitalists,
independently of the rise and fall of wages, of the exchange value of labor-power; or that
the profit of the capitalist may also rise through improvements in the instruments of
labor, new applications of the forces of nature, and so on.
But in the first place it must be admitted that the result remains the same, although
brought about in an opposite manner. Profit, indeed, has not risen because wages have
fallen, but wages have fallen because profit has risen. With the same amount of another
man's labor the capitalist has bought a larger amount of exchange values without having
p[aid more for the labor on that account -- i.e., the work is paid for less in proportion
to the net gain which it yields to the capitalist.
In the second place, it must be borne in mind that, despite the fluctuations in the
prices of commodities, the average price of every commodity, the proportion in which it
exchanges for other commodities, is determined by its cost of production. The acts of
overreaching and taking advantage of one another within the capitalist ranks necessarily
equalize themselves. The improvements of machinery, the new applications of the forces of
nature in the service of production, make it possible to produce in a given period of
time, with the same amount of labor and capital, a larger amount of products, but in no
wise a larger amount of exchange values. If by the use of the spinning-machine I can
furnish twice as much yarn in an hour as before its invention -- for instance, 100 pounds
instead of 50 pounds -- in the long run I receive back, in exchange for this 100 pounds no
more commodities than I did before for 50; because the cost of production has fallen by
1/2, or because I can furnish double the product at the same cost.
Finally, in whatsoever proportion the capitalist class, whether of one country or of
the entire world-market, distribute the net revenue of production among themselves, the
total amount of this net revenue always consists exclusively of the amount by which
accumulated labor has been increased from the proceeds of direct labor. This whole amount,
therefore, grows in the same proportion in which labor augments capital -- i.e., in the
same proportion in which profit rises as compared with wages.
THE INTERESTS OF CAPITAL AND WAGE-LABOR
ARE DIAMETRICALLY OPPOSED
-- EFFECT OF GROWTH OF PRODUCTIVE CAPITAL ON WAGES
We thus see that, even if we keep ourselves within the relation
of capital and wage-labor, the interests of capitals and the interests of wage-labor are
diameterically opposed to each other.
A rapid growth of capital is synonymous with a rapid growth of profits. Profits can
grow rapidly only when the price of labor -- the relative wages -- decrease just as
rapidly. Relative wages may fall, although real wages rise simultaneously with nominal
wages, with the money value of labor, p[ provided only that the real wage does not rise in
the same proportion as the profit. If, for instance, in good business years wages rise 5
per cent, while profits rise 30 per cent, the proportional, the relative wage has not
increased, but decreased.
If, therefore, the income of the worker increased with the rapid growth of capital,
there is at the same time a widening of the social chasm that divides the worker from the
capitalist, and increase in the power of capital over labor, a greater dependence of labor
To say that "the worker has an interest in the rapid growth of capital",
means only this: that the more speedily the worker augments the wealth of the capitalist,
the larger will be the crumbs which fall to him, the greater will be the number of workers
than can be called into existence, the more can the mass of slaves dependent upon capital
We have thus seen that even the most favorable situation for the working class, namely,
the most rapid growth of capital, however much it may improve the material life of the
worker, does not abolish the antagonism between his interests and the interests of the
capitalist. Profit and wages remain as before, in inverse proportion.
If capital grows rapidly, wages may rise, but the profit of capital rises
disproportionately faster. The material position of the worker has improved, but at the
cost of his social position. The social chasm that separates him from the capitalist has
Finally, to say that "the most favorable condition for wage-labor is the fastest
possible growth of productive capital", is the same as to say: the quicker the
working class multiplies and augments the power inimical to it -- the wealth of another
which lords over that class -- the more favorable will be the conditions under which it
will be permitted to toil anew at the multiplication of bourgeois wealth, at the
enlargement of the power of capital, content thus to forge for itself the golden chains by
which the bourgeoisie drags it in its train.
Growth of productive capital and rise of wages, are they really so indissolubly united
as the bourgeois economists maintain? We must not believe their mere words. We dare not
believe them even when they claim that the fatter capital is the more will its slave be
pampered. The bourgeoisie is too much enlightened, it keeps its accounts much too
carefully, to share the prejudices of the feudal lord, who makes an ostentatious display
of the magnificence of his retinue.. The conditions of existence of the bourgeoisie compel
it to attend carefully to its bookkeeping. We must therefore examine more closely into the
- In what manner does the growth of productive capital affect wages?
If as a whole, the productive capital of bourgeois society grows, there takes place a
more many-sided accumulation of labor. The individual capitals increase in number and in
magnitude. The multiplications of individual capitals increases the competition among
capitalists. The increasing magnitude of increasing capitals provides the means of leading
more powerful armies of workers with more gigantic instruments of war upon the industrial
The one capitalist can drive the other from the field and carry off his capital only by
selling more cheaply. In order to sell more cheaply without ruining himself, he must
produce more cheaply -- i.e., increase the productive forces of labor as much as possible.
But the productive forces of labor is increased above all by a greater division of
labor and by a more general introduction and constant improvement of machinery. The larger
the army of workers among whom the labor is subdivided, the more gigantic the scale upon
which machinery is introduced, the more in proportion does the cost of production
decrease, the more fruitful is the labor. And so there arises among the capitalists a
universal rivalry for the increase of the division of labor and of machinery and for their
exploitation upon the greatest possible scale.
If, now, by a greater division of labor, by the application and improvement of new
machines, by a more advantageous exploitation of the forces of nature on a larger scale, a
capitalist has found the means of producing with the same amount of labor (whether it be
direct or accumulated labor) a larger amount of products of commodities than his
competitors -- if, for instance, he can produce a whole yard of linen in the same
labor-time in which his competitors weave half-a-yard -- how will this capitalist act?
He could keep on selling half-a-yard of linen at old market price; but this would not
have the effect of driving his opponents from the field and enlarging how own market. But
his need of a market has increased in the same measure in which his productive power has
extended. The more powerful and costly means of production that he has called into
existence enable him, it is true, to sell his wares more cheaply, but they compel him at
the same time to sell more wares, to get control of a very much greater market for his
commodities; consequently, this capitalist will sell his half-yard of linen more cheaply
than his competitors.
But the capitalist will not sell the whole yard so cheaply as his competitors sell the
half-yard, although the production of the whole yard costs him no more than does that of
the half-yard to the others. Otherwise, he would make no extra profit, and would get back
in exchange only the cost of production. He might obtain a greater income from having set
in motion a larger capital, but not from having made a greater profit on his capital than
the others. Moreover, he attains the object he is aiming at if he prices his goods only a
small percentage lower than his competitors. He drives them off the field, he wrests from
them at least part of their market, by underselling them.
And finally, let us remember that the current price always stands either above or below
the cost of production, according as the sale of a commodity takes place in the favorable
or unfavorable period of the industry. According as the market price of the yard of linen
stands above or below its former cost of production, will the percentage vary at which the
capitalist who has made use of the new and more faithful means of production sell above
his real cost of production.
But the privilege of our capitalist is not of long duration. Other competing
capitalists introduce the same machines, the same division of labor, and introduce them
upon the same or even upon a greater scale. And finally this introduction becomes so
universal that the price of the linen is lowered not only below its old, but even below
its new cost of production.
The capitalists therefore find themselves, in their mutual relations, in the same
situation in which they were before the introduction of the new means of production; and
if they are by these means enabled to offer double the product at the old price, they are
now forced to furnish double the product for less than the old price. Having arrived at
the new point, the new cost of production, the battle for supremacy in the market has to
be fought out anew. Given more division of labor and more machinery, and there results a
greater scale upon which division of labor and machinery are exploited. And competition
again brings the same reaction against this result.
EFFECT OF CAPITALIST COMPETITION ON THE CAPITALIST CLASS,
THE MIDDLE CLASS,
AND THE WORKING CLASS
We thus see how the method of production and the means of
production are constantly enlarged, revolutionized, how division of labor necessarily
draws after it greater division of labor, the employment of machinery greater employment
of machinery, work upon a large scale work upon a still greater scale. This is the law
that continually throws capitalist production out of its old ruts and compels capital to
strain ever more the productive forces of labor for the very reason that it has already
strained them -- the law that grants it no respite, and constantly shouts in its ear:
March! march! This is no other law than that which, within the periodical fluctuations of
commerce, necessarily adjusts the price of a commodity to its cost of production.
No matter how powerful the means of production which a capitalist may bring into the
field, competition will make their adoption general; and from the moment that they have
been generally adopted, the sole result of the greater productiveness of his capital will
be that he must furnish at the same price, 10, 20, 100 times as much as before. But since
he must find a market for, perhaps, 1,000 times as much, in order to outweigh the lower
selling price by the greater quantity of the sale;since now a more extensive sale is
necessary not only to gain a greater profit, but also in order to replace the cost of
production (the instrument of production itself grows always more costly, as we have
seen), and since this more extensive sale has become a question of life and death not only
for him, but also for his rivals, the old struggle must begin again, and it is all the
more violent the more powerful the means of production already invented are. The division
of labor and the application of machinery will therefore take a fresh start, and upon an
even greater scale.
Whatever be the power of the means of production which are employed, competition seeks
to rob capital of the golden fruits of this power by reducing the price of commodities to
the cost of production; in the same measure in which production is cheapened - i.e., in
the same measure in which more can be produced with the same amount of labor -- it compels
by a law which is irresistible a still greater cheapening of production, the sale of ever
greater masses of product for smaller prices. Thus the capitalist will have gained nothing
more by his efforts than the obligation to furnish a greater product in the same
labor-time; in a word, more difficult conditions for the profitable employment of his
capital. While competition, therefore, constantly pursues him with its law of the cost of
production and turns against himself every weapon that he forges against his rivals, the
capitalist continually seeks to get the best of competition by restlessly introducing
further subdivision of labor and new machines, which, though more expensive, enable him to
produce more cheaply, instead of waiting until the new machines shall have been rendered
obsolete by competition.
If we now conceive this feverish agitation as it operates in the market of the whole
world, we shall be in a position to comprehend how the growth, accumulation, and
concentration of capital bring in their train an ever more detailed subdivision of labor,
an ever greater improvement of old machines, and a constant application of new machine --
a process which goes on uninterruptedly, with feverish haste, and upon an ever more
But what effect do these conditions, which are inseparable from the growth of
productive capital, have upon the determination of wages?
The greater division of labor enables one laborer to accomplish the work of five, 10,
or 20 laborers; it therefore increases competition among the laborers fivefold, tenfold,
or twentyfold. The laborers compete not only by selling themselves one cheaper than the
other, but also by one doing the work of five, 10, or 20; and they are forced to compete
in this manner by the division of labor, which is introduced and steadily improved by
Furthermore, to the same degree in which the division of labor increases, is the labor
simplified. The special skill of the laborer becomes worthless. He becomes transformed
into a simple monotonous force of production, with neither physical nor mental elasticity.
His work becomes accessible to all; therefore competitors press upon him from all sides.
Moreover, it must be remembered that the more simple, the more easily learned the work is,
so much the less is its cost to production, the expense of its acquisition, nd so much the
lower must the wages sink -- for, like the price of any other commodity, they are
determined by the cost of production. Therefore, in the same manner in which labor becomes
more unsatisfactory, more repulsive, do competition increase and wages decrease.
The laborer seeks to maintain the total of his wages for a given time by performing
more labor, either by working a great number of hours, or by accomplishing more in the
same number of hours. Thus, urged on by want, he himself multiplies the disastrous effects
of division of labor. The result is: the more he works, the less wages he receives. And
for this simple reason: the more he works, the more he competes against his fellow
workmen, the more he compels them to compete against him, and to offer themselves on the
same wretched conditions as he does; so that, in the last analysis, he competes against
himself as a member of the working class.
Machinery produces the same effects, but upon a much larger scale. It supplants skilled
laborers by unskilled, men by women, adults by children; where newly introduced, it throws
workers upon the streets in great masses; and as it becomes more highly developed and more
productive it discards them in additional though smaller numbers.
We have hastily sketched in broad outlines the industrial was of capitalists among
themselves. This war has the peculiarity that the battles in it are won less by recruiting
than by discharging the army of workers. The generals (the capitalists) vie with one
another as to who an discharge the greatest number of industrial soldiers.
The economists tell us, to be sure, that those laborers who have been rendered
superfluous by machinery find new venues of employment. They dare not assert directly that
the same laborers that have been discharged find situations in new branches of labor.
Facts cry out too loudly against this lie. Strictly speaking, they only maintain that new
means of employment will be found for other sections of the working class; for example,
for that portion of the young generation of laborers who were about to enter upon that
branch of industry which had just been abolished. Of course, this is a great satisfaction
to the disabled laborers. There will be no lack of fresh exploitable blood and muscle for
the Messrs. Capitalists -- the dead may bury their dead. This consolation seems to be
intended more for the comfort of the capitalists themselves than their laborers. If the
whole class of the wage-laborer were to be annihilated by machinery, how terrible that
would be for capital, which, without wage-labor, ceases to be capital!
But even if we assume that all who are directly forced out of employment by machinery,
as well as all of the rising generation who were waiting for a chance of employment in the
same branch of industry, do actually find some new employment -- are we to believe that
this new employment will pay as high wages as did the one they have lost? If it did, it
would be in contradiction to the laws of political economy. We have seen how modern
industry always tends to the substitution of the simpler and more subordinate employments
for the higher and more complex ones. How, then, could a mass of workers thrown out of one
branch of industry by machinery find refuge in another branch, unless they were to be paid
An exception to the law has been adduced, namely, the workers who are employed in the
manufacture of machinery itself. As soon as there is in industry a greater demand for and
a greater consumption of machinery, it is said that the number of machines must
necessarily increase; consequently, also, the manufacture of machines; consequently, also,
the employment of workers in machine manufacture; -- and the workers employed in this
branch of industry are skilled, even educated, workers.
Since the year 1840 this assertion, which even before that date was only half-true, has
lost all semblance of truth; for the most diverse machines are now applied to the
manufacture of the machines themselves on quite as extensive a scale as in the manufacture
of cotton yarn, and the laborers employed in machine factories can but play the role of
very stupid machines alongside of the highly ingenious machines.
But in place of the man who has been dismissed by the machine, the factory may employ,
perhaps, three children and one woman! And must not the wages of the man have previously
sufficed for the three children and one woman? Must not the minimum wages have sufficed
for the preservation and propagation of the race? What, then, do these beloved bourgeois
phrases prove? Nothing more than that now four times as many workers' lives are used up as
there were previously, in order to obtain the livelihood of one working family.
To sum up: the more productive capital grows, the more it extends the division of labor
and the application of machinery; the more the division of labor and the application of
machinery extend, the more does competition extend among the workers, the more do their
wages shrink together.
In addition, the working class is also recruited from the higher strata of society; a
mass of small business men and of people living upon the interest of their capitals is
precipitated into he ranks of the working class, and they will have nothing else to do
than to stretch out their arms alongside of the arms of the workers. Thus the forest of
outstretched arms, begging for work, grows ever thicker, while the arms themselves grow
It is evident that the small manufacturer cannot survive in a struggle in which the
first condition of success is production upon an ever greater scale. It is evident that
the small manufacturers and thereby increasing the number of candidates for the
proletariat -- all this requires no further elucidation.
Finally, in the same measure in which the capitalists are compelled, by the movement
described above, to exploit the already existing gigantic means of production on an
ever-increasing scale, and for this purpose to set in motion all the mainsprings of
credit, in the same measure do they increase the industrial earthquakes, in the midst of
which the commercial world can preserve itself only by sacrificing a portion of its
wealth, its products, and even its forces of production, to the gods of the lower world --
in short, the crises increase. They become more frequent and more violent, if for no other
reason, than for this alone, that in the same measure in which the mass of products grows,
and there the needs for extensive markets, in the same measure does the world market
shrink ever more, and ever fewer markets remain to be exploited, since every previous
crisis has subjected to the commerce of the world a hitherto unconquered or but
superficially exploited market.
But capital not only lives upon labor. Like a master, at once distinguished and
barbarous, it drags with it into its grave the corpses of its slaves, whole hecatombs of
workers, who perish in the crises.
We thus see that if capital grows rapidly, competition among the workers grows with
even greater rapidity -- i.e., the means of employment and subsistence for the working
class decrease in proportion even more rapidly; but, this notwithstanding, the rapid
growth of capital is the most favorable condition for wage-labor.
 Translator's Note to 1891 edition: It must be remembered that
this was written over 40 years ago. Today the class struggle in Switzerland, and
especially Belgium, has reached that degree of development where it compels recognition
from even the most superficial observers of political industrial life.
 That is the "common" people as distinct from the
"noble" and "clerical" (or "religious") people. Originating
in feudal times in the rank of freeman and town-burgher the "commons" or
"citizens" (burgher, burghers, citizen, citizens, or bourgeois) formed the
starting-point of the bourgeoisie". - Ed.
 As stated by Engels in the Introduction, the series of articles
on "Wage-Labor and Capital" remained incomplete; the pamphlet is confined almost
exclusively to a consideration of the first "great division": the relation of
wage-labor to capital. - Ed.
 "Sell" is not a very exact expression, for serfdom in
its purity did not involve any relations of buying and selling between serf and the lord
of the manor, the tributes of the former to the latter consisting in labor and in kind. It
is evident that Marx here uses the word 'sells" in the general sense of alienation.