Important Notice: Our web hosting provider recently started charging us for additional visits, which was unexpected. In response, we're seeking donations. Depending on the situation, we may explore different monetization options for our Community and Expert Contributors. It's crucial to provide more returns for their expertise and offer more Expert Validated Answers or AI Validated Answers. Learn more about our hosting issue here.

What is the organic composition of capital?

April 26, 2017Capital composition organic

0

Posted

What is the organic composition of capital?

1 Answer

0

Posted

All capital is either constant or variable. The organic composition of capital is the ratio of the labor value of constant capital to the labor value of variable capital. In other words, the organic composition of capital is the ratio of the labor value of the means of production (constant) to total wages (variable). Roughly, the organic composition of capital is a measure of capital intensity. According to Marx, surplus value can only be realized through exploitation of variable capital; therefore, a change in the organic composition of capital has an effect on working hours and wages.