| Commodity | Any good or service produced for exchange. Has both use-value (utility) and exchange-value (market value). | A loaf of bread has utility as food (use-value) and can be exchanged for money (exchange-value). | Commodities are the basic units of capitalist production; Marx analyzes their dual nature to reveal systemic exploitation. |
| Labor Power | The capacity of a worker to work, which is itself a commodity in capitalism. | A factory worker sells 8 hours of labor to a capitalist for a wage. | Understanding labor power is key to analyzing how surplus value is generated. |
| Value | Determined by socially necessary labor time required to produce a commodity. | If producing a chair takes 5 hours of average labor, its value is equivalent to that labor. | Explains the source of wealth in capitalist production and underpins the labor theory of value. |
| Surplus Value | The value produced by labor beyond the worker’s wage; the source of profit. | Worker produces goods worth $200, but is paid $100; surplus value = $100. | Central to Marx’s critique of exploitation and the extraction of profit. |
| Constant Capital (C) | Value invested in means of production (machines, materials). | Machines, raw materials, and factory equipment. | Does not generate new value itself but is essential for production. |
| Variable Capital (V) | Value invested in labor power. | Wages paid to workers. | Generates surplus value, as labor produces more value than it receives. |
| Rate of Surplus Value | Ratio of surplus value to variable capital; measures exploitation. | If $100 of surplus value is produced on $50 wages, rate = 200%. | Quantifies the degree of worker exploitation. |
| Capital (K) | Wealth invested to produce more wealth; includes constant and variable capital. | Investment in machinery + wages to produce goods for sale. | Forms the basis of capitalist accumulation and expansion. |
| Commodity Fetishism | Perception of commodities as having intrinsic value independent of human labor. | A smartphone seems valuable on its own, ignoring labor and social conditions that produced it. | Obscures exploitation and social relations inherent in production. |
| Alienation | Workers become estranged from: (1) the product, (2) the labor process, (3) other workers, (4) human potential. | Factory work reduces labor to repetitive tasks, disconnected from the finished product. | Highlights the human cost of capitalist production. |
| Means of Production | Physical instruments of production: machinery, tools, land, raw materials. | A textile mill’s looms and threads. | Determines control over production; workers without means of production are dependent on capitalists. |
| Mode of Production | Combination of productive forces (labor, tools) and relations of production (social organization of labor). | Feudal, capitalist, or socialist modes of production. | Framework for historical materialism; defines societal structure and class relations. |
| Primitive Accumulation | Historical process establishing private property and capitalist relations. | Enclosure movement in England, expropriating common lands. | Explains the historical emergence of capitalism and dispossession of workers. |
| Circulation of Capital | Process of turning money into commodities and back into money (M–C–M’). | $100 invested in materials and labor → commodity → sold for $150. | Demonstrates how capital reproduces itself and generates profit. |
| Fixed Capital | Long-term means of production that depreciate over time (machines, buildings). | Factory machinery. | Determines the structure and efficiency of production. |
| Circulating Capital | Short-term inputs consumed in production (raw materials, wages). | Cotton, thread, energy for production. | Requires constant replenishment; essential for continuous production. |
| Overproduction | Production exceeding the market demand; a source of crises. | Factories produce more goods than consumers can buy. | Explains recurrent economic crises in capitalism. |
| Rate of Profit | Ratio of surplus value to total capital invested. | $100 surplus on $400 total capital → 25% rate. | Determines investment strategies and economic fluctuations. |
| Tendency of the Rate of Profit to Fall | Long-term decline in profitability due to mechanization and capital concentration. | Machines replace labor, reducing surplus value proportionally. | Central explanation for systemic crises in capitalism. |
| Concentration and Centralization of Capital | Process where capital accumulates and larger enterprises dominate smaller ones. | Mergers and acquisitions in industrial sectors. | Leads to monopolies and intensifies exploitation. |
| Crisis of Capitalism | Periodic breakdowns due to internal contradictions: overproduction, falling profit rates, or debt. | Economic depressions or stock market crashes. | Demonstrates capitalism’s instability and historical specificity. |
| Exploitation | Extraction of surplus value from labor by capitalists. | Paying workers less than the value of goods they produce. | Core of Marx’s critique of capitalism. |
| Productive vs. Unproductive Labor | Productive labor generates surplus value; unproductive labor supports production indirectly. | Factory worker (productive) vs. accountant (unproductive, indirect contribution). | Helps analyze labor’s role in value creation. |