Below is some old notes I came across that tries to summaries Wage Labour and capital by Marx and Engels.
The worker sells their labour power, that is their ability to labour to the capitalist in order to secure for his or herself the means to continue his existence. The time spent labouring isn’t felt to be part of his/her life, but as a sacrifice made in order to live. The objective result of labour, the product of the labour is of no concern to the worker, it is rather, only the wage that s/he works for. The wage being that faction of the value of the commodity the worker made that is returned to the worker by the capitalist such that the worker can carry on living and therefore carry on working.
What determines the price of a wage? Just as with any commodity price is determined by competition between buyers and sellers, and the cost of production of the commodity. Wages are determined in the same fashion that is the magnitude of wages are a result of the cost of producing labour that is, the worker. Therefore the lesser the cost of producing a worker, the lesser the wage and the higher the profit for the capitalist. Wages approach the level of bare subsistence as the work become more menial (ie requiring less skill and training).
The minimum wage however is not that required for the subsistence of every individual worker, but the subsistence of the working class as a whole. For a great many workers, the minimum wage is not enough to support themselves and their families, but it is sufficient for the working class to survive in general.
In the exchange of labour power for the means of existence the worker’s labour is combined with the means of production to multiply capital. Capital can be seen as materialised labour. It is the domination of this materialised labour over that labour of the living worker that gives the accumulation of this material labour its character as capital. Capital does not serve the worker as a means by which new production can occur, but it is the labour of the worker that serves the accumulated material labour in its preservation and multiplication of its exchange value. The creative function of the worker’s labour gives the accumulated labour, that is capital, a greater value than it has before.
The exchange between the worker and capitalist.
The capitalist appropriates the majority of the increased value conferred to his capital, which can be further invested in capital expansion. The worker however must sell his labour to secure his/her means to survive anew everyday. As once the worker’s wage has been spent, it must be worked for again, the worker has no substantial means to invest, no other means to exist other than to continually sell their labour.
Even though the relationship between the capitalist and the worker that appears to be based on a free exchange, it is in fact nothing of the sort. The worker chooses to enter the relationship, but it is a forced choice as there is no alternative. There is no commonality in the interests between the two classes.
In times of economic boom, however, when capital grows so does the demand for workers, resulting in an increase in wages. Yet the worker is always in a subordinate position to the capitalist, even under these more favorable conditions. For example as capital expands so does the relative share of value to the capital owning class and the decadence that comes along with this. Marx explains it with reference to a neighbourhood containing a hut and palace, as capital increases the palace grows grander, while on the other hand the trivial increase in wages makes the hut slightly nicer to live in. However the hut will always remain more uncomfortable and difficult to live in relative to the capitalist’s palace. Wages may very well rise, but the proportion of value directed towards the profit of capital always rises with disproportional rapidity.
This relativity relates to the difference between nominal wages (price of labour power) and real wages. The nominal wage does not coincide with the real wage ie. the amount of commodities one can actually exchange wages for. To quote Marx:
“real wages express the price of labour power in relation to the price of other commodities; relative (nominal) wages express the share of immediate labour in the value created created by, in relation to the share of it which falls to accumulated labour, that is, capital.”
To say that workers and capitalist have a shared interest because as capital expands wages can increase too means only that the more the worker enriches the capitalist, the larger are the scraps that fall form his table. The material conditions of the worker might have partially increased with the rise in wages, but his social position relative to the capitalist has diminished. that is the gap between the two interns of material wealth has grown much larger. To quote Marx again:
To say that the most favorable conditon for wage labour is the fastest growth of capital is to say: The faster the working class multiplies 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 itself the golden chains by which the bourgeoisie drags at its train.”
The Effect of Machinery
Machinery has the effect of increasing the productivity of labour. The greater the division of labour is in a society, the greater the scale is to which machinery can be employed to achieve this effect. Additionally the more productive labour is, the less the cost of production is. The capitalist now has the means to produce the same amount of goods with fewer labour hours, or more goods with the same amount of labour hours.
With the increase in goods that come at the cheaper productive cost, the capitalist is able to sell at a lower price, undercutting other competing capitalists. However, more must be sold to achieve the same profit as before the introduction of machines. Therefore the means of production are revolutionised by the introduction of machinery, but once there has been a general adoption of machinery across the industry in question, the original adopter of the machinery loses its advantage. He must now revolutionise the process of production again, or find a larger market for the increased output of goods.
The effect of machinery on the worker under capitalism is a general impoverishment. machinery and the division of labour makes work tedious and repetitive, rendering the skill of the worker unnecessary, so wages fall as the cost of producing workers (ie less training, skill etc…) fall too. The worker can seek to maintain the level of his/her wages by working more hours. In doing so though, the more he comes into competition with other workers, lowering wages further.
In summary the greater the expansion of capital, the greater the division of labour is and the employment of machines; the greater the division of labour and employment of machines become, the greater the competition is among workers and the greater the collective fall in wages becomes.
Addendum regarding additional factors on the magnitude of wages:
The above trend can be suspended or reversed temporarily via other factors such as working class action to maintain or increase wages or via imperialist super-exploitation of the 3rd world in order to maintain profit while also allowing for an increase in wages in the 1st world. The ultimate effect being that workers in the imperialist centres of the world are placated with the higher relative wage and turn away from revolutionary action. While in the 3rd world without the support of the workers of the 1st world, any opposition to their imperial subjugation can be easily crushed by the overwhelming force of the 1st world.
Marx in the Carparx 