Surplus labour

Surplus labour is a concept used by Karl Marx in his critique of political economy. It means labour performed in excess of the labour necessary to produce the means of livelihood of the worker. The "surplus" in this context means the additional labour a worker has to do in his/her job, beyond earning his own keep. According to Marxian economics, surplus labour is usually uncompensated labour.


Marx explains the origin of surplus labour in the following terms:
The historical emergence of surplus labour is, according to Marx, also closely associated with the growth of trade and with the emergence of a society divided into social classes. As soon as a permanent surplus product can be produced, the moral-political question arises as to how it should be distributed, and for whose benefit surplus-labour should be performed. The strong defeat the weak, and it becomes possible for a social elite to gain control over the surplus-labour and surplus product of the working population; they can live off the labour of others.
Labour which is sufficiently productive so that it can perform surplus labour is, in a cash economy, the material foundation for the appropriation of surplus-value from that labour. How exactly this appropriation will occur, is determined by the prevailing relations of production and the balance of power between social classes.
According to Marx, capital had its origin in the commercial activity of buying in order to sell and rents of various types, with the aim of gaining an income from this trade. But, initially, this does not involve any capitalist mode of production; rather, the merchant traders and rentiers are intermediaries between non-capitalist producers. During a lengthy historical process, the old ways of extracting surplus labour are gradually replaced by commercial forms of exploitation.

Historical materialism

In Das Kapital Vol. 3, Marx highlights the central role played by surplus labour:
This statement is a foundation of Marx's historical materialism insofar as it specifies what the class conflicts in civil society are ultimately about: an economy of time, which compels some to do work of which part or all of the benefits go to someone else, while others can have leisure-time which in reality depends on the work efforts of those forced to work.
In modern society, having work or leisure may often seem a choice, but for most of humanity, work is an absolute necessity, and consequently most people are concerned with the real benefits they get from that work. They may accept a certain rate of exploitation of their labour as an inescapable condition for their existence, if they depend on a wage or salary, but beyond that, they will increasingly resist it. Consequently, a morality or legal norm develops in civil society which imposes limits for surplus-labour, in one form or another. Forced labour, slavery, gross mistreatment of workers etc. are no longer generally acceptable, although they continue to occur; working conditions and pay levels can usually be contested in courts of law.

Unequal exchange

Marx acknowledged that surplus labour may not just be appropriated directly in production by the owners of the enterprise, but also in trade. This phenomenon is nowadays called unequal exchange. Thus, he commented that:
In this case, more work effectively exchanges for less work, and a greater value exchanges for a lesser value, because some possess a stronger market position, and others a weaker one. For the most part, Marx assumed equal exchange in Das Kapital, i.e. that supply and demand would balance; his argument was that even if, ideally speaking, no unequal exchange occurred in trade, and market equality existed, exploitation could nevertheless occur within capitalist relations of production, since the value of the product produced by labour power exceeded the value of labour power itself. Marx never completed his analysis of the world market however.
In the real world, Marxian economists like Samir Amin argue, unequal exchange occurs all the time, implying transfers of value from one place to another, through the trading process. Thus, the more trade becomes "globalised", the greater the intermediation between producers and consumers; consequently, the intermediaries appropriate a growing fraction of the final value of the products, while the direct producers obtain only a small fraction of that final value.
The most important unequal exchange in the world economy nowadays concerns the exchange between agricultural goods and industrial goods, i.e. the terms of trade favour industrial goods against agricultural goods. Often, as Raul Prebisch already noted, this has meant that more and more agricultural output must be produced and sold, to buy a given amount of industrial goods. This issue has become the subject of heated controversy at recent WTO meetings.
The practice of unequal or unfair exchange does not presuppose the capitalist mode of production, nor even the existence of money. It only presupposes that goods and services of unequal value are traded, something which has been possible throughout the whole history of human trading practices.

Criticism of Marx's concept of surplus labour

According to economist Fred Moseley, "neoclassical economic theory was developed, in part, to attack the very notion of surplus labour or surplus value and to argue that workers receive all of the value embodied in their creative efforts."
Some basic modern criticisms of Marx's theory can be found in the works by Pearson, Dalton, Boss, Hodgson and Harris.
The analytical Marxist John Roemer challenges what he calls the "fundamental Marxian theorem" that the existence of surplus labour is the necessary and sufficient condition for profits. He proves that this theorem is logically false. However, Marx himself never argued that surplus labour was a sufficient condition for profits, only an ultimate necessary condition. Five reasons were that:
All that Marx really argued was that surplus labour was a necessary feature of the capitalist mode of production as a general social condition. If that surplus labour did not exist, other people could not appropriate that surplus labour or its products simply through their ownership of property.
Also, the amount of unpaid, voluntary and housework labour performed outside the world of business and industry, as revealed by time use surveys, suggests to some feminists that Marxists may have overrated the importance of industrial surplus labour performed by salaried employees, because the very ability to perform that surplus-labour, i.e. the continual reproduction of labour power depends on all kinds of supports involving unremunerated work. In other words, work performed in households—often by those who do not sell their labour power to capitalist enterprises at all—contributes to the sustenance of capitalist workers who may perform little household labour.
Possibly the controversy about the concept is distorted by the enormous differences with regard to the world of work:
Countries differ greatly with respect to the way they organise and share out work, labour participation rates, and paid hours worked per year, as can be easily verified from ILO data. The general trend in the world division of labour is for hi-tech, financial and marketing services to be located in the richer countries, which hold most intellectual property rights and actual physical production to be located in low-wage countries. Effectively, Marxian economists argue, this means that the labour of workers in wealthy countries is valued higher than the labour of workers in poorer countries. However, they predict that in the long run of history, the operation of the law of value will tend to equalize the conditions of production and sales in different parts of the world.