Study Guide for

Karl Marx’s

Capital

Volume II

Part I: The Metamorphoses of Capital and their Circuits

Chapter 1: - The Circuit of Money-Capital

Terms: Circuit of Capital, Commodity, Capital, Money, Production and Consumption, Metamorphosis of Capital. Labour-power, Price, Surplus Value, Means of Production, Proletariat.

Questions for discussion:
1. What does it mean to assume that commodities are sold “at their value”? Is this not a circular assumption?
2. Why does Marx say that labour cannot have a value?
3. Under what conditions is the sale of labour part of the circuit of capital, M —L?
4. Which specific features of M —L in capitalist production should be attributed to money and which to capital?
5. Why is it necessary for commodity production to be general for wage-labour to be the dominant form of labour? And why is it impossible for money to take the form of capital outside of the circulation of commodities?
6. What is meant by money capital, productive capital and commodity capital and what is their relation to one another, and what is “industrial capital”?
7. What commodity is produced by the transportation industry? And how would you reckon the transportation commodity as part of the cost of getting a product to the market and realising its value as money? And what about a worker's cost of getting to the workplace?

Chapter 2: - The Circuit of Productive Capital

Terms: Proletariat.

Questions for discussion:
1. Even though the bourgeoisie are as wealthy a class as any monarchy or nobility, they usually do not make a show of their wealth, at least in mature capitalist countries. Why is this?
2. Why is it not viable for the capitalists to consume the entirety of the surplus realised in production?

Chapter 3: - The Circuit of Commodity-Capital

Questions for discussion:
1. Why does Marx say that commodity capital must contain surplus value at the start of the circuit?
2. Marx rejects the political economists' depiction of production as the purpose of the process of capitalist production. Why?
3. Marx says that the fact that the total social capital is the algebraic sum of all the individual capitals does not preclude the fact that the individual capitals may present other phenomena than the same movement as part of the aggregate capital?
4. “Increased productivity can increase only the substance of capital, but not its value.” Explain.

Chapter 4: - The Three Formulas of the Circuit

Terms: Mediation, Abstract, Market, Functionalism, Commodification.

Questions for discussion:
1. Why has Marx divided the circulation of capital into three forms and what phenomena does he bring to light in this way?
2. Why does Marx refer to production as an interruption of circulation?
3. What does this chapter tell you about different sections of the capitalist class and their interrelations?
4. What is the historical relation between the three circuits of capital?
5. What does Marx mean by natural economy, money economy and credit economy?

Chapter 5: The Time of Circulation

Terms: Cycle of Reproduction, Variable and Constant Capital.

Questions for discussion:
1. What factors can you list that lengthen/shorten the time of circulation of capital?
2. Broadly speaking, how do you think the time of circulation has varied over the past decades? And how do you see it moving at the moment, and what effect do you see this as having?
3. What is the effect on the time of circulation on the rate of profit, other things being equal?

Chapter 6: The Costs of Circulation

Terms: Productive Labour, Realisation, Taylorism, Brand.

Questions for discussion:
1. How do you understand Marx's metaphor with the Law of Conservation of Energy?
2. What does Marx say about the productiveness and usefulness of the retail worker? How does the cost of circulation affect the value of the product, according to Marx?
3. What distinction (if any) does Marx make between the costs of circulation and the costs of transportation? Do you think that this distinction is legitimate?
4. What does Marx say about the costs of accounting &c.? And again, do you think it is legitimate to distinguish between the labour of the bookkeeper, as a cost of production and deduction from capital, and the labour of the production line operator, which creates new value by its use?
5. What is Marx's point about costs which increase the price of a commodity without adding to its usefulness? How who you look at advertising and “branding” in this context?
6. What is Marx's point, in terms of cost of circulation, about the mass of commodities resting in the market awaiting purchase?
7. What is Marx's point about the costs of transportation (here considered as part of the costs of circulation)? Do you think these costs are rightly placed under costs of circulation, or could they legitimately included under costs of production?
8. Discuss how the categories outlined by Marx in this chapter may or may not express the nature of the capitalist production process in his times, and whether the nature of capitalist production today warrants any amendment to these ideas?

Part II: The Turnover of Capital (Ch 7-17)

People: Adam Smith, Quesnay, David Ricardo.

Terms: The Working Day, Rate of Surplus Value.

Questions for discussion:
1. How does the concept of velocity of turnover relate to the concepts of the circuit of capital, discussed in Part I?
2. What differences does Marx identify between fixed and “circulating” capital, and between constant an variable capital in terms of the turnover time?
3. What is Marx's criticism of Adam Smith's analysis of fixed vs. circulating capital?
4. What is Marx's criticism of the Physiocrats' analysis of fixed vs. circulating capital?
5. What is Marx's criticism of David Ricardo's analysis of fixed vs. circulating capital?
6. How does the length of the period of interruption of the circulation of capital during the production process affect relations between different capitals?
7. What imperative does the distnction between the time of production and the working time impose on the productive capitalist?
8. What effect does the circulation time have on competition between capitalists?
9. How would a change of prices affect a capitalist in relation to all these varaibles?
10. What is the distinction between the rate of surplus value and the annual rate of surplus value? And how would you describe the significance of the annual rate of surplus value?
11. How do all these factors affect the accumulation of capital?
12. How does the amount of money and credit in circulation affect all these factors?
13. In general, how do you think velocity of turnover, the proportion of fixed to circulating capital and the proportion of working time to production time have varied over the past?

Part III: Reproduction and Circulation of the Aggregate Social Capital (Ch 18-19)

Terms: Distribution and Exchange, Credit.

Questions for discussion:
1. What does Marx see as the essential role of Money capital in the aggregate process of capitalist production?
2. What is Marx criticism of Quesnay's conception of the aggregate process of capitalist production?
3. What is Marx criticism of Adam Smith's conception of the aggregate process of capitalist production?
4. What is Marx criticism of Ricardo's conception of the aggregate process of capitalist production?

Chapter 20: Simple Reproduction

Terms: Departments of Capital, Overproduction and Underconsumption, Necessary and Surplus Labour Time.

Questions for discussion:
1. In terms of the production in Departments I and II, what factors constrain the proportion of the total social product which the bourgeoisie must allocate for their own consumption and that of the working class?
2. In the same terms, what would be the effect of a wage increase on the economy as a whole?
3. What issues would arise for a developing country trying to build up a capitalist economy? And what issues arise in respect to international trade between countries in which living standards are very different?

Chapter 21: Accumulation and Reproduction on an Expanded Scale (Ch 16-18)

Terms: Fordism, Great Depression, Free Trade and Protectionism, Bretton Woods.

Questions for discussion:
1. What kind of measures foster accumulation of capital on an expanded scale?
2. What kinds of crises do you see arising from too rapid expansion of accumulation?
3. In these considerations, do you see reasons for the decline of agriculture?
4. Do you see in these consdierations any basis for the growth of the service sector in recent deacdes?
5. Do you see in these consdierations any basis for the growth of the finance sector in recent deacdes?

Andy Blunden, 2002