Labor power, producing a greater value than how much something is worth, that is a “surplus,” has created capital; enlarging then this surplus value with prolongation of the workday, has given sufficient nourishment to the capital for its infancy. The capital grows, and the surplus value must increase to satisfy the grown need. Increase of surplus value, however, does not mean, like we saw before, the extension of the workday, which eventually also has its necessary limits, although it is a very elastic length. For what little time there is that the capitalist leaves to the worker for the satisfaction of his most basic needs, the workday will always be less than 24 hours. The workday meets then a natural limit, and the surplus value, consequently, an insurmountable obstacle. Let’s represent the workday with the line A–B.

A-------D-------C----------------B

The letter A here represents the beginning and B the end, that natural limit, that is, past which it isn’t possible to go. A-C is the part of the day in which the worker produces the value of the salary received and C-B the part of the day in which the worker produces surplus value. We see that our cotton spinner, in fact, receiving 3 lire in salary, was reproducing the value of his salary with half of his day, and was producing 3 lire of surplus value with the other. The work done from A-C, with which the salary’s value is produced, is necessary labor, while the work done from C-B, which produces surplus value, is called exploitation.

The capitalist is thirsty for exploitation, because it is this that creates surplus value. Prolonged exploitation prolongs the workday, which finishes at its natural limit B, which represents an insurmountable obstacle to exploitation and surplus value. What to do now? The capitalist soon finds the solution. He observes that exploitation has two limits, one B, the end of the workday, the other C, the end of the necessary work; if the limit B is fixed, it won’t be so for limit C. Being able to move the point C all the way to point D, one would grow the exploitation from C-B the length of D-C, exactly how much the necessary work from A-C would decrease. Surplus value would thus find a way to continue growing, not in the absolute way like at first, which is by always prolonging the workday, but in relation to the growth of exploitation with the corresponding decrease in necessary work. The first was absolute surplus value, this is relative surplus value. Relative surplus value is founded upon the decreasing of necessary work; the decreasing of necessary work is founded upon the decreasing of wages; the decreasing of wages is founded upon a decrease in prices of things that are necessary for the worker; therefore relative surplus value is founded on the depreciation of the commodities that the worker uses.

And there would be an even quicker way of producing relative surplus value, someone will say, and that would be to pay the worker a salary less than that which he is due, that is not to pay him the proper price of his commodity, labor power. We cannot consider this expedient, used often in fact, minimally, because we aren’t admitting that it’s the most perfect observance of the law of exchange, according to which all commodities, and consequently labor power as well, must be sold and bought at their proper value.

Our capitalist, like we already saw, is an absolutely honest bourgeois; he will never use, to enlarge his capital, a method that is not entirely worthy of him.

Let’s suppose that, in a workday, a worker produces 6 items of a commodity, that the capitalist sells for the price of ₤7,50, because in the value of this commodity the raw materials and the means of production come to ₤1,50 and 12 hours of labor power come to 6 lire: all three components, therefore, come to ₤7,50. The capitalist finds a surplus value of 3 lire on the value of ₤7,50, the cost of his commodity, and on top of every component a surplus value of ₤0,50, because he spends ₤0,75 and extracts ₤1,25 from each of these. Let’s suppose that with a new system of work, or just with perfection of the old way, production doubles, and that, instead of 6 items a day, the capitalist is able to attain 12. If in 6 items the raw materials and the means of production come to ₤1,50, in 12 he will come to 3 lire, that is every item comes to ₤0,25. Those 3 lire combined with the 6 lire produced by labor power in 12 hours, make 9 lire, that is how much the 12 items cost, each one of which therefore comes to the price of ₤0,75.

Now the capitalist needs to make himself a larger place in the market to sell a double quantity of his commodity; and you can do this by somewhat restricting the price. In other words, the capitalist needs to make a reason arise for which he is able to sell their items on the market in twice the number as before; and the reason is found exactly in price reduction. He will sell, therefore, his items at a price somewhat lower than ₤1,25, which was his price before, but greater than ₤0,75 (how much each one of these is truly worth). He with sell them at a lira each, and so he will have secured doubled sales of his items, from which he now gains 6 lire; 3 lire of surplus value and 3 lire of difference between their value and the price at which they are sold.

As you can see, the capitalist gains a great profit from this growth of production. All capitalists are therefore highly interested in increasing the products of their industries, and it is with this that they are able to make this happen every day in any kind of production. Their extraordinary gain, however, that which represents the difference between the value of the commodity and the price at which it is sold, doesn’t last long, because right away the new or perfected system of production becomes adopted by all out of necessity. So now as a result the value of the commodity lessens by half. At first every item was worth ₤1,25; now instead it’s worth 62 ½ cents. The capitalist however always attains a profit, having doubled production. At first 3 lire of surplus value for 6 items and now 3 lire of surplus value for 12 items; but given that the 12 items are produced in the same time the 6 items were made, that is in 12 hours of work, he always has as a final result 3 lire of surplus value for one 12-hour workday, but double the production.

When this increase in production is regarding goods necessary to the worker, it consequently carries the lowering of the price of labor power, and therefore the lessening of necessary work and the increase of exploitation, which makes up relative surplus value.