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Rate of exploitation

Express surplus value relative to variable capital, with the ratio and percentage shown together.

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Start with the worked example below. Use the same value units and period for both inputs; use a decimal point without commas.

Surplus value produced during the chosen period.

Value advanced for labour-power in the same units and period; must be greater than zero.

Result

Rate of exploitation (e)

100%

Ratio: 1

Step-by-step derivation

  1. 1.Relate surplus to variable capital

    e = s / v

    The rate of surplus value compares surplus value with the value advanced for labour-power.

  2. 2.Substitute the values

    e = 90 / 90

    Both amounts use the same value unit and accounting period.

  3. 3.Calculate the ratio

    e = 1

    A ratio of 1 means surplus value equals variable capital.

  4. 4.Express it as a percentage

    1 × 100% = 100%

    Multiplying the ratio by 100 expresses the rate in percent. Rates can exceed 100%.

Displayed numbers use up to 10 significant figures. Calculations use the full precision of the inputs.

Notes and assumptions

The rate of exploitation, or rate of surplus value, compares surplus value with variable capital. It differs from the rate of profit, whose denominator includes constant capital as well. Use matching value units and accounting periods.

Variable capital must be positive: a zero denominator gives an undefined rate, including when surplus is also zero. Zero surplus with positive variable capital gives 0%. Rates above 100% are valid in this model.

Worked example

For surplus value of 90 and variable capital of 90, the ratio is 1 and the rate is 100%. In Marx's example this also describes equal necessary and surplus labour time. It does not state the absolute length of the working day.

Source

Karl Marx, Capital, volume I, chapter 9, section 1: “The Degree of Exploitation of Labour-Power”. Chapter numbering follows this edition.