Das Kapital, Volume 3, sub-titled “The Process of Capitalist Production as a Whole,” was published posthumously in 1894 and edited by Marx’s close collaborator, Friedrich Engels. In this volume, Marx integrates the theories from the previous two books to analyze how the capitalist system appears on the surface, with profits, interest, and rent concealing the underlying exploitation that generates them.
Key concepts and analysis
- The Transformation Problem: Marx tackles the discrepancy between the values of commodities derived from labor time (the focus of Volume 1) and the prices at which they are actually sold in the market. He explains how competition forces individual capitalists to sell their goods at prices that yield an average rate of profit, regardless of their own organic composition of capital (the ratio of constant to variable capital).
- Tendency of the Rate of Profit to Fall: This is a core theory of Volume 3. Marx argues that as capitalists compete and seek more efficient production methods, they invest more in constant capital (machinery and raw materials) relative to variable capital (labor). Because surplus value is extracted from labor, the overall rate of profit tends to fall over time, despite counteracting influences like foreign trade, increased intensity of exploitation, and cheapening of constant capital. This tendency drives crises and internal contradictions within the capitalist system.
- Distribution of surplus value: Marx analyzes how the total surplus value generated in production is divided among different factions of the capitalist class. He examines how surplus value is converted into different forms of revenue, which include:
- Industrial Profit: The portion of surplus value that goes to the industrial capitalist.
- Commercial Profit: The portion that goes to merchant capitalists involved in the circulation of commodities.
- Interest-bearing Capital: The portion paid to financiers as interest.
- Ground-rent: The portion that goes to landowners.
- Credit system: The book explores the role of credit in the capitalist system, explaining how banks and financial institutions mediate the flow of capital and allow for the expansion of production beyond what individual capitalists could achieve alone.
- Crises and contradictions: Volume 3 describes how the inherent contradictions of capitalism—such as the tendency for the rate of profit to fall, overproduction, and underconsumption—lead to cyclical crises. It predicts that these crises will become more severe, ultimately leading to the collapse of the system.
The role of Engels
After Marx’s death in 1883, Friedrich Engels undertook the immense task of compiling and editing Volume 3 from Marx’s extensive notes and manuscripts. Engels structured the text, clarified certain points, corrected mathematical errors, and added context where necessary, all while striving to maintain Marx’s original vision. This editorial work was crucial in bringing Marx’s complete critique of political economy to publication.