Wages by the piece are nothing else than a converted form of wages by time, just as wages by time are a converted form of the value or price of labour-power. In piece wages it seems at first sight as if the use-value bought from the labourer was, not the function of his labour-power, living labour, but labour already realized in the product, and as if the price of this labour was determined, not as with time-wages, by the fraction daily value of labour-power the working day of a given number of hours The confidence that trusts in this appearance ought to receive a first severe shock from the fact that both forms of wages exist side by side, simultaneously, in the same branches of industry; e.g., In the same saddlery shops of London, often for the same work, piece wages are paid to the French, time-wages to the English. In the regular factories in which throughout piece wages predominate, particular kinds of work are unsuitable to this form of wage, and are therefore paid by time.  But it is, moreover, self-evident that the difference of form in the payment of wages alters in no way their essential nature, although the one form may be more favorable to the development of capitalist production than the other. Let the ordinary working-day contain 12 hours of which 6 are paid, 6 unpaid. Let its value-product be 6 shillings, that of one hour s labour therefore 6d. Let us suppose that, as the result of experience, a labourer who works with the average amount of intensity and skill, who, therefore, gives in fact only the time socially necessary to the production of an article, supplies in 12 hours 24 pieces, either distinct products or measurable parts of a continuous whole. Then the value of these 24 pieces, after. subtraction of the portion of constant capital contained in them, is 6 shillings, and the value of a single piece 3d. The labourer receives 1 d. per piece, and thus earns in 12 hours 3 shillings. Just as, with time-wages, it does not matter whether we assume that the labourer works 6 hours for himself and 6 hours for the capitalist, or half of every hour for himself, and the other half for the capitalist, so here it does not matter whether we say that each individual piece is half paid, and half unpaid for, or that the price of 12 pieces is the equivalent only of the value of the labour-power, whilst in the other 12 pieces surplus-value is incorporated. The form of piece wages is just as irrational as that of time-wages. Whilst in our example two pieces of a commodity, after subtraction of the value of the means of production consumed in them, are worth 6d. as being the product of one hour, the labourer receives for them a price of 3d. Piece wages do not, in fact, distinctly express any relation of value. It is not, therefore, a question of measuring the value of the piece by the working-time incorporated in it, but on the contrary, of measuring the working-time the labourer has expended by the number of pieces he has produced. In time-wages, the labour is measured by its immediate duration; in piece wages, by the quantity of products in which the labour has embodied itself during a given time.  The price of labour time itself is finally determined by the equation: value of a day s labour = daily value of labour-power. Piece-wage is, therefore, only a modified form of time-wage. Let us now consider a little more closely the characteristic peculiarities of piece wages. The quality of the labour is here controlled by the work itself, which must be of average perfection if the piece-price is to be paid in full. Piece wages become, from this point of view, the most fruitful source of reductions of wages and capitalistic cheating. They furnish to the capitalist an exact measure for the intensity of labour. Only the working-time which is embodied in a quantum of commodities determined beforehand, and experimentally fixed, counts as socially necessary working-time, and is paid as such. In the larger workshops of the London tailors, therefore, a certain piece of work, a waistcoat, e.g., is called an hour, or half an hour, the hour at 6d. By practice it is known how much is the average product of one hour. With new fashions, repairs, &c., a contest arises between master and labourer as to whether a particular piece of work is one hour, and so on, until here also experience decides. Similarly in the London furniture workshops, &c. If the labourer does not possess the average capacity, if he cannot in consequence supply a certain minimum of work per day, he is dismissed.  Since the quality and intensity of the work are here controlled by the form of wage itself, superintendence of labour becomes in great part superfluous. Piece wages therefore lay the foundation of the modern domestic labour, described above, as well as of a hierarchically organized system of exploitation and oppression. The latter has two fundamental forms. On the one hand, piece wages facilitate the interposition of parasites between the capitalist and the wage-labourer, the sub-letting of labour. The gain of these middlemen comes entirely from the difference between the labour-price which the capitalist pays, and the part of that price which they actually allow to reach the labourer.  In England this system is characteristically called the sweating system. On the other hand, piece-wage allows the capitalist to make a contract for so much per piece with the head labourer in manufactures with the chief of some group, in mines with the extractor of the coal, in the factory with the actual machine-worker at a price for which the head labourer himself undertakes the enlisting and payment of his assistant work people. The exploitation of the labourer by capital is here effected through the exploitation of the labourer by the labourer.  Given piece-wage, it is naturally the personal interest of the labourer to strain his labour-power as intensely as possible; this enables the capitalist to raise more easily the normal degree of intensity of labour.  It is moreover now the personal interest of the labourer to lengthen the working-day, since with it his daily or weekly wages rise.  This gradually brings on a reaction like that already described in time-wages, without reckoning that the prolongation of the working-day, even if the piece wage remains constant, includes of necessity a fall in the price of the labour. In time-wages, with few exceptions, the same wage holds for the same kind of work, whilst in piece wages, though the price of the working time is measured by a certain quantity of product, the day s or week s wage will vary with the individual differences of the labourers, of whom one supplies in a given time the minimum of product only, another the average, a third more than the average. With regard to actual receipts there is, therefore, great variety according to the different skill, strength, energy, staying-power, &c., of the individual labourers.  Of course this does not alter the general relations between capital and wage-labour. First, the individual differences balance one another in the workshop as a whole, which thus supplies in a given working-time the average product, and the total wages paid will be the average wages of that particular branch of industry. Second, the proportion between wages and surplus-value remains unaltered, since the mass of surplus labour supplied by each particular labourer corresponds with the wage received by him. But the wider scope that piece-wage gives to individuality tends to develop on the one hand that individuality, and with it the sense of liberty, independence, and self-control of the labourers, and on the other, their competition one with another. Piece-work has, therefore, a tendency, while raising individual wages above the average, to lower this average itself. But where a particular rate of piece-wage has for a long time been fixed by tradition, and its lowering, therefore, presented especial difficulties, the masters, in such exceptional cases, sometimes had recourse to its compulsory transformation into time-wages. Hence, e.g., in 1860 a great strike among the ribbon-weavers of Coventry.  Piece-wage is finally one of the chief supports of the hour-system described in the preceding chapter.  From what has been shown so far, it follows that piece-wage is the form of wages most in harmony with the capitalist mode of production. Although by no means new it figures side by side with time-wages officially in the French and English labour statutes of the 14th century it only conquers a larger field for action during the period of manufacture, properly so-called. In the stormy youth of modern industry, especially from 1797 to 1815, it served as a lever for the lengthening of the working-day, and the lowering of wages. Very important materials for the fluctuation of wages during that period are to be found in the Blue books: Report and Evidence from the Select Committee on Petitions respecting the Corn Laws (Parliamentary Session of 1813-14), and Report from the Lords Committee, on the State of the Growth, Commerce, and Consumption of Grain, and all Laws relating thereto (Session of 1814-15). Here we find documentary evidence of the constant lowering of the price of labour from the beginning of the anti-Jacobin War. In the weaving industry, e.g., piece wages had fallen so low that, in spite of the very great lengthening of the working-day, the daily wages were then lower than before. How little the increased intensity and extension of labour through piece wages benefited the agricultural proletariat, the following passage borrowed from a work on the side of the landlords and farmers shows: Malthus at that time remarked with reference to the facts published by Parliament: In the workshops under the Factory Acts, piece wages become the general rule, because capital can there only increase the efficacy of the working-day by intensifying labour.  With the changing productiveness of labour the same quantum of product represents a varying working-time. Therefore, piece-wage also varies, for it is the money expression of a determined working-time. In our example above, 24 pieces were produced in 12 hours, whilst the value of the product of the 12 hours was 6s., the daily value of the labour-power 3s., the price of the labour-hour 3d., and the wage for one piece d. In one piece half-an-hour s labour was absorbed. If the same working-day now supplies, in consequence of the doubled productiveness of labour, 48 pieces instead of 24, and all other circumstances remain unchanged, then the piece-wage falls from 1 d. to 3/4d., as every piece now only represents 1/4, instead of of a working-hour. 24 by 1 d. = 3s., and in like manner 48 by 3/4d. = 3s. In other words, piece-wage is lowered in the same proportion as the number of the pieces produced in the same time rises,  and, therefore, as the working time spent on the same piece falls. This change in piece-wage, so far purely nominal, leads to constant battles between capitalist and labour. Either because the capitalist uses it as a pretext for actually lowering the price of labour, or because increased productive power of labour is accompanied by an increased intensity of the same. Or because the labourer takes seriously the appearance of piece wages (viz., that his product is paid for, and not his labour-power) and therefore revolts against a lowering of wages, unaccompanied by a lowering in the selling price of the commodity. The capitalist rightly knocks on the head such pretensions as gross errors as to the nature of wage-labour.  He cries out against this usurping attempt to lay taxes on the advance of industry, and declares roundly that the productiveness of labour does not concern the labourer at all.  
Economic Manuscripts: Capital Vol. I - Chapter Twenty-One