economists such as David Ricardo), with another theory. This theory suggests that the value of a commodity is equal to its cost of production. Under this idea, the value of labor can be determined by the cost of sustaining him or the cost of replacing him.
Another way of looking at the exploitation of the worker is by examining the number of hours put into producing a product. The value of each product consists of three parts, according to Marx: the first part is the amount of constant capital put into a good, the second part is the amount of variable capital used to create the good (wages), and the third is the surplus value. The surplus value is the value of a good above and beyond the value that was paid to the worker in the form of wages. In fact by dividing the surplus value by the workers wages we are able to derive the Rate of Exploitation of the worker. So for example a worker?s wage might equal half of the value of the good he produced. The other half of the value that the worker added is the surplus value and the surplus value is taken for profit by the capitalist.
By looking at the relationship between the worker and the capitalist one thing is certain. The value of a good is determined either directly or indirectly by the worker. The value is either composed of the actual units of labor used to produce the product or the cost of labor is used as part the valuation of the good (in addition to the other costs such as materials and machinery). Regardless the worker is reduced to a tool used by the Capitalist and he is nothing more than a component in the production process. And that is what Marx felt would cause the strain and the inevitable rebellion of the worker.
It is important to note that despite the common misperception, Marx did not feel that Capitalism is all bad. He recognized that it ended feudalism which was far worse. In many ways he looked at Capitalism as a segue to something better. He believed that Capitalism was dynamic and constantly changing and this leads to the promotion of technology and spurs advances in science. He also knew that Capitalism was an efficient way of creating material wealth.
However, despite capitalism?s advantages, Marx could not over look its disadvantages. It divides people into classes, which in and of itself, Marx believed, creates problems. It produces wealth for few and unhappiness for many. He believed that a worker is not just selling his labor, he is selling his humanness. He believed that a Capitalist economy will grow for decades (although their will be periods of recession and depression), but the capitalist system can not flourish indefinitely because by isolating the worker and creating the tension that must exist between the capitalist and the worker, capitalism must fall. The workers will eventually organize themselves and overthrow capitalism and then capitalism will be regarded as feudalism is now, as a stepping stone to something better.