a functional form of, and the third stage in, the circulation of industrial capital. Commodity capital functions in the sphere of circulation, acting to change the form of value. In its natural form, it is represented by a given quantity of commodities that are produced in capitalist enterprises and designated for sale. As expressed in terms of value, commodity capital consists of three elements: c + v + m, where c is the constant capital, v the variable capital, and m the surplus value. As the scope of capitalist production becomes greater and the social division of labor becomes more pronounced, the functions of commodity capital realization are individuated in the form of commercial capital.
It is characteristic of commodity capital that its circulation reflects not only the process wherein the originally advanced value increases spontaneously but also the movement of the capital value, which contains the surplus value. Both the value of the advanced capital and the surplus value are realized within the process of the commodity capital’s movement.
The circulation of commodity capital implies the satisfaction of personal and production needs. Capitalists must find in the market the means of production necessary to recover the means of production that have been consumed and to expand the scope of productive activity. Capitalists and workers must have the opportunity to buy consumer goods in the market. The circulation of commodity capital reflects the internal interdependence between capitalist production and the circulation of all social capital within the framework of reproduction. The goal of capitalist production is the derivation of surplus value, and from this point of view it does not matter to capitalists which use values they produce. However, the appropriation of surplus value implies an act of selling. If the commodity produced is not in accord with the volume and structure of societal demand, it cannot be sold; the transformation of value, and hence of surplus value as well, from the commodity form to the money form would be impossible, and the normal process of reproducing individual capital would be violated. The interdependence between production and circulation under the conditions of capitalism is regulated spontaneously by the law of value; hence it always manifests itself in an approximate, indirect manner in the form of periodic crises of overproduction.
REFERENCEMarx, K. Kapital, vol. 2. In K. Marx and F. Engels, Soch., 2nd ed., vol. 24, ch. 3.
A. A. KHANDRUEV