We must further bear in mind that profits are made not only by industrial undertakings, which produce commodities; but also by commercial undertakings, which merely act as a medium between the producer and the consumer for the sale of such commodities to the latter; and likewise by banks, carriers and forwarding agents, railways, etc. In the case of all these undertakings--always assuming efficient business management--profits are determined by the amount of capital invested. It is no wonder that those persons who are concerned in the practical conduct of such undertakings should be convinced that profits arise, so to speak, spontaneously out of capital--that capital produces them just as the tree, if properly cultivated, produces fruit. And in so far as profits are not regarded as a natural characteristic inherent to capital, they are looked upon as the result of the work accomplished by the capitalist. As a matter of fact, we have invariably had to start, in our discussion, from the presumption that the management of the business is an efficient one. Much depends on the personal efficiency of the manager. Should the latter prove inefficient, the profit of any individual undertaking can easily sink below the general average rate, whereas a capable manager may succeed in raising it above that average.
PROFIT AND VALUE IN CIRCULATION
(Extracted from vol. III, part. 1, sections 1 & 2, German ed. --Vol. I, ch. 5.)
BUT how can profit derive "spontaneously" from capital? For the production of any given commodity the capitalist needs a certain sum, say $25.00. In this sum are included all the costs of production, i. e. raw and auxiliary materials, wages, the wear of the machinery, tools, buildings, etc. He subsequently sells the finished commodity for $27.50. If we conclude that the finished commodity is really worth $27.50, we must necessarily conclude that this increased value, which has accrued during the process of production, has arisen out of nothing, seeing that all the values for which the capitalist