If the capital further grows to $10,000, 400 men will be employed, or one-third more than under the old system. Their numbers have, in point of fact, increased by 100, but relatively, i. e., in proportion to the total capital advanced, they have diminished by 800, for the $10,000 capital would, in the old state of things, have employed 1,200 instead of 400 men. Hence, a relative decrease in the number of hands is consistent with an actual increase.
DECREASE OF THE RATE OF PROFIT
(Extracted from vol. III, part 1, ch. 13-15. German ed.)
THE continuous relative decrease of the number of labourers employed, must have a peculiar effect on the rate (or percentage) of profit.
The aim of machinery (as also of the technical discoveries of former times) is to save labour. The same quantity of commodities--or a larger one--is produced by less labourers. Living labour becomes more productive and more fertile. The Alpha and Omega of economic progress is the increase of productiveness.
But this means that the same number of workmen workup an ever increasing mass of raw materials and utilise an ever increasing number of implements of labour. For instance, when the workman, with the help of the machine, is able to produce 10 times as much cotton yarn in the same time as he formerly did, he consumes also 10 times as much cotton, to say nothing of the immense and costly machine, which is far more valuable than the simple tool formerly in use. In other words, every economic progress--but in by far the largest measure the progress due to machinery--increases the quantity of constant capital consumed by a given number of labourers. But at the same time such progress diminishes, as a necessary consequence, the percentage of profit, as is clearly illustrated by the following table.
In order to simplify the calculation, we have everywhere