1. Define how wages, labor, commodities, and the cost of production are related in the system of capitalism, as Marx outlines it. What happens to the cost of production as industrial innovations and greater division of labor are introduced, and how does this affect other parts of the system?
From what I was able to comprehend from this chapter, Marx is suggesting that wage, labor, commodities, and the cost of production work in a recurring manner. The process of each entity affects the other. He starts with wage which he defines as the amount of money paid by the capitalist in exchange for the provision of labor. Basically, there is a price to be paid for extracting labor from someone else. The worker's commodity is his labor as confusing as Marx puts it because "for the same sum with which the capitalist has bought their labor, for example, two marks, he could have bought two pounds of sugar or a definite amount of any other commodity. The two marks, which he bought two pounds of sugar, are the price of the two pounds of sugar. The two marks, with which he bought twelve hours' use of labor, are the price of twelve hours' labor." (122) In other words, labor is a commodity neither more or less than sugar because it is purchased with the capitalist's money. The worker exchanges his commodity (labor) for the capitalist's commodity (wage). The worker in order to make his means of subsistence exchanges the commodity (wage) paid to him for other commodities (products) such as food, fuel, and clothing. He is able to purchase these products because the capitalist has paid him for his labor. As Marx also specifies, the wage of a worker is determined by the cost of the commodity he produces. For example, when a product is made, it is bargained for by buyers who want to buy it for a cheap price and sellers who want to sell it at a reasonable price and still profit. Therefore competition arises and when a final price is reached, this price will determine the worker's wage. Marx uses the term "fluctuation" to describe the variation of things that affect the price of commodities (wages and products). The cost of production being one of them affects wage in the sense that the price of labor will depend on the cost of production such as the time inputted into the labor and the amount of effort as well. Basically, the less time you spend working or the less the job requires of you, the less the cost of production of the worker and the lower his wages.
As industrial innovations and greater division of labor are introduced, the cost of production decreases because larger amounts of products are being created in a shorter time with the same amount of labor and capital. The capitalist profits while the worker's relative wage decreases. This means that the margin between capitalist growth and worker wage widens dramatically. It does not mean that the worker's wage won't increase but in the long run, the bourgeois wins and the proletariat loses. At this stage, the worker needs the capitalist in order to make his means of subsistence. His dependence on capital increases.