Karl Marx, answered from the texts and cited to the page.
Surplus value is the difference between what the worker creates and what he is paid — and the whole architecture of Capital rests on grasping that difference precisely. Begin with the working day. Part of it the worker spends reproducing the value of his own labor-power: the food, shelter, clothing required to keep him alive and capable of working.
That portion I call necessary labor-time.1 But the working day does not end there. He continues to labor beyond that point, and during this surplus labor-time he creates value for which he receives nothing — no equivalent, no return.2 That unreturned value is surplus value, and it is, as I put it in Capital, nothing but materialised surplus-labour, a congelation of unpaid time.3
The mechanism that makes this possible is the peculiar commodity the worker brings to market: not a finished product, but his labor-power itself. This is the pivot on which everything turns. If the worker sold the capitalist a commodity — say, the twist already woven, the product already finished — the law of value would govern the exchange directly: equal quantities of labor for equal quantities of labor, no surplus, no profit.4
But he does not sell a product. He sells the capacity to labor for a period of time, and that capacity has a value determined by what it costs to reproduce it — which is less than what it produces when set to work.5 The capitalist buys labor-power at its value, and then extracts from it more labor than that value represents. The surplus is not a swindle in the marketplace; it is the structural consequence of what is being bought and sold.
The formula, then: the capitalist advances a sum of money containing a certain quantity of labor. The worker, in production, adds more labor than that sum represents. The product emerges containing more value than the wages paid out.6 That excess — the additional quantity of labor for which nothing was paid — constitutes surplus value, and it is precisely from this source that profit flows.7
What the trinity formula of bourgeois economics — land/rent, capital/profit, labour/wages — systematically conceals is that wages appear to be the specific and complete product of labor, its sole product, while rent and profit appear as the natural offspring of land and capital respectively.8 The structural relation disappears behind the surface of distribution.
Strip that away, and the matter is, as I wrote in the Theories of Surplus Value, fairly simple in its embryonic state: if with £100 you buy the labor of ten men but the product embodies the labor of twenty, the surplus value is £100 — the unpaid labor of ten men, or equivalently, twenty men each working half the day for themselves and half for the capitalist gratis.9
The difficulty is not arithmetic. The difficulty — and it occupied me for decades — is showing how this appropriation of labor without any equivalent arises not despite the law of commodity exchange, but through it.10
That portion of the working-day, then, during which this reproduction takes place, I call 'necessary' labour time, and the labour expended during that time I call 'necessary' labour.Capital Vol I
During the second period of the labour-process, that in which his labour is no longer necessary labour, the workman, it is true, labours, expends labour-power; but his labour, being no longer necessary labour, he creates no value for himself. He creates surplus-value which, for the capitalist, has all the charms of a creation out of nothing.Capital Vol I
It is every bit as important, for a correct understanding of surplus-value, to conceive it as a mere congelation of surplus labour-time, as nothing but materialised surplus-labour, as it is, for a proper comprehension of value, to conceive it as a mere congelation of so many hours of labour, as nothing but materialised labour.Capital Vol I
If he had confronted the capitalist in the first form, as a possessor of commodities, the capitalist would not have been able to make any profit, to realise any surplus-value, since according to the law of value exchange is between equivalents, an equal quantity of labour for an equal quantity of labour.Theories of Surplus Value Vol I, pp. 314–315
The capitalist's surplus arises precisely from the fact that he buys from the labourer not a commodity but his labour-power itself, and this has less value than the product of this labour-power, or, what is the same thing, realises itself in more materialised labour than is realised in itself.Theories of Surplus Value Vol I, pp. 314–315
the capitalist buys an additional quantity of labour for which he does not pay, an excess over the quantity of labour contained in the money he pays out. And it is precisely this additional quantity of labour which constitutes the surplus-value created by capital.Theories of Surplus Value Vol I, p. 86
Since however, by his labour materialised in the product, he has added not only as much labour-time as was contained in the money he received, he has paid not only an equivalent but has given surplus-labour gratis—which is precisely the source of the profit.Theories of Surplus Value Vol I, p. 86
Since wages here appear to be the specific product of labour, its sole product (and they are indeed the sole product of labour for the wage-worker), the other parts of value—rent and profit (interest)—appear to flow just as necessarily from other specific sources.Theories of Surplus Value Vol III, pp. 485–486
if with £100, i.e., the labour of 10 [men], one buys the labour of 20 [men]... the value of the product will be £200 and the surplus-value will amount to £100, equal to the unpaid labour of 10 [men].Theories of Surplus Value Vol III, pp. 485–486
The difficulty is simply to discover how this appropriation of labour without any equivalent arises from the law of commodity exchange.Theories of Surplus Value Vol III, pp. 485–486