42 SOCIAL SCIENTIST
creation and expansion of a ^reserve army of labour', a term to be elaborated below.
Accumulation and Wages ^
Historical experience shows that in capitalist society., periods of feverish economic activity alternate with periods when the economy is in the doldrums. At times., due to one or more of such factors as the opening up of new markets., a whole new crop of scientific-technical inventions^ conquest of colonies and so on, the capitalist class seeks to convert as much of its surplus .value into capital as possible, trying to take advantage of very profitable business conditions. In such periods, the rate of accumulation becomes quite high. With the levels of technique in society as a whole more or less fixed at existing levels, this implies a considerably increased demand for labour power. Given the nature of the commodity, labour power, however, it is clearly not possible to increase its supply immediately in accordance with the capitalists' demand. The increased demand for labour power thus expresses itself in an increase of wages above the customary value of labour power. There are, however, severe limits to the rise of wages. In the first place, such wage increases will occur only in so far as the capitalists find themselves more than compensated by the increased surplus values accruing to them from their investments. In the second place, if the rise in wages cuts into the gains of the capitalists, the stimulus of gain is thereby blunted and the capitalists will reduce their investments, thus slowing down the rate of accumulation, and therefore removing the cause of the wage increases. Marx puts the matter thus:
If the quantity of unpaid labour supplied by the working class, and accumulated by the capitalist class, increases so rapidly that its conversion into capital requires an extraodinary addition of paid labour, then wages rise. and, all other circumstances remaining equal, the unpaid labour diminishes in proportion. But as soon as this diminution touches the point at which the surplus labour that nourishes capital is no longer supplied in normal quantity, a reaction sets in, a smaller part of revenue is capitalized, accumulation lags, and the movement of rise, in wages receives a check. The rise of wages therefore is confined within limits that not only leave intact the foundations of the capitalistic system, but also secure its reproduction on a progressive, scale.1
A number of points need to be made here. It is the rate of accumulation by the capitalist class that determines the level of wages and its rise. Thus, even in a period of capitalist prosperity, the fact remains that the incomes of employed workers are determined by the independent decisions of the capitalist class. Secondly, nothing of basic importance changes as a result of the temporary rise in wages. Workers continue to produce surplus value, and in fact a larger total mass of