The Labor Theory of Value posits that the exchange value of a commodity is determined by the socially necessary labor time required for its production, while surplus labor appropriation describes the extraction of value generated by workers beyond what is needed to reproduce their own means of subsistence within capitalist relations. This framework relies on formal economic definitions distinguishing between constant capital (means of production), variable capital (labor power), and surplus value, operating strictly within classical political economy as a methodological foundation for analyzing class dynamics and profit origins. It functions as a critical theoretical lens in Marxism that isolates the structural mechanisms of exploitation independent of market prices or subjective utility assessments.
Marx's labor theory of value holds that the exchange value of a commodity is determined by the socially necessary labor time required to produce it under prevailing conditions of production and avera…