The Surplus

THE SURPLUS

The surplus product is that part of the total output of an economy that is in excess of what is needed for reproducing and replenishing the labor, tools, materials and another inputs used or used up in production. In other words it is what remains after the necessary product has been taken out from the total product.

A way of increasing the surplus is with a labor-saving technical change, which is a new technology that increases the total output produced with a given amount of labor. However, the advantages of a labor-saving technical change can be taken either as an increase in total product with the same amount of labor or the same production with less labor. If you go with the first way then the productivity will increase, so the surplus product. With the use of same production with less labor method the consumption of the producers will be reduced and it will cause an increase of the surplus product.

Another way of increasing the surplus would involve capital goods-saving technology. It is a new technology which reduces the capital goods and/or materials required to produce the total product. By using this type of change you could reduce the amount of input necessary for production. Since you reduce the amount to replace the materials and capital goods used in production, the amount of the surplus will be increased.

There are still some other ways of increasing the surplus product. One of them is to make the workers work harder with the same number of hours that they work. By keeping their hours the same, you keep their consumption at the same level. If the intensity of labor is increased the total product will increase, so the surplus, assuming that the replacement of materials and goods and the consumption stay the same. A final way is based on the total time the producers spend at work. If you make them work longer they will produce more so the total product will be more.

Conflicts of interest occur in two ways, one within the nations and the other between the groups in different nations. Conflict with the nations arises when the producers are not allowed to keep the surplus. When the surplus is to be enlarged the owner will get the producers work harder, work longer or consume less. Owners are the “happy” ones in this situation. But as oppose to this the producer are “better off” if they work less intense, less hours or their consumption level is higher. If the producers’ well being is increased the owners will not be happy because the surplus will be less since the producers’ consumption is raised. Here the conflict arises between the producers and the owners.

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