Fixed capital

The two terms fixes vs. capital. Liquid capital is an instrument for the analysis of capital transformations that tries to explain from the perspective of the sphere of circulation formation and transformation of social wealth.

The term fixes capital comes from Adam Smith and referred to him and subsequently in the theory of Karl Marx, the peculiarity of the part of the constant capital, which acts as a working tool in the production process: This section retains the specific use the form with which he in the production process is received, compared to the products, it contributes to the formation and accordingly remains a part of its net present value is fixed in this form. This gives this part of the constant capital in the form of fixed capital. All other material components of the production process, in contrast, form liquid or circulating capital.

Karl Marx summed up this in-depth into the production process fixed capital than wear. That is, the net present value of the fixed capital is piecewise transferred to the product within the depreciation period and is completely converted back to the original form of money at the end of the depreciation period. The machine is then written off, its value is amortized. Therefore, it is

• In the total value of the machine (the purchase price ) to the fixed capital originally invested,
• While acting in the production part which is not yet transferred its value to the products, accounts for the applied fixed capital,
• The part that already transferred its value to the products, the already amortized part of the fixed capital forms.

Therefore: The " proportion in which it delivers value always is in inverse proportion to its entire working life " (Karl Marx, Capital, Volume 2, MEW 24, p 159). The fixed capital is thus not by its specific use-value, but characterized in that there is a double existence receives as value: A portion remains bound by its " bound natural form in another part dissolves from her than money " (Karl Marx, Capital, Volume 2, MEW 24, p 164). However, job resources according to the theory of Karl Marx by nature as little fixed capital, as they are inherently constant capital.

A machine is not their property, properties fixed capital, but by the way, as their value in productive capital is involved in the production, just piecemeal. This form of circulation, however, is determined by the objective properties. The counterpart to the fixed capital is circulating capital. In addition money capital and commodity- capital which imputes Marx neither circulating nor the fixed capital.

The relationship becomes clear when one takes a means of production as an example of fixed capital, which in contrast to actual work equipment also material enters the product of labor: Marx ' land improvements, whose value is indeed advanced to at once, but on eg five years distributed both materially as well as the value in the agricultural product is received.

Contrary to this, the economists confuse differentiation according to Marx, like for a fixed constant, on the other circulating with variable capital. Another popular misconception is it, for example, to reinterpret physical properties of work equipment, their immobility in the case of buildings, properties of fixed capital. Also, the fact that a sum of capital is advanced for a longer period without looking beat, do not do it to fixed capital. In agriculture, seed was fixed as one year in the production process, not being circulated during this time, but as a value.