Productive Capital

Capital that exists in the form of the means of production and labor-power; the functional form that industrial capital takes in the second stage of its circuit, i.e., the stage of production. Its function is to transfer the old value of the means of production to the new product through the combination of the means of production and labor in the production process, and to create new value from the labor of the workers to realize the valorization of value.

Productive capital can be classified according to the part it plays in the process of production of surplus-value: constant capital, i.e., means of production; and variable capital, i.e., labor-power.

According to the different modes of transfer of value in the process of turnover of capital, it can be divided into fixed capital and circulating capital, fixed capital, such as machinery, equipment, buildings, etc., and circulating capital, such as raw materials, materials, fuel, auxiliary materials, etc.

Since productive capital produces commodities that contain surplus-value, capital undergoes a valorization in the stage of production, which is therefore the decisive stage in the circuit of capital.