The M-C-M’ diagram is key to understanding how capitalists sustain and grow their wealth within a capitalist system. Here’s a breakdown of what each element represents and how they interact.

M (Money): This is the starting point for capitalists. They begin with a certain amount of money that they use to invest in the production process.
C (Commodities): The money is used to purchase commodities, which can include labor, raw materials, and machinery. These commodities are essential for creating goods or services.
M’ (Increased Money): After the commodities are produced and sold, the capitalists receive money back, but ideally, this amount is greater than the initial investment. The difference between the original amount of money (M) and the amount received after sales (M’) represents profit.
The process can be summarized as follows: a capitalist invests money (M) to buy resources and labor (C), produces goods, and sells them for a higher price, thus generating more money (M’).

This cycle allows capitalists to continually reinvest their profits into further production, expanding their wealth over time. Key factors that enable this process include market demand, efficiency in production, and the ability to control costs, especially labor costs. By consistently repeating this cycle—transforming money into commodities and back into more money—capitalists can maintain and increase their wealth, reinforcing their economic power within society.