Means of production are the machines, land, factories, and equipment used to produce commodities, which are owned by capitalists. Labor is the human effort that is utilized to produce goods and services, with laborers selling their labor but not the means of production. Example: The owner of the factory owns the machinery, while workers operate them.
Value is found in the amount of labor expended in creating a commodity. The greater the amount of labor needed, the more valuable the item. Example: A chair handmade is more valuable than a mass-produced plastic chair because of the labor.
Work creates value; without work, raw materials mean nothing. Value is based upon the work necessary to produce something. Example: A diamond isn’t just precious because it’s rare, but because of all the work to unearth it, cut it, and polish it.
Labor is the actual work performed, whereas labor power is the ability of the worker to work and is sold to employers at a wage. Example: A computer programmer is paid for his labor power, but the company earns much more money through the software created.
Surplus value is the extra value produced by labor beyond their wages, which employers keep as profit. It is responsible for class struggle, where workers ask for higher wages and capitalists attempt to extract as much surplus value as they can. Example: An employee produces $100 worth of goods but receives only $10; the other $90 is kept by the employer as surplus value.
