M-C-M’ formula illustrates the process with which the capitalist maintains and accumulates their wealth by means of capital accumulation cycle. The cycle is initiated by investment of M (Money) in purchasing C (Commodities)—raw material, machinery, and labor power—to produce products or services. The commodities are then sold to achieve M’ (More Money), and in this M’ the original money as well as extra surplus value (profit) is included. The idea of this cycle is that capitalists need to receive more value from production than they initially invested.

Exploitation of labor is one of the most significant things about it, as capitalists only pay the laborers less than what the work is worth. For example, the laborer might be paid for working eight hours, but what the laborer produces is worth more than what is paid. This surplus value is amassed by the capitalist to be invested and circulated again to repeat itself on a growing scale. Capitalists also exploit to extract maximum profit through downsizing, speedups, contract labor, and wage depression to extract maximum surplus to keep costs and attain maximum surplus.

This cyclical process of M-C-M’ enables the capitalists to amass wealth and have economic power, while the workers, who receive only wages and no surplus value, are dependent upon selling their labor to survive. With time, this widens the economic gap, as wealth in the hands of the owners of the means of production grows further, contributing towards consolidation of the capitalist class’s influence in society.