Classical Political Economy borrowed from every-day life the category
 “price of labour” without further criticism, and then simply asked the
 question, how is this price determined? It soon recognized that the change
 in the relations of demand and supply explained in regard to the price
 of labour, as of all other commodities, nothing except its changes i.e.,
 the oscillations of the market-price above or below a certain mean. If
 demand and supply balance, the oscillation of prices ceases, all other
 conditions remaining the same. But then demand and supply also cease to
 explain anything. The price of labour, at the moment when demand and supply
 are in equilibrium, is its natural price, determined independently of the
 relation of demand and supply. And how this price is determined is just
 the question. Or a larger period of oscillations in the market-price is
 taken, e.g., a year, and they are found to cancel one the other, leaving
 a mean average quantity, a relatively constant magnitude. This had naturally
 to be determined otherwise than by its own compensating variations. This
 price which always finally predominates over the accidental market-prices
 of labour and regulates them, this “necessary price” (Physiocrats) or “natural
 price” of labour (Adam Smith) can, as with all other commodities, be nothing
 else than its value expressed in money. In this way Political Economy expected
 to penetrate athwart the accidental prices of labour, to the value of labour.
 As with other commodities, this value was determined by the cost of production.
 But what is the cost of production – of the labourer, i.e., the cost of producing
 or reproducing the labourer himself? This question unconsciously substituted
 itself in Political Economy for the original one; for the search after
 the cost of production of labour as such turned in a circle and never left
 the spot. What economists therefore call value of labour, is in fact the
 value of labour-power, as it exists in the personality of the labourer,
 which is as different from its function, labour, as a machine is from the
 work it performs. Occupied with the difference between the market-price
 of labour and its so-called value, with the relation of this value to the
 rate of profit, and to the values of the commodities produced by means
 of labour, &c., they never discovered that the course of the analysis
 had led not only from the market-prices of labour to its presumed value,
 but had led to the resolution of this value of labour itself into the value
 of labour-power. Classical economy never arrived at a consciousness of
 the results of its own analysis; it accepted uncritically the categories
 “value of labour,” “natural price of labour,” &c., as final and as
 adequate expressions for the value-relation under consideration, and was
 thus led, as will be seen later, into inextricable confusion and contradiction,
 while it offered to the vulgar economists a secure basis of operations
 for their shallowness, which on principle worships appearances only.