Where Does the Money Come From? Marx’s Commodity Capital Circuit and the Reproduction of Total Social Capital

Many scholars emphasise the centrality of the money capital circuit in exposing the monetary nature of capitalist production relations, thereby distinguishing it from mainstream, neo-Ricardian and Sraffian approaches. Additionally, monetary circuit theorists dispute Marx’s reference to commodity money, arguing that only credit can monetise profits. In doing so, however, they overlook the layered structure of Marx’s dialectical method, which encompasses not only the circuit of capital analysed in Volume I of Capital, but also the two further circuits of capital introduced in Volume II of Capital and the analysis of capitalist credit forms in Volume III. Marx maintains that only the commodity capital circuit provides a suitable framework for moving from the analysis of individual capitals to that of total social capital and its relations. Within this perspective, the monetisation of surplus-value is not inherently problematic, as it relies on capitalists’ consumption and on their monetary advances, which actively finance new production. Marx’s choice to begin Capital, Volume I, with commodity money reflects a theoretically grounded view of capitalist relations, overlooked by Circuitist theorists who conflate the distinct levels at which monetary realisation and credit become relevant. He defers the analysis of capitalist credit forms to Volume III, consistent with the historically grounded premise that capital initially emerged where commodity money predominated. Only when expanded reproduction surpasses what the existing mass of commodity money in circulation can sustain does credit become necessary. Reinstating the commodity capital circuit also clarifies the nature of capitalism as inherently prone to crises, the inadmissibility of treating social reproduction as a sequence of self-contained static periods and the inadequacy of theorising the formation of prices of production under the constraints of simple reproduction.