The concept of “socially necessary labour time” emerged from classical political economy and was later explicitly formulated by Karl Marx. Early economists like Adam Smith and David Ricardo argued that the labour embedded in a commodity determined its value. However, it was Marx who refined and popularized the term, particularly in his work, Capital.

Marx used “socially necessary labour time” to denote the average amount of labour required to produce a commodity under prevailing social and technological conditions. This idea implies that the value of commodities isn’t based solely on the individual effort of a single producer but on the standardised conditions and methods accepted by society. Such an approach highlights the collective nature of production processes and helps explain how surplus value is generated in capitalist systems through the difference between paid labour time and the labour actually needed to reproduce the value of wages.