"In his Preface Engels claimed that at the beginning of Volume I of Capital ‘Marx takes simple commodity production as his historical presupposition, only later, proceeding on this basis, to come on to capital’: the advantage of this was that he could proceed ‘from the simple commodity and not from a conceptually and historically secondary form, the commodity as already modified by capitalism’.[6] This is in fact a misreading: Marx never used the expression ‘simple commodity production’ in Capital. Likewise, it is certain he never referred to the capitalistically produced commodity as a secondary derivative form.[7] Marx certainly does not develop the idea of ‘simple commodity production’ at the point where it was supposed to be under discussion, namely the first few chapters. Rather, as the first sentence of Volume I makes clear, the simple circulation discussed in the first few chapters is that of the capitalist economy."
CB: In Chapter 1: Comodities SECTION 2 THE TWOFOLD CHARACTER OF THE LABOUR EMBODIED IN COMMODITIES, is Marx talking about circulation of commodities in a capitalist economy when he cites Aristotle's discussion of commodities in ancient Greek society ? No, Aristotle was not discussing circulation of commodities in capitalist economy because a capitalist economy didn't exist in Aristotle's time. Here's Marx discussion of Aristotle on circulationof commodities in a non-capitalist economy. It is in the very first chapter of Capital Vol. One:
http://www.marxists.org/archive/marx/works/1867-c1/ch01.htm#S2
The two latter peculiarities of the equivalent form will become more intelligible if we go back to the great thinker who was the first to analyse so many forms, whether of thought, society, or Nature, and amongst them also the form of value. I mean Aristotle.
In the first place, he clearly enunciates that the money form of commodities is only the further development of the simple form of value – i.e., of the expression of the value of one commodity in some other commodity taken at random; for he says:
5 beds = 1 house – (clinai pente anti oiciaς)
is not to be distinguished from
5 beds = so much money. – (clinai pente anti ... oson ai pente clinai)
He further sees that the value relation which gives rise to this expression makes it necessary that the house should qualitatively be made the equal of the bed, and that, without such an equalisation, these two clearly different things could not be compared with each other as commensurable quantities. “Exchange,” he says, “cannot take place without equality, and equality not without commensurability". (out isothς mh oushς snmmetriaς). Here, however, he comes to a stop, and gives up the further analysis of the form of value. “It is, however, in reality, impossible (th men oun alhqeia adunaton), that such unlike things can be commensurable” – i.e., qualitatively equal. Such an equalisation can only be something foreign to their real nature, consequently only “a makeshift for practical purposes.”
Aristotle therefore, himself, tells us what barred the way to his further analysis; it was the absence of any concept of value. What is that equal something, that common substance, which admits of the value of the beds being expressed by a house? Such a thing, in truth, cannot exist, says Aristotle. And why not? Compared with the beds, the house does represent something equal to them, in so far as it represents what is really equal, both in the beds and the house. And that is – human labour.
There was, however, an important fact which prevented Aristotle from seeing that, to attribute value to commodities , is merely a mode of expressing all labour as equal human labour, and consequently as labour of equal quality. Greek society was founded upon slavery, and had, therefore, for its natural basis, the inequality of men and of their labour powers. The secret of the expression of value, namely, that all kinds of labour are equal and equivalent, because, and so far as they are human labour in general, cannot be deciphered, until the notion of human equality has already acquired the fixity of a popular prejudice. This, however, is possible only in a society in which the great mass of the produce of labour takes the form of commodities, in which, consequently, the dominant relation between man and man, is that of owners of commodities. The brilliancy of Aristotle’s genius is shown by this alone, that he discovered, in the expression of the value of commodities, a relation of equality. The peculiar conditions of the society in which he lived, alone prevented him from discovering what, “in truth,” was at the bottom of this equality.