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Marxism & Business
Karl Marx was a 19th century German philosopher whose ideas formed the basis of communism and significantly influenced the fields of economics and commerce. Some of Marx's key contributions included critiquing capitalism and private property, advocating for proletarian revolution, developing theories of surplus value, wage determination, and the labor theory of value. Marx analyzed how capitalism exploits workers and pushes wages down over time as profits rise, laying the foundation for communist and socialist movements that sought to redistribute wealth more evenly.
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Marxism & Business
- 1. Marxism Contributions tothe fields of Commerce & Economics A report by Raymund Sanchez
- 2. Content of theReport Background Biography of Marx Development of the school of thought Theories Key terms Key concepts Contributions
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- 4. Background Karl HeinrichMarx Born: May 5, 1818 Died: March 14, 1883 Father: Heinrich Marx, a successful lawyer, was a man of the Enlightenment, devoted to Kant and Voltaire, who took part in agitations for a constitution in Prussia Mother: Henrietta Pressburg, native of Holland Religion: parents born Jewish but converted to Evangelical Established Church due to work requirements
- 5. Background Spouse: Jennyvon Westphalen, the educated daughter of a Prussian baron Children: 3 of 7 survived to adulthood due to poverty. Jenny Caroline, Jenny Laura, & Edgar Income: patronage from Friedrich Engels, writing, & inheritance of spouse German philosopher, political economist, historian, political theorist, sociologist, communist and revolutionary, whose ideas are credited as the foundation of modern communism
- 6. Development of MarxismKarl Marx & Friedrich Engels began collaboration in September 1844 Pair established the Communist Correspondence Committee in January 1846 Published the Communist Manifesto in February 1948 Marx’s death in March 14, 1883 leads to breakup of Marx-Lenin communist philosophy & subdivision of Marxism
- 7. Influences of MarxismGerman philosophers: Immanuel Kant Georg Wilhelm Friedrich Hegel Ludwig Feuerbach Immanuel Kant Georg Hegel Ludwig Feuerbach
- 8. Influences of MarxismBritish political economists: Adam Smith David Ricardo Adam Smith
- 9. Influences of MarxismAncient materialism: Epicurus Lucretius Aristotle Giambattista Vico Lewis Morgan Charles Darwin Epicurus
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- 11. Key Terms EXPLOITATION:A person is exploited if he or she performs more labor than necessary to produce the goods society consumes; like-wise, a person is an exploiter if he or she performs less labor than is necessary to produce goods. Burmese sweat shop
- 12. Key Terms ALIENATION:the estrangement of people from their humanity which is a systematic result of capitalism.
- 13. Key Terms HISTORICALMATERIALISM: societal development and change in the collective ways humans use to make the means for living.
- 14. Key Terms CLASSCONSCIOUSNESS: the awareness — of itself and the social world — that a social class possesses, and its capacity to rationally act in their best interests. Classifications: PROLETARIAT : individuals who sell their labor power, and in the capitalist mode of production, do not own the means of production. BOURGEOISIE : those who own the means of production and buy labor power from the proletariat, thus exploiting the proletariat PETIT BOURGEOISIE: are those who employ laborers, but who also work, i.e. small business owners, peasant landlords, trade workers et al. LUMPENPROLETARIAT : criminals, vagabonds, beggars, et al., who have no stake in the economy, and so sell their labor to the highest bidder. PEASANTRY AND FARMERS
- 15. Key Terms POLITICALECONOMY: the study of the conditions under which economic production was organized in the capitalist system.
- 16. Key Terms LABOR:work exerted to produce a good or a service
- 17. Key Concepts THEDIALECTICAL AND MATERIALIST CONCEPT OF HISTORY — Humankind's history is fundamentally that of the struggle between social classes.
- 18. Materialist Concept OfHistory Primitive communism Slavery Feudalism Capitalism Communism
- 19. Key Concepts THECRITIQUE OF CAPITALISM — In capitalist society, an economic minority (the bourgeoisie) dominate and exploit the working class (proletariat) majority.
- 20. Critique Of CapitalismI spent 3 hours creating a product, in the process I consume means of production that sometime in the past required 2 hours to produce – i.e., they have a value of 2 hours. The value of my product will be: mp + lt = 2 + 3 = 5 (in units of hours.) where: mp = means of production lt = labor time labor = average quality
- 21. Critique Of CapitalismExpenditure: = mp + lv Where: lv = value of the labour(-power). Income: = value of product = mp + lt Difference: = lt – lv = surplus value
- 22. Key Concepts ADVOCACYOF PROLETARIAN REVOLUTION — In order to overcome the fetters of private property the working class must seize political power internationally through a social revolution and expropriate the capitalist classes around the world
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- 24. Contributions Marx alsoexpanded greatly on the notion that laborers could come to harm as capitalism became more productive. WAGE DETERMINATION: Marx offered a theory of how a relative surplus population in capitalism tended to push wages to subsistence levels.
- 25. Contributions DISTRIBUTION OFWEALTH / PROFIT: profit was a deduction from society's output and that wages and profit were inversely related: an increase in profit came at the expense of a reduction in wages. CONCEPT OF PRODUCT VALUE: Marx employed a labor theory of value, which holds that the value of a commodity is the socially necessary labor time invested in it.
- 26. Contributions FACTORS OFPRODUCTION: contributed to the development of the economic concept labor, "the personal activity of man." the subject of labor: the thing worked on. the instruments of labor: tools, laboring domestic animals like horses, chemicals used in modifying the subject, etc.
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Editor's Notes
- #12 Exploitation is a matter of surplus labour — the amount of labour one performs beyond what one receives in goods. Exploitation has been a socio-economic feature of every class society, and is one of the principal features distinguishing the social classes. The power of one social class to control the means of production enables its exploitation of the other classes
- #13 Under capitalism, the fruits of production belong to the employers, who expropriate the surplus created by others, and so generate alienated labourers. Alienation objectively describes the worker’s situation in capitalism — his or her self-awareness of this condition is unnecessary
- #14 also synonymous to “the economic interpretation of history”, The social features of a society (social classes, political structures, ideologies) derive from economic activity; “base and superstructure” is the metaphoric common term describing this historic condition.
- #15 hence, class consciousness is required before they can effect a successful revolution
- #16 In Marxism, political economy studies the means of production, specifically of capital, and how that is manifest as economic activity
- #18 The productive capacity of society is the foundation of society, and as this capacity increases over time the social relations of production, class relations, evolve through this struggle of the classes and pass through definite stages (primitive communism, slavery, feudalism, capitalism). The legal, political, ideological and other aspects (ex. art) of society are derived from these production relations as is the consciousness of the individuals of which the society is composed.
- #19 The productive capacity of society is the foundation of society, and as this capacity increases over time the social relations of production, class relations, evolve through this struggle of the classes and pass through definite stages (primitive communism, slavery, feudalism, capitalism). The legal, political, ideological and other aspects (ex. art) of society are derived from these production relations as is the consciousness of the individuals of which the society is composed.
- #20 Marx uncovered the interworkings of capitalist exploitation, the specific way in which unpaid labor (surplus value) is extracted from the working class labor theory of value, extending and critiquing the work of earlier political economists value. Although the production process is socialized, ownership remains in the hand of the bourgeosie. This forms the fundamental contradiction of capitalist society. Without the elimination of the fetter of the private ownership of the means of production, human society is unable to achieve further development.
- #21 It is apparent that I have increased the value that previously existed by 3 units; I have created 3 units of value. (This is assuming that my labour is of average quality, but more or less efficient labour can be accounted for simply by pro-rating the time: eg., if I work only two-thirds as fast as the average person, we could say that in 3 hours I create a value of only 2.)
- #23 In order to overcome the fetters of private property the working class must seize political power internationally through a social revolution and expropriate the capitalist classes around the world and place the productive capacities of society into collective ownership. Upon this, material foundation classes would be abolished and the material basis for all forms of inequality between humankind would dissolve.
- #25 Wage determination: Marx offered a theory of how a relative surplus population in capitalism tended to push wages to subsistence levels. Marx saw this relative surplus population as coming from economic causes and not from biological causes (as in Malthus). This economic-based theory of surplus population is often labeled as Marx's theory of the reserve army of labour.
- #26 Marx employed a labor theory of value, which holds that the value of a commodity is the socially necessary labor time invested in it. Capitalists, however, do not pay workers the full value of the commodities they produce, but compensate the worker for the combination of skill and time required to produce a given commodity. Marx theorized that the gap between the value a worker produces and his wage is a form of unpaid labour, known as surplus value. Moreover, Marx notes that markets tend to obscure the social relationships and processes of production, a phenomenon he termed commodity fetishism. People are highly aware of commodities, and usually don't think about the relationships and labour they represent.
- #27 From the French Physiocracy , The farmer labors on land (sometimes using "crafts") to produce food, fiber, and the like. The artisan labors to produce important capital goods (crafts) to be used by the other economic actors. The landlord is only a consumer of food and crafts and produces nothing at all. The merchant labors to export food in exchange for foreign imports. to classical economics, Land or natural resource – naturally-occurring goods such as water, air, soil, minerals, flora and fauna that are used in the creation of products. The payment for land use and the received income of a land owner is rent . Labor – human effort used in production which also includes technical and marketing expertise. The payment for someone else's labor and all income received from ones own labor is wages . Labour can also be classified as the physical and mental contribution of an employee to the production of the good(s). The capital stock – human-made goods (or means of production ) which are used in the production of other goods. These include machinery, tools and buildings.