Marxian Economics: Key Words and Concepts Flashcards
Historic Materialism
Definition: Marx’s framework for understanding historical change based on material conditions and class struggle.
Core Idea: Economic forces (forces and relations of production) shape social institutions and historical progress.
Surplus Labour
Definition: Labour performed beyond what is necessary to meet a worker’s subsistence needs.
Relevance: Source of profit in capitalism, as capitalists extract this unpaid labour.
Alienation
Definition: Process where workers are disconnected from their labour, product, and humanity under capitalism.
Types:
From the product.
From the production process.
From oneself (loss of creativity).
From other workers (due to division of labour).
Commodity Fetishism
Definition: Misplaced value on commodities, obscuring the labour and exploitation behind their creation.
Relevance: Reinforces alienation by prioritizing material goods over social relations.
Reserve Army of Labour
Definition: Unemployed workers used to pressure wages and working conditions.
Relevance: Expands with technological advances, contributing to economic instability.
Organic Composition of Capital
Definition: Ratio of constant capital (machinery) to variable capital (labour).
Relevance: Increasing ratio reduces profit rates over time, a key contradiction in capitalism.
Falling Rate of Profit
Definition: Tendency for profit rates to decline as technological advancements reduce the reliance on labour.
Relevance: Marx viewed this as capitalism’s self-destructive tendency.
Historic Materialism and the Dialectic
Key Ideas:
Material conditions drive historical change.
Forces of production evolve, outgrowing existing relations and causing conflicts (e.g., industrial revolution intensifying class divides).
Examples of Class Struggle:
Slaves vs. Masters (Ancient Society).
Lords vs. Serfs (Feudalism).
Capitalists vs. Workers (Capitalism).
Marx’s Labour Theory of Value
Key Points:
Labour Power: Capacity to work sold to capitalists.
Surplus Value: Profit derived from unpaid labour beyond subsistence needs.
Capitalist Exploitation:
Workers only paid for necessary labour.
Additional hours become unpaid surplus labour.
Contradictions of Capitalism
Alienation:
Workers lose control over their product, process, and creative potential.
Division of labour isolates workers from each other.
Commodity Fetishism:
Obscures social relations behind commodities.
Reinforces alienation.
Reproduction Schemes:
Simple reproduction: All surplus used for consumption.
Expanded reproduction: Surplus reinvested, leading to accumulation and crises.
Marx’s Theory of Crises
Reserve Army of Labour:
Expands with technological change.
Pressures wages downward, causing economic instability.
Falling Rate of Profit:
Rising reliance on machinery reduces labour input.
Declining profits destabilize capitalism.
Ultimate Collapse: Marx argued these contradictions would undermine capitalism.
