Handbook on the History of Economic Analysis Volume II

Handbook on the History of Economic Analysis Volume II

Schools of Thought in Economics

Edited by Gilbert Faccarello and Heinz D. Kurz

Volume II contains entries on the major schools of economic thought and analysis. These schools differ with regard to their 'vision' of the working of the economic system, the major forces and interactions that shape its path, and the policy recommendations proposed. At any moment of time, several such schools typically compete with one another, striving for dominance within the economic and political discourse. Each Handbook can be read individually and acts as a self-contained volume in its own right. It can be purchased separately or as part of a three-volume set.

Chapter 16: Marxism(s)

John E. King

Subjects: economics and finance, history of economic thought


Marx saw himself as the heir and critic of classical political economy, which concentrated its attention on the production and distribution of the means of subsistence (Dobb 1973). Ricardo and his followers explained the evolution of modern economies in terms of the fundamental conflict between the different social classes in a predominantly agricultural society where the producers enjoyed a bare minimum standard of living and the surplus product was shared between landlords and capitalist farmers. The size of the surplus, relative to total output, set a maximum limit on the rate of growth; actual growth depended on the relative shares of thrifty capitalists and prodigal landlords. Marx himself defined the subject matter of the political economy of capitalism as the production, distribution, consumption and exchange of commodities, which are useful products of human labour destined for sale on markets rather than for direct use. He privileged production over the other categories, not only in the explanation of distribution, consumption and exchange, but also in accounting for the nature of the state and forms of social consciousness. According to the principle of historical materialism, the relations that define the economic system, and the institutions of politics and the law, as well as the dominant forms of social consciousness, are all ultimately determined by the requirements of the productive forces, which consist of means of production and human labour power. The productive relations are relations of power, and usually also of ownership, over the productive forces. Three propositions are central to historical materialism. The development thesis states that human creative intelligence, reacting to scarcity, makes the productive forces develop over time. The primacy thesis asserts that it is the level of development reached by the productive forces that explains the nature of the productive relations, which in turn account for the nature of the superstructure (non-economic institutions such as the legal system and the state). Most important for the dynamic of history, the fettering thesis states that, when the productive relations become a shackle on the development of the productive forces, they will change in order to break the fetters (Marx 1859 [1971]; Cohen 1978).

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