Prosperity based on commodities

An earlier post looked at economic prosperity and standard of living from the point of view of a grain-based agricultural economy. There I singled out intensive, extensive, and technology-based growth, and the effects these scenarios had on the standard of living for a farming population. This is a particularly simple case, since it equates standard of living with food availability per capita. (This is enough, however, to arrive at credible estimates of the standard of living over long stretches of Chinese history, as Bozhong Li has demonstrated in Agricultural Development in Jiangnan, 1620-1850.)  This simplification leaves out markets, prices, and trade; so it doesn't shed much light on economies based substantially on the production of commodities (including farm products, but also including manufactured goods). So how does the situation change when we postulate production for exchange and consumption based on cash income?

Let's once again consider an isolated region, where all products consumed are produced in the region. So there is no interregional trade. And let's suppose there are three goods: grain, shirts, and beer. Every household needs some of each, and households acquire income through ownership of resources: land, capital, and labor power. The income available to a household is the net return it achieves through use of its resources. Goods are produced by "firms" and are bought and sold through competitive markets.

Now to estimate a household's standard of living we need to do a more complex estimation: we need to estimate the household's income and we need to estimate the "purchasing power" of this income in terms of the baskets of goods this income can purchase at prevailing prices. So we need an income model and a price model for the three goods.  (See Robert Allen's detailed efforts at answering these questions across Eurasia (link, link).)

Production requires access to resources.  Each resource can be used in two basic ways: it can be used directly by its owner in production, or it can be "rented" to a firm for use by the firm in production. So there is also a competitive market for resources: rent for land, interest for capital, and wages for labor. And at any given time there is a specific distribution of resources across population; some households have dramatically more of each resource than others.

We can begin our thought experiment by taking as fixed the techniques of production that exist for the three basic commodities. In order to produce at a given level of output, the firm needs access to a known quantity of resources, in a specific proportion. Firms amd households with lots of resources can begin producing shirts, beer, and grain immediately. Poor firms and households will either rent access to more resources through promise of future rents; or they will rent out the resources they currently possess, including labor time. So landless, propertyless households have no choice but to sell their labor time; they become workers. So now let's picture our region as populated by firms and households producing commodities, and all persons functioning as consumers purchasing a bundle of commodities for life needs.

So far we've provided a scene very familiar from the classical political economists and Marx. Much of subsequent economic thought went into solving various parts of this story: what determines prices, what does the distribution of income look like, and how do innovation and organizational and technological change fit into this story?  What does an equilibrium of production, consumption, and price look like with static technology?  What are the dynamic processes of adjustment that occur when there is a substantial change in the process of production?

My question here is a limited one: what needs to occur in this scenario in order for there to be a rising trend in the average and median standard living for this society?

Let's define the standard of living as the size of the wage basket available to the median consumer: the sets of baskets of grain, shirts, and beer that the median income earner is able to purchase. In order for the standard of living to rise in this isolated region, there needs to be an overall increase in the efficiency and productivity of the production process for the three goods. And the money wage of the median consumer needs to rise.  (Amartya Sen provides quite a bit of analysis of the meaning of the standard of living in The Standard of Living.)

Let's refer to the concrete production process at a given time as the current practice; this is the specific way that inputs are organized in order to create the output. As we saw in the graph of output against time borrowed from Mark Elvin (link), we can think of progress here in two ways. First, there is refinement of practice, as producers gradually recognize small modifications that permit removal of costs from the process. And, as Marx and Smith agree, firms and households producing goods for a market have a powerful incentive to seek out these improvements: they can continue to sell their products at the old price until the rest of the producers catch up.

Second, producers can introduce substantial, revolutionary changes in technology. They may replace skilled sewing-machine operators with sewing robots that reduce each of the inputs into the good. Productivity takes a big stride forward.

There is a third mechanism of cost reduction available: the firm/household may speed up the labor process, lengthen the working day, or lower the wage. Volume I of Capital goes into detail on each of these mechanisms within a market-governed firm.  And each of these approaches is negative for the quality of life of the working class.

Now let's get back to the question of the standard of living. Does the process of competition, rising productivity, and falling prices imply an improvement in the standard of living? Or, conceivably, does it lead to a paradoxical immiseration of the bulk of the population? Both outcomes are possible. Rising efficiency and productivity have permitted our little society to produce a rising quantity of beer, grain, and shirts. And this on the basis of a fixed level of basic resources. So in principle everyone may be better off. But it is possible as well that the benefits of rising productivity have been disproportionately captured by a small advantaged group. So income may have become increasingly concentrated at the top. The average wage basket will have increased. But the median consumer may have declined through that process of concentration.

What this story tells us is something fairly simple: the effects of productivity improvement within a commodity economy depend critically on the prior distribution of assets and the institutions through which income and the gains of efficiency are distributed. And this in turn suggests a point much like that of Robert Brenner: the social-property relations embedded within an economy are critical in determining the fate of the median person, and they are subject to profound political struggle (post).

It would be very interesting to use agent-based modeling software to represent a series of scenarios based on this description of a commodity-based economy undergoing growth.  What do distributive outcomes look like when the prior distribution is relatively equal?  How about when they are substantially unequal?  How much difference does the timing of growth make on the eventual distributive and welfare characteristics of the scenario?

(Piero Sraffa's Production of Commodities by Means of Commodities : Prelude to a Critique of Economic Theory picks up some parts of this story in a neo-Ricardian way; Marxian economists have looked at Sraffa's work as also providing a novel basis for the labor theory of value.  The framework provided here also leads into an argument for a new definition of exploitation by John Roemer in A General Theory of Exploitation and Class.)

Marx on Russia

In 1881 Marx wrote a letter to Vera Zasulich, an important Russian follower, that addresses the question of theory and prediction when it comes to thinking about the future course of history.  In particular, he denies that his theories have determinate predictive implications for the development of capitalism or socialism in Russia.  Here is a link to the letter, and below are a few paragraphs.

The issue is an important one: did Marx think of his body of knowledge as constituting a general predictive theory?  And the letter clearly implies that he did not.

The letter is interesting in several respects. First, it explicitly rejects the notion that Marx's economic and historical theories are suited to the task of identifying the necessary or inevitable course of historical development. It summarily dismisses the idea of a necessary sequence of modes of production. Instead, Marx shows himself to recognize the contingency that exists in historical development, as well as the degree to which history creates new conditions in its course that influence future developments.

The other important feature of the letter is its substantive analysis of the material characteristics of the Russian peasant commune, and the potential that this social form has for constituting the material core of an alternative route to socialism in Russia.  As the letter makes clear, Marx thinks that the social relations associated with the peasant commune provide a possible social foundation for a modern socialist economy; and this would be an economy that was not "post-capitalist" but nonetheless technologically and socially advanced.

In a way Marx's argument anticipates the theory of "late developers" -- for example, Gerschenkron's Economic Backwardness in Historical Perspective.  Marx argues that a socialism in Russia was possible through an alternative pathway.  A version of socialism in Russia based on the "archaic" commune can take advantage of the developments in technology and social organization created by advanced capitalism.  It is not necessary for Russian society to go throughout the several-centuries long process of agricultural and technological modernization that England underwent; rather, Russia can simply adopt the modern technologies now available.

The interest of this letter is not to be found in the historical predictions it makes, but rather in the example it offers of the way that Marx's mind worked.  The reasoning here represents a good example of Marx's materialist approach to history.  He wants to arrive at a fairly detailed level of understanding of the social and economic relations -- the property relations -- that constituted a historical form of the rural commune.  And he then seeks to provide an analysis of the way in which those relations might be expected to develop under a specific set of historical circumstances.  And key within this analysis is the workings of the specific form of property that corresponded to this social system -- the social relations of production.

I suppose the letter illustrates something else as well: Marx's interest at the end of his life in finding an alternative pathway to socialism.  The revolutions of 1848 were long in the past, and a proletarian revolution had not ensued.  The Paris Commune had been decisively and violently repressed in 1871.  Working-class militancy was not propitious in the advanced capitalist countries -- France, Germany, or Britain.  So the prospects of revolution in the advanced capitalist world were not encouraging to Marx.  And so finding some hope for an alternative process of social development through which the ends of socialism might be achieved was an appealing prospect for Marx.

Here are the first few paragraphs of the letter, which is worth reading in full:

1) In dealing with the genesis of capitalist production I stated that it is founded on “the complete separation of the producer from the means of production” (p. 315, column 1, French edition of Capital) and that “the basis of this whole development is the expropriation of the agricultural producer. To date this has not been accomplished in a radical fashion anywhere except in England... But all the other countries of Western Europe are undergoing the same process” (1.c., column II).

I thus expressly limited the “historical inevitability” of this process to the countries of Western Europe. And why? Be so kind as to compare Chapter XXXII, where it says:

The “process of elimination transforming individualised and scattered means of production into socially concentrated means of production, of the pigmy property of the many into the huge property of the few, this painful and fearful expropriation of the working people, forms the origin, the genesis of capital... Private property, based on personal labour ... will be supplanted by capitalist private property, based on the exploitation of the labour of others, on wage labour” (p. 341, column II).

Thus, in the final analysis, it is a question of the transformation of one form of private property into another form of private property. Since the land in the hands of the Russian peasants has never been their private property, how could this development be applicable?

2) From the historical point of view the only serious argument put forward in favour of the fatal dissolution of the Russian peasants’ commune is this: By going back a long way communal property of a more or less archaic type may be found throughout Western Europe; everywhere it has disappeared with increasing social progress. Why should it be able to escape the same fate in Russia alone? I reply: because in Russia, thanks to a unique combination of circumstances, the rural commune, still established on a nationwide scale, may gradually detach itself from its primitive features and develop directly as an element of collective production on a nationwide scale. It is precisely thanks to its contemporaneity with capitalist production that it may appropriate the latter’s positive acquisitions without experiencing all its frightful misfortunes. Russia does not live in isolation from the modern world; neither is it the prey of a foreign invader like the East Indies.

And here is an important summary statement:

Theoretically speaking, then, the Russian “rural commune” can preserve itself by developing its basis, the common ownership of land, and by eliminating the principle of private property which it also implies; it can become a direct point of departure for the economic system towards which modern society tends; it can turn over a new leaf without beginning by committing suicide; it can gain possession of the fruits with which capitalist production has enriched mankind, without passing through the capitalist regime, a regime which, considered solely from the point of view of its possible duration hardly counts in the life of society. But we must descend from pure theory to the Russian reality.

There is a major irony in rereading Marx's analysis of the emancipatory possibilities inherent in the social form of the "peasant commune" in Russia.  Most striking is the experience of the collectivization of Soviet agriculture in the 1920s and Stalin's war on the kulaks.  Rather than representing a bright new future for the peasants, collectivization represented a cruel war by starvation against rural society (Lynne Viola, The War Against the Peasantry, 1927-1930: The Tragedy of the Soviet Countryside, Volume one (Annals of Communism Series) (v. 1)).

It is also also interesting to recall that one of the disputes among the Bolsheviks within Soviet leadership in the 1920s and 1930s was the issue of cooperatives in agriculture.  A. V. Chayanov advocated for a more democratic route to Soviet socialism, through the mechanism of locally established rural cooperatives (link).  His reasoning had quite a bit in common with Marx's analysis in this letter to Vera Zasulich; and, of course, it led to his persecution and execution in 1937.

Farms in historical materialism

Materialist explanations in history generally attempt to discover fundamental features of technology and labor that impose a very deep imprint on the rest of society. Farming is almost always fundamental in this respect; the forces and relations of production are particularly visible, and the products of the farm system are fundamental to the survival of society. The standard of living of a traditional society is largely determined by agricultural productivity and the nature of the farming system -- nutrition, for example, is essentially determined by the ratio of total grain output to population. Finally, virtually all traditional economies are primarily rural; so farm life defines the conditions of ordinary social existence for the majority of the population. So let us consider a brief analysis of the farm. (A. V. Chayanov's classic treatment of the peasant economy, The Theory of Peasant Economy, written in the 1920s, remains highly valuable. Robert Allen's lifetime of research on the English farm economy is highly insightful (Enclosure and the Yeoman: The Agricultural Development of the South Midlands, 1450-1850), as is Bozhong Li's work on the farm economy of the Lower Yangzi (Agricultural Development in Jiangnan, 1620-1850).)

A farm is the basic unit of agricultural production. It represents the coordinated application of diverse factors of production in order to produce crops. The factors of production include labor; land; tools, implements, and machinery; fertilizers; and water resources and irrigation techniques. Crops include both foods (e.g., rice, wheat, millet) and raw materials (e.g., cotton, soya beans). And farms may be organized for a variety of purposes: to satisfy a family's subsistence needs, to create a profit within a market system, or to provide employment for the greatest number of rural people.

Farms in different agrarian regimes may be characterized in terms of a set of technical and social features. On the technical side we need to know what the scale of cultivation is (farm size); what techniques of cultivation are employed; what varieties of crops and seeds are available; what types of farm tools and machines are used; what types of irrigation, if any, are in use; what varieties and skills of labor are employed; what types of fertilizers are used; and what forms of agronomic knowledge are available to the farmer. (We might reduce this variety of technical features to a spectrum ranging from low-technology to high-technology farming systems.) On the social side we need to know the purpose of cultivation (family subsistence or commercial profitability); the form of land tenure in place (fixed rent, sharecropping, smallholding, etc.); the forms of labor employed (slave, serf, family labor, hired labor); the forms of supervision employed; and the processes of income distribution embodied in the agricultural system.

These features are the primary subject of research for agricultural historians such as Allen and Li. These features essentially determine the most important economic characteristics of the agricultural system. First, they determine the productivity of the farming system, whether measured in terms of land efficiency (output per hectare) or labor efficiency (output per man-day). For once we know the techniques of cultivation in a given ecological setting, it is possible to form relatively accurate estimates of output for a given input of land, labor, and capital. This set of considerations also determines what we might describe as the net rural product--the total agricultural product over and above the replacement cost of the factors of production. On this basis, Chinese historians such as Dwight Perkins attempt to estimate the overall wealth and income of late Imperial China, including estimates of quality of life for the majority of rural people (Agricultural development in China, 1368-1968).

Second, the full description of the farming system as indicated above will allow us to infer the system of surplus extraction in place; it will be possible to indicate with adequate precision how much surplus is generated and where it goes. Victor Lippit attempts to arrive at such an estimate for traditional China (Land Reform and Economic Development in China: A Study of Institutional Change and Development Finance). This in turn permits us to describe the system of rural class relations that correspond to a given farming regime.

Within this framework we can now indicate a variety of types of farms; and as a working premise, we may postulate that agrarian regimes in which different farm types are dominant will have distinctive patterns of organization and development. The following are advanced as ideal types; variants and mixed examples are possible as well. However, these types are selected as being particularly central in the development of both Asian and European traditional economies. And, significantly for the historian of social change, each farming system creates a distinctive pattern of incentives, barriers, social relations, and modes of behavior that have important consequences for historical change.

• The peasant farm. The peasant farm is small (1-10 hectares), and is organized to satisfy consumption needs of the family. It is managed and run by a peasant family using family labor. Cultivation is divided between subsistence crops and commercial crops with some risk-aversive preference for subsistence crops. There is a very low level of capital available to the peasant farmer, and cultivation is oriented towards labor-intensive techniques. Low-cost traditional techniques and tools are employed in cultivation. The peasant cultivator typically pays rent on the land he cultivates, though smallholding with clear title to the land is also possible.
• The manor. This farm is of medium size (100 hectares). It is managed by a resident lord whose aims are (1) to satisfy the consumption needs of his household, and (2) to produce a marketable surplus to generate cash income. The manor employs a sizable number of bonded laborers (serfs or slaves); it uses traditional techniques of cultivation but benefits from some economies of scale; and it employs foremen as supervisors. Part of the estate is farmed by individual families in circumstances of peasant farming.
• The capitalist farm. This farm is medium to large (50-150 hectares) and is organized to produce a profit. It is therefore located within a commercialized rural economy within which crops may be readily marketed. The farm is organized and directed by the capitalist farmer, who may either own or rent the land. The capitalist farmer has the fiscal resources needed to make capital investments in the process of cultivation; and he is oriented towards cost-cutting in considering various alternative techniques. The capitalist farm employs wage labor, where the wage is determined by local economic circumstances and the minimal cost of subsistence. The capitalist farm represents a rationalization of available techniques aimed at maximizing the profitability of the unit.
• The cooperative farm. The cooperative farm is a large unit (100-400 hectares) owned by the cultivators (75 families). This farm is oriented towards profitability; it uses the labor of the cultivators; and it is organized by a council of the cultivators. The collective has access to investment funds, and is therefore able to invest in new techniques; moreover, the collective farm benefits from economies of scale.

Significantly, this typology of farming units corresponds broadly to the classical Marxist taxonomy of modes of production: feudalism, capitalism, and socialism. The peasant farm, however, represents a form of organization of the productive forces of rural society that is overlooked in Marxist theory: call it the "peasant mode of production." The peasant mode of production may be defined as a system in which agriculture is performed on peasant farms; the bulk of the population consists of free peasant cultivators; and agricultural surpluses are extracted through rent, interest, and taxation.

In short, careful analysis of the circumstances of farming is crucial for large-scale history, including especially the history of economic development, the history of urbanization, and the history of human well-being. And, of course, the twentieth century demonstrated the centrality of peasants in the great political movements of revolution and anti-colonialism.

Primitive accumulation

Marx's treatment of the "so-called 'primitive accumulation'" is one of the most historically detailed sections in Capital: A Critique of Political Economy (Volume 1). And it is one of the most interesting parts of Capital to read as a separate piece. (Here is an electronic text of the section.) It is Marx's account of the historical processes of change in rural life of the fifteenth through eighteenth century in Britain and Ireland, through which peasants were forced off their land and the commons were enclosed. Marx believes that this separation of the peasantry from the land was a necessary condition for the development of capitalism, in that it created the conditions in which there was a pliable and abundant proletariat. This "free" proletariat was needed for the creation of the factory system and the development of manufacturing cities. So the process of primitive accumulation created the changes in social relations, property relations, and the accumulation of wealth that permitted the creation of the capital-labor relation and factory-based capitalism.

Marx sometimes puts this point in a fairly teleological way, looking at primitive accumulation as a necessary step on the road to British capitalism. (For example, he refers to this process as "the revolution that laid the foundation of the capitalist mode of production.") But it is possible, and preferable, to read Marx's analysis here less teleologically, as simply a detailed account of some of the crucial but contingent changes that took place in rural social relations during these centuries, without importing the idea that these changes were functionally related to the later development of capitalism. And read non-teleologically, the section holds up fairly well in relation to modern historical scholarship.

Marx describes the basic social relations of British rural life in the fifteenth century in these terms, as a freeholding peasantry with access to substantial common lands, pasture, and forest:

The immense majority of the population consisted then, and to a still larger extent, in the 15th century, of free peasant proprietors, whatever was the feudal title under which their right of property was hidden. In the larger seignorial domains, the old bailiff, himself a serf, was displaced by the free farmer. The wage-labourers of agriculture consisted partly of peasants, who utilised their leisure time by working on the large estates, partly of an independent special class of wage-labourers, relatively and absolutely few in numbers. The latter also were practically at the same time peasant farmers, since, besides their wages, they had allotted to them arable land to the extent of 4 or more acres, together with their cottages. Besides they, with the rest of the peasants, enjoyed the usufruct of the common land, which gave pasture to their cattle, furnished them with timber, fire-wood, turf, &c.

And he identifies the crucial turn towards expropriation of the free peasant proprietor:

In insolent conflict with king and parliament, the great feudal lords created an incomparably larger proletariat by the forcible driving of the peasantry from the land, to which the latter had the same feudal right as the lord himself, and by the usurpation of the common lands. The rapid rise of the Flemish wool manufactures, and the corresponding rise in the price of wool in England, gave the direct impulse to these evictions. The old nobility had been devoured by the great feudal wars. The new nobility was the child of its time, for which money was the power of all powers. Transformation of arable land into sheep-walks was, therefore, its cry.

(It is interesting to recall that Oliver Goldsmith describes the eighteenth-century version of this process in Ireland in his poem, The Deserted Village (1770):

Sweet smiling village, loveliest of the lawn,
Thy sports are fled, and all thy charms withdrawn;
Amidst thy bowers the tyrant's hand is seen,
And Desolation saddens all thy green:
One only master grasps the whole domain,
And half a tillage stints thy smiling plain.
No more thy glassy brook reflects the day,
But, choked with sedges, works its weedy way;
Along thy glades, a solitary guest,
The hollow-sounding bittern guards its nest;
Amidst thy desert walks the lapwing flies,
And tires their echoes with unvaried cries:
Sunk are thy bowers in shapeless ruin all,
And the long grass o'ertops the mouldering wall
And, trembling, shrinking from the spoiler's hand,
Far, far away thy children leave the land.

Ill fares the land, to hastening ills a prey,
Where wealth accumulates, and men decay.
Princes and lords may flourish, or may fade;
A breath can make them, as a breath has made:
But a bold peasantry, their country's pride,
When once destroy'd, can never be supplied. )

And Marx emphasizes the coercive nature of this expropriation of the yeoman peasant:

Even in the last decade of the 17th century, the yeomanry, the class of independent peasants, were more numerous than the class of farmers. They had formed the backbone of Cromwell’s strength, and, even according to the confession of Macaulay, stood in favourable contrast to the drunken squires and to their servants, the country clergy, who had to marry their masters’ cast-off mistresses. About 1750, the yeomanry had disappeared, and so had, in the last decade of the 18th century, the last trace of the common land of the agricultural labourer. We leave on one side here the purely economic causes of the agricultural revolution. We deal only with the forcible means employed.

A crucial component of the "primitive accumulation", in Marx's interpretation, was the abolition of common property, culminating in the enclosure acts in the seventeenth century:

Communal property — always distinct from the State property just dealt with — was an old Teutonic institution which lived on under cover of feudalism. We have seen how the forcible usurpation of this, generally accompanied by the turning of arable into pasture land, begins at the end of the 15th and extends into the 16th century. But, at that time, the process was carried on by means of individual acts of violence against which legislation, for a hundred and fifty years, fought in vain. The advance made by the 18th century shows itself in this, that the law itself becomes now the instrument of the theft of the people’s land, although the large farmers make use of their little independent methods as well. The parliamentary form of the robbery is that of Acts for enclosures of Commons, in other words, decrees by which the landlords grant themselves the people’s land as private property, decrees of expropriation of the people. Sir F. M. Eden refutes his own crafty special pleading, in which he tries to represent communal property as the private property of the great landlords who have taken the place of the feudal lords, when he, himself, demands a “general Act of Parliament for the enclosure of Commons” (admitting thereby that a parliamentary coup d’état is necessary for its transformation into private property), and moreover calls on the legislature for the indemnification for the expropriated poor.

We even are afforded a glimpse of the economist's view of the rationality of enclosure. According to John Arbuthnot, enclosure and the creation of private farms is a more productive use of land and labor:

Let us hear for a moment a defender of enclosures and an opponent of Dr. Price. “Not is it a consequence that there must be depopulation, because men are not seen wasting their labour in the open field.... If, by converting the little farmers into a body of men who must work for others, more labour is produced, it is an advantage which the nation” (to which, of course, the “converted” ones do not belong) “should wish for ... the produce being greater when their joint labours are employed on one farm, there will be a surplus for manufactures, and by this means manufactures, one of the mines of the nation, will increase, in proportion to the quantity of corn produced.”

And here Marx describes the final stages of the "rationalization" of agriculture, in the expropriation of the Scots:

The last process of wholesale expropriation of the agricultural population from the soil is, finally, the so-called clearing of estates, i.e., the sweeping men off them. All the English methods hitherto considered culminated in “clearing.” As we saw in the picture of modern conditions given in a former chapter, where there are no more independent peasants to get rid of, the “clearing” of cottages begins; so that the agricultural labourers do not find on the soil cultivated by them even the spot necessary for their own housing. But what “clearing of estates” really and properly signifies, we learn only in the promised land of modern romance, the Highlands of Scotland. There the process is distinguished by its systematic character, by the magnitude of the scale on which it is carried out at one blow (in Ireland landlords have gone to the length of sweeping away several villages at once; in Scotland areas as large as German principalities are dealt with), finally by the peculiar form of property, under which the embezzled lands were held.

Eventually we come to the point where industrial capitalism is feasible and there is a "free" proletariat available for labor:

It is not enough that the conditions of labour are concentrated in a mass, in the shape of capital, at the one pole of society, while at the other are grouped masses of men, who have nothing to sell but their labour-power. Neither is it enough that they are compelled to sell it voluntarily. The advance of capitalist production develops a working-class, which by education, tradition, habit, looks upon the conditions of that mode of production as self-evident laws of Nature. The organisation of the capitalist process of production, once fully developed, breaks down all resistance.

And, of course, Engels picks up the story from the perspective of nineteenth-century Manchester and Birmingham, and the conditions of squalor and oppressive factory labor that resulted. (See an earlier posting on Engels's sociology of the proletarian city.)

The English Marxist historians have devoted a lot of their attention to this period of British social history. (Harvey Kaye gives a very good account of the work of this generation of Marxist historians in The British Marxist Historians.) Maurice Dobb is one of the English socialist historians who has retraced Marx's steps on this subject in some detail. One of Dobb's important books, Studies In The Development Of Capitalism (1963), treats this process of the decline of the English peasantry and the rise of the proletariat, making use of the historical scholarship of the first part of the twentieth century. Some of Rodney Hilton's research on this period can be found in Class Conflict and the Crisis of Feudalism: Essays in Medieval Social History (Rev). Several generations later, Robert Brenner gave a somewhat different interpretation of the history of agrarian change in England from the sixteenth to the eighteenth centuries; his views were developed in the splendid journal Past & Present and were separately published along with a round of critical reactions in The Brenner Debate: Agrarian Class Structure and Economic Development in Pre-industrial Europe.

Structures in Marx's thought

The concept of a social structure has often played a large role in social theorizing. The general idea is that society consists of an ensemble of durable, regulative structures within the context of which individuals live and act. Sometimes structures are interpreted functionally: the ensemble of structures constitute a system, and discrete structures satisfy important social functions. This is a physiological approach to society: what are the chief sub-systems in society and what do they do; how do they fit together to assure the continuing functioning of society?

There is much to fault in this set of ideas about the constituent parts of society -- for example, its tendency to reify a continually shifting social reality and its tacit assumption that the social order is a system in functional equilibrium.

But here I want to ask a smaller question: does Marx offer a social ontology that includes enduring social structures?

It would appear that the answer is a resounding "yes". Marx looks at capitalism as a system. For example, consider this statement from the Preface to the Contribution to the Critique of Political Economy:

In the social production of their life, men enter into definite relations that are indispensable and independent of their will, relations of production which correspond to a definite stage of development of their material productive forces. The sum total of these relations of production constitutes the economic structure of society, the real foundation, on which rises a legal and political superstructure and to which correspond definite forms of social consciousness. The mode of production of material life conditions the social, political and intellectual life process in general. It is not the consciousness of men that determines their being, but, on the contrary, their social being that determines their consciousness. At a certain stage of their development, the material productive forces of society come in conflict with the existing relations of production, or — what is but a legal expression for the same thing — with the property relations within which they have been at work hitherto. From forms of development of the productive forces these relations turn into their fetters. Then begins an epoch of social revolution. With the change of the economic foundation the entire immense superstructure is more or less rapidly transformed. In considering such transformations a distinction should always be made between the material transformation of the economic conditions of production, which can be determined with the precision of natural science, and the legal, political, religious, aesthetic or philosophic — in short, ideological forms in which men become conscious of this conflict and fight it out. Just as our opinion of an individual is not based on what he thinks of himself, so can we not judge of such a period of transformation by its own consciousness; on the contrary, this consciousness must be explained rather from the contradictions of material life, from the existing conflict between the social productive forces and the relations of production.

Here and elsewhere Marx picks out the forces of production and relations of production as the fundamental determinants of historical change. He identifies social classes as the chief actors in society. And he offers a conception of the capitalist mode of production as consisting of an economic base -- the economic structure -- and an ensemble of superstructural elements -- law, state, ideology, religion, culture --that stand above the economic structure and serve to preserve its conditions of reproduction. All of this invokes an ontology of social structures, social systems, and functional interdependency (G. A. Cohen, Karl Marx's Theory of History: A Defence).

The functionalism implicit in this ontology has been deeply challenged (Jon Elster, Making Sense of Marx; Daniel Little, The Scientific Marx). The bottom line of these criticisms seems inescapable: there is no basis whatsoever to expect that social structures will develop that are functionally suited to the needs of the social system. There is no process of natural selection for social arrangements. So if there is alignment across structures, we need to seek out the specific social mechanisms that bring it about.

But what about the structuralism? Is this ontology a credible one if it is separated from the functionalist assumption?

Here we need to be very careful at every step of the argument. Marx is right that Britain and France possessed a set of property relations in capital and labor in the mid-nineteenth century. These relations were distinct from those of French feudalism in the fourteenth century. These social relations are durable and coercive. Those differences created different historical dynamics in nineteenth-century Britain and France. So far so good -- there were durable, coercive social relations embodied on the two societies, and it doesn't seem misleading to call these "structures." Moreover, these structures had historical effects, much as Marx described them to have. Likewise, his definitions of "proletariat" and "capitalist" are rigorous and historically grounded. So Marx succeeds in identifying social structures in particular societies.

But here it is very important to avoid the error of reification: the assumption that the structures of capitalism are substantially the same in every capitalist society, or the same in one capitalist society over time. Rather, there are substantial and causally important differences across the basic economic institutions, and the situations of the great classes, in different capitalist societies. This is one of the central insights of the new institutionalism (Kathleen Thelen, How Institutions Evolve: The Political Economy of Skills in Germany, Britain, the United States, and Japan). These differences over time and across societies in turn imply that the structuralism of the concept of the capitalist mode of production must be abandoned as well. There is no super-category of "capitalism" and its logic that can be used to subsume the historical trajectories of multiple societies.

Finally, it bears repeating that all theories of structures require microfoundations. Structures do not exist free-standing; instead, they must be embodied on the actions and thoughts of socially constituted individuals. (See Levels of the Social for more on this.) I don't think Marx would object to this stricture -- I think he actually provides an agent-centered political economy himself. But the more holistic advocates of French structuralism (Althusser or Poulantzas, for example) would object strenuously.

So this leaves us with a pretty tame version of a Marxian structuralism. Social structures exist. They vary from society and across time. They are not functionally adapted. There are no transcendent structures possessing a unique historical dynamic. And, finally, all these claims about causally active social structures need to be compatible with microfoundations at the level of the social actors.

Is there such a thing as capitalism?

Marx's central theoretical concept is "capitalism." He wanted to provide a theory of the capitalist mode of production; he wanted to discover the laws of motion of the capitalist mode of production; and he believed that there was a compact structural identity that is shared by capitalist economies. Later Marxist economists refined the concept somewhat by distinguishing among various stages of capitalist development, with thinkers such as Ernest Mandel and Paul Sweezy focusing on "late capitalism".

My question here is a simple one. From the point of view of social ontology and concept formation in sociology -- does it make sense to think of capitalism as a single thing with multiple instances across time and space? Is there a reason to think that "England, 1880," "Germany, 1910," "Japan, 1960," "United States, 1980," and "France, 2000" are all instances of a single economic system?

Consider briefly Marx's account of the core features of capitalism. It is an economic system based on a particular and distinctive property system: private property in the means of production (capital) and private ownership of labor by the worker (labor). The worker is free to sell his/her labor power to multiple owners of capital; but, having been separated from all other forms of access to means of production, the worker is not free to withhold his/her labor altogether. So the worker is dependent on the capitalist for access to the means of subsistence; and the capitalist is dependent upon the worker as the creator of surplus value. It is a system that is premised on surplus extraction by owners of capital from the producers of value (workers). It is a system based on accumulation: constant growth and expansion of the appropriation of surplus value (profits). And it is a system based on accumulation rather than consumption. And, finally, Marx believes that these social institutions create an institutional logic for capitalist economies that is different from other modes of production -- a tendency towards technological innovation, a tendency towards a falling rate of profit, the creation of an "industrial reserve army," and the creation of a tendency towards economic crisis. It is this claim that permits Marx to assert that he has produced a theory that encompasses a whole class of social formations, rather than being simply a description based on a single case, British capitalism of mid-nineteenth century.

In order to carry this concept through, we would need to postulate that there is a core set of economic features and institutions that constitute the "essence" of capitalism; that these core features recur across multiple historical social formations; and that the differences that exist across historical cases are non-essential, accidental, epiphenomenal, or super-structural.

And differences there are, of course. One important dimension of difference is the degree and nature of state involvement in the economy. But other differences are equally important: the subtle but distinctive differences in property systems that exist in England, Germany, Japan, or the United States; the differences that exist in regulatory regimes (such as those documented by Frank Dobbin); the cultural differences that exist across "capitalist" societies with respect to attitudes towards wealth, the environment, or inequalities; and so on for a continuing and broad range of differences across societies.

Given this fact of sociologically important differences across historical instances of capitalism, we appear to have two theoretical choices. The first is to postulate that the common, core institutions of capitalist societies impose a logic of development on capitalist societies that is more fundamental than any of the evident differences across instances. The other is to judge that the concept of capitalism is simply a nominal social category, grouping together a number of societies which have some similarities and also important differences. Or, following Weber, we might say that capitalism is an ideal type, an organizing and idealized concept that singles out a set of features that often hang together, but recognizing that no particular society perfectly exemplifies all these features.

It seems to me that Marx fell into a fetishim of his own in reifying the capitalist mode of production as a general historical category. We are better off following the lead of the new institutionalists, recognizing that every society has a somewhat different configuration of basic institutions; and acknowledging that these differences make a difference in the development and historical trajectory of these societies. There are important commonalities across many or most of the societies that Marx would call "capitalist" -- a deep conflict of interest between capital and labor, a likelihood that economic property ownership will support political power and influence, and other common features. But to judge that "every capitalist society develops in the same way" goes well beyond what history or theory would support. Instead, we need to have specific, factual analysis of each of the societies we are interested in, and should highlight the differences that exist as well as the commonalities that recur. This finding takes us further down the road of emphasizing particularity and difference as much as generalization and regularity in social science theorizing.