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Crowding out capitalism: A law of historical materialism

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  • Hagendorf, Klaus

Abstract

This paper presents a modern response to the problem imposed by Marx in Capital in 1867, “to lay bare the economic law of motion of modern society” and to provide a vision on how on the basis of this law of motion the transformation of the capitalist mode of production to the socialist mode of production can be perceived. The analysis begins with a discussion of the Marxian analysis of labour values. To overcome the difficulties the marginal analysis of labour values is introduced and it is shown that in an optimal economy where labour is used in an efficient manner commodities exchange by their labour values. The transformation problem is thereby eliminated. In a further step the socially necessary character of surplus value as a fund of capital accumulation in order to increase and maintain the productivity of labour is presented and opposed to the capitalists strife for the private exploitation of surplus value. It is argued that the capitalist harmful practices, leading to economic and social crisis, can and must be overcome by the labour movement via economic democracy and collective capital formation thereby eliminating the 'ultima ratio' of the capitalists, the supply of and control over capital. Finally this process of crowding out capitalism is contrasted with the orthodox reformist and revolutionary approaches.

Suggested Citation

  • Hagendorf, Klaus, 2011. "Crowding out capitalism: A law of historical materialism," MPRA Paper 31745, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:31745
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    References listed on IDEAS

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    1. Yong Bao & Melody Lo & Franklin G. Mixon, 2010. "General-interest versus specialty journals: Using intellectual influence of econometrics research to rank economics journals and articles," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 25(2), pages 345-353.
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    More about this item

    Keywords

    Crowding out capitalism; Historical Materialism; labour theory of value; marginal analysis; Marxian economics; political economy; social revolution; Rosa Luxemburg; transformation problem;

    JEL classification:

    • B51 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Socialist; Marxian; Sraffian
    • D46 - Microeconomics - - Market Structure, Pricing, and Design - - - Value Theory
    • P51 - Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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