Home / papers / Marxian Economic Theory

Marxian Economic Theory

According to Marx analysis, the source of profit and the driving force behind capitalism is the unpaid labor of workers. Exploitation in the context of workers has always been explained as working for long hours with less payment that does not reflect the time and the energy applied in such duties. On the other hand, Karl Marx has a different and broader view of exploitation from the one explained above. According to Karl Max, exploitation is the forced appropriation of the unpaid labor of workers such that all working class people are paid. Marx argues that the driving force behind capitalistic production and the ultimate source of profit is the unpaid labor of workers, which forms the foundation of capitalism system (Lapon, 2011). According to Karl Marx, the best way to achieve an entirely different system is to embrace socialism since capitalism leads to exploitation of the workers. Under socialism, there is more equality and there is no tiny minority at the top to control the wealth while the rest struggle to live. Slavery is the most open form of capitalism since the exploiter uses sword and lash to force the exploited, which in turn is provided with small product to keep him alive. This is almost similar to feudalism in its classical form in Europe; whereby, the serfs work for the lord and gets absolutely nothing in return from the lord.

In neoclassical microeconomics, the source of capitalist profits comes from the determinants of prices that are dependent on the forces of demand and supply. In this arrangement, maximum utility is achieved by properly employing the available market information and the factors of production. According to Karl Max, the wages are used by the capitalist to hide the exploitative nature of capitalism by making it appear on the surface that an equal exchange has taken place (which is not the case). Just in the same way the capitalist buys the raw materials and machinery, the capitalist also buys the labor power and he controls their creativity and physical energies (Lapon, 2011). In conclusion, Marx argues that the abolition of wage system, which is the source of capitalist wealth, is the only way to end the exploitation of workers.

 

Reference

Lapon, G. (2011). What do we mean by exploitation? SocialistWorker.org

Leave a Reply

Your email address will not be published. Required fields are marked *

Top