What Is Marxian Economics?

Marxian economics is a school of economic thought based on the work of 19th-century economist and philosopher Karl Marx.

Marxian or Marxist economics focuses on the role of labor in the development of an economy. It's critical of the classical approach to wages and productivity developed by 澳洲幸运5官方开奖结果体彩网:Adam Smith. Marx argued that the specialization of the labor force coupled with a growing population pushes wages down. He added that the value placed on goods and services doesn't ac🎀curately account for the true cost of labor.

Understanding Marxian Economics

Much of Marxian economics is drawn from Karl Marx's seminal work, "Das Kapital." It was his magnum opus first published in 1867. Marx described his theory of the capitalist system, its dynamism, and its tendencies toward self-destruction in the book.

Much of Das Kapital spells out Marx’s concept of the “surplus value” of labor and its consequences for capitalism. It wasn't the pressure of labor pools that drove wages to the subsistence level, according to Marx. It was the existence of a large army of unemployed and he blamed this on capitalists. He maintained that labor was a mere commodity that could gain only subsistence wages within the capitalist system.

Capitalists could force workers to spend more time on the job than was necessary to earn their subsistence, however. They could then appropriate the excess product or surplus value created by the workers. Marx argued that workers create value through their labor but aren't properly compensated. He said that their hard work is exploited by the ruling classes who generate profits not by selling their products at a higher price but by paying sta🌸ff less than the value of their labor.

Marxian Economics vs. Classical Economics

Marxian economics is a rejection of the cl𓂃assical view of economics developed by economists such as Adam Smith. Smith and his peers believed that the free market, an economic system powered by supply and demand with little or no government control, and an onus on maximizing profit, automatically benefits society.

Marx disagreed, arguing that capitalism consistently only benefits a select few. He argued that the ruling class becomes richer bᩚᩚᩚᩚᩚᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ𒀱ᩚᩚᩚy extracting value out of cheap labor provided by the working class under this economic model.

In contrast to classical approaches to economic theory, Marx favored government intervention. He said that economic decisions shouldn't be made by producers and consumers. They ought to be carefully managed by the state to ensure that everyone benefits.

He predicted that capitalism would eventually destroy itself as more people become relegated to worker status,🔴 leading to a revolution and production being turned over to the state.

Special Considerations

Marxian economics is considered separate from Marxism even if the two ideologies are closely related. It focuse﷽s less on social and political matters. Ma🤡rxian economic principles clash with the virtues of capitalist pursuits.

It seemed the Marxist ♏dream had finally and firmly taken root during the first half of the twentieth century w🍸ith the Bolshevik revolution in Russia and the spread of communism throughout Eastern Europe.

That dream collapsed before the century had ended. The people of Poland, Hungary, Czechoslovakia, East Germany, Romania, Yugoslavia𝓰, Bulgaria, Albania, and the USSR rejected Marxist ideology and entered a remarkable transition toward private property rights and a market-exchange-based system.

The Bottom Line

The Marxian economics theory🀅 focuses on what Marx claimed were two major flaws in capitalism: the ups and downs of the free market and ꦛan abundance of labor. He argued that the availability of more specialized workers drives wages downward and that the value of goods and services doesn’t match the true cost of labor. Marx favored government intervention to intercede with these dilemmas.