Marx

The economic principles of Karl Marx

Running head: The Economics of Karl Marx

The economic principles of Karl Marx

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Abstract:

The document highlights the principles that underpin the economy of Karl Marx, Marx predicted a revolution by workers to replace the capitalist form of economic organization with a communist society. Marx said that there are two groups that include the economy and the capitalists and workers who are in permanent conflict, there is no accumulation capital by the capitalist, which replaces variable capital with constant capital will result in lower levels of profit, the capitalist profit decline and try to improve their level of surplus for other workers through oppression prices and lower wages will lead to a revolution that will replace capitalism in the form of communism.
Introduction:

This article examines the economics of Karl Marx, some of the principles discussed herein include economic measures announced changes Marx, the concept of labor value, capital gains constant and variable capital and profits, benefits decrease, and monopoly capitalism. What follows is a discussion of some of these basic economic principles of Karl Marx.

Economic stages of development:

The economic principles of Marx, Marx's economy consists of two large groups that include workers and media owners production, He provided a historical overview of economic development in which he emphasized the big stage, the first step was slavery, and feudalism capitalism and, finally, communism, he saw communism as a form of economic organization that emerged from the ruins of capitalism, he said the workers were oppressed and alienated, a revolution that would replace capitalism with a communist society. (Benedetto, 1996)

This principle has been criticized by other researchers and some of the criticism is the fact that capitalism has become widely accepted as legal in many countries, it is also clear economies that have adopted the form of communism Company failed to achieve economic growth and, finally, workers are no longer trying to replace the capitalist form of society as he predicted. (Cunningham, 1993)

Value of work:

worth of work was another of the principles of economics, Karl Marx, the value of work refers to the value of a product is generally determined by the amount of labor used to manufacture the product. This means that we have assumed that the value of the products depends on the amount of labor used in the production of this product, said that greater work productivity, mean less hours are devoted to producing the product and therefore lower the value of the product. (Skousen, 2007)

As wages in the economy, Marx stressed that the power of workers labor sold to the owner of the production process, he said, the value of prevailing wages were determined by the forces including market demand for labor by the capitalist and labor supply by workers forces determine the wage rate and because the means of production are owned only a few capitalists, and most workers have and thus labor supply was high. payment rates in the economy, however, was enough so that workers can reproduce the work. (Skousen, 2007)

Constant and variable capital:

Karl Marx distinguishes two forms of capital that constant capital and variable capital as regards the reproduction of capital constant, constant capital refers to the value of capital is not subject any value in the machine, as the production process and raw materials, he said, interest costs and depreciation have transferred the cost of these products and therefore the form of capital is not an added value of manufactured product. (Karl Marx, 1991)

The other form of capital, he said, was crucial variable variable capital refers to the portion of capital represented the labor force, labor force produces the product value was equal to its value and has also produced a surplus. Work is the only source of product value and refers to the part of capital was spent in recruiting workers. (Karl Marx, 1991)

The added value:

From the above discussion, it is clear that according to Marx, profit is the difference between the value of the product and the value of work, the gain is the gain in the production process, but Marx recognized other sources of revenue, including interest on capital, income and profits of the normal business. (Karl Marx, 1991)

diminishing returns:

Referring to his work, noted that the objective values fall profits in the future, he said, because surpluses arising in the process of capitalist production will increase investment in constant capital, such as machinery, would lead to an increase of constant capital over variable capital after the fall in profits as the level of surplus earned by workers and thus reduce loss of income. (Karl Marx, 1991)

Despite their understanding of these benefits in Marx suggests ways in which this would be offset, which includes increasing the exploitation of labor, increasing labor exploitation concerns a further reduction of wage rates to achieve the surplus levels. Another way to counteract costs will decline through trade in which capitalists can choose to export their products to other economies in order to accumulate assets, the other will be reduced the cost of constant capital and the cost of raw materials used in the production process. (Benedetto, 1996)

Technology:

Marx also stressed the importance of technology in the production process, technology and equipment have been important elements in the production process, and technology has increased labor productivity and the reduction of time spent by workers to produce the exchange value of wages, so that capitalists to reduce the time spent working in the production process through the introduction of machinery in the production process. (Benedetto, 1996)

The monopoly capitalism

Marx also introduced the concept of monopoly capitalism, monopoly capitalism refers to the increase in surpluses of capital accumulation, this process of capital accumulation in a small number of individuals in the economy and what he calls the monopoly capitalism. (Hollander, 2008)

He stated that monopoly capitalism would result in economies of scale and promoting technologies that reduce the cost of products. Due to falling prices of small capitalists products leave the area and only capitalist with large amounts of capital will remain in the production process, this also happens that large companies buying smaller companies. (Hollander, 2008)

The capitalists will face levels declining profits and the only solution to this problem will be strengthened labor exploitation, labor exploitation involves reducing wages in order to achieve the desired values on the other hand, there will be an increase in unemployment and will be due to the advancement of technology and population growth, high unemployment will be increased labor supply to exploit more capitalist work. (Hollander, 2008)

monopoly capitalism will lead to an increase of constant capital and more workers unemployed due to the exploitation of labor with other types of low wages, there will be a revolution that is the capitalist form of society is replaced by communist society. (Hollander, 2008)

Conclusion

The above discussion highlights the economic principles of Karl Marx, some of the principles include the value of labor, capital accumulation, capital gains, reduced profits, monopoly capitalism and the stages development of changes overall economy, Marx's critique of capitalist society and called for a communist society

References:

Benedetto Croce (1996) Historical materialism and the economics of Karl Marx, Prentice Hall Press, New Jersey

John Cunningham (1993) Economy Karl Marx: a critical appraisal. Press McGraw Hill, New York

Karl Marx (1991) Marx on the economy, and Black Press, New Jersey

Mark Skousen (2007) The economy of the top three: Adam Smith, Karl Marx and John Maynard Keynes, McGraw Hill Press, New York.

Samuel Hollander (2008) Economy Karl Marx: analysis and application, John Wiley and Sons, New York.

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