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Simple commodity production (German: einfache Warenproduktion), also translated as petty commodity production, is a term coined by Friedrich Engels in 1894 when he had compiled and edited the third volume of Marx's Capital.[1] It refers to productive activities under the conditions of what Karl Marx had called the "simple exchange" or "simple circulation" of commodities, where independent producers trade their own products to obtain other products (the trading circuit C-M-C'). The use of the adjective simple is not intended to refer to the nature of the producers or of their production,[2] but rather to the relatively simple and straightforward exchange processes involved from an economic perspective.
As discussed below, both Karl Marx and Engels claimed explicitly that the law of value applied also to simple exchange, and that this law is modified by the capitalist mode of production when all the inputs and outputs of production (including means of production and labour power) become tradeable commodities. According to Marx and Engels, simple commodity production and trade existed for millenia before the advent of capitalism.[3] From the beginning of the bourgeois epoch, the reach and scope of commodity production begins to grow incrementally, although sometimes interrupted by wars, epidemic diseases and natural disasters. Only with the growth of free wage labour is commodity production generalized (verallgemeinert) to most of the economy, and integrated into national and international markets. Originally commodity production existed alongside subsistence production. Particularly during the last six centuries, the share of commodity production in total output grew together with population growth, and grew tangentially in the 19th and 20th centuries, until production for the market represented the largest part of total output in the majority of countries.[4]
This interpretation is however not accepted by all Marxists. Some believe that capitalist markets function in a totally different way from pre-capitalist markets, or they believe that the law of value applies only to industrial capitalism and not to market systems which preceded industrial capitalism.[5] Engels aimed to give a consistent explanation of the evolution and development of the market economy, from simple beginnings to the complexities of modern capitalist markets, but his critics argue he disregards the transformation of the relations of production involved.[6]
Marx and Engels's interpretation of the historical role of simple exchange based on simple commodity production has been the subject of considerable controversy among Marxist scholars. It has been claimed that the concept of simple commodity production was never used by Marx.[7] If that is true, then it seems that Engels's concept is really alien to Marx's thought. Moreover, it is claimed that an economy or society fully based on simple commodity production has never existed, contrary to what Engels (allegedly) suggested.[8]
- ^ Friedrich Engels, "Preface" to Karl Marx, Capital, Volume 3, London: Penguin classics, 1991, p. 103.
- ^ Jacques M. Chevalier, "There is nothing simple about simple commodity production". The Journal of Peasant Studies, Vol. 10, No. 4, 1983, pp. 153-186.
- ^ Ernest Mandel, An introduction to Marxist economic theory. New York: Pathfinder Press, 1973, p. 29f.
- ^ Standard national accounts such as UNSNA provide data for the market and non-market sectors of the national economy, as well as for corporate and non-corporate enterprises.
- ^ John Weeks, Capital and exploitation. Princeton: Princeton University Press, 1981, p. 47.
- ^ The validity of this criticism is disputed, given that Marx and Engels both argue that the operation of the law of value is altered by the emergence of capitalist industry precisely because of changing relations of production (see below). Something similar appears in foreign trade, among other things because the market value of the same product can vary in different countries (see the Big Mac index[1].
- ^ Michael Heinrich, "Das Programm der Kritik der politischen Ökonomie". In: Michael Quante & David P. Schweikard (eds.), Marx-Handbuch. Leben - Werk - Wirkung. Stuttgart: J. B. Metzler Verlag, 2016, pp. 98–99.
- ^ Christopher J. Arthur, The new dialectic and Marx's Capital. Leiden: Brill, 2004, chapter 2. Christopher J. Arthur, "The Myth of ‘Simple Commodity Production’", Marx Myths & Legends, 2005.[2]