Marxist crisis theory

from Wikipedia, the free encyclopedia

The Marxist crisis theory , also called Marxist business cycle theory based on today's parlance , assumes that a capitalist economy is periodically afflicted by crises and tries to explain this crisis cycle.

A distinction is made between two types of crises: 1. Realization crises caused by disproportionality between the various branches of production or by under-consumption, 2. Crises caused by over-accumulation . The latter type of crisis is based on the ( dialectical ) contradiction between the development of productive power and the utilization of capital . The increase in the productive power of labor ( labor productivity ) appears contradictory, because at the same time it reduces the use of workers in favor of machines, i.e. fixed capital :

“[The increase in the productive power of labor] increases the relative surplus value only by reducing the labor input with a given capital input. This lowers the rate of profit and creates a barrier to exploitation that can only be overcome through the crisis. "

- Alfred Müller : The Marxian business cycle theory - an over-accumulation-theoretical interpretation. Cologne 2009, p. 51

Cycle phases

The economy goes through a cycle that includes various phases. Neither the number of phases nor their designations are uniform in Marx. There are:

  1. Stagnation / Second phase of downturn
  2. Prosperity / first upswing
  3. Overproduction / Second boom phase
  4. Crisis / first downturn

or

  1. medium liveliness
  2. High pressure
  3. crisis
  4. stagnation

or

  1. Bracing
  2. medium liveliness
  3. Rush
  4. crisis

or

  1. Idle state
  2. growing animation
  3. prosperity
  4. Overproduction
  5. Noise
  6. Stagnation (economy)

requirements

Necessary conditions - "possibility"

Only in a money economy can there be general market overcrowding, general overproduction , in subsistence economies or exchange economies , on the other hand, not or only partially.

A money economy includes the possibility of money being hoarded . Those who sell goods for money can keep the money instead of using it to buy other goods. This stagnates the money cycle and the economy. This view is not only found in Marxist crisis theory, but also among non-Marxists such as Silvio Gesell .

Sufficient conditions - "necessity"

Fixed capital

Large-scale industrial production with the help of machinery, of fixed capital, is a sufficient prerequisite for the crisis cycle . This is supposed to increase labor productivity, living labor is replaced by machinery, which increases the relative surplus value .

Lack of macroeconomic coordination

In addition, there is no macroeconomic coordinating body in a market economy.

Hoarding money for later investments in fixed capital

In Capital , Volume II, Marx shows how the banking of money for future major purchases of fixed capital (banking of cash accumulation fund) the hoarding caused by money. Hoarding is no longer just a possibility of a crisis, but a necessity, because otherwise the accumulation funds cannot be built up. As a result, the economy is constantly threatened with an interruption in the money cycle. Theoretically, other companies are stealing at the same time, spending their accumulation funds. Without joint coordination, it is unlikely that the two will complement each other just right. One way out is the credit system , the business of banks. While some companies invest their surplus income with the banks, others borrow their money needs from the banks. The need for money can theoretically be covered by money creation . The problem of hoarding money is elastically absorbed by the credit system, but contradictions and causes of crises arise again at a higher level, as Marx then explains in Capital, Volume III.

Time delays

Industrial machine production causes time lags , delays, for example between production and demand, or vice versa, or between investment and the development of labor productivity. In the upswing, production reacts to demand with a time lag, the demand is greater than the supply in the downswing, vice versa. According to the cobweb theorem or in the multiplier-accelerator model, time lags also lead to oscillations.

Investments in rationalization at the expense of employment

Ultimately, consumer demand is a prerequisite for value created in production to be realized on the market. This is differentiated from under-consumption theories by the fact that an increase in wages with a subsequent greater demand for consumer goods cannot solve the problem because it depends on the value, which, according to Marx, is determined by the labor theory . It comes down to more profitable employment, not more wages. Although higher wages increase consumer demand, they also reduce profits. If prices finally fall during the downturn, this increases real wages and the purchasing power of workers, without this in the view of the capitalists solving the problems of the crisis.

cycle

Indicators of economic development in the USA , employment , consumption , investment , production

Beginning of the cycle or lower turning point

The economic upswing is initiated at the end of the stagnation phase, because below-average price levels and below-average profit rates lead to massive investments in new, improved production technologies. As a result of the previous downturn, existing production capacities have been devalued through moral wear and tear , which leads to replacement investments on a technically advanced basis. In order to get out of the crisis, new production techniques with higher labor productivity are introduced, which are connected with a higher use of fixed capital per worker. Marx assumes that the newer processes are more expensive than those to be replaced, so that higher production is necessary if the new investments are to pay off.

"Marx assumes that the newer processes are more expensive than those to be replaced and therefore require a higher level of production when used to increase productivity."

- Alfred Müller : The Marxian business cycle theory - an over-accumulation-theoretical interpretation. Cologne 2009, p. 178

prosperity

The general introduction of technically advanced production facilities leads to a general economic boom, to the phase of prosperity , in which the new production techniques are introduced more and more into the economy, which also leads to an boom in the logic of a multiplier-accelerator model . The offer can demand a delay before prices rise.

According to Alfred Müller (similar to Joseph Schumpeter's business cycle theory ), those who introduce the new production technology initially achieve an extra profit at the expense of those who still produce with old technology. These extra profits dwindle as the new production technology generalizes.

A profitable use of capital and labor from the point of view of the capitalists cannot be immediately provided by the existing production possibilities. Because of the excess demand, there is a general price increase, perhaps mitigated by the fact that existing stocks can be dismantled or production facilities that have been idle since the last downturn can be switched on. Workers from the reserve army are now back in work. Maksakowski expressed this by saying that, in the “language of the market”, prices signal underproduction, they signal that demand is greater than supply. In the “language of production”, supply equals demand if the future supply of the production facilities still under construction were already taken into account. This is due to the fact that production facilities that are produced appear on the one hand already on the demand side, demand for labor and thus for consumer goods, demand for means of production. However, these production facilities under construction are not yet effective on the supply side, but only with a delay effect . According to Maksakowski, prices are now generally higher than their values ​​correspond to (cf. labor theory ). This means that the value of money is below its value.

Müller emphasizes the redistribution of value-added production from the lagging companies to the innovators who introduce the new, more productive technology. At Maksakowski, there is a redistribution of added value production within the cycle. Added value that is not realized in the downturn is also realized in the upswing. The law of value applies in the average of the cycle, but not in the individual phases.

The rates of profit rise. Wages lag behind the development, the wage share falls in the upswing. The upswing is primarily driven by investment in expansion , employment is rising, and less by investments in rationalization , which lead to an increase in the composition of capital .

Over accumulation and crisis

The upswing is carried by imitators, imitators who are forced to take on the new, more productive investments. It is about extensive growth, which means that a given production technique is becoming more and more popular, as more means of production are used and more workers are employed. Some time elapses between the point at which a new investment is started and the point at which the production of the new production equipment enters the market. Between investment decisions and sales of the new products is a time " Time was ".

Because of the time lag between investment decisions and the point in time at which the investments themselves begin to produce for the market, over- accumulation occurs . The demand has already been satisfied, but investments are still being made, which will come onto the market with a delay, with time lag . In addition, the production facilities fail as demand after their completion, since the manpower and materials and production capacities required for their production are no longer required after completion of the facilities.

The result is overproduction , supply is greater than demand. The downturn also follows the logic of a multiplier-accelerator model . From the capitalists' point of view, it is now evident that more workers and production facilities are employed than are actually needed. Goods cannot be sold or can only be sold below their value - the real crisis , in some cases production is in stock. Workers are released into the reserve army , production facilities shut down. This exacerbates the downturn. According to the Russian Marxist economist Pavel Maksakovsky, prices are now lower than their values ​​correspond to (cf. labor theory). As long as the production facilities are not yet adapted to the reduced demand, says the "language of the market", that is, the prices signal that the supply is greater than the demand, even if in the "language of production" the dismantling of the production facilities is already in progress is, but takes time. The profit rates collapse.

"After the generalization phase has ended and the increase in productivity has faded away, it turns out, in retrospect, that the capitalist use of machine-based technical progress " only increases one factor, the rate of surplus value , by reducing (by, AM) the other factor, the number of workers "(MEW 23 p. 429)."

- Alfred Müller : The Marxian business cycle theory - an over-accumulation-theoretical interpretation. Cologne 2009, p. 183

stagnation

For now, the economy comes to a standstill as there is a lack of demand and profits. Some companies are leaving the market, others can barely hold out, and still others are still making a profit. On the one hand, the supply declines because capital is devalued and is eliminated on the supply side. On the other hand, new investments at a higher technical level, which are associated with a higher composition of capital , can lower costs by producing the same quantity of goods with less labor. Investments in expansion hardly take place at first, through rationalization investments , which lead to an increase in the composition of capital, the companies try to save necessary working time and reduce costs and thus generate profits again . When innovations in production techniques have finally prevailed during the stagnation phase, the leading companies again make massive new investments with a higher composition of capital and higher labor productivity with subsequent imitation investments, so that a new upswing begins.

Cyclical movement of individual quantities

Interest and wages

During stagnation, interest rates are low, which forms the basis for a new upswing. In comparison to investment-seeking money capital, there are initially no profitable investment opportunities (investment emergency). Then, during prosperity, the interest rate increases because the demand for credit for new investments increases. At the beginning of the crisis, companies try to survive with the help of loans, while the risk premium included in the interest rate increases. The interest rate is reaching its cyclical peak. In the stagnation, the interest rate then falls again. There are still profits seeking investment, but no predictable investment opportunities.

The wages fall in the crisis due to high unemployment, which forms a basis for a new upswing. In the upswing, the wage rate also rises and unemployment declines. As profits rise in the course of prosperity, the scope for distribution grows and with it the ability of the unions to enforce higher wages. Before the crisis, wages reach their cyclical peak (Marx: rising wages as the “storm bird of the crisis”).

Prices

In the upswing, demand leads the delayed supply, so that prices rise. When prices rise, the value of hoarding of money falls, so hoarding of money is dissolved and the money gets into circulation and thus increases demand and thus the upturn. Conversely, in a downturn, when prices fall as a result of over-accumulation. This means that the value of money is above its value. As prices go down, the value of money hoarding increases, causing further hoarding of money. This exacerbates the lack of demand and the downturn.

Differentiation from Joseph Schumpeter

For Joseph Schumpeter , the starting point of the business cycle is a state of equilibrium , which, however, encourages market participants to innovate with extra profits, which then disturb the equilibrium. In the following upswing, the imitators take over the successful innovations (innovations) until the extra profits have competed away and a new equilibrium without growth has developed, which as the end point of the cycle is also the starting point of a new cycle. Schumpeter rejects the attempt to explain the boom as a consequence of the depression and then the depression as a consequence of the boom as "perpetuum mobile reasoning". With Marx, on the other hand, in contrast to Schumpeter, the starting point is not an equilibrium position, but rather “depression”, because of over-accumulation there is a depressed rate of profit, which forces innovation. The innovators receive extra profits at the expense of the rest. This forces the rest to imitate the innovations. This leads to a temporary upturn. To the extent that the imitators take over the innovations with higher rates of surplus value, the extra profits dwindle and the higher capital advances for fixed capital remain. A new ratio of surplus value production and capital stock, which is less favorable than before the upswing, is emerging, which as an imbalance triggers a new surge in innovation.

Differentiation from the multiplier-accelerator model

In Keynesian economic theories , the company has suitable investment that the capital stock increase, the production capacity of the demand of ( "capacity adjustment principle"). In macroeconomic terms, it is assumed that the capital stock adapts to demand with time lag . Since the investments themselves are part of the demand, there may be continual deviations between the production capacity aimed for in accordance with the expected demand and the demand that has already changed again as a result of the investments. Under certain assumptions, economic fluctuations can occur if the adjustment of production capacities both upwards and downwards regularly overshoots the target. Such processes are represented in multiplier-accelerator models .

According to the over-accumulation theory, however, capacities are not adjusted to a demand, but the profits are used to build up capacities, which regularly leads to overinvestment, the supply possibilities exceed the demand. This initially leads to a profit crisis and a slump in expansion investments . But then this forces replacement investments at a technically higher level (usually with a higher technical and organic composition of the capital ) in order to escape the profit crisis. These replacement investments lead to an upswing. Multiplier-accelerator processes can play a role in both an upswing and a downswing.

Differentiation from bottleneck theories

Bottleneck theories are theories that state that the lack of specific production factors inhibits capitalist growth or makes it fluctuate in a crisis. Kondratiev in particular provided such an explanation: the factors of production required for production do not grow to the same extent as the economy as a whole; they change their relative cost ratios among themselves. If a certain factor of production can no longer be physically reproduced, it becomes too expensive. So it is not general overproduction or overaccumulation that causes falling profits. In fact, because of the specific scarcity of factors, it is no longer worthwhile for entrepreneurs to expand production. The scarcest production factor marks a “real cost limit”, that is, a deficiency that cannot be remedied with money. Such bottlenecks in production force innovations such. B. in the form of new basic technologies. These break through the real cost limit by saving labor, capital or other production factors. It was the steam engine that made it possible to solve the problems of dewatering and inexpensive coal production in British mines; Decentralized information processing was a prerequisite for making production technology more flexible and thus for the exit from mass production . For state crisis management, this approach means that investments should primarily be made at the real cost limit.

Demarcation from wage pressure theory

A mathematical representation of the wage pressure theory is the Goodwin model . The economic fluctuations result from a shortage of labor. In the upswing, the reserve army declines , wages rise, profits fall. In the crisis that follows, the reserve army rises, wages fall, and profits rise. This leads to an upswing again. The rate of surplus value or the wage share fluctuates cyclically.

Technical progress and the composition of capital play no role in wage pressure theory. In the over-accumulation theory , the motor of business cycle fluctuations is the composition of capital with the accompanying development of labor productivity and the relative surplus value influenced in this way .

Over-cyclical developments

"Just as the law of the tendency for the rate of profit to fall can only be explained together with the business cycle , so the law of the rate of profit and the development of its internal contradictions have an equal effect on the process of dissolution of capitalism."

- Alfred Müller : The Marxian business cycle theory - an over-accumulation-theoretical interpretation. Cologne 2009, p. 397

The crisis cycle leaves its mark in that only the larger capitals survive, capital centralization occurs . Under the assumption that only capitals with a higher composition of capital have a sufficiently high labor productivity that allows survival in competition, the rate of profit falls (cf. law of the tendency of the rate of profit to fall ). The number of unemployed does not just fluctuate cyclically, rather the reserve army is supplemented in the long term by a "Lazarus layer", people who can no longer find work not only periodically but permanently. It is possible that this permanently unneeded supply of labor in unproductive parts of the capitalist economy, e.g. B. at the state, are employed.

These long-term developments ultimately question the capitalist system as a whole and raise the question of a socialist revolution .

Critique of the law of the tendency of the rate of profit to fall

The law that the rate of profit tends to fall has often been criticized. The Okishio theorem , which contradicts this law, is named after the Japanese Nobuo Okishio . Okishio, after a mathematical review of the law, concludes that the rate of profit is determined “by the struggle of two opposing classes”. In particular, the hypothesis that is decisive for the law, namely the increase in dead labor in relation to living labor, or the increase in the capital coefficient, is doubtful according to the economist Heinz Holländer. It is an axiomatic theory that deduces certain consequences from certain axioms , but cannot make any statements about the real course of history.

Overview of Marxist business cycle theories

This article or section consists mainly of lists, which should be replaced by running text . Please help Wikipedia improve this. More about is here to find.

Business cycle off

  • Production sphere
Over-accumulation theories
  • Circulation sphere
Circulation theories
Realization theories
Underconsumption Theories
Disproportionality theories
Bottleneck theories
Real cost theory
Wage pressure theories (see e.g. Goodwin model )
Price range theories
  • Circular process of capital
Capital cycle theories

Individual evidence

  1. ↑ Alfred Müller p. 79., cf. Stephan Krüger (2010) p. 336, Pavel Maksakovsky 2004, p. 60ff.
  2. ^ MEW 25, Chapter Volume III, "TWENTY-TWO CHAPTER Division of Profits. Rate of interest. "Natural" Rate of Interest "
  3. ↑ Alfred Müller 2009, p. 40 f.
  4. ↑ Explained in detail in: The new doctrine of money and interest. Physiokratischer Verlag, Berlin / Leipzig 1911, and The natural economic order through free land and free money. Self-published, Les Hauts Geneveys 1916.
  5. ↑ Stephan Krüger (2010) p. 339, 342f., Pavel Maksakovsky 2004, p. Xli, p. 37, 42ff., 57ff., 81.
  6. ↑ Stephan Krüger (2010) p. 344.
  7. ↑ Alfred Müller 2009, pp. 48, 143.
  8. ↑ Alfred Müller 2009, pp. 106f, 160, 237f.
  9. ↑ Pavel Maksakovsky 2004, p. 45.
  10. ↑ See e.g. B. Martha Campbell: "Money in the Circulation of Capital" in: Christopher J. Arthur and Geert Reuten : "The Circulation of Capital - Essays on Volume Two of Marx's Capital ", London, New York 1998.
  11. ↑ Alfred Müller 2009, p. 99.
  12. ↑ Pavel Maksakovsky 2004, p. 81ff.
  13. ↑ Stephan Krüger (2010) p. 351.
  14. ↑ Alfred Müller 2009, p. 297.
  15. ↑ Pavel Maksakovsky 2004, p. 64.
  16. ↑ Pavel Maksakovsky 2004, pp. 68, 71., Stephan Krüger (2010) pp. 436, 209, 234f.
  17. ↑ See Alfred Müller, p. 9, 19f., 26ff., Stephan Krüger (2010) p. 353f.
  18. ↑ Alfred Müller 2009, pp. 174f.
  19. ↑ Stephan Krüger (2010) p. 321.
  20. ↑ Pavel Maksakovsky 2004, pp. 59, 63.
  21. ↑ See Stephan Krüger (2010) p. 342.
  22. ^ Alfred Müller 2009, p. 178 with reference to wage labor and capital MEW 6, p. 418.
  23. ↑ Müller 2009, p. 307, cf. Stephan Krüger (2010) p. 345.
  24. ↑ Stephan Krüger (2010), p. 350 f, p. 359 f.
  25. ↑ Pavel Maksakovsky 2004, p. 84 f.
  26. ↑ Pavel Maksakovsky 2004, pp. 64 ff., 71.
  27. ↑ Pavel Maksakovsky 2004, p. 67.
  28. ↑ Maksakovsky 2004, p. 101.
  29. ↑ Pavel Maksakovsky 2004, p. 84.
  30. ↑ Pavel Maksakovsky 2004, pp. 73, 79.
  31. ↑ Pavel Maksakovsky 2004, pp. 74ff.
  32. ↑ Alfred Müller 2009, p. 183.
  33. ↑ Pavel Maksakovsky 2004, pp. 95ff.
  34. ↑ In Das Kapital Volume III, MEW 25, p. 200 , Marx describes the adaptation of companies to low demand by reducing supply on the one hand and technical progress with lower labor costs on the other .
  35. ↑ Alfred Müller 2009, p. 294.
  36. ↑ See Krüger 2007, pp. 73ff.
  37. ↑ On the cyclical movement of prices and thus the value of money cf. also “1.11 Changes in the value of money” in “Alan Freeman: Price, value and profit - a continuous, general, treatment. In: Freeman, Alan and Carchedi, Guglielmo, (Eds.): Marx and non-equilibrium economics. Edward Elgar: Cheltenham, UK, Brookfield, US 1996. On the Internet at the University of Munich . "
  38. ↑ See Alfred Müller 2009, p. 336ff.
  39. ↑ See e.g. B. Representation with the help of Lotka-Volterra equations Frank Schohl (1999): The market-theoretical explanation of the economy. Mohr Siebeck Tübingen.
  40. ↑ See Frank Schohl 1999, p. 17.
  41. ↑ Müller 2009, p. 310ff.
  42. ↑ Money or Life? In: Netzwerk Plurale Ökonomik , accessed September 19, 2016.
  43. ↑ Alfred Müller 2009, p. 248ff.
  44. ↑ See Richard B. Day, foreword p. Xxxiii to Maksakovsky 2004.
  45. ^ So Stephan Krüger (2010) p. 177.
  46. ↑ Cf. Capital points beyond itself Richard Day in Maksakovsky 2004, pp. Xxxiv ff. And pp. Xliii ff.
  47. ↑ Hans G. Nutzinger ; Elmar Wolfstetter : The Marx theory and its criticism II. Herder and Herder, Frankfurt 1974, pp. 165-192.
  48. ^ Nobuo Okishio: Technical Change and Rate of Profit. In: Hans G. Nutzinger; Elmar Wolfstetter: The Marx theory and its criticism II. Herder and Herder, Frankfurt 1974, pp. 173–191, here p. 187.
  49. ↑ Walter Holländer: The law of the tendency of the rate of profit to fall. Marx's justification and its implication. In: mehrwert - Contributions to the Critique of Political Economy. No. 6/1974, pp. 105-135, here: p. 135.
  50. ↑ Müller 2009, p. 37.

literature

  • Pavel V. Maksakovsky: The Capitalist Cycle. Translated with Introduction and Commentary by Richard B. Day. Leiden, Boston 2004 (= 1929).
  • Karl Marx: Capital . Critique of Political Economy , 1867.
  • Paul Mattick : Crises and Crisis Theories . In: Crises and Crisis Theories with contributions by Paul Mattick, Christoph Deutschmann and Volkhard Brandes. Fischer Taschenbuchverlag, Frankfurt am Main 1974.
  • Alfred Müller: The Marxian business cycle theory. An over-accumulation theoretical interpretation. Cologne 2009.
  • PROKLA : Crises and Crisis Theories (PDF file; 3.6 MB) , Prokla No. 30, 1978.
  • PROKLA: “Crisis of the economy - failure of the crisis theory?” (PDF file; 3.6 MB) , Prokla No. 57, 1984.
  • Thomas Sablowski: Crisis Theories. In: Historical-Critical Dictionary of Marxism , Volume 8 / I, Crisis Theories up to the Luxemburg-Gramsci Line; Hamburg 2012, pp. 1–38.
  • Paul Sweezy : Theory of Capitalist Development. Bund-Verlag, Cologne 1959. Part III: crises and depressions .

Web links