CENTRE FOR DEVELOPMENT STUDIES

Working Paper 107

ON THE DEVELOPMENT OF CAPITALISM IN

AGRICULTURE.

Mihir Shah

Centre for Development Studies,

Ulloor, Trivandrum-695011

March, 1980

ON THE DEVELOPEET 02 GAPITIILMI IN AGRICULTURE

1. IKTRODUCTION

The debate concerning the development of capitalism in

agriculture has often tended, especially in India, to get bogged down

in a plethora of false 1 problematics'. This has happened essentially

because of the persistent adherence to a rather naive version of the

Harxist conception of this process. is a consequence, there has been

a preoccupation with a mechanical application of indices intended to

measure the extent of capitalist development at a -saint of time, with-

out taking into account the ,:ride variety of forms it may assume. This

variety of forms is precisely a reflection of the different strategies is able to emplc --to subordinate the labour-process to

capital employs - or more correctly,Lits control. Without an analysis

of these forms and an understanding of th_ir raison d' etre, it is

impossible to gain insight:7, into the complex of processes that under-

lies 1,":240 developent of in agriculture.

The Marxian vision of the dynamics of an .,rani an economy under

the influence of caaital is based on the expectation of a gradual

. , polarisation of the Ipeasantry'

/I - peasantry' /into two main classes - the capitalists

and tha prole tarians. dtated in very general terms, the argumen.

underlying such a view is that as capital penetrates agricu]tare, 117erc

would occur an accentuation of commodity production and of the social

division of labour. process of capital accumulation and difrorentia-

tion of the peasantry under the impact of com_netitiye market forces

would be set into motion. Rich peasant farms, larger and batter equipped

1/ This does not, of course, exclude the possibility of thoT ;)eing landless labourers in -ore-capitalism. Under oLo)italism, tiaey would be transformed intoV)rolet&rians in the new context of their employ-ment. dee n.16 for an elaboration of this point.

2/r I7_a= "Trot:; this an essay by de Girardia, "Locialism and Taxes", issue No.,/' of :*ournal :.eue Irh.einisch(: Zeitun?

l'ionomische .3.evl..e issued in T.J1-y from Hambul

'the marxist theory of capitalist production does not

reduce the development of capitalist production to the

simple formula: 'disappearance of the snail holding

before the as ir such a formula were a ::oy to the

understanding of modern economy. To study the agrarian

question according to Harx's method, we should not con-

find ourselves to the question of the future of small

scale farming; on the contrary, e should look fqr all

the changes wich agriculture experiences under the do-

mination of ca:italist - )roduetion. Te shoUld as!:: is

and in what 7ays is capital, taLdivz hold of agriculture,

rovolutionisin7 it, smashin' the old f. r of rroduction

and of -,,overla_z-nC establishing the nell forms which p' _ u

u scceed' r isky ( 1 89 9 ) pp , 2-3/

with resources would fin.1 themselves in a relatively advantageous

position as far as access to inputs, the.. optimal use and the possi-

bility of accumulation are concerned. They would, over time, fo-:•n.

the new capitalist class. For l)recisely the o,,pposite reasons through

the accumulation of disadvantages, the poor peasant farms would gradually

be reduced to the status of proletarians.

'.pile this very general presentation of thelIarxian view

correctly states tic lonr.;-run tendencies of the process, it must be

emphasised that the development of capitalism in agriculture is not

expected to occur in a unilinear fashion over time. There was an acute

awareness of this fact in Classical Harxism. As early aS 1850 Harx, in

a crituo of Girardints work, argued that under capitalism agriculture

is bound to oscillate 'oetween concentration and parcellisation.- Later

Lenin, in }1.4 3 C.7=77i'7 ot-Idy of the development of casitalism in Russia,

observed that "Capitalist por.trates into agri7ulture particularly

slowly and in extremely varied f rT7s (Lenin 1399 p,131). And finally

Kautshy who wrote :rith :;reat sophistication on ;110 quosUonl

It is to this question: that any analysis of the process of

the development of capitalism in agriculture must be centrally addressed.

In this paper we analT3e the principal reasons why the debate on this

issue has tended to !.s:J.To away from this question. On the basis of

this analysis - which leads us into a more general discussion on the

methodology of studying the evolution of tae capitalist mode of pro-

duction - us try to arrive at some clues regarding the broad approach

that needs co be adopted in working on the problem.

2. 17.117 TI-172.,E ER:102S

750 can identify three broad reasons for the -,-)ersistence of tile

crude conception that capitalism in agriculture develops in a simple

unilinr manner over time:

a) the failure to appreciate fully the :i_71portance of certain Fe..:,.tures

specific to agriculture union imvly that "agriculture does not develop

accoring to the same p:,7ocos as industry; it Zollows laws of its own"

even though "both arc developing in the diection".(K .ntsky 1899 p.2)

b) the failure to recogni:,e the significance of the distinction

Marx Droporx:d between "the formal and real subsumption of labour under

capital'. (Marx- 1976 rap. 1019--1033)

c) the failure to perceive the implications of differences in the

concrete historical setting in which capitalis7 develops in agricul-

ture, i.e. an inability to reckon with the diversity of situutio:Is in

which capitalism has developed historically. Mile this diversity

woul(I not negate the general long-run tendencies 0; capitalist develop-

ment, it would make - .the forms of its manif,j,station extremely varied.

All three errors have led to mistakes even in the formulation

of Ude o.uostions to be asked, quite abart from the nature of the

answers provided.

3. THE '.3PECIICTT7 213:ICULTUflE

Hautsy (1F399) in analysin the currents and tendencies which

thwart the process of concentration' first discusses those which

operate in both industry and agriculture. Lore he mentions tho and shows how

enormous reserves of resistance" of the netty-producers,/the 'huner

and overwork orolon,r; their death-agony to ex.trome limits". Also 'the

conscious political suiport of the State, which attempts to retard the

jisintegration of the middle strata." But Lautsky adds in ac:riculturo

other tendencies oT)erato, which do not appear in industry, :and the

question is thus Euch more comolicat,:d' C2.30). Let us turn to en

examin-tion T-ctorq,

in his anal7sis of capitalist devo )pmont distincuishod

b‘etween trio move:Its in the process of c .Di Gal accu - con,

contration and centralisation. The point of ti:.; distinction is to

focus on a form that the 1)rocess of concetration tes - vizn

tralisation. For 'the am ple concentration of the M1113 of 1produ:Jtio-a

and the command over labour ... is identical with accumulation". But

centralisation "is concentration of c:1-bitals already formed, destruction

of their individual injepon-cnco, expropriation of critali;:lt by

:-•_?italist, transformation of many n 1 into fan lar:e

This --a•ocess only pressuposcs a chant-0 in the distrib:Ition of

already available and already functioning capital" (lIarx ic,;76, -2.777).

in t';is con-t.::xt, to the problems that may arise

in the process of centralisation in agriculture. Narx had shown in

Volume III of Caital,llow private property in land under capitalism

ac is a a barrier to the real subordination of labour to capital.

He argued that 'the eroc!nditure of money-o-itr,a for the purchase of

land, thon, in not .?.n investment of agricultural capital. It is a

cL:crease protant)in the caDital which small peasants can employ in their

o,Tn sphere of production's (harx, 139d, o.810). Also "in large-scale

agriculture, and large estats operating on a capitalist basis,

ownership likewise acts, as a barrier, because it limits the tenant

farmer in his productive investment of capital, which in the final

analysis benefits not him, but the landlord" (Narx 18.W„ p.812).

iCantsy shone farther the difficulties 7)rivate property in land creates

in the of contr^aisation by =1-1-inf; it difficult to form a

large, continuous surf '.ce area for cultivation. In countries linere

the whole of the land is occupied, a larger continuous arca can only

be obtained 137 buyin:; up the neighbouring al land. Thus both

the spatial fixity of land as also the rigidity of the land market

(partly due to the tenacity, deriving from she factors we mentioned

earlier, with uhich the small producers stick to their land) sot

limits to the centralisation process.- 3

Capital, of course trios to get around this problem in varioun

ways. An i portant c.rls-quericu_ ;4' this is th'it-

the development of capitalism in agriculture not necessarily be

reflected in a higher concentration of operated land area although

:217 The most stark iklustration of the nays in which c:mital strives to overcome this 'tenacitTlis, of course, the British Enclosure Hovement.

the latter does usually accoLpany the former. This error, repeatedly

warned against by Lenin and Kantsky (see especially Lenin (1915) which

is among Lenins most important writings on the agrarian question), is

made by a number of non-iTarxists and even some Marxists /see Chandra

(1974) and its criticism in Sau (1976) 7. Thus Lenin (1915) argues

that what is important is the scale of production and not the acreage,

given the possibilities of intensive cultivation in agriculture. Thus

data on difference in the value of the output and the degree of concen-

tration of non-land assets (livestock, seeds, fertilisers, access to

irrigation, machinery, 'credit' in general), as also differences in

land quality, must supplement those on lend area operated, if a more

accurate picture of differentiation is to be obtained.

Another important reason why the development of capitalism in

agricultuie may not be reflected in an increased concentration of land

ownership is provided by Chayanot (1925). In his major work, Peasant

Farm Organisation, Chayanor spends the first six chapters in outlining

the principles underlying the economic activity of th-..3 individual

peasant family. Chayanor admits in the seventh chapter that the

"analysis in all six preceding chapters was static because they were

dealing with static problems." (p.242). Even "the process of demo-

graphic differentiation which depends on biological family growth is,

in essence, not new and is, essentially speaking, static" (p.257).

In the seventh chapter, however, Chayanov deals with questions

of a dynamic nature and acknolwedges that the Drocesseaof-capitaList

concentration. and of the proletarianisation of the Russian peasantry

are occurring. He reiterates Lenin's point that "these social processes

should be sought out, not by means of classifying sown areas and so on,

but by direct analysis of capitalist factors in the organisation

of production" (p.255). Moreover, lie- argues that concentration of

capital may often be vertical rather than horizontal. He alaims that

"this form of concentration in agricultural production is characteristic

of almost all young agricultural countries, which produce mass uni-

form produce for distant, mainly export markets".(p.263). By vertical

concentration, Chayanov implies a process whereby

"repeating the stages in the development of industrial

capitalism, agriculture comes out of a seminatural

existence and becomes subject to trading capitalism

that sometimes in the form of very large scale trading

undertakings draws masses of scattered peasant farms

into its sphere of influence and, having bound those

small scale commodity producers. to the market, econo-

mically subordinates trn to its influence. By develop-

ing oppressive credit conditions, it converts the orga-

nisation'of agricultural production almost into a special

form of distributive office based on r., 'sweatshop system'"

(p.257).

He further adds: "Frequently, the trading machine,

concerned about a standard qffality in the commodity

collected, begins to actively interfere in the orga-

nisation of production, too. It lays down technical

conditions, issues seeds and fertilisers, determines

the rotation, and'turns its clients into technical

exacutthrs of its designs and economic plans

If to this we add in the most developed capitalist

countries, such as those in Forth America, widely

developed mortgage credit, the financing of farm

circulating capital, and the dominating part played

by capital invested in transport, elevator, irrigation

and other undertakings, then we have bofore us new ways

in which capitalism penetrates agriculture. These

ways convert thelfarmers into a labour force working

with other people's means of production" (p.262).

In these passages, Chayanov provides hints for the conceptu-

alisation of a process that has consid:rable importance in under-

standing the development of capitalism in a number of countries

(especially those with a colonial past) of the world today. The

process can be reformulated with greater rigour using Marx's

concept of the formal subsumption of labour under capital. Before

going into an elaboration of this concept, however, let us conclude

this section by mentioning the final and perhaps most important

argument against using figures on concentration of.lond ownership

to settle matters in this debate. This point is especially import-

ant because, like the previous one, it brings out the need to

discuss the precise logic of. the forms capitalist penetration of

agriculture takes, without restricting onsolf to a mechanical

application of indices to measure the d..velopment of capitalism.

The argument, first proposed by Kautsky (1899) and later

repeate,Ily emphasised by Lenin is that the emerging agrarian

capitalists very often fulfill their requirement of regular cheap

labour by making allotments of land to wage-labourers. This helps

ensure that the supply of labour is regular. In the figures on

concentration of land holdings this nay appear as- a decline in

inequality, while actual differentiation would, in all probability,

rise as a consequence.

As Lenin (1899a) argued "our literature frequently contains

too stereotyped an understanding of the theoretical proposition that

capitalism requires the free, landless labourer." (p.181). Actually

"it would not even be advantageous for the big landowners to force

out th small proprietors completely: the latter provide them with A/This 'bondage' is, of course, entirely a creation of the capitalist

class and should not be confused, as is often done, with feudal bondage. (we sh!,11 discuss this later in greater detail).

hand! For this reason the landowners and capitalists frequently

pass laws that artificially maintain the :mall peasantry. Petty

farming becomes stable when it ceases to compete with large-scale

farming, when it is turned into a supplier of labour-power for the

latter. The relations between large and small landowners••uomestill

closer to those of capitalists and proletarians" (Lenin 1899b, pp.96-7).

"The allotment holding rural worker is a type to be found in all

capitalist countries" (Lenin 1899b. p.181). In fact "an absolutely

propertyless agricultural labourer is a rarity, because in agriculture

rural economy, in the strict sense, is connected with household

economy. Whole categories of agrioultural wage-workers own or ;

have the use of land. when small production is eliminated too gredtly,

the big landowners tryto strengthen or revive it bythe sale or laase

of land' (Lenin 1899b -.P.136).

5/ In our view, these insights of Lenin, Kautsky and Chayanot-

into the processes that make up the basis for the development of

capitalism in agriculture and the varied forms that it might take,

represent a remarkably rich understanding of Marx's conceptualisation

of the process of capitalist development in general. In fact, one can

attempt a rigorous reformulation of these insights by incorporating them

into Marx's overall framewo'rk, utilising concepts which were not

available to Lenin, Kantsky and Chayanov. To this task we now turn.

Chayanor's work, of couise, remains an object of great controversy. We believe that his work, although open to criticism, contains many

. valuable insights.

10

4. TEE FORMAL AND REAL SUBSUMPTION OF LABOUR UND2R CAPITAL

Our attempt in this section will be to present, as clearly

as possible, Marx's distinction between the formal and real subsumption

of labour under capital. We further try to bring together the various

attempts made by Marx to conceptualise the transition to what he calls

a "specifically capitalist mode of production" (Marx 1976 Pp.1019-1038).

This is a task which can and must be performed because there is a

definite continuity and consistency in Marx's writings on this question

which is often not recognised. Moreover, with Marx's text "Results

of the Immediate Process of Production" becoming available in English

in 1976, we have been provided with a broad conceptual framework within

which this can be done.- In particular, we shall be considering

Parts 2-5 and the Appendix to the Penguin edition of Volume I of

Capital, Parts 4 and 6, esp.)cially Chapters 20 and 47 of Volume III

of Capital and the sections on the 'Original Accumulation of Capital'

in the Grundrisse (Marx 1973 especially pp.459-516).

(i) Capital

Our presentation like the categories involved has both a

logical and a historical aspect. Capital, as Marx points out, is

older than capitalism. Historically, capital emerges first in the

form of money - as merchants' or wuzets!. capital. - Money pcquiTing

the form of capital nresupposes a certain form of circulation. In

the direct form of circulation of commodities, Ci - M - C2, or selling

6 This text, originally planned as Part 7 of Volume I of Capital, was first published simultaneously in Russian and German in Vol.II of the Marx-Engels Archives (Moscow) in 1933. It was published for the first time in English as an Appendix to the Penguin edition of Volume I of Capital in 1976. This text contains t-14 clearest statement by Marx on the general form the capitalist mode of production takes when it first make its appearance.

40

1 I

I

11

one set of commodities to buy another qualitatively different set,

money does not function as capital. But money which appears in the

circuit M - C - M , is capital. ThusM-C-M is the general

formula for capital.

The production of use-values is the final goal of the circuit

C1-M-C2' The two extremes of the circuit are commodities of equal

value but qualitatively different use-values. The motivating force

behind the circuit M-CTM , however, is the production of exchange

values. The two extremes of the circuit are both money and thus not

qualitatively different use-values. But X' is greater than M,

surplus-value. Value is thus not only preserved in the process but

also expanded or valorised. This valorisation is the motive force of

the circuit M-C-N . It this M is now withdrawn from circulation by

spending it on commodities for the satisfaction of definite needs (con-

sumption), it ceases to be capital. For "the circulation of money as

capital is an end in itself, for the valorisation of value takes place

only within this constantly renewed movement. The movement of capital

is therefore limitless. As the conscious bearer (Trager) of this

movement, the possessor of money becomes a capitalist'. (Marx 1976,

pp.253-4).

(ii) Merchants Capital

The earliest capitalists, as we said, were the merchant and

us rer capitalists, who emerged before the capitalist mode of production

itself. In the precapitalist era, capital is restricted to ne sphere

of circulation. As Marx says in Volume III of Capital, 'merchant's

capital is originally merely the intervening movement between extremes

12

which it does not control, and between premises which it does not

create" (Marx 1894, .p.330). Merchant's capital, 'the oldest free

state of existence of capital", (p.325) is based on the principle

of cheap in order to sell dear. In such an epoch, "commer-

cial profit not only appears as outbar ainin and cheating,but also

largely originates from them".. Marx explains the basis of the

operation of merchants capital;

'it exploits the differences between the prices of

production of various countries ....goreover, it :.cts7

as a mediator between communities which still substan-

tially produce for use-value, and for whose economic

organisation the sale of ...products at their value,

is of secondary importance.... Merchants capital, when

it holds a position of dominance, stands everywhere

for a system of robbery, so that its development among

the trading nations of old and modern times is always

directly connected with plundering, piracy, kidnapping

slaves and colonial conquest; as in Carthage, Rome, znd

later among the Venetians, Portugese, Dutch etc."

(pp.330-1, emphasis ours).

That these observations of Marx are very well grounded on

actual historical experience is cJnfirmed by some of the most detailed

and ineisine work done on the history of merchants capital.-7/ The

implications of the discovery of the All Sea Route from Europe to

India via the Cape of Good Hope in 1498 and the subsequent "confron-

tation of the carracks, the caravans and the companies" (Steinsgaard,1973)

has been an important object of study among historians. Of particular

7 Our main point of reference here is Stoinsgaard (1973). But mention must be made of the generally (i.e. both historically and theoreti-cally) very significant work of Karl Polanyi and Frederic Lane as also the more specialised work of Charles Boxer, Ralph Davis, Meilink-lisalefso etc.

a

0

13

interest to us is the analysis of the essential character of the

Portugese Estado da India which entered an arena dominated by the

'peddling trade'. The peddling trade was subject to groat uncertainty.

The peddling merchant needing to make a decision about investments'

in distant markets, had to reckon with many unknown in his calculations

- the principal one being the cost of 'protection' and the risk of

complete or partial loss of stock resulting from the attack of robbers

8/ or other extortion.-

When the Portuese came in their main attempt was not to exploit

the All Sea Route for their own trading operations but to make profit

out of this high degree of uncertainty characterising the pre-

existing trading operations. They used their military control over

the sea to extract a 'tribute' from the Asian traders for the 'sale

of protection' to them (Land'sterminology). In principle, every Asian

trading ship had to be equipped with a Portugese pass, a 1 Cartazo'.

This was not only a source of income in itself, but also provided

the possibility of diverting an important part of the trade through

Portugese controlled towns, - Goa, Harmuz and the ports on the Gulf

of Cambay, being the most important. Thus, the administration of

organised violence was the principal source of income of the Estado

da India. This is confirmed by a scrutiny of its budgets for 1587 and

1607, which_clearly show that the main revenue source were customs

duties at ports. (iii) Capitalism

It is only when capital assumes control over the process of

Production or the labour process that one can speak, in the Marxist

/ - 'The pedlar might well have possessed the habit of thinking rationally but had no possibility pf making a rational calculation of -his costs in the- modern sense so long as the protection costs and the risks remained uipredictable and the market non-transparent" (steinsgaard 1973) To this relationship between the 'economic calculus' of an eLtel-i,rise and the broader environment in which it operates, we shall return in another context.

•

14

sense, of the advent of the capitalist mode of production. This

presupposes the emergence of a number of historical conditions. Under

these conditions Marx shows how surplus-value can emerge even in a

situation where equivalents (in terms of value) are exchanged for

equivalents. Surplus-value can now emerge only in one part of the not in the value of the commodity bou;lit because

circuit M-C-M viz. M-C and that tool, z equivalents are being

exchanged. As Marx argues:

"The change can therefore originate only in the actual

use-value of the commodity, i.e. in its consumption.

In order to extract value out of the consumption of a

commodity, our friend the money-owner must be lucky enough

to find within the sphere ef circulation, on the market,

a commodity whose use-value possesses the peculiar property

of being a source of value, whose actual consumption is

therefore itself an objectification of labour, hence a

creation of 7aluc. The possessor of money does find

such a special commodity on the market: the capacity

for labour, in ether words labour-power.

We mean by labour-power, or labour-caoacity, the aggre-

gate of those mental and physical capabilities existing

in the physical form, the living personality, of a human

being, capabilities which he sets in motion whenever he

produces a use-value of any kind." (iiarx 1976 p.270).

One can summarise the conditions necessary forthe emergence

of the capital-labour relation, as follows:

1. The owner of labour-power must, as a free commodity proprietor

be able to sell his labour-power for a definite limited period of

time - "for if he were to•sell it in a lump, once and for all, he

would be selling himself, converting himself from a free man into a

slave, from an owner of a commodity into a commodity.' (Marx 1976 p.271).

15

2. The owner of labour-power must be dispossessed of commodities otherwise

which wouldLallow him to produce and sell other commodities asan-

indePendent coEmodityroducer. This is the economic coercion which

comp _els the proletarian to sell his labour-power.-

3. On the other hand, the capitalist, must have unde2r his command

sufficient resources to be able to "cease to be a worker himself and

(begin) to concern himself entirely with directing work and organising

sales" (Marx 1976 p.1027). A minimum scale of production is necessary

for capitalist production to be viable "to furnish the objective

conditions not only for the production of the products or values

required to reproduce or maintain living labour capacity, but also

for the absorption of surplus labour - to supply the objective material

for the latter" (Marx 1973, p.463).

4. Capital is eaegto 1-elation which involves not the direct

appropriation of alien labour -is slavery and serfdom do, 1A:it the

buying of labour power on the market. The process of exploitation

is gradually"stripped of every patriarchal, political or even

religious clyake and is converted into "a relationship of sale and

purchase, a purely (Marx 1976, p.1027).

This is in contrast to the serf and the slave who had to. be !extra -economicallyt coerced, prevented access to means of orocluctien, in order to force thorn to work for the lords- for, in principle, without the operation of such a compulsion they could eke out a living even without worli.ng for any lord. The development of capitalism progressively rules out such an option. This is not. to say that tne.proletarian does not experionce any extra-economic coercion - it is only to argue that such coercion-, has a different sigificance for the prole-tarian on the one hand, and the serf and slave, on the other. See the trite-:staterient of Sir James Steuart which Marx quotes: "Mon were then greed to work because they were .slavos of others; men are now forced to work because they are slaves of their necessities" (Marx 1976, footnote 25 pp.300-01).

16

5. Finally, what confronts the proletarian, "must present

itself as value, and must regard the positingof value, solf-realisation,

money making, as the ultimate purpose not direct consumption or the

creation of use-value" (Marx 1973 p.464). Marx goes on to illustrate

the point with a number of examples in the Grundrisse. The central

argument is that 'Labour as mere performance of services for the satis-

faction of immediate needs has nothing whatever to do with capital

since that is not capital's concern." (p.272). The capitalist rela-

tionship implies on the contrary. that labour is "capital-positing,

capital creating labour, wage labour" (p.463). Thus free-day labourers

encountered in pre-capitalism, are not wage-labourers in this strict

sense. Their services aro sometimes in fact bought for production

and not rarely consumption,

'but, firstly, even if on a large scale, for the

production only of direct use values, net of values;

and secondly, if a nobleman e.g. brines the free worker

togs her with hiz serfs, .irer_ if he re-sells a part of

the workers product, and the freo worker creates value

for him, then his exchange takes place only for the

superfluous 5roduct7 !7.nd only for the sake of super-

fluity, for luxury consumption, is thus at bottom only

a veiled purchase of alien labour for immediate con-

sumption or as use-value' (p.469).

The emergence of these conditions which Ieads'ultimli;ely, to th,, •

mode of production', advent7:pf-,a capi-tetlist is the result of a long

period of historical development. Let us mo-o on to a discussion

of Marx's attempts to analyse the processes involved in this, great

transformation.

17

(iv) Tho Transition

We first elaborate Marx's distinction between the formal

and real subsumption of labour under capital. Wc then attempt to

give these concepts greater analytical and historical depth by in-

corporating into the discussion, Marx's exposition of the initial forms

of capitalist production in Part 4 of Volume I of Capital. Finally,

we try to place Marx's analysis of "the two ways' of capitalist develop-

ment in the context of the distinction between formal .71nd real sub-

sumption.,

10/ Before we proceed, however, one clarification is n.:ccosary.--

Marx used the term mode of production in two distinct meanings the

difference between which can be :)erceived by reforrinq to the context

in which the term is used. The more common use of• the term by Marx . -

is in the sense of oTocha of production or broad periods in history,

which is to be found in the entire range of his -zritings. But in

certain contexts Marx used the term more literally, meaning by it

the process of production or the labour process. For example in

Capital Volume I Marx writes: "Hitherto, in dealing with the production

of surplus-value in the above form, we have assumed that the mode of

production is given and invariable." (Marx 1976, pp.431-2), obviously

meaning by mode of production, the labOur P rocess Again, in his

critique of private property in land under capitalism in Volume III

of Capital, ho says: "where the capitalist mode of production h,-.s a

limited development....agriculture,is no longer, or not yet, subject

to the capitalist mola_21:nroduction, but rather to ono handed down

4e owe this to Banaji (1977a) In fact, our overall approach been ,reatly stimulated by tat paper and owe much to it.

18

from extinct forms of society" (Marx,: 1894, Pp.811-2, emphasis ours). from

VA.Lds cleart the cont;.!xt that in thu_secon. 1:_case made,!,:f production

IfJans labour process. •

That this distinction appears in places • whore Marx is

analysing the initial forms of capitalist development is not sur-

prising. In fact, as we shall see presently tho distinction has

significance precisely in such a context.

The existence of the two stages of the formal and real

subsumption of labour under capital was hinted at by Marx in Volume I

of Capital itself. Thus he writes:" At first capital subordinates

labour on the basis of the technical conditions within which labour

has been carried on up to that point in history. It does not there-

fore directly change the node of production" (Marx 1976, p.425).

Mode of production in cic!-.rly used in the sense of labour process.

Again:Th specifically capitalist mode of production (is) a mode of

production which, along with its methods, means and conditions, arises

and develops spontaneously on the basis of the formal subsumption

Of labour under capital. This formal subsumption is then replaced

by a real subsumption" (Marx 1976 p.645). Lenin, whose reading of

Marx was one of the richest anon Marxists, rade quite a perceptive

anticipation of this distinction. As he says, "capital always takes

the technical process of production as it lands it, and only subse-

quently subjects it to technical transformation" (Lenin, 1895, p.466).

And, finally, we may mention Maurice Dobb who, again in anticipation,

summarised the distinction remarkably well: 'what the industrial

revolution represented Tms a transition ifrom an early and still immature

19

stage of Capitalism, where the pro-capitalist potty mode of

production had been penetrated by the influence of capital, sub-

ordinated. to capital, robbed of its independence as on economic

form 'but not yet completely transformed, to a stage where capitalism,

on the basis of technical change, had achieved its own specific pro-

duction process restin on the collective large-scale production

unit of the factory...." (Dobb, 1945, p.19).

Marx's own clearest elaboration of the distinction is to be.

found in his 'Results of the Lanediate Process of Production". The

central insight which Marx develops is that "capital subsumes the

labour process as it finds it, that is to say, it takes over an

02cte .__,Tlal2?ourraessa, developed by different and more archaic

modes of production." (Marx 1976 p.1021)., ThiS phase in the deve-

lopment of capitalism, in which the technological basis of production

does riot change, Marx calls the formal subsumption of inbour under

capital. It is the general form of every capitalist process of

production, at. the same time, however, it can ')o found ns cLIELcular

form alongside the specificallz capitalist :::ode of oroductior. in its

developed form, because although the latter entails the 2e:mer, the

converse does not necessarily obi:n.in i.e. the formal subsumption

• can be found in the absence of the specifically capitalist mode of

preduction7" (ibid., p.1019). The specifically capitalist Mode of

• production involves the real subsumptien of labour under capital.

The formal always Jrucedes the real ''although the second form, the

more highly developed one, can provide the foundations for the intro-

duction of the firat.in new branches of industry" (ibid.p.1025).

20

The contrast between ',-;he two lies in the fact that the

specifically capitalist node of production not only transforms

the situations of the various agents of production, it also r:rireiu-

toniPQs their actual mode of labour and the real nature of the

labour process as a whole" (ibid., p.1021). "The social forces of

production of labour are now developed, and with lane-scale production

comes the direct application of science and technology". Moreover,

"capital must increase the valUe of its operations to the point %.there

it assumes social dimensions, and so sheds its individual character

entirely" (ibid. p.1035). Also, "production for production's sake',

production as an end. in itself - does indeed cone on the scone with

the formal subsumntion of labour under capital. It makes its apperance

as soon as the immediate 71.1i'l)020 of production is to produce as much

surplus-value as soon as the ,achange -value of the

product becomes the deciding lector. But this inherent tendency

of capiteieIst p.eoduction Gees net become adequately realised - it

does not become indis;)ensable, and that also noarle

indispensable - until the specific mode of ca-dtalist Production

and. hence the real subsum. tier of labour under caDital ha$ beco:.le

a reality.' (ibid. p.10.37). And finally, with the advent ;11' the real

subsumption phase, relative surolus value gradually reele.eee

surplus value as the -orincipal source of capitalist profit.. Tin s,

in addition to surplus value extraction through lengthening

working day, lowering wages intensifying work (absolute sur7)11.-.3 -

value), capital increasingly relies on producing profits by raising

the productvity of labour through the deployment of machinery in large-

scale factory production. •

21

This' distinction proposed by Marx acquires greater

analytical 'and historical depth if we place it in the context of

his own discussion on the evolution of the capitalist mode of

production in Part 4 of Volume 1 of Capital.

(v) 922221:2119/3....;_amdManuturo,

According to Marx, "a llrge number of workers working

together, at tho same time, in one place (or, if you like in the field of labour) in order to produce the ,,sane sort of commodity under the command of the same capitalist,

constitutes the starting-point of capitalist produbtion. This is true

both historically and conceptually" (Marx 1976, p.439). This is What

Marx calls cooperation and 'that form of cooperation which is based

on division-of labour assumes its classical shape in manufacture."

(ibid. p.455). But with regard to the mode of production itself,

manufacture can hardly be distinguished, in its earliest stages, from

the handicraft trades of the guilds, except by VIA) greater number of

workers simultaneously employed by the same individual capital"

(ibid. p.439 emphasis ours) /Eode of production is used, as is evident

in the sense of labour-procos7. Even so, manufacture provides the

foundations for largo-scale industry based on machinery which

transformed the archaic labour process,

0 A very plausible synthesis, than, could be proposed suggesting

• that the formal subsumption stage corresponds broadly to the periods

of cooperation and manufacture, i.e. the period prior to the advent

of large-scale industry the latter being tho, period of real eubsum7ction.

This is, in fact, ghat Dobb hinted at (seo above) and what

Ernest Mandel (in his introduction to the Appendix of the Penguin cdn.

of Vol.I of Capital, Marx 1976, p.944) and Ben Pine (1978) do propose.

same

22

Howe'vr- one warning is necessary - it would be incorrect to say

that in the period when the technological basis of production remains

unchanged no relative surplus value is produced. In fact, as Marx

himself argues, both. cooperation and division of labour do raise the

productivity of labour. Moreover, it must be emhasised that the

period of the real subordination of labour to capital is also the period

when the production of absolute surplus-value receives a great

impetus. Marx's Chapter 15 of Vol.1 of Capital, contains a. -cost

graphic account of precisely thishonemem.rILI

The Two ways

Let us finally come to Harx's attempt to capture the

transition to capitalism in terms of -the 'two ways' in Volume -3 of

Capital. Accordin_; to Marx, way No.1 means that

1 'the producer

b: cones merchant an.. capitalist.... This is the really

revolutionising path (Harx 1894-, P.334).' The

master heaver for instance, buys his wool or yai'n

himself and sells his cloth to the merchant, .instead

of receiving wool from the merchant piecemeal and

workinL; for him together with his journeymen., The

elements of production pass into the production process

as commodities bought by himself. And instead of pro-

ducing for some individual merchant, or for 5--3cified

customers he produces for the world of trade. The

producer is himself merchant.... As soon as menu- •

facture gains sufficient strength, and Particularly

large-scale industry, it creates in its turn a market

for itself, by capturing it through its coumodities.

At this point commerce becomes the servant of indus-

trial production, fog which continUbd expansion of the

• 23

marl.:at bece7aef3 a vitl necessity. 11;ver more

extended mass production floods the ed.sting

market and thereby works continuously for a still

greater expansion of this market for breaking out

of its limits. - Uhat restricts this mass production

is not commerce (in so far as it expresses the exist-

ing demand), but the magnitude of employed capital

and the level of development of the productivity of

labour. The industrial capitalist always has the

world market bef_cre. him, compares, and must con-

stantly compre, his own cost-prices with the market--

prices at home. . and throughout the world." (Marx,

1894, P-336).

Way No:2'meanS that; "The merchant establishes

direct sway over production... This system presents

everywhere an obstacle to the real ea- italist mode of

.rodiction and gees under with its development. Uith-

out revolutionising the node of production, it only

worsens the condition of the direct producers, turns

into mere wa3e-workers and prolotarians...'

(Marx, 1894, PD-334-5) (emphases ours).

The use of the term r real capitalist mode of production'

is striking, being consistent with the terminology of the text

"Results...". Also node of production is once again used by

Marx (in the second case) in the sense of labour process.

An important discussion on the precise content of the two

ways occured in the debate on the transition from feudalism to

capitalism which followed tine publication of Dobb's 'tudies in

the Development of CapitaliEd."

Dobb argued in the 'Studies' that the esentil fHatur

?:'ay No. 1 was that'the capitalists rose from th,3 ranks of tie p:Aty

24

producers, through their internal differentiation, rather than

being constituted by the former merchants which would be 'Tay No.2.

Jwcezy, however, argued that this interpretation was faulty and that

Marx's principal airs in contrasting 7:Tay No.1 with Way No.2 was to

contrast the launching of full-fledged capitalist enterprises with

the slow development of the putting-out system. There is no indi-

cation that ho was concerned about producers' ..rising from the ranks".

Thus 'Jay No.1 'might equally well mean that the producer, whatever

his background, starts out as both a merchant and an employer of

wage-labour" (Sweezy, Dobb et.al 1976 p.54). In support of the

la:tter contention he cites Nef's examples .of 'new' industries like

mining, metallurgy, brewing, sugar .X-Pfiling soap, alum, glass and

s alt-making.

ho:rev,:z, felt that "one of Dobb's most. valuable

contributions to historical science is' that he sought the genesis

of industrial capitalists not among the 'haute bourgeoisie' but in

what was taking form within the class of the petty-commodity producers

thouselves in the process of freeing themselves from feudal land

property.' (ibid, p.87). But -.:he added that Dobb was mistaken in

including within 'jay Z0.1, the .:ath followed by those petty producers,

who aSter becoming caPitalists set up production on a putting out

basis, agreeing with-",vreezy that the latter was indeed the core of

':'Tay No.2.

Takahashi's contribution was lucid and clarifying. Both

the points he makes are valid and important. In the conteNt of :lectern

Europe, 'Dobb's emphasis on the class struggle between the emergent

capitalist class and a group of the 'haute bourgeoisie' originating

25

in the feudal land.aristocr:,cy, the merchant and financial mono-

polists (exemplified in the struggle bettrccn the Independents and

the Royalists in England and the Jacobins and Girondins in France)

11 is crucial.--/ But for Marx clearly Way No:1 was 'revolutionary' also

because it led to a revolution in the technological basis of pro- .

duction and so the putting-out system can have no place in it, as

Suoozy and Takahashi argue. In fact, Suoozy is further right in

pointing to certain cases where the putting-out sytem may be obviated

and a capitalist ontorpriso with wage-labour may be :got up from the

12/ start.—

(vii) The Synthesis

_The main reason for our getting into such an elaborate

discussion of Marx's tuo ways is to show that Maxx's preoccupation

in this context is no different from that in the discussion of the

formal and real subsumption of labour under capital. His main interest

remains understanding the :rocess of the transition to the specifi-

It must be recognised, houovor, that the class configurations involved in 'bourgoois revolutions' can vary - e.g.,in Prussia and Jason, capitalism arose on the basis of a collusion, not conflict with Absolutism.

Dobb himself provides evidence confirming this:'....in a number of now industries such as cooper, brass and ordnance, oaper and powder making, alum and soap, and also in mining and in smelting, the tchniquo of production was sufficiontly transforod as a ' result of recent invention to require an initial capital that was anito beyond the capacity of the ordinary craftsman. In consequence, enterprises were here being launchod by promoters on a partnership, or joint-stock basis, and hired labour was beginning, to be employed by them on a considerable scale.' (Dobb 1945, p:124).

cally capitalist mode of production. And the two analyses can be

reasonably reconciled by arguing that the predominance of 7Tar No.2

11

12

26

in a historical situation could imply an extremely protracted

existence of the merely formal subsunption of labour under capital.

It is true that both ways in general begin with this phase (with

the exception, perhaps, of 'new' industries of the kind mentioned

above), but way No.1 historically demonstrates a greater potential

for the transition to the real subordination of labour to capital.

This is Marx's own sug:;cstion in the passage from Vol.3 of Capital

ouoted above.

Moreover, ono can argue that 'Jay No.2 give us, in a sense, greater

a description of what, in Z. • or lesser degrou, is the formal sub-

ordination of labour to capital. The accentuation of the control

exercisa by the merchant over the labour proces through the putting-

out system loads gradually, over time, to his emergence as the

immediate owner of the process sf pr3duction. This process may,

of c3uroo, he quite protracte:. and nay involve, in the initial

phases, only partial domination by the merchant. However, over time,

as the potty-producer increasingly loses his independence, ono may

sneak of the formal subsumption of labour under capital. In this

Phase...the potty-producer (torn craftsman or rural Peasant) becomes

totally dependent on the nerchant(Who is usually also a money-lend r, for

IP (i) purchase of raw-uaturials for production

(ii) marketing of the final products 0

(iii) oven the purchase of the qeans of subsistence oyez time.

In fact the merchant-moneylendr capitalist soon dictates not only

what is to be produced - the auality and quantity but also how it is •

to be produced (recall Chayanor's description and see Banaji (1977a)

27

for a characterisation of this articulation - 13p.32-6). It is this

detailed intervention in the process of prDduction and the complete

control that he exercises over it, that earns the 1:lurch-Int the chara-

cterisation of the immediate owner of the process of production. The

petty-producer now is reduced to the status of a semi-prolJtarian.

The price he roceives nay be considered a concealed wage. As Banaji

puts it

'the social process of production incorporating the

immediate labour-process of the small peasant enter-

prise is goIerned by the aims of capitalist production,

namely by the compulsion to produce surplus-valuo.

Within this social process of production dominated by

the capitalist enterprise, the economic conceptions

of the small households, and their fornal possossion

of a portion of the me:1ns of subsistence, antur as

regulating elements only as a function of the law of

surplus.-value uction. The patriarchal notions of

accounting, which dissociate the range of acceptable

markot-prices from the price of production and/ No-

nomeus internally subsisdised roproduction of labour-

power which from the perspective of the process as

whole, ensures a sale of labour-power below its value,

enable capital to depress wages 'in a fashion unequalled

elsewhere', as Engels noted (Englos to Babel, Dec.11,

1834)" gbid, p.347

The technological basis of Production remains unchanged in

this process, thu principal source of capitalist profit remaining

absolute surplus-vlue c.traction. Thu ability of capital to continue

to extract surplus-value on the old technological basis reduces the

incentive to revolution:-dse the lab)ur-procoss, to posit itp self-

determined labour-pmocess. This does not, however, mean that this

28

process knous no limits. In foot, there oporato vory dofinito

forces that circumscribo the ability and reduce the incentive for

capital to continuo in this form. `re may mention hero the supply

of labour, the availability of noir technology, the level of develop-

rent of the working class movement and the competition among capitalists influencing

in short, all factors . the balance of forc s in the_ capital-

13/ labour relationship.-- '

*Lyon so, the significance of our discussion so far derives

from the fact that the formal subsunption of labour under capital

based on !Ta-y No.2 can be an extremely long phase in the; dovolopment

of capitalism. This appears to be ospecially true. in present-day

Idovolopingt countries uhich have passed through a period of colonial

role. This is so for a variety of historical reasons, the prodominant

one being that the seeds of capitalism uoro semi in those countries

from the outside, as it war:), and in the main by foreign trading

companies. .:(3 are, of course, not suggesting an exclusive reliance

on "-!ay No.2. As wo said earlier, even grouth baood on Tiny No.1 begins

typically with the formal subordination of labour. to capital. But as

Dobb very rightly says; Thu tus roads of which Marx sooaks do not

remain distinct for the uhole their course, but often norgo for

a distance and at places intersect." (Dobb 1945, P.124). That uc,.

thereforo, seek to omphasiso is the nrotractod nature of the plias°

of the forma subordination of labour to ca-oitnl in which 'cly No.2

predominates and there ovun development initially based on I:Tay 1;3.1 •

13/ is Loo)rtant unox-olorod area of

rosoorch. Nontion Li-:LL of Ben rine (-1973), 'cane (1980) and Burustein (1979). Soo especially Bortistoir'edotailod descri-ption of the. forms the struggle is assuming in Africa on p.432 and 'Ale references he give. in footnote 29. ',To nay olso mention hero the Suptombor 1979 issue of tho Cambild.go Jou=1 of .j;conoylics which contains a symposium on the subject which 1:rings out the important role class struggle plays in fashioning the form Capitalist production. tapes :von of to tlw roal subordination of labour to ca vital has occurred.

•

29

14 sometimes merges with Way No.2.--/ Finally, w.o.may notethat this phas( could

hncompass within it a variety of forms of exploitation that capital

uses to subordinate the labour-procel::; to its control.

Before we can go on to consider the analytical significance

of these observations, we must first try to establish the historical

importance of the phenomenon we speak of. The evidence we present

here is based on a number of studios being conducted on the develop-

ment of capitalism in various countries, especially those belonging

to Latin America and Africa.

5. THE EVIDENCE

For Latin America, the best conceptualisation of the phenomenon

is that of Fernando Bello (in a review of Bartra's work), while

the best description of the more important mechanisms involved is

provided by Rudolfo 6tavonhagen (1978). Both refer to Ilexican

agriculture.

Roger Bartra for Mexico and Juan Villarreal for Argentina

described a phenomenon which they feel can be regarded as indicating

the presence of what they call a 'simple mercantile mode of production

Bartra writes: " - the peasant ... is exl)loited by capital (by moans

of the market), but at the same time is the direct agent of this explo

tation in the sense that he labors under non-capitalist conditions of a

production." (quoted in Harrla 1976, D.3). Rellp/: inZrevieu of

Bartrats work criticises his conceptualisation of the process in terms

close enough to our oun to warrarit a.full quote. Rollo: says:

14T Just one example of this is the reported phenomenon of capitalist in Indian Green Revolution areas going out of direct cultivation and taking up money lending.- (Sau, 1976).

•

15/ For Latin American studies we have relied heavily on the review article by H.,zric (1978).

30

"Hade of production has to be distinguished from the

category of form of Production, w:lich expresses a

specific social relation of production (share-cropping,

different types of tenant farming, artisan workshops,

independent producers associated with capitalist

firms, etc.). TheJe forms of production can contain

elements of pre-calitalist nodes of production, but they part

aretol-the capitalist node of production and perform

specific functions within this system. In this case,

Ile must speak of the articulation of forms of produ-

ction within the capitalist mode of production, which

assigns to these forms their rank and importance,

My criticism of Bartra is that not only does he

confuse mode of production ,f!ith form of production,

he also sees a node of production that does not

exist.' (quoted in Ha:eris 1978, p.4).

Starenhagen's contention that "the maintenance and oven

the constant re-creation of ',file peasant economy is functional for

the ca4talist system" (Stavenhagen 1978, p.35) :ley be an over-

statement, but he Makes a neat analysis of the mechanisms that

operate in such a situation. Firstly, the non-agricultural sector

is not growing fast enough to absorb the entire pool of labour produced

by the disintegration of the 1-,)ensant economy'. Also for the labour

force itself, the 'peasant economy' is an important re4orve to fall

back upon given the uncertain and unstable character of the labour

market. But more crucially, the 'peasant economy' reproduces the

labour force for the capitalist system at a low cost. This in turn

allows the capitalists to keep the wages low. The 'peasant economy'

provides a permanent reserve oft cheap labour for the capitalists.

31 -

The very same processes are emphasised La Tassig (1978)

which is a study of the development of ca- ltalist agriculture in the

Cacua Valley in Colombia. Solon Berriclou;hfor Chile and Veronica

Bennholdt-Dromsen for Latin America gs a whole, also argue that the

rural workerst continuing dependence on land is a reflection of the

fact that acute conditions of unemployment leave no other means ibr

survival. As Bennholdt-Thomsen says: "The ties to the land today do

not stem from extra-economic pressures, rather the situation of the

jobs market. ?What Lehin describes in the case of pre-revolutionary

Russia is valid for contemporary Latin America' (quoted in Harris

1978 p.10). And Luisa Pare', in a study of Mexidan sugar, argues that

the control that the sugar mills exercise over the small-holding

peasant producing sugar-cane, renders the latter 'proletarian disguised

as a peasant' (quoted in Harris 1978 p.9). These peasants work on their

own land but are financed and organised by private or state capitalists.

They sell Their cane to the capitalists who finance them and give them

1 just enough to enable t

6/ hem to reproduce their labour-power.

Although marred by a number of ambiguities in his theoretical

conceptions, Anthony 7ineons (1978) study of the development of

capitalism in the five Central American nations of Costa Rica, it

Selvedav Houduras, Guatemala amilZicaragua is empirically among the

richest in the studies on Latin America. trinson presents data to

indicate the very wide variety of formsof exploitation that coexist in

each historical setting. Moreover, he argues that given the "availa-

bility of inexpensive exploitable labour power, large landowners have

not found it in their interests to undertake the modernisation of the

productive Process,•or at least not until more recent times" (p.39), 16

The much more difficult Tention, of course, is the political one of consciousness. As Banaji outs it, 'Commodity-relations of eroduction are never directly reflected in consciousness - their forms of appearance

contd...

,e0

It is perhaps this wide-ranging evidence from all over Latin

America that prompted Teresa Heade (1973) in her own study of Br:zit

to posit a third path of capitalist development as distinct from

Mares two ways. Meade argues that while she finds a number of

similarities in the Brazilian path with '.T ay No.2 of Marx, she feels

that its distinctiVe character ddrives from the impact of imperialism

on Brazilian society and the export-producing role imposed on it by

foreign capital. In fact, in termsof our own argument the Brazilian

case which has parallels in Latin America could also be incorporated

into Jay No.2.

Coming next to Africa, we may mention first work Cewenis

(1976a,b) on Yenya. which we shall return to later. Cowen shots how

capitalist enterprises use pre-capitalist forms such as share-cropping

to dominate the labour--process. Philip Raikes (1978). in a study of

rural Ufferentiation in Tanzania aclmowledges that 'dhe "processes by

which African commodity production has been increasingly subordinated

to the requirements of international capital" ehld which the :peasantry

as a whole is increasingly separated from control over the means of

production and labour process, thus. becoming proletarianised even

while they continue to own the land on which they cultivate". are "highly

significant and substantially different from the 'classic' case", the

latter being Marx's ''ay No.1 (p.286) Lionel Cliffe (1977), in a study of

empirical richness comparable to ':Tinson's, emphasises the protracted

character of the transition to'a r>p,eciticailyce:_eitalist mode of .oroduction.

Using P.P.Rey's broad theoretical framework (see conclusion for ela-

boration) , Cliffe examines the very gide variety of forms in ,:hich

capital -i enetrates agriculture in three countries - Kenya, Uganda

conbi.of footnote 16 • mediate their reception into consciousnezis" (Banaji 1977b 2.1390).

Parc' Donnolt-Thomsen are all acutely aware of this as also are2J1ILLn, Bernstein and Raikes whom we mention later.

•

a

33

and Tanzania. Samir Amin (1977) 171,ile discussing the evolution of

capitalist agriculture in sub-Saharan Africa, shows how tae immediate

producer is not an independent petty-commodity producer, despite appearance:

In fact

"the administration and capital intervene in the :productive

process and actually control it. There is a host of

administrative measures employed to force the Peasant to

produce What is wtnted and in the manner desired" (p.69).

"Thus dominated the Iproaucteur de traite' is stri-ned

of the real control of his means of production .... nor

can he decide what to produce on the basis of competitive prices. Ho is therefoie not really a commodity producer.

His remuneration does not include either compensation for his ownership of the i.e. ground rent or a return on

his capital; he is reduced, owing to the domination of capi-

tal, to the value of his labour-power or frequently to even less. .... A peasant reduced tothis status is a semi-prole-tarian: a proletarian, -Jecause he is subjected to ca)ital

exploitation which extracts surplue-value from him; a semi-

proletarian, because he retains the appearance of a free

commodity producer.' (7).70).

Finally, we may note that in a recent important article,

Henry Berbstein (1979) has proposed a theoretical frameJor:: within

which to study African peasantries. In the article, Demustein expli-

citly recognises the importance of the phase of the farmal subordination

of labour to capital. (v0.456-7). He argues that "?easant Producers

are Twege-labour equivalents, that is, producers of surplus-value,

but in less determinate conditions than the proletariat- (p.436)

because they are not yet really subordinated to capital.

34

7rom all over Latin .Ams:ica and Africa, therefore, we get

evidence of various aspects of the phenomon we earlier spoke of

theoretically. It is undoubedly true that the way in which it is

concoptualised varies greatly among scholars but one thiag is clear-

all scholars show an acute awareness of the need- to study the concrete

processes involved in the transition to caPitalism-something which is

most often missing in Indian studies on the question. Among the

useful Indian studies we may mention Banaji (1977b), Bundle (1979)

and Isaac (1980). A significant recent work in the context of Isaac's

study (and which tallies with his general aDproach)is that of Alice

Littlefield for artisan industries in the Yacatan provinc'e of S.E.Hexico.

She concludes that

'although the overall tendency is clearly for mechanised

industrial production by large-scale capitalist enter-

,T)rie..; to tZ:e oyez. -1-Le provision of the internal mass

market, other historically more ancient, technically

sim)102 and lees fall:- capitalist forms of production

survive -uhd arc reproduced and

created anew by the special condition3of the Hexican

economy" (p.485 emphasis ours).

But she adds,

"in terms of the explanatory framework adopted here,

craft activity in Mesoamerica is seen not as a aa_Tvival

of non-capltaliC.It economic forms but as an activity

whose persistence, growth and d.:velopment in contemporary

times are to be explained in terms of the Reneral processes

of class differcntiation and division of labour undar capitalist

development, and the subsumption of non-capitalist modes

of -Production by capitalist ones. Although retnirILDE

certain tpre-ca-litalisti features relation3of -production

i. rural artisanry are f.ncreagLaElydeteinined by the

lar-er capitclist clualay." (p.486, emphasis ours)

35

6. aGATIVE IBPERENCE: ODE

Ue are 1101/ in a position to drau the first of the two major

negative analytical inferences of this paper. The phenomenon we

have been concerned with clearly has a fairly high degree of empiri-

cal significance. Thu3, in any analysis of the transition to the

specifically capitalist mode of production, it becomes crucially

important to recognise that the developing capitalist node of produ-

ction may utilise a variety of forms of exploitation in order to

subordinate the labour process to its control and that the process

of the merely formal subordination of labour to capital may occur over

17/ a very long period of time.-- Thus, the various forms of exploita-

tion that exist in this phase may embody essentially capitalist rela-

tions of production. Vary oftm their existence can be merely a reflectio

of the varying strategies that capital em?loys to subsume the labour-

process.

The firot major ner;ative nhalytical inference that ire may,

then, draw is that modes of production can:aot be identified by merely

observing the prevailing forms of exploitation uitaout attempting to of these forms

understand the_ precise functionalityl(especially given the wide

range these forms may assume particularly in a period prior to the

advent of the specifically capitalist mode of production). This is,

in fact, a conclusion that necessarily follows from a wide variety

of propositions- presented in this paper - Chaynnov'S vertical concen-

tration, Lenin and Kauts:w!s argument about the possible comlomentarity

of small production and capitalism, iiarx's argument about wage ir:oour 1

In fact, as Dobb argud: "ti.:: subordination of pro,kuction to capital, and the appence Of this cl,,so rolz.tionshiL) be'reon -Lnd tP.. proalcer is, therefor3, to b- the. crucial .TL_t.rshod betwon the old riode "of production t'Ae n)w, .,iren if the technical changes ;re associate with the industrial revolution were needed both to complete the tr:_nsition and to afford scope for the full maturing of the cajitalist mode of production and of the great incrc:.so in thc: - i-uctive power of hur.i.lia labour associated uith it." (Dobb 1945, P.143).

36

in pre-ca.-dtalism and finally the ride ranginc evidence from Lin

America and Africa which nay be regarded kstually as a confirriation

18/ of the mechanisms Lenin, ICLI..tsky and Chayan&vspoo of In fact,

a number of scholars from all ovu2 tho world,despito their man-.

differences, agree on this one issue /L'ee Corti;::nt.al (1978).

26nneu et. al (1977), Bernstein (1977), Cowen (1976 a,b), Martinez-Alder

(1971, 1977), Banaji (1977 a c .nd b), Foster-Carter (1970), Djurfeldt

and Lindbort (1975), Littlefield (1979) Fernando hello ot s( .19/ --

However, in the context of the debate, on the mode of production

in Indian agriculture, this error is persistently made by those who

argue that forms of exoloitntion such as e.hare-cropping and Usury

necessarily indicate tho presence of semi-feudalism. In fact, such

forms could be perfectly compatible with capitalist agriculture, and

their specific raison-d' etre only bo understood by placing them in

the context of the entorprio and tho mode of production within which

Zee also discussion of the development of modem industry where he mentions the significance of domestic units of production that continue to exist. Ho writes "This modern 'domestic industry' has not ling except the ncUO in common with old-fashioned domestic industry, the existence Of which -)resupposes independol:t urban handicrafts, independent peasant farming, and above all, a dwelling-house for the Worker and his family. That kind of industry has now been conver-bd into an external deoartment of the factory, the manufacturin_; workshop or the warehouse. Besides the factor.- worker, the uorl.:ers enga3ed in manufacture, and the h r- whom it concentrates in large zlasses at ono spot, and directly commands, capital also sets another army into motion, by mealls of invisible threads :tho o.utworkers in the domestic industries, who live in tho large t..Agns as well as bein scattered over the countryside.' (Marx 1976 -op.59-1, emphasis ours),'

How, in fact, modes of production are to be identified and, therefore, what is the way to determine the precise sigAficance of the forms that exist within it, are questions 7re shall attempt to answer only in the concludinr:; section of this pa:)er.

37

they occur.--

::Tith reference to sliare-crop•eing, ue may mention thy; studies

of Couen (1976) and Martinez-AlieT.(,1977) hartinez-Alier argues that •

"share-cropping, and also cash-tenacy are forms of use of labour

zimilar to carefully negotiated -oiece-work rates, not customary but

variable. Those ::re rationalisee. ways of using labour sncl they might

be substituted for other forms-including wage payment as agriculture

becomes more commercialised, provided that the share of. labour in total

costs is still high.' (p.36). In fact, ho she:S.111th examples from

uthern Spain and pre-revilutionary Cuba that 'landowners themselves

decide between different forms of use of the labour available partly

in terms of profits.: (or rents) they will get under one syztem or the

other. Thus they compare profits from using wage-labour with rents from

using share-cropping (or cash-tunancy) and may decide accordingly'

(3.35). Such choice decieions Haong different labour-contract arr.:mgc-

=its clearly do not represent differences in modes of production - they

are simply a reflection of the profit calculus of a c:..oitlist enter-orisc.

In fact, Nichol Cozen in a study ofKonyan agriculturo shows

hoar capitalit enterprises may be sot up through a re;;ulation of 1-21„; cron-

choices of share-croopers -.lid by maing them produce a certain outout-

who e quantity and quality i specified-without neces:;arily expro-oriatini:

20 The ir.lportance of placinL; forms of exploitation in the context so,7'Le ent,r,)riza employing then can be illustrated b.y referrin:: to In cited in Djurfeldt and Lindberg. (1975,630-1). They show how mall

.lore: for -ach other as Icoeliesi, A -ror:in..for D on, day, .nt2. B wor!:ing for L _'.troth .:r day. 2:.ymentz are made in mJ1_ ey-7.3 is a relatively .canvenient?receduro. But labour clu,:rly not capital-positing, cardtal-creating labour'. _L I; the s -17.e tine, in concrete situation they are analysing, Djurfeldt and. Lindberg ooint to the existence of ra,g;e-labour in this strict sense 'IDO, exoressin the relationship between rich farmers on the one 1Lan!:'., TLall farme...-s and laneless labour,::!s, on the other. Thus Athin 'the sz%me mode of production, the same fhrm may acquire a different sii;nific:Inco, depending on the enterprise eimloying it.

38

them directly. Moreover, in an area of production dominated by

great uncertainty, share-croppin could be regarded as a risk-sharing

technique.

• And, finally, one can hardly forgot the repeated reminders

of Lenin and Kautsky that the ::merging cnoitalist class' would find

it profitable to make allotments to labourers which ensure a more

regular supply of labour. -Jou Utsa Patnaik (1979) very rightly

recognises that 'bola the phenomena discussed by 1:^_utzy - the small-

scale tillers and semi-nroletarians cultivating at - below-wages return

in the absence of any preferred alternative and tie-in land allotments

to farm labourers - are encountered Oil an oven more (Intensive scale

in India today' (P.410). In fact, she provides imnortant data which

are evidence that this is happening. She shves hou poor tenants are

"typically obliged to underfeed their bullecks and underfeed themselves

in order to obtain the very condition for production, land on lease"

(D.400). :h;: ITS3 dat on paid-out costs of production of major

crops which vary between 40-45;; of gross output value. dasumin3 an

average 'rent' of 501-; (which seems usual) this leaves 0-5. for the

producer - could easily re-oresent the semi-proletarian we

spoke of earlier. But for Patnaik this d,:ta shows high levols of pre-

canitalist n:round rent! - tr licll loads her to the conclusion: ''This

is the fundamental reason for the fact that, in history, capitalist

Dr)duction h s been necessarily associated with a more productive

level of technique. This is.not merely an empirical fact: but also

a lolcrl necessity" (p.401). And this, as our entire ?A:ceding

discussion 3110WS, is a total mist^ko.

39

The usefulness of her analysis as also of Bhadurifs(1973)

lies in fact, in indicating some of the factors that influence the

transition to a 2.7pecificcalv capitalist mode of production based on

a higher level of technique. For it is clear th-lt in a situation where

a high rate of interest can be obtained by londinc money arld/or a high

rate of absolute surplus-value can be extracted on the b-Isis of existing

technique, there Llay be little incentive for the cal)italist to revolu-

tierisa the production-process.

Before leaving share-cropping we would like to make one final

clarification. Our argument is not that share-cropping; always represents

a concealed wage rel-.tionship. The point, however, is that it very

well could and the answer to -whether or not it does, hr.s to be deter-

mined by investigation, and not asserted by definition, as the SODi-

foudalii3ts do.

Oinilarly about usury - it is clear that the capitalist in his

attempt to establish his supremacy over the labour-process would use

a number of instruments, of ,,Thich usury is Dile. -s rote

while commenting on the conditions of peasants in j?rance in the mid-

19th century,: "It can be seen that their exploitation differs onlyL

in form from the exploitation of the industrial proletariat. The

exploiter is the same: capital. Thu individual capitalists exploit

the individual peasants through mortaqes and 1111112" (11,x:: 1050, p.111).

In fact, we suggest that the phenomenon of tho so-called

interlocking of the land, labour, credit and product markets observed

in India by many, is, perhaps, best viewed as the attemlA caAtal

to extort cheap labour from the large mass of proletarian and semi-

proletarians. For 'a very useful nttempt at concretely understanding

•

40

the :cehomics of bond..-.T;:) in ithe Indian context, see Hundlc (1979).

It is ,.1so true, Mr0OV...tr, that just like the tho

worker :nay -.1so, .at times, conbinc a varioty of econonic roloL3. This

uould conclusively bring to nought any attempt to identify modes of

1-, roduction by ncrcly the prevailing form:3 of exloitation.

ma2.7.es this point convincingly in his effective critique

of 'on-f.rn JeterminismF. No cites the example of

'a single corker who is simultanoously (i) ownor of

his o-.In land and house, (ii) shcrocro.oper on another'

(iii) tenant on thirds land, (iv) wae

worker during h!lrvest times ea onu of those lands,

(v) independent trftdeZ of his own hone produced

(Frank, 1969, 73p.271-2).

7. THE '131=D27..XY TTIEOrd.

Thu way out of tip, hou -Jver, is not the one :'rank

2dr in': -.1i. :11. the recognition th.at a mode

of production cT',-_not bo dofind in t.ars of the fortis of

oxjloit -Aion, load , _. to th- diametric:A..1y op-losite error - they argue

that with the advent of a upiad oconony in the 16th century,

relations of production throughout the world had to bu redefined in

turas of the governing princioles ',of the int.rnational divi:lion of

labour diottod by the world ca?)it.alist economy. Before .TfoLig an

to elaborate our own view zgarai17g ;thcro the defining role should

21/ lie, we briefly criticise this arrmnont.-- This iE;

i:aoortant for us becL6e the funda:lent.11 urror undo:dying this

tieo us with the third majer error no em7hasisud at t:h.. start, vis. the

t.c.iporta:nco of tie :dstorical startini point. •

21/. detailed criticise of view would be beyon.l. t"Le co :)e of this . )a)or, A u_oful VAA of Bronner (1977).

41

Thci focus of the Idoiendency theorists' is on th, tinter-

n,:tional division of labour' th.at enorges uith the conin:; of.thu

uorld systout, in tie 16th century. This innliLo

hior:_rchy of productive t'as'.!-:i gots defined to which corrys:,onds

hierarchy of 'forms of labour control."Crudely, those who brocCI

uanpowor sustain those rho grow food 'rho sustain those who grow

other rnw natorials who sustain those involved in industrial production'

("J llorstein, 1976, p.65). And correspondingly, there are different

nodes of organioing labour at the anne point of tine in different parts

of the 1 modurn world systonl, -very and 'coerced c.sh-crop labour'

ealistod in the. 'periphryr, haro-uronpors in the tsemi-DoriYthery'

;and waco-labourors and "off-cultivators in the 'coro'. Noreover,

"oach nolo of labour control is boot suit d. for particul.:.r types

oaf production' (ibis. ,x.65) that It carrius out. And it is this

hierarchy that assured the flow of surplus u-ich •;:nabl d the capitalist

world economy to 22/ cone into 0::istunco.2-- And once it was established

"other 'modes of prOLuction' survived in function of how- they filled

into a politico-social framework deriving from c:voitalisr," (ibid,p.58).

Thu view is, to sc.y the luce quite surpriisir. a

it is&no-sidedneas which involves assuming that the de:1 ,nds of: capitr_i-

reproduction ;arc; the only elenont of ::planation in understLndin-•; tLe

iupetus for _change in different '7a its of the world uver oince th

1 6th century. This coupletely iznor,..s the inner dya2lic of the no,le

of prodaction uith which the expandinc 0::..Ditalist node of - 7.-Jdur;tion

hs )1=ji puts it, Ithose nodes of production ar.;

2/ -- In this concuptualisation the isocond scm-fdon' "1.]ur).?u

i3 es'sentially capitaliat in charactur.

4

•

I

4

42

to be noroly "vegetating on thL periphery of an industrialising Europe

like a vast resorve of labour-power periodically called into action

by tho spasmodic expansions of metropolitan capital" (Banaji, 1977a, p.14).

Further, Brenner (1977) provides important empirical refutations

of 7ralterstein's arguments. And 3,..aaji argues, citing the -works of

Vilar. .7.nd 11%3:Lan Malowist, that "tho initial' impulse which sustained

the vast network of world commodity exchanges before; the eighteenth

century derived from the expanding consumption requirements of the

lords. Moreover, at its incention the colonis..tion of Latin Amorist'.

was a feudal colonisation" (ibid. p.31) attotpted by thu crisis-ridden

landowning classes.of Europe. In fact, Vila (1971) describes Spanish

'imperialism', of this period as the Highest stage of feudalism.

8. ITEGATIVE IKVERE:CE: T70

In emphasising the import:rnce of the historical starting point of

4 in any Jtudy :)f develonr?c:ntL our main -.1.;u:aunt is directed

agaim,t a certain vulgaris4tipn of the Marxist concuntion of history

which reduces it to a universally applicable unilinuar model of

evolution, in which every hur.lan society passes through the s=0 sequence

of stages. To would like to quote Harz in t1us context to Liow that

ouch a view is completely alien to his work and ne thod. In a repudiation

of Mikhailorslzy's attempt "at trnnRforning my historical sketch of the

genesis of capitalism in 'estern Europe (in Capital I, Part a) into an

historico-philosophic; l theory of the gener!;.1 path of.devel.pment

prescribed by fate to all. nations", he writes:

•

43

"events strikingly anal:igous but taking olace

in different historical surroundings led to totally

different results. By studying each oft ::se forms

of evolution separately and then comparing them one

can easily find the clue to this )henemonon, but one

will never arrive there by using as one's master hey

a general historico-philosophical theory, the supreme

virtue of which consists in being supra-historical"

Rarx, letter to the editors of Otechostvenniye Zapiski

in November 1877 quoted in Corrigan ot.al (1978)7

The extraordinary fact is that the dependency theoreists

who took precisely such an attitude as their point of departure,

ended up by =king a very similar error, viz. that of ignoring

the specificity of the historical setting in which capitalism develops.

Mao Tse `sung suns up the matter

"Does materiali:It dialectics exclude external causes?

Not at all. It holds that external causes aro the

cone.ition pf change and internal causes the basis of

change, and that external causes become operative thrDugh

internal causes. In a suitable temperature n eg-; sh-ere;es

into a chiclren, but no tenperature can chance a ston.; into

a chicken, because each has a different basis." (3.1ao Tse Tung,

1971, p.89).

The need to avoid the error th.t the dependency theorists

make is, therefore, the second major negative cnalytical

of this paper. It is evident that the subordination of the-labolir .

process to capital does not proceed irrespective of the nature of

the anterior mode of production but is, in fact, deeply conationed

by it, and varies greatly :rith variations in the latter..

•

44

9. COliCLUSION

The central analytical problem motivating this paper may now

be posed. In doing so vie bring together all the major methodolo4cal

points made throughout the paper.

The problem as ue have presented it appears to be one of

deciding the level of abstraction at which our analysis must be pitched

once it is clear that both the crude empiricism involved in ton-farm

d , terminismt, and the 'abstract determin^tiont (Harz, Grundrisse p.101)

,of the dependency theorists must be rejected. The flaw in both these

approaches is their one-sidedness which is refl(eted in th•ir viewing

phenomena "seDarately from each other" and not "in their inner connection

as an integrated totality" (Mandel, introduction to Harx, Volume I of

Capital 1976, p.18). And in Marx's scheme, this totality is provided

by the pr,dominant mode of production existing in the specific spatio-

temporal conjuncture und.Jr coar;idorcItion, predomthance being dofinecl

in terms of the predominance of its laws of motion.

The centr -:1 foun:'1:tion of Harx's metho'd is the princiPle that

very historical p,riod possesses its Dun laus" (ilarx quetin7KAUfman.

on his own method, post-face to jecond Edn. of Vol.I of Ca,,dtal, Harx

1976, p.101). L.n0 what en::bles on„ to demarcate thus, hiLtorical

period3,7hat H.rx called mo,,lec of production, are thus, 1-,ws themselves.

As Engels wrote to Harx in 1873, "to Identify the different hinds nf

motion is t -) identify the bodies themselves.' The neatest stat_ment,

however, is that of 7itold Kul:, whose work on the foudal node of

production is an eutstan. ing examplC of the apAicati,n Earx's

method. Kula writes:

45

"An economic system is a set of dependent, interconnected

economic relationships which, precisely because they are

interconnected, arise more or loss contomnorancously and

disappear more or less contemporaneously, giving way to

other relationships. The 1-„tin-onniricrad.r21. th; it onorgenco lad dissolution anables us to fix the limits

of a specific economic system in time (Kula, 1975, p.175,

emphasis ours).

Thus, our analysis must be pitched at a level (o patio-temporal)

where we can identify these relationships or laws. This would bo the

totality in whose domain we exanine the forms of oxIDloitation that

coexist within it. Only within such a totality can we understand

the precise significance of these forms. Tho fact is that the same

form can exist in different historical contexts and acquire an entirely

different significance in each of then i.e. embody quite different

production relations in each case. This depends on the specific

function it performs in each situation. That this is a central tenet

of iiarmt s method becomes imileaately clear if we rocogniee that

Marx emphasised the distinction between form and essence not merely

to stress the need to unravel the essence underlying the form but also

to explain how :and why a particul-r essence rikos its appearance in th

Liven concrete farm.

4Political oconomy.has indeed analysed value and its

magnitude, however incompletely, and has uncovered tho

content concealed within these forms. But it has never

asked the question why this content has assumed that

particuLx (Marx 1976, p2.173-4).

As :dubin (1972) puts it, Marx's genetic or dial ctical method

consists of both analysis and synthesis in contrast to the -me-sided

analytical method of the Classical _Ccmonists. 1.n riother. context -

46

Rubin says

"on the question of the relation between content and

form, Marx took the standpoint of Hegel, and not of Kant. Kant treated form as soncting external in rola-

tion to th- content, and as something which adheres to

the content from the outside. From the standpoint of

He gel' philosophy, th, content is not in itself something

to which form adheres from the outside. Rather, through

its develipment, the content itself gives bitth to- the

form which was already latent in the content. Form

Moreover, this argument is closely related to the logical

ri.d historical character of Marx's method and his distinction between

simple md concrete categories in th, Grundrisso. As Marx says in

the Grundrisso

"even the moot abstract cat,gories, despite their vali-

dity-precisely because of their abstractn.ass.- f'or .111 epochs,

are n vortheleos,, in th, specific character of this

abstraction, themselves likewise a Product of historic

relations, and possess their full validity only for and

within these relations." (Marx 1973, D.105).

In the concrete historical situations we are moot interested

in, viz. the ex-col:nial nation:, of the world tod:T, the T::ajor problem

is thf:t of analysin.: the interaction between the expandin inter-

national 'talist uodJ of prodUction and the modes of production

existing in these nations. One has to try to capture the .7;r -:dual

rooess through ,Thich these anterior mo:',cs of production are deprived

of their own laws of motion and subjected to those of the expanding

The same point ie onph=ised by iThndel (introduction to Marx. 1976), Ilosdolsky (1977), 6'ohn-Rethel (1978), Linder (1975) and Banji (1977a).

23/ necessarily grows out of the content itself" (ibid.p.117)--

23

I

0

Pp

47

24/ capitalist one.- This is crucial in order not to fall irito the

error of the dependency theorists who while avoiding the crude

empiricist mistake of identifyin,- ampearance with essence, totally

fail to provide the mediating links .necessary to explain why the

sane essence ap,.pears in riven concrete forms in a certain astorical

setting and not in others. In fact the form that ca,it:Ilist penetra- 0̀

Lion takes would crucially depend on all factors of the )articular

historical setting which influence the balance of forces in the

capital-labour relation (enumerated earlier in brief).

Very general formulationsof this so-called larticulatiop'

have been attempted by P.P.itey 9:-

5'/

and Charles Bettlehein (1S772).

Rey speaks of three- ,)hasee in the. transition to capitalism.

The first in which the capittlist node of production is not yet

doninant. Gaoitalian je dependent on other modes for ra materials etc.

and hence reinforces their rel;Itions of production. In the second phase,

the tronkition to which necessarily entails a .,:;reat do:J of violence,

the capitalist mode takes root aldd becomes the dor.:Linant .ziode. However,

it still needs pre-capitalist nodes to proviC.Lo 1J; a r,:-;ular supply

of labour. Those nodes now- enit 'on the basis' of ccitalisn md are

modified accordingly. The third phase is that of the 's)ecifioally

capitalist modc -3roductiont which is yet to rail;:us its Fa.petlrance in

the Third -Jorld.

24 This is a )rocess which can be said to bord-1 to occur from the 15th century onwards on world-wid scale. Tho uictah of the de-Jendoncy theorists is to assume it to be over by then!

25/ The major writings of :le:- aro still not available in J2inzlish. See Bradby (19V) and Ii.loter-Carter (1973) for summaries.

48

According to Bettleheim, the development of capitalism

proceeds differently in social formations in which the cc:At -list

node of production is predominant and those in which it is not.

In both there exist. tendencies towards what he calls "dissolution"

and "conservation—dissolution' of )/..ecanitalist modes of production.

(CA:msamvaiial-dissolution means 'restructuring' or partial dissolution.

The difference lies in the fact that in social formations where

capitalism predominates, the first tendency is the primary one and

the second one, secondary while the opposite holds in the pericheral

formations.

These are interesting formulations and have the merit of at least

recognising the protracted character of the transition to the s-lecifically

capitalist node Df production and -that various forms May coexist within 10

it. But th,Ar, generality is seductive and must not be talon as a

substitute for concrete empirical enalysis. This still re:Aains an

area which needs for greater euldrical substantiation before any

grand theorisation can be considered Credible. lircover, ;:hey must

not lead to the tendency, which in widespread, of necesary speaking

terms of coexistence of mode's of production even whore a dominant

mode articulatin various forma and assigning; them their significlnce,

can be identified. This would otherwise merely resurrect the

dualism which it was the primary aim of these thcorint:3 to contest. F.

An ,ttom-)t must, therefore, be made to identify the dominant

26 tendencies which define the mo...e ef production=— .

267 very imortant task is that of formulatim the diffTerences in the laws ch-,.racterisin:; the p_riods of formal :'r'id Jubsumption. See Ben Pinu (1970) for be,:finning in this direction.

49

In this context, to muuld like to put forward four pr000sitions

each of which contains suggestions for further work:

(1) These tendencies or laws can be (liscJrned, at one level, by

examining the 'economic calculus' and activity of the 'enterprises'

existinz within the node of production.

(2) To comprehend the precise significance of this calculus and

activity however, it is necessary to first locate the exact place

the enterprise occupies in the mode of produc tion. The latter is

what Marx (1976, see footnote 13 above) and Lenin do (see Volume I

and Volume III of his Collected 7orks), while analysing 'dornstic

industry' under capitalisn. See also Banaji (1977a), Isaac (1930)

and Littlefield (1979), for a similar analysis of 'peasant', 'domestic'

and 'artisan' production respectively, under capitalizm. For feudalism

see Kula (1976).

(3) This economic calculus and activity are moreover, influenced

dee-oly by the material conditions (!institutional' and technolo(ical)

characterising the mode of production.Kula (1976, Ch.3) is a brilliant

substantiation of this point, with reference to the feudal mode of

oroduction. Bettelheim (1976) examines similar is.:ues in the context

of the transition to socialism.

(

The dynamic of the mode of production is, finally, a :.roduct of

the operation and interaction of the totality of the enterprises

existing within it. Kula (1976, ch.4) for example, vividl describes

how the demesne —peasant plot articulation determines the

term dynamic' of the.Ceudal node of production.

50

Propositions 3 and 4 amount really to auggostin:.; the

need to study the dialectic between the lairs of motion of a mode

of production and the relations and forces of production characterising

it. Inciive analyses of this type arc to be found, for examplo,

27/ in Bremer (1975 and 1977).:—

Thu aim of any study attempting to analyse the development

of capitalism in agriculture, then must bo to place the existing

forms of exploitation in the context of the ontorpriso and the mode

of production within which thoy occur. Only then can one an

insight into both the essential function that these forms embody and

th r D113 VTIly theY aper..r as such. such a methodolojIc al anpro ach

iS k_f oven greater significance for agriculcure because, no we havo

already noted, the transition to the specically capitalist mode of

production in agriculture can be -)articularly protracted and can

vxiat,noo of a v,riety of forms of exploitation.

27/ -- Here, we nay also mention T.Nauro, a French historian, uhose uork seems methodologically quite attractive. Thnugh still unavLiiable in '&1glish, it is montioned.in Kula (1976, T.p.24-5). Mauro examines, what he a:111.3, the era of ',merchant ca7italism' i.e. the period from the 16th to the 18th century in -'astern Europe.

References

411171- h (1975): ILklia and the colonial Mode of Production, Economic and Political F2,222122naaks11.12 _21salat1912

Amin, S. (1977): ILTDorialism and Urequal Development.

Banaji, J. (1976): Chayanov, rauta:zy, Lenin: Considerations Totrards -A Synthesis, Economic and P Utica]. Ueekl‘ October 2 1976.

Banaji J. (1977a): Modes of ProduCtion in A Materialist Conception of History, Caoital and Class

Banaji, J. (1977b): Ca-Atraist Domination and the Small Peasantry Deccan. Districts in tho Late Nineteenth Century, Economic and

Bernstein, H. (1979): African PoasAmtkies: A Theoretical Framouork, Journal of Peasant Studies, Vol.6, N. o.4.

Bottalheim, C. (1972): Thoretical Comments, A,.)pendix 1 in-Emmanuel (1972)

Bettelheim, C. (1976): Economic Calculation and Forms of Property.

Bhaduri, A. (1973):. A, Study in A„;:ricultaral Bnclrdnoss Under Semi-Feudalism, The Economic Journal March: 1973. •

Dradby, B. (1975): The Destruction of Natural Economy, 2c3nony aid

Brenner, (1976): Ar:rarian Cla3s Structure and Iconomic Development ti

in ?tee-industrial Suro.de. =past arc. Prosent, 70.

Brenner, R (1977): TA;: oriL;insof Capitalist D-voloDment: A critic uo of Neo-SmiClian Marxism. Neu Left Reviev,104.

C-mbridge.Journal of Econo:lics (1979) Vol.5, ;",00tumber 1979.

Chnndra,17.1C (1974): Farm 2fficiuncy under Somi-Feualism: Critique of Marginalist Thoorics and some Marxist foTudl:.tions, Economic and PJlitical `eekly, Siocial Number' Aur;ust 197.1.

Chayanov, A.V. (1925): Punzont Farm Ordnisation, in Thorner ot.al ( 1966) .

Cliffe, L. (1977): Rural Clr',ss Formation in East Africa, Journal of Peasant Studies Vol.," No.2.

Corrigan, P., Ramsay, H. and Sayer, D. (1978): Socialist ConstructiJn and Marxist Theory, Eolshovism and Its Critique.

Cowen, M.P. (1976a): 13apital and Peasant Households (mimeo).

Cowen, M.P. (1976b): 'Tattle Production in tho Central Provinces and Household commodity Production (in Kenya 1903-64) (nimoo).

Djurfeldt, G. and Lindberg, S. (1975): Behind Poverty, The Social Formation in a Tanil Village.

Dobb, N. (1945); Studies in the ll,:velopuent of Capit,-...11:rm.

Emmanuel, A (1972) : Unequal Exchange, A Study in the Imperialism cf Trade.

Ennew, J, Hirst, P. and Tribe, K. (1977): 'Peasantry' As An licononic Category, Journal - of Peasant Studies Vo .z No., .

Fine, B. (1970 ) On the Origins of Capitalist Developraent, Now Left Review, 109.

F ost er-Carter, A. (1973): The of Production ControverFly, New 1L.ttRovigaz_191

Frank, A.G. (1969): Capitalism and,. Underd:evelopMent in L atin

Friedman, J. ( 1974) : Structuralism and Vulgar lizlizialisra.

Harris , R.L. (1978): Marxism an(.1.. Agrarian Question in Latin America, Latin American P,rs-sec-',;ivos Vol. No.-4 .

Harriss, J. (1979): The liode ,-)f Production Controversy. Th.cr..e.s and Problems of the Debate, MIDI Uor17Ing Paper 110 .6.

Hindess, B. and Hirst, P . 1975) 15re-c api talist Modesof Production.

Isaac, T.11. (1900): Class Strugglo and the Formo.1 Suhsumr:,tion of Labour Under. Ca,;:ital A Case Study of the Coir Industry in Kerala.

Lautsky, K. (1899): The Agrz.,..rian question - (translated into English by Danaji, J. f or Economy rnd Vol.5, No.1, 197',3).

Hula., (1976): An Economic The 017 of the Feudal System.

Lenin, V.I. (1895): The Economic Content of Narodian and the Criticism of It in rir.Struvar s Book (in Vol.I of Collected I.Torks).

, The Lenin, V.I. (189S;a):ZDevolopment of Capitalism in Russia.

Lenin, V.I. (1C99b) : Review of Karl Kautskyl s The Agrarian Quoation (in Vol.4 of Collected 7:forks).

Lenin, V.I. (1915): Neu Data on the Laws Governinri. the Dc.,veloamop.t if bj Capitalism in AGriculture (in Vol.22 Collected

Linder, Ii. (1975): Reification n.d the Consciousness of the critics of Political Economy. itu.dies in the Development of Tir,rx s The ory of Vr.lue

L i tt le f lc ld, A. ( 1979) ; The Expansion of C of Pfoduction in Itexionn. Crafts, Journal of P.-;1-.:.3aut V01,6,

Mr....ndel, B. (1.976a)• : Introduction t Marx ( 1976) .

Mandel, E. (1976b): Introduction to A-ppendiz to Marx (1976).

Mao Tse Tung ( 19 71 ) Selected Readings from the 'Tor:;:s ..)f Mao `:.'se Tung.

HartzLnez-Alier, J. (1977): Haciendas, Plantations and Golic.:ctive Farms.

liartienz-Alier, J. (1971 ).: Lr.tbouters and Landowners in Southern

Nar,Z, K. (1850): The Class Struggles in France 18,',8-1850.

Marx, IC. (1877): Letter to the editors of Otecherrtxrenniyo ZaDiski, reprinted in part in Corrigan et.al (1978).

Harz, K. (1894): Capital Ve1.5.

Marx, K. ( 19 7 3) : Grundrisse.

Marx, K. (1976): Capital Vol.l.

Heade, T. ( 19 73 ) : The Transition to Capitallem in Brazil. Notes on a 'bird Road - in Latin Anerican Pors- )ectives Vol.5 1To.

Bundle, S. ( 19 79 ) : Backwardness and Bond.as.e.

Patnaik, U. (1979): Neo-l'o-Dulisu and Marxism: The Chayanovian Viou of the Agrarian Question And Its fundamental Journal of Peasant Stuflic.,..o Vo1.6,

Raikes, P. (1978): Rural Differentiation Class formation its. Tanzania, Journal of Po sant studies, Vo1.5,

Rosdolsky, R. (1977): The Wai:ing of Marx' s Ca2ital.

Roseberry, 1.r. (1978): Pc.)as.7.tntf:: and Proletarians, • Crjti•-i e of Anthr000lo , .11 .

Rubin, I.I . (1972) : fissays On Marx.' s Theory of Value.

Rudra, A. (1973) : ClaSs- Relations in In al an Agriculturo, c Jlloaie k! 7'reekly, June .3 17, 1973.

S au, It. (1976): Can Capitalism Develop in L.criculire? Economic :210. Political December 1976.

S ohn-lie the 1, A. ( 1978) : Intellectual and Manual Labour: Critique of Epistemolov.

tavenhaisen, It. (1378): Capitalism and the Peaunntry In Mexico, Latin Auoricen P,rs-Dectives

teinsaard, N. (1973): Carrac!zr, CaravanS mid Companies: The Structural crisis in the Euro—Asian Trade in the 17th Century.

'jvreezy, Dobb et.al (1976): The Transition from Fouclalism to

Tatissig, Ti. (1978): Pe..7,sant Ec.ononies and theDevelopnent • Ca.A.talist A3-riculture in. the Cadua Valley, Colombia,

Latin American P,rs-)ertive Ve1.5, No.3.

Thornor, D., Kerblay, B. and Smith, R.E.P. (ads) (1966): A.Y.Clayanov's The Theory of the Peasant Economy.

Vilar, P. (1971): The Age Jf Don Quiznte, NcrLoft•RaAaIrJust, 1971.

Uallersteim, I. (1976): Tuii,...7ioti•Irn T.rnrld System.

A. (1978): Class Struc tare And Agrarian Transition in Central America, • .

• • - • Tp2:10,...„.,,,,,E,LeA„:- . • •