Generalised market dependence forces producers to cut costs and accumulate
Evidence
Capitalism, uniquely among all modes of production to date, is immensely successful at raising productivity levels. This is the key dynamic that expresses capitalist economies’ unprecedented capacity to grow at a rapid pace and to raise living standards. What makes capitalism different? This cannot be explained through psychological mechanisms, as though at some time we collectively decided to become greedier or more efficient at producing than our ancestors did. Instead, what explains capitalism’s productivity growth is a change in social relationships, particularly property relationships. In precapitalist societies, producers had direct access to their means of subsistence: land for farming and housing. Under those conditions, survival did not systematically depend on how efficiently one’s production process was. The vagaries of natural cycles may mean that a crop did not grow at adequate levels for one year, but these were contingent constraints rather than systemic ones. Working sufficiently hard to gain the resources necessary for survival was all that was needed. Under capitalism, this changes. Economic agents are now separated from the means of subsistence and, in order to secure the goods they need for survival, they must now turn to the market. While markets had existed for thousands of years, under capitalism economic agents were uniquely faced with generalised market dependence. Production therefore became oriented towards the market: one had to sell goods in order to make the money needed for purchasing subsistence goods. But, as vast numbers of people were now relying upon selling on the market, producers faced competitive pressures. If too costly, their goods would not sell, and they would quickly face the collapse of their business. As a result, generalised market dependency led to a systemic imperative to reduce production costs in relation to prices. … The outcome of these competitive actions was eventually expressed in the mediumterm tendencies of capitalism: prices tangentially declined to the level of costs, profits across different industries tended to become equal, and relentless growth imposed itself as the ultimate logic of capitalism. — Nick Srnicek, Platform Capitalism, 20
Categorization
- DEFINE: Defines generalized market dependence as the distinctively capitalist social relation, contrasted with direct access to subsistence.
- XREF: connects to: Regressive taxation and spending cuts both function to secure market dependence — Clara E. Mattei, Escape from Capitalism: An Intervention, 150; Firm-level accumulation rates depend on macro forces irreducible to individual firms — Yanis Varoufakis, Technofeudalism: What Killed Capitalism, 817; Mass production made goods affordable by exploiting high volume and low unit cost. — Shoshana Zuboff, The Age of Surveillance Capitalism, 89
Related
Broader Connections
- Regressive taxation and spending cuts both function to secure market dependence
#expands(0.72) — Clara E. Mattei, Escape from Capitalism, 150 - Firm-level accumulation rates depend on macro forces irreducible to individual firms
#expands(0.70) — Yanis Varoufakis, Technofeudalism, 817