Marx’s Theory of Division of Labor and Socialism

1. Marx’s Theory ofDivision of LaborandSocialism Speaker:HaipingQiu SchoolofEconomics RenminUniversityofChina

2. Outline: • the essentials of Marx’s theory of division of labor • two key points to Marx’s theory of division of labor • Some brief viewpoints

3. AdamSmithandKarlMarx • the two economists who have the most profound understanding of the division of labor

4. AdamSmith: • the first to recognize the role and significance of labor division to the development of social productivity • ”the greatest improvement in the productive powers of labor, and the greater part of the skill, dexterity, and judgment with which it is anywhere directed, or applied, seem to have been the effects of the division of labor.” • failed to distinguish between the divisions that are inside the business and that are across the society. • he only identifies labor division from the perspective of productivity development and production efficiency.

5. Marx: • the first to fully understand the important position and role of division of labor in the development of human society. • “Division of labor is the universal category of political economics”. • He has abundant theory of labor division.

6. The essentials of Marx’s theory of division of labor: • Division of labor is both a result and an important form of the labor productive powers development. Thus, the important and special role of division of labor in the development of human society. • Divisionof labor is not only the prerequisite for commodity production but also the basis of the urban rural distinctions and the alienation of people. Different stages of the labor division are also different forms of the ownership. The important role and special status of the division of labor in the social productive relation, social structure and their evolution over time are hence emphasized. • Thedevelopment of social division to an extent is the premise of the division inside the capitalist organization, while the division inside organization and its development is the product of the capitalism time. Social division and division inside the organization can convert into each other in the capitalist society. They are two ways of resources allocation, implying different economic relationships.

7. Inthe course of capitalism development, capital accumulation makes the scale of single capital much larger. However, it couldn’t satisfy the requirement of the maximization of surplus value just by capital accumulation thus emerges the capital centralization. By the centralization of capital, big capital merges the medium and small size capital, or many medium-and-small-sized capitals forms a bigger single capital by establishing stock corporations. Social divisions increasingly convert into divisions inside organization with capital centralization. Not only the capital giants decrease, but also proletarians increase and more and more converge in a few big enterprises. Marx concludes that,“The knell of capitalist private property sounds. The expropriators are expropriated.” • Ascapitalist private ownership is wiped out or dies out and the socialist public ownership is constructed, the old division, class and class conflict, commodity production and urban-rural distinctions are gone with it.

8. Two key points to Marx’s theory of division of labor • Marx interprets the contradiction between labor socialization and capitalist private ownership caused by capital centralization as the most important driving force for capitalism to be inevitably replaced by socialism. • Marx interprets labor’s socialization as the basis and premise of establishing socialist mode of production as well as the centralized development of production and labor and the elimination of old division.

9. In my opinion, the theoretical study of contemporary Marxism political economy on both capitalism and socialism should not ignore these two theoretical points. • We know the most important question about capitalism is the historic fate of it, if capitalism will be inevitably wiped out or die out. The most important issue about socialism is the reason for the failure of socialist planned economy, is the market economy the inevitable choice of socialism or an expedient measure? • Worldwide scholars have put forward various views about these two points. • The point I am trying to make here is that it may be difficult to find the right path and direction for understanding the contemporary capitalism and socialism, if we don’t seriously restudy Marx’s theory of division of labor and its overall logic

10. Some brief views: 1.Marx has not only constructed content-rich division theory but also put forward the theory of collaboration. It is necessary to combine the division of labor theory and cooperation theory to form the complete content of Marx’s theory about production and labor socialization. In other words, it is Marx himself who both interprets the development of division of labor as the form of productivity development and the collaboration as the form of productivity development. 2. According to Marx’s methodology and theory, more diverse conclusions may be derived from the double meaning and fact of the socialization of production to understand the trend of the development of capitalism if logically the socialization of production and labor is interpreted as the development of collaboration (centralization) and division (dispersion). 3. If we can confirm the development of social division of labor is a never-ending process, the commodity production and market as a resources allocation method caused by division of labor may be not caused by the underdeveloped productivity but the necessary choice under socialism condition, even if we admit the socialist public ownership can replace the capitalist private ownership. It is undoubtedly significant for understanding the development of socialist market economy in China.

11. Thanks !