In the body there is the circulation of blood, it goes in one direction only.

Now consider the circulation of goods in a barter economy; goods move by exchange. Hence we can identify always two circulations which are exactly mirrors of each other in the sense of moving in opposite directions.

Question: Does this always hold, under every circumstance? Even in a modern economy when we consider cash, say, as just another good; and without considering its special status as the medium of exchange?

But then how can an economy grow? Which in fact it appears to do? Or can we consider the economy in a larger context - that of the world - and say that what was fixed and not in motion; ie natural goods such as the coal in the surface of the earth, and trees on its surface; are placed in motion, and this by becoming a commodity?

  • +1 I didn't try to upvote first, but the questioner referred to Locke, as in the comment line. It is a widely held view. ( meaning Marx owes much to his predecessors waaay back even to Greek philosophers ) – Kentaro Tomono Apr 25 '15 at 16:03
  • Notice that blood circulation is also a double circulation, that of oxygen vs that of carbon monoxid. But I don't think the analogy can hold; economic "circulation" does not fulfill the same functions as blood circulation. – Luís Henrique Aug 9 '16 at 1:42

While the Wikipedia article on economic reproduction is kind of a mess, that seems to be the concept that this question is grasping at. I'll quote the following which is actually a very nice summary of Marx's answer.

Marx distinguishes between "simple reproduction" and "expanded (or enlarged) reproduction".[4] In the former case, no economic growth occurs, while in the latter case, more is produced than is needed to maintain the economy at the given level, making economic growth possible. In the capitalist mode of production, the difference is that in the former case, the new surplus value created by wage-labour is spent by the employer on consumption (or hoarded), whereas in the latter case, part of it is reinvested in production.

So Marx's theory of simple reproduction explains that the circuit of capital must always stay in motion. Note here that the opposite of circulation is basically the "hoarding" of wealth. Capitalists don't hide their money under they mattress, because then they won't make a profit. They keep it circulation by reinvesting it in production (or at least putting it in a bank that can isssue loans). Hoarding (or non-productive investments, like in a real estate bubble) is a basic sign or symptom of an economic crisis. This is where Keynes draws from Marx, although his basic understanding fo the process is very different.

Marx's theory of expanded reproduction gets to the other part of the question, which is economic growth. And for Marx, decisively, this is not just a mere appearance of growth, but an accumulation of value-in-circulation. Picture an electrical circuit where the voltage tends to increase more and more over time. The source of the metaphorical "energy" in the capitalist economic system, for Marx, is human labor. It is the only commodity capable of adding additional new value to the circuit of commodities. The value of machinery and represents previous human labor accumulated in a productive physical form, and that is also part of what allows the scale of circulation to increase over time.

The other kind of circulation Marx touches on, but does not develop in very much detail, is metabolism, that is, the circulation of matter and energy in general, regardless of whether it is commodified. Humans in every society, like all living beings, take water, food, oxygen, sunlight, use it for our own biophysical reproduction, and then turn it into waste. In a health ecoystem, every form of "waste" is potnetially a necessary input for some other lifeform(s). This kind of circulation goes on regardless of whether or not nature is commodified. But the expanded reproduction of capial tends to disrupt circulation of matter and energy through ecosystems. It produces more waste (pollution, greenhouse gases, etc.) then the biosphere can manage to circulate. The circulation of commodities and the circulation of useful matter do not always fit well together. Ecological Marxists refer to this problem as the metabolic rift.

  • +1. Good answer. Marx said the capitalistic mode of production ( I would not like to use this word ( long )) is an exploitation of nature, then well, here we again see his contradiction in his idea ( = exploitation vs culturailizing effect of capitalism. ) – Kentaro Tomono Jun 5 '15 at 2:04
  • Marx did not say that exactly. The closes he gets to that is the idea of "a free gift of Nature to capital", which is toward the end of this chapter in Volume III. But ecological Marxists have been doing a lot with that idea recently. Here is a very concise and recent example. – Brian Z Jun 5 '15 at 2:49
  • He said that exacly. Let me give some time. – Kentaro Tomono Jun 5 '15 at 3:39
  • 1
    I found a corresponding line from the English version. Kindly see the bottom of this page link ------- Here, in small-scale agriculture, the price of land, a form and result of private land-ownership, appears as a barrier to production itself. In large-scale agriculture, and large estates 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, – Kentaro Tomono Jun 5 '15 at 4:59
  • 1
    but the landlord. In both forms, exploitation and squandering of the vitality of the soil (apart from making exploitation dependent upon the accidental and unequal circumstances of individual producers rather than the attained level of social development) takes the place of conscious rational cultivation of the soil as eternal communal property, an inalienable condition for the existence and reproduction of a chain of successive generations of the human race. – Kentaro Tomono Jun 5 '15 at 5:00

Oh well, I, a drafter may be s), well then,

You quoted the coal, trees, etc in the surface of the earth are the assumable examples to be non commodities.

Simply thinking, how are we, human beings, able to dig, cut the objects in your question in order for them to take off or out the earth without the work-power of ourselves? Not ridiculing, but can they ( coals, trees ) come to us upon calling them to do so by chanting some magical words? Like, "Hey trees, fly and cut yourself and come to us".

Since the answer is required citations, here is an example, Capital Vol.1, Chapter 16,

So far as the labour-process is purely individual, one and the same labourer unites in himself all the functions, that later on become separated. When an individual appropriates natural objects for his livelihood, no one controls him but himself. Afterwards he is controlled by others. A single man cannot operate upon Nature without calling his own muscles into play under the control of his own brain.

Then if we deny your proposition, then the companies which produce and sell their products in the market will not be listed in Dow, I think.

And regarding your this inquiry,

But then how can an economy grow?

Smith says vaguely but pardon me to search in English text. Well, then I think when the total sum of the commodities only usable to others increase, then can we say for human beings only ( since we have to take into account environment issues too ) the economy for human beings are growing?? I don't think only the increase of the medium-the money can not be regarded ( I am emphasizing the word only ) as the economic growth.

Have a nice day.

Thank you.

  • Ok, human labour and which signifies not just the hand but also the mind; and therefore not just its routine form; but also in enterprise. – Mozibur Ullah Apr 25 '15 at 10:17
  • 1
    Doesn't this align with Lockes view that property is that which is inscribed by human force? – Mozibur Ullah Apr 25 '15 at 10:51
  • I'm sorry Ullah, I really can not understand about Lockes' part. Which book is it? Or can you elaborate about the meaning of "being inscribed"??? I'm sorry I really don't understand. You know, first thing I happened to have known about philosophy is the translation has the great power ha-ha. Really. – Kentaro Tomono Apr 25 '15 at 12:20
  • Btw, as I asked, and deleted before, I restarted reading Ardent's. Man, where is her English e-book. I found a good site but zip-code stuff hinges me from buying. If you know, let me know. man. – Kentaro Tomono Apr 25 '15 at 12:53
  • 1
    Locke, I think is seen as belonging to the liberal tradition; so it's interesting that both Marx & Locke trace value (as an abstraction of property or commodity) to human labour, or giving it a different slant force. – Mozibur Ullah Apr 25 '15 at 15:07

I would take your last statement as fact. There are raw inputs to an economy, the flesh of wild animals is a perfect example. And there is pure waste, such as non-recyclable plastic floating in the ocean, or when someone declares bankruptcy.

This notion of circulation does not hold. The system is wide open at both ends. Something becomes economic and something else ceases to be economic and they are not necessarily connected in any way. Even if you want to include the Earth and its contents as an economic actor (which I do not think can actually be done) the sunlight that falls on us is still raw input, and the ultimate waste-heat that can no longer be leveraged is still pure waste. Since by and large whatever sunlight does not happen to fall on a plant, still turns immediately into waste-heat, there is still huge leverage for efficiencies. This creates so great an opening that this is still virtually an open system.

Given that it is really an open system, it seems obvious that the economy grows by pulling more non-economic stuff into economic stuff, or by speeding up the loops that do exist in the system.

This latter is called the 'velocity of money' when the reverse flow involves cash, and I think it explains the vast majority of the growth we see. Most of the increased consumption in modern economies is artificially driven, and most of our production is of psychological value (It is the same food, but it tastes better, or we are happier about the source. It is the same clothing, but it marks our status. It is the same communication, but it happens more automatically.) And these distinctions are amplified by the overall overabundance of goods available, not by naturally occurring levels of psychological needs. Those otherwise non-productive layers of 'production' get people paid, and they spend their earnings, creating more money in the system.

So even a closed economy could still grow quite a bit, by pumping up the speed of circulation.

  • @jobermark:Ok; as you point out there are sinks and sources in the flow; plus of course commodities can be combined, divided and refashioned; and I suppose it's at that point where human labour is an input; And deterioration in value can be seen as a kind of friction - but values also appreciate - so maybe a negative friction; I can see this getting quite complicated quickly. – Mozibur Ullah Apr 26 '15 at 7:12
  • I'm not sure that one can call markets of status and quality 'artificial needs' - they serve human needs; but I agree that they can be artificially inflated; or become perverse, corrupted. – Mozibur Ullah Apr 26 '15 at 7:15
  • @KentaroTomono Perhaps that was too indirect. I did not mean solar energy. In an odd way, mining coal is harvesting long-past sunlight, no? Human labor can be seen as a cultivated product, since we feed ourselves, and we put lots of resources into raising our children. But the light that makes plants grow, etc. really is raw input. It largely just becomes atmospheric heat, but to the degree it produces plants, it is not wasted, and creates economic potential. The OP wanted us to consider if the Earth itself were not commodified, but neglected the Sun. – jobermark Apr 26 '15 at 12:25
  • @KentaroTomono By the part about 'psychological value' and 'artificial needs', I am talking only about modern global economies, not economies throughout most of history. Economic production is usually physically driven, or at least driven by a natural level of psychological need. But our new cosmopolitan global economies, which make up most of the world economy now, largely create extra 'need' to promote growth. – jobermark Apr 26 '15 at 12:51
  • But the energy trapped in trees, and therefore in the coal made out of trees is sunlight. Our work power itself is a much less basic input to the economy, since it is something the economy develops and controls. Since it is managed, and because it is made out of food, it is really not a very raw form of raw input, when you include the planet as one of the economic actors rather than a commodity. The point is you can't consider all commodities derived, so there is no circulation, the economy is not a closed system. It is, at base, an epiphenomenon of the flow of light through various forms. – jobermark Apr 26 '15 at 15:33

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.