The Dictionary of Human Geography

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markets were serially and coextensively disem-

bedded from, and re-embedded in, social

institutions and relations. In particular, the

possibility of a counter-hegemony to the self-

regulating market resided in the resistance to

(and reaction against) the commodification of

the three fictitious commodities – land, labour

and money – that represented the spontaneous

defence of society.

Marx’s account identifies a fundamental

contradiction at the heart of capitalism – a

contradiction between two great classes

(workers and owners of capital) that is funda-

mentally an exploitative relation shaped by the

appropriation of surplus. Unlikefeudalism,in

which surplus appropriation is transparent (in

the forms of taxes and levies made by land-

owners and lords, backed by the power of the

church and Crown), surplus value is obscured

in the capitalistlabour process. Marx (1967)

argues that labour is the only source of value

and value is the embodiment of a quantum of

socially necessary labour. It is the difference

between the sale of a worker’s labour power

and the amount of labour necessary to repro-

duce it that is the source of surplus value. The

means by which capital extracts this surplus

value under capitalism – through the working

day, labour intensification and enhancing

labour productivity – coupled to the changing

relations between variable and constant capital

determine, in Marx’s view, the extent, degree

and forms of exploitation. In the first volume

ofCapital, Marx identifies the origins of sur-

plus value in the organization of production

(the social relations of production so-called).

In volume II, Marx explains how exploitation

affects the circulation of capital, and in

volume III he traces the division of the total

product of exploitation among its beneficiaries

and the contradiction so created. In Marxist

theory two kinds of material interests – inter-

ests securing material welfare and interests

enhancing economic power – are linked

through exploitation (exploiters simultan-

eously obtain greater economic welfare and

greater economic power by retaining control

over the social allocation of surplus through

investments). Members of a class, in short,

hold a common set of interests and therefore

have common interests with respect to the

process of exploitation (see alsomarxism).

In the wake of Marx’s work, the central

debates over capitalist exploitation have turned

on (i) whether the labour theory of value is a

necessary condition for any truth claim about

exploitation, (ii) whether exploitation can be

made congruent with the complex forms of

class differentiation associated with modern

industrial society, and (iii) whether there are

non-Marxist accounts of exploitation. Inneo-

classical economics, for example, exploit-

ation under capitalism is seen as ‘the failure

to pay labour its marginal product’ (Brewer,

1987, p. 86). Exploitation in this view is

micro-level and organizational. That is to say,

using micro-economic theory exploitation is a

type of market failure due to the existence of

monopoly or monopsony. In more developed

versions of this organizational view, exploit-

ation can be rooted in extra-market forces;

for example, free-riding or asymmetric

information (the so-called principal–agent

problem). A more structural account of

exploitation from a liberal vantage point

would be the ideas of Henry George or John

Maynard Keynes, for whom land owners or

rentier classes (non-working owners of finan-

cial wealth) produce not exploitation in the

Marxist sense, but exploitation as waste and

inefficiency due to ‘special interests’.

In the Marxian tradition, there has been in

general an abandonment of the labour theory

of value – away from the view of Elster (1986)

that ‘workers are exploited if they work longer

hours than the number of hours employed in

the goods they consume’ (1986, p. 121) –

towards John Roemer’s notion that a group is

exploited if it has ‘‘some conditionally feasible

alternative under which its members would be

better off’ (Roemer, 1986a, p. 136). Perhaps

the central figure in developing these argu-

ments is Erik Olin Wright (1985), who sought

to account for the contradictory class location

of the ‘middle classes’ (in that they are simul-

taneously exploiters and exploited). Building

on the work of Roemer, Wright distinguishes

four types of assets, the unequal control or

ownership of which constitute four distinct

forms of exploitation under capitalism: labour

power assets (feudal exploitation), capital

assets (capitalist exploitation), organization

assets (statist exploitation) and skill assets

(socialist exploitation). While pure modes of

production can be identified with single forms

of exploitation, ‘actually existing capitalism’

consists of all four, opening up the possibility

of the simultaneous operation of exploiter/

exploitee relations (e.g. managers are capital-

istically exploited but are organizational

exploiters).

A long line of Marx-inspired theorizing

has attempted to grasp the relations between

(European or transatlantic) capitalism,empire

and the non-capitalist (or developing) world.

This is the heart of theories ofimperialism

Gregory / The Dictionary of Human Geography 9781405132879_4_C Final Proof page 61 31.3.2009 9:45pm

CAPITALISM