Reproduction (economics)

In Marxian economics, economic reproduction refers to recurrent (or cyclical) processes by which the initial conditions necessary for economic activity to occur are constantly re-created. Karl Marx developed the original insights of Quesnay to model the circulation of capital, money and commodities in the second volume of Das Kapital.

Marx distinguishes between simple reproduction and expanded (or enlarged) reproduction. 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. The difference is that in the former case, the surplus value created by wage-labour is spent by his employer on consumption, whereas in the latter part of it is reinvested in production.

Ernest Mandel additionally refers to contracted reproduction, meaning production on a smaller and smaller scale, in which case business operating at a loss outnumbers growing business (e.g. in wars, depressions, or disasters - see further Joseph Tainter et al., The Collapse of Complex Societies).

1 Theoretical approach
2 Economic reproduction in capitalism
3 Reproduction of labor power
4 References
5 See also

[edit] Theoretical approach

As an approach to studying economic activity, economic reproduction contrasts with equilibrium economics, because economic reproduction is concerned not with statics but with dynamics, i.e. the motion of an economy. It is not concerned with the conditions of a perfect match of supply and demand under idealised conditions, but with quantitative proportions between different economic activities or sectors which are necessary in any real economy so that economic activity can continue and grow. And it is concerned with all the conditions for that, including social and technical conditions, necessary for the economic process.

[edit] Economic reproduction in capitalism

According to Marx, in a capitalist society economic reproduction is conditional on capital accumulation. If workers fail to produce more capital, economic reproduction begins to break down. Therefore, economic reproduction in capitalist society is necessarily expanded reproduction and requires market growth. Capital must grow, otherwise the process breaks down. Thus, economic growth is not simply desirable, but also absolutely necessary in capitalism.

In this light, the ecological vision of a "zero-growth society" appears rather utopian; or, at the very least, its achievement would require the abolition of capitalism. Some would argue that population growth makes economic growth absolutely necessary. The real argument though is not about "growth or no growth", but about the kind of growth that is best for the (enlarged) reproduction of the human species as such. Ecologists may validly argue that some types of growth undermine important conditions for human survival in the longer term, without this invalidating other kinds of growth which are beneficial.

[edit] Reproduction of labor power

Reproduction can also refer to the worker's daily reproduction of his own labor power. This consists of the tasks of everyday existence — food preparation, laundry and so forth — that maintain him and his ability to show up at his job as required. Much of this domestic labor has historically been the responsibility of women; thus it is of particular interest in feminist economics.