Theories of Surplus Value, Part II, Chapter 9 - Part 11

The 10 years, 1641 – 1649, saw the highest level of enclosures for any period up to 1860, apart from the period 1800 – 1819, when demand rose due to the Napoleonic Wars, and there was large scale land theft, following the introduction of the General Enclosure Act of 1801. Comparing the movement of prices, during and after these periods of more rapid enclosure, when new land is brought into cultivation, and an increase in fixed capital investment occurs, confirms the argument that Marx sets out. The 50 year average figures are misleading, Marx says, because they can be distorted by some unusual years. So Marx writes,

“Prices constantly fall in the period from 1810 to 1859, whereas in the period from 1750 to 1799, despite the lower average price over the 50 years, an upward movement (takes place); the upward movement is just as consistent as the downward movement between 1810 and 1859.

In fact, compared with the period of 1641-1649, there is, on the whole, a continuous fall in decennial average prices, until this fall reaches its peak (lowest point) in the last two decennial periods of the first half of the 18th century.” (p 143)

The upward movement in prices commences from the middle of the 18th century, which is the period when the agricultural revolution takes place, and large scale capital investment in agriculture takes place, and the industrial revolution leads to a growing demand for agricultural products. The rise in prices intensifies in the first two decades of the 19th century, as the growth of the factory towns reaches a peak, imports of food are disrupted by the Napoleonic Wars, and large swathes of land are enclosed as a result of the General Enclosure Act. Large amounts of fixed capital investment are required on all of this newly cultivated and enclosed land, and this is reflected in the higher prices during the period. But, from the latter part of the second decade of the 19th century, prices begin to fall, as the pace of new fixed capital investment declines, and the effect of the investment undertaken over the previous 75 years begins to bring forth lower cost output.

“From that point on, the consistent downward movement begins again. If we take the average of the period of rise from 1750 to 1819, then its average price (a little over 57s. per quarter) [is] equal to the starting-point of the period of fall from 1820 (namely a little over 58s, for the decennial period 1820-1829); just as the starting-point for the second half of the 18th century [equals] the average price of its first half... 

“If one deducts the differential costs for the capital successively employed in bringing new land into cultivation, which for a certain period enters as an item into cost, then perhaps the prices of 1820-1859 [would be] lower than any of the earlier ones.” (p 144).

[9. Anderson versus Malthus. Anderson’s Definition of Rent. His Thesis of the Rising Productivity of Agriculture and Its Influence on Differential Rent]

Anderson noted that, the first half of the 19th century had experienced constantly falling, and the second of constantly rising corn prices. But, he says, in opposition to Malthus, West and Ricardo,

““the population […] was on the increase during the first half of this century as well as the last” (l.c., p. 12).” (p 145)

Anderson opposes the population theory of Malthus, and argues that agricultural production can be more or less expanded without limit.

“The soil can be continuously improved by chemical influences and cultivation” (l.c., p. 38) 

“…under a judicious system of management, that productiveness may be made to augment, from year to year, for a succession of time to which no limits can be assigned, till at last it may be made to attain a degree of productiveness, of which we cannot, perhaps, at this time conceive an idea” l.c., pp. 35-36). 

“…it may be with certainty said, that the present population is such a trifle compared to that” which this island can maintain, as to be much below any degree of serious consideration” (l.c., p. 37).” (p 145)

In contrast to Malthus, and his present day followers, including those who oppose immigration, on the naive basis that there is some fixed amount of work and resources that can be shared out, Anderson correctly asserts that the expansion of those resources and of work is itself a function of the expansion of the population, and of the additional labour power that comes with it.

““Wherever population increases […], the produce of the country must be augmented along with it unless some moral influence is permitted to derange the economy of nature” (l.c., p. 41).” (p 145)

Consequently Anderson argues that Malthus population theory is “the most pernicious prejudice” (l.c., p. 54) (p 145)

Anderson was, of course, correct. The rising population brought about a rising production that exceeded the additional demands of that population. But, Marx is even more right that the production could and would rise even without a rise in population, because of constantly rising productivity, which resulted in an increased mass of surplus value, and accumulation of capital. That was particularly marked in agriculture, where the agricultural population and workforce continued to shrink, whilst agricultural production continued to rise. But, also that process illustrated another point set out by Marx. In terms of the value of the output of agriculture, it continued to fall as more capital was introduced. The extent of that fall can be seen by looking at the continually falling share of agricultural production as a proportion of the GDP of all industrial countries. Yet, despite those more or less continually falling agricultural commodity prices, capital employed in agriculture continued to make substantial profits.

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