Pretty much the only example taken from reality, provided by Krivenko is the brick industry. His argument is that there are a number of industries in which the expenditure on means of production is minimal, and so where small-scale production is possible. In the brick industry, he says, the expenditure is only one-fifteenth the annual turnover. So, Lenin undertakes a more in depth analysis of the brick industry, looking at the economic statistics provided by the Moscow Zemstvo.
In the Bogorodskoye Uyezd, where the industry was concentrated, there were 233 establishments, employing 1402 workers. Of these, 41%, or 567 workers, were members of the master's family, and 59%, or 835 were hired workers. The value of the annual output was ₽357,000. Lenin notes that the nature of the industry had changed rapidly in the previous 15 years, following the construction of a railway, which brought markets closer. What had traditionally been a family business was rapidly becoming one in which wage-labour predominated.
But, here, too, even the nature of the small family business hid other capitalist relations. For example, large merchants, and other large producers, had the resources for marketing. The consequence was that the small family producers sold their bricks to those larger producers at very low prices, and the latter then shipped them to market. However, as with previous examples, in which the Narodniks use of average, aggregated data led to false conclusions, so too here. Lenin provides a table from the official data, which breaks down establishments into three groups: those employing 1-5 workers, those employing 6-10, and those employing more than 10.
The data shows that the smallest establishments account for the majority (72%), with the second group accounting for 18%, and the third group just 10%. But, the smallest firms accounted for 34% of total output, whilst the largest firms accounted for 44% of output. In other words, although the small firms outnumbered the large firms by 4:1, the large firms accounted for a third larger proportion of total output. Its true that the large firms employed more workers than the small firms, 609 as against 476, but, even measuring output per worker, the largest firm is more productive. It produces ₽260 per worker, as against ₽251 per worker in the small firm. The small firms, however, performed better than the second group, and it would have been useful had Lenin explained why this might have been. It could, perhaps, have been that the first group required little in the way of supervisory labour, whereas the second group, employing more wage labour, did. Although the largest firms employed most wage labour, the proportional cost of supervision is smaller.
Examining the nature of each group, only 25% of Group I firms employed wage labour, whereas 90% of Group II firms, and 100% of Group III firms employed wage labour. For Group I, wage workers accounted for 19% of workers, with 58% and 91%, respectively, for Groups II and III.
“This concentration of the means of production in the hands of a minority, which is connected with the expropriation of the majority (the wage-workers), explains both the dependence of the small producers on buyers-up (the big industrialists are in fact buyers-up) and the oppression of labour in this industry. Hence we see that the cause of the expropriation of the working people and of their exploitation lies in the production relations themselves.” (p 213)
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