Lenin sets out Struve's description of the development of commodity economy,of the division of labour, and role of the “buyer-up”, i.e. the merchant capitalist, who appropriates surplus value from the producers via the Putting Out System. When commodities begin to be sold in more distant markets, this facilitates the role of the buyer-up, who buys them cheap and takes on the costs of selling in these more distant, but bigger markets. The expansion of the market encouraged and increased division of labour, but, at this stage, does not bring about a technical restructuring of the industry. Existing handicraft producers are concentrated in one particular type of commodity production, and often continue to produce domestically, their output bought by the buyer-up. This means that the merchant capitalist is the first section of the bourgeoisie to rise in social importance.
Lenin quotes Struve's comment,
“This is lost sight of by our ’true Marxists’ like Mr. V. V., who are blinded by the significance of purely technical progress”.” (p 427)
Lenin says that this “proves beyond doubt” that “The entire process is expressed in the fact of petty production (handicraft) approximating to ’capitalism’ in some respects, and in others to wage-labour separated from the means of production” (Note * p 427)
Of course, the significance of the merchants on its own does not prove that. From almost the dawn of commodity production and exchange, 10,000 years ago, there have been merchants, and they played a significant role. Tribes and primitive communes selected individuals from their midst to act as merchants representing them in exchanges with other tribes and communities. The merchants became specialists in their own right, being able to assess the value of commodities produced by different communities, and, as Marx describes, therefore, played a crucial role in the formation of market values of these commodities, which is the basis for the determination of exchange-values. As Marx describes, merchants and merchant capital, which along with interest-bearing capital, represents an antediluvian form of capital, has existed alongside all modes of production.
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