“The relations and modes of distribution are thus merely the reverse aspect of the factors of production. An individual whose participation in production takes the form of wage-labour will receive a share in the product, the result of production, in the form of wages. The structure of distribution is entirely determined by the structure of production. Distribution itself is a product of production, not only with regard to the content, for only the results of production can be distributed, but also with regard to the form, since the particular mode of men's participation in production determines the specific form of distribution, the form, in which they share in distribution. It is altogether an illusion to speak of land in the section on production, and of rent in the section on distribution, etc.” (p 200)
This is why the ideas of the vulgar economists and vulgar socialists are idealist, subjectivist and utopian, because, given any mode of production, the mode of distribution, and from that the content and nature of that distribution is also determined, and not at all a question of free will or choice. Consequently, the ideas about workers obtaining “the full fruits of their labour”, or else of some kind of redistribution via the tax and benefits system, are pie in the sky.
But, in another sense, distribution also determines production. That is in the sense that, before production can take place, the factors of production must exist, and must, thereby, have been previously distributed, to their current owners. This, of course, is the objection to Pareto Optimality conditions. In other words, Pareto Optimality sets out the optimal conditions, given any set of factor allocations, but it cannot, thereby, determine whether some more optimal condition is possible if a different set of factor allocations is assumed.
“Economists like Ricardo who are mainly accused of having paid exclusive attention to production, have accordingly regarded distribution as the exclusive subject of political economy, for they have instinctively treated the forms of distribution as the most precise expression in which factors of production manifest themselves in a given society.” (p 201)
In any given society/mode of production, for the individual, their place within it appears to flow from some eternal social law, whereas that law is specific to that particular society. That becomes apparent when, as a result of wars and revolutions, those initial factor endowments get thrown into the air, and a new arrangement takes their place, complete with new distributional arrangements, and new social laws.
“An individual who has neither capital nor landed property of his own is dependent on wage-labour from his birth as a consequence of social distribution. But this dependence is itself the result of the existence of capital and landed property as independent factors of production.” (p 201)
Such a condition, for example, could never be understood by a member of the primitive commune, for whom the possibility of the ownership of land and means of production, privately, by a small number of individuals, and the consequent denial of ownership to the majority was inconceivable. It is only social revolutions that created private property that make such conditions possible. Those social revolutions may arise from within, or they may arise from wars and conquest, as, for example, with the role of British colonialism in India.
“A conquering nation may divide the land among the conquerors and in this way imposes a distinct mode of distribution and form of landed property, thus determining production. Or it may turn the population into slaves, thus making slave-labour the basis of production. Or in the course of a revolution, a nation may divide large estates into plots, thus altering the character of production in consequence of the new distribution. Or legislation may perpetuate land ownership in certain families, or allocate labour as a hereditary privilege, thus consolidating it into a caste system. In all these cases, and they have all occurred in history, it seems that distribution is not regulated and determined by production but, on the contrary, production by distribution.” (p 201)
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