what is profit? where do profits come from? Essay

Division of labour is also credited with the rise of trade between different areas, the rise of capitalism, and increasingly complex manufacturing and industrialization. For Karl Marx, the production portion of Capitalism signalled great trouble. He believed production in Capitalist society worked in a way that the rich factory owner benefited and the poor factory workers lost. In his manner of reasoning, the Capitalist system was inherently meant to benefit the rich and exploit the poor: “All the bourgeois economists are aware of is that production can be carried on better under the modern police than on the principle of might makes right. They forget only that this principle is also a legal relation, and that the right of the stronger prevails in their ‘constitutional republics’ as well, only in another form.”[ii] Marx’s view of society and the world lead him to believe that humans create change in their lives and in their environment through practical activity in the practical world.

Modern economic society can be described as a combination of certain points from several theories combined into one. Changing dynamics and economic needs of nations has spawned a development of various, and contrasting, economic systems throughout the world. Perhaps the two most contrasting philosophies seen in existence today are that of capitalism and communism. The two philosophers most notably recognized for their views on these economic systems are Adam Smith and Karl Marx. This paper will identify several fundamental aspects of economic philosophy as described by Smith and Marx, and will compare and contrast the views of these

However, the functionalist ideology that rewards enjoyed by the wealthy are acceptable due to their social importance does not thoroughly constitute the cause of economic inequality (Colomy 31). Karl Marx, a known proponent of the conflict theory, exemplifies the dilemma of economic inequality through the relationship of the the proletariat and the capitalists. The proletariat or the labour worker and the capitalists are involved in a revolving system of exploitation. The capitalist pays his worker less to produce a surplus (Marx 479). It is the lucrative profit that is obtained through the capitalist industry that fuels this vicious cycle of exploitation. The worker produces the

Marx's theory on Capitalist exploitation is an incredibly deep theory, but to explain it in a nutshell, it is that the working-class people are improperly compensated for their work. The rich, the higher-ups, they continue to expand their wealth by exploiting the working class, the Capitalist system not only allows but effectively demands that Capitalists increase their wealth, long-term or short-term, whether at the cost of the working-class or not. There are three “values” to take into consideration, the use-value, the exchange-value and the

According to Marx, surplus value is obtained in the form of profit in which the capitalist owns the means of production (private property), thus the workers have no choice but to sell their ability to work to the capitalists in order to live. This means that labor is the source of profit under capitalism. Capitalism has a historically specific relation of production, as capitalists pay for labor power (gained by paying wages) and get labor in return. The exploitation of worker’s potential through wages produces surplus value, which is the reason why capital tends to grow. Money put into capitalist relations will then grow; thereby, resulting in the creation of labor markets that give value to things we consider capital. For example, surplus value was extracted under feudalism in this order: commodities are produced (essentials of living) and then feudal lords extracted this surplus by charging rent to the serfs (sometimes through

Therefore, it can be simplified down to this: the proletariat is always working not for himself but for the bourgeoisie in order to survive, producing products that will not only be taken away from them but decrease their human value as well. If one is to assign a monetary value to a proletariat’s life, for example a hundred dollars, each time the proletariat works, a dollar will be decreased from his total value and in the end he is basically left with nothing. However, since the bourgeoisie is the capitalist, he gains from the products produced by the proletariat and increases his own wealth as well. This inequality is why Marx believes there should be a classless society because the bourgeoisie will continue to exploit the hard working proletariats until they void themselves of any human value. It is unfair to have a minority ruling wealthy class over a majority class of working laborers. However, Davis and Moore disagree with how it is unfair to have a wealthy class ruling over the working class.

Under capitalism, if you purchase a business and pay people to work there, you are entitled to all of the profits earned. Marx views this as an immoral and an unsustainable socio-political model.

In the following section, I will define terms that Karl Marx used in his works. The term bourgeois is defined as the owners of the means of production. In oppose to bourgeoisie, the proletarian or the wage-earner is defined as “a class of labourers who live only as long as they find work, and who find work only as long as their labour increases capital” (I. Craib, Classical Social Theory, 99). Economic is defined as relating to the process or system by which goods and services are produced, sold, and bought (Merriam-Webster, 2016). The economic process that we will mainly focus on is capitalism. In a capitalist society, the main goal of any firms is simply to make profits for the owner. In the following essay, I will attempt to explain why do

Do we know what constitutes sufficient reason to attribute “responsibility to any person, company, or set of conditions? What kinds of risks do we assume when buying a car, or a motorcycle, or a can of tuna fish?

Karl Marx developed his theory on class division by suggesting that all societies have two major classes, a ruling class and a subject class. The ruling class owned a means of production such as land or capital, whereas the subject class did not. Marx argued that this leads to the ruling class exploiting the subject class. The ruling class use a superstructure of the legal and political systems to justify its position and prevent protests by the subject class. In capitalist societies the main classes are the bourgeoisie (capitalist) and the proletariat (working class). In these societies the bourgeoisie exploits the working class through wage labour. The capitalists pay wages to the workers, but make a profit because they pay the workers less than the value of what they produce. Capitalism is the newest type of class society but it will also be the last. Eventually it will be replaced by a communist society in which the means of production

Marx points out that the means of production are owned by only a small group of the population and most other people do not. These people who don't own the means of production (land, machinery, factories, tools, etc..) are called the proletariat and cannot sell their produce, only their labour-power... that is, they can sell hours of their time to other people. So the profits of their labour always go to those who hire them, and they are left with only a bare minimum wage.

Another concept that brought about inequality among the bourgeoisie and proletariat is the labour theory of value. As stated in the textbook Classical and Contemporary Sociological Theory, “One of the basic truths of capitalism is that it takes money to make money, and the more money a business owner has at his or her disposal, the more ability the business owner has to generate profit-making schemes” (Appelrouth and Edles: 25). In this case, the bourgeoisies are at a benefit as they own the means of production, while the proletariat are at a disadvantage as they don’t have capital to make money. Marx’s ‘general formula for capital’ explains the class and power relations that predominate in modern capitalist society through the formula M-C-M. Marx describes this law of value to be beneficial to the bourgeoisies as they increase profits and capital. Bourgeoisies are able to do this because they have the money (M) to buy capital, which converts their money into commonality (C), which they then use to produce other commodities that are sold for money (M). Bourgeoisies predominate the proletariats through power relations as the formula is inversed for the working class, C-M-C. The working class sells their labour through commodity (C), which then is exchanged for money (M) and used to buy commodities (C) necessary for survival. The C-M-C

I think that although there were limits imposed by reform legislation Marx still believe that exploitation can not be overcome under capitalism. I feel like he wants to get the point across about how important the two are and how they connect in the way they do. In the “Working Day” you see how the limits of the work day are listed and the many reasons why they are listed. Basically, the author is trying to show us on page 361, that no matter how much of the surplus value is, there is sill no comparison to the limit of the working day. Another thing that supports Marx’s argument on exploitation not being able to overcome under capitalism is a quote from the “Working Day which the author states, “The capitalist then takes his stand on the law of the exchange of commodities. He, like all other buyers, seeks to get the greatest possible benefit out of the use-value of his commodity (Marx, 363).” This quote explains how exploitation is being used under capitalism because the

The philosophy of Karl Marx begins with the belief that humans are inherently cooperative with common characteristics and shared ends. To human beings, life is considered an object and therefore, humans make their “life-activity itself the object of his will and of his consciousness” (Tucker 76). In other words, humans are able to think, imagine, and “produce even when he is free from physical need and only truly produces in freedom therefrom” (p. 76). It exemplifies that idea that humans not only have the capability to create things for survival but express themselves in what they produce, within the standards of the human race or universally. When capitalist wage-labor enters the picture, it forces these shared ends and the freedom of expression in human production to cease, causing a rise of competitiveness among

All economic theories share common roots, they attempt to address the basic question of how an economy can, and should, be maintained. One of the most influential economic philosophies is Marxism. The fact that economic theories can share common roots is especially evident in Marxism; It even shares a basic premise of laissez-faire with capitalism, a philosophy it directly contradicts (Sowell 12). In studying Marxism, two basic necessities must be addressed; the nature of Marxism and its basis, and the political and economic implications of Marxism.