Uncertainty is a pervasive feature in monetary production economies. Different social groups experience uncertainty in different ways. An investor may be worried about the future revenue streams of alternative investment projects. A worker may worry about having a job next year. Obviously, the effects of uncertainty are mediated and shaped by the particular institutional setting of a society. One of the basic building blocks of these institutional structures is class structures. Therefore, the question arises how class relations and the distribution of uncertainty are related.Uncertainty is a key category in (at least some versions of) Post Keynesian theory. The concept of (fundamental) uncertainty highlights the challenges individuals face in making decisions, which are due to the historical openness of social and economic processes. Similar to Marxists, some Post Keynesians use class analysis in macroeconomic analysis. (1) However, Marxian economics is unique in combining class analysis with the notion of exploitation. Society is composed of different classes that fulfill different functions in the production process. Most modes of production are based on exploitation: there exists a class that is performing surplus labor and another one that is appropriating this surplus labor. This paper explores the boundaries and overlaps of these key concepts of Post Keynesian and Marxian economics. As specific institutions mediate the effects of uncertainty, a deeper understanding of the significance of the concepts involved requires a historical approach. Rather than a general discussion in abstract terms, the question what the relation between uncertainty and the class Structures is, will be investigated at the more specific level of different modes of production. The interrelation between exploitation and the distribution and nature of uncertainty will be analyzed for the capitalist, feudal and slave modes of production. The presumption of this paper is that different schools in heterodox economics are potentially complementary and could benefit from interaction and cross-fertilization. The cross-fertilization explored here is between Post Keynesian and Marxian concepts. In fact, both strands of economic thought share a similar historical (path-depended) approach toward economic analysis (Setterfield 2003, 371ff.). Similarly, both analyze the capitalist system as a monetary production economy. The aim here is to investigate how these common methodological elements can be transformed into a fruitful analysis on a more concrete level. To be clear, this paper does not offer a Grand Synthesis. In particular, little effort is made at this stage to address the potential methodological and theoretical problems that the use of concepts rooted in different theoretical approaches raise. Rather we wish to illustrate that cross-fertilization, can be a fruitful enterprise that yields genuine insights. A clarification is necessary at the outset. We concentrate on stylized modes of production rather than on the description of existing societies. The configurations are analyzed for three modes of production: capitalism, feudalism and slavery. By design, these modes of production eliminate much of the actual historical complexity to clarify key features of an economic and social system. These stylizations do have specific historical epochs in the background on which generalizations are based. It will therefore be helpful to make these explicit. In the analysis of capitalism, we follow standard Marxian analysis and thus adopt a focus on the capitalist system of the 19th century. The feudal mode of production that is discussed is that of Western Europe in the 10th to 12th century. The notion of slavery refers to its appearance in the 1st and 2nd century Roman Empire in the area of today's Italy. Overall, the modes of production analyzed do not claim historical accuracy, but are to be understood as ideal types. The paper is organized as follows. Section 2 presents the basic concepts of uncertainty and exploitation and their theoretical foundation. Section 3 analyzes uncertainty and exploitation in the capitalist mode of production. Section 4 discusses the feudal and section 5 the slave mode of production. Section 6 gives a comparison of the configurations across modes of production and concludes. Uncertainty, Exploitation, and Modes of Production Work has not been distributed evenly among different classes in most of human history. Some classes live off the surplus labor of others. The specific organization of exploitative class relations has historically taken on different forms that are described as modes of production. This is the core of Marxian economic analysis. We shall first clarify the notion of exploitation and then the notion of the mode of production. In doing so, the analysis will focus on fundamental class positions. However, no simple or dichotomous class analysis is advocated. Therefore, some intermediate and neutral class positions are also discussed. In defining exploitation, Wright (1997) argues that exploitation involves "antagonistic interdependency of material interests." He defines exploitation by means of the inverse interdependent welfare principle, the exclusion principle and the appropriation principle: * "the welfare of the exploiter is at the expense of the exploited" * "exclusion of the exploited from access to ... certain important productive resources" * "appropriation of the fruits of labor of the exploited by those who control the relevant productive resources" (Wright 1997, 10). The argument proposed in this paper does not rest on the labor theory of value, which is often used as the foundation of a theory of exploitation. Rather it is based on unequal distributions of work and consumption possibilities. Typically, exploitative relations also involve some form of command, and thus power, relations. The mode of production refers to "the way in which the means of production were owned and to the social relations between men which resulted from their connections with the process of production" (Dobb 1963, 7). This concept is used here to describe the structure of (Western) societies, in particular the social division of labor and income. A capitalist, a feudal and a slave mode of production will be distinguished. These are defined with respect to the fundamental relation of exploitation and the corresponding class positions. Actual historical social formations are of course more complex than such a bipolar class analysis would suggest. A specific society will be a social formation comprising more than one mode of production, with one of them typically being dominant. Moreover, various intermediate classes as well as non-class groups may play an important role for political or economic reasons. (2) In the analysis some intermediate class positions will be discussed. This is a difficult task, however. While there is a substantial literature on intermediate class positions for the capitalist mode of production (Wright 1989), there is hardly any conceptual analysis of intermediate class positions for pre-capitalist modes of production. We speak of intermediate class positions when a certain group performs functions of the exploiting as well as the exploited class. Neutral class positions (with respect to a given mode of production) refer to positions that are not related to the dominant fundamental class process. They may be outside exploitative relations (3) (such as independent producers) or belong to other class structures that play a subordinate role. In the debates on Marxist theory of history there is a tension between those emphasizing the determinant role of the development of the means of production (e.g., Cohen 1978) and those highlighting the role of class struggle (often associated with the British school of Marxist historians, e.g., Thompson 1966). The approach taken here is closer in spirit to the latter. As the aim of this paper is (static) comparisons of uncertainty associated with different class positions in various modes of production, the disagreement on the relative weight of different technological and social factors as determinants of historical outcomes is of little significance for our argument. Still, class relations will play an important part in our argument, the forces of production will not. The usefulness of the Marxian approach is that it conceptualizes societies as consisting of various classes defined by their positions and functions with respect to the production process. Thus, the term mode of production is used to describe stylized social formations in history. No claim of historical accuracy is made. Rather the interesting, and novel, question investigated is, what the implication of these historical formations on the distribution of uncertainty is. Fundamental uncertainty is often cited as a core concept in defining Post Keynesian economics. (4) Fundamental uncertainty is a result of the fact that economic processes in the real world do not follow ergodic patterns. Under such circumstances no probability distribution for outcomes can be given. This inability to give probability distributions does not merely reflect the limited knowledge or information processing abilities of humans but is a reflection of the openness of the historical process in which human societies and economies evolve. "Uncertainty in general refers to situations where probability cannot be measured. This immeasurability arises from the nature of the real world" (Dow 1995, 118). To clarify the concept of uncertainty, let us quote a well-known passage from Keynes: The sense in which I am using the term is that in which the prospect of a European war is uncertain, or the price of copper and the rate of interest twenty years hence, or the obsolescence of a new invention, or the position of private wealth-owners in the social system in 1970. About these matters, there is no scientific basis on which...
Uncertainty and exploitation in history.
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