Marxian Economics

Marxian economics develops the analysis of capitalism set out by Karl Marx, most fully in his multi volume work Capital, the first volume of which was published in 1867. Marx argued that the value of a commodity derives from the labor required to produce it, and that capitalists extract a surplus value from workers by paying them less than the value their labor creates, with the difference captured as profit. On this account capitalism is not a neutral, harmonious system but a historically specific arrangement built on a structural conflict of interest between labor and capital, one that Marx expected to generate recurring economic crises and to eventually give way to a different economic system. Marxian economics has continued as an active tradition of analysis of capitalism, crisis, inequality and the relationship between economic structure and political power, distinct from and often sharply critical of the value theory shared by classical, neoclassical and most other mainstream schools of economic thought.