Means of production
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Supply and Demand graph, illustrating one of
the most important economic principles
In economics and sociology, the means of production are physical, non-human inputs used for the production of economic value, such as facilities, machinery, tools, infrastructural capital and natural capital.
The means of production includes two broad categories of objects: instruments of labor (tools, factories, infrastructure, etc.) and subjects of labor (natural resources and raw materials). If creating a good, people operate on the subjects of labor, using the instruments of labor, to create a product; or, stated another way, labour acting on the means of production creates a good.
In an agrarian society the means of production is the soil and the shovel. In an industrial society it is the mines and the factories, and in a knowledge economy the offices and computers. In the broad sense, the "means of production" includes the "means of distribution" such as stores, the internet and railroads.
The ownership of the social means of production is a key factor in categorizing different economic systems. In the terminology of classical economics, the means of production are the "factors of production" minus financial capital and minus human capital.
Factors of production are defined by German economist Karl Marx in his book Das Kapital as labour, subjects of labor, and instruments of labor: the term is equivalent to means of production plus labor. The factors of production are often listed in economic writings derived from the classical school as "land, labour and capital". Marx sometimes used the term "productive forces" equivalently with "factors of production;" in Kapital, he uses "factors of production", in his famous Preface to the Critique of Political Economy, he uses "productive forces" (that may depend on the translation).
Production relations (German: Produktionsverhältnis) are the relations humans enter into with each other in using the means of production to produce. Examples of such relations are employer/employee, buyer/seller, the technical division of labour in a factory, and property relations.
Mode of production (German: Produktionsweise) means the dominant way in which production is organised in society. For instance, "capitalism" is the name for the capitalist mode of production in which the means of production are owned privately by a small class (the bourgeoisie) who profits off the labour of the working class (the proletariat). Communism is a mode of production in which the means of production are not owned by anyone, but shared in common, without class based exploitation.
Marxian economic analysis
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The analysis of the ownership and control of the means of production, as well as the level of their technological sophistication, is a central component of Marxist theory.
In Marxist theory, the process of socioeconomic change and evolution is based on the premise of technological improvements in the means of production. As the level of technology improves, existing forms of social relations become inconsistent and unnecessary, creating contradictions between the level of technology in the means of production, and the organization of society and its economy in particular. These contradictions manifest themselves in the form of class conflicts, which develop to a point where the existing mode of production becomes unsustainable, either collapsing or being overthrown in a social revolution, leading to the emergence of a new mode of production based on a different set of social relations, most notably, a different form of ownership for the means of production.
Ownership of the means of production and control over the surplus product generated by their operation is the fundamental factor in delineating different economic systems (or modes of production). Capitalism is defined as private ownership and control over the means of production, where the surplus product becomes a source of unearned income for its owners. By contrast, socialism is defined as public ownership of the means of production so that the surplus product accrues to society at large.
To the question of why classes exist in human societies in the first place, Karl Marx offered a historical and scientific explanation that it was the cultural practice of ownership of the means of production that gives rise to them. This explanation differs dramatically from other explanations based on "differences in ability" between individuals or on religious or political affiliations giving rise to castes. This explanation is consistent with the bulk of Marxist theory in which Politics and Religion are seen as mere outgrowths (superstructures) of the basic underlying economic reality of a people.
- James M. Henslin (2002). Essentials of Sociology. Taylor & Francis US. p. 159.
- Michael Evans, Karl Marx, London, England, 1975. Part II, Chap. 2, sect. a; p. 63.
- Flower, B. O. The Arena, Volume 37. The Arena Pub. Co, originally from Princeton University. p. 9
- Mode of Production. Marxism.org
- Frederick Engels: Socialism: Utopian and Scientific Chapter III Historical Materialism Marx2mao.com. p. 74
- Institute of Economics of the Academy of Sciences of the U.S.S.R. (1957). Political Economy: A Textbook. London: Lawrence and Wishart.