Definition of Capitalism

One of the best definitions of what is and isn’t Capitalism from the late Ellen Meiksins Wood in Jacobin Magazine in 2014:

Capitalism’s Gravediggers

“But the social average of productivity that, in any given market, determines success in price competition is beyond the control of individual capitalists. They can’t command the prices at which their products will successfully sell and don’t even know in advance what conditions are necessary to guarantee a sale at all, let alone a profitable one.

The one thing capitalists can control to a significant extent is their costs. So, since their profits depend on a favorable price/cost ratio, they will do everything possible to cut their costs to ensure profit. This means, above all, cutting the costs of labor; and this requires constant improvements in labor productivity, to find the organizational and technical means of extracting as much surplus as possible from workers within a fixed period of time, at the lowest possible cost.”

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