​Marxism is a social science theory founded by Karl Marx that consists of three major components: scientific socialism, Marxist economics, and Marxist philosophy.

​

(see Figure A)

​

1. Scientific Socialism (wissenschaftlich sozialismus)

 

1.1 Summary

 

Scientific socialism is the use of the scientific method to develop socialism, determining its characteristics and deducing development patterns of different forms of society. The term was coined by French socialist Pierre-Joseph Proudhon in 1840, then borrowed by Engels to describe Marx’s social theories in 1880. It is the opposite of utopian socialism.

​

⇒ The scientific method refers to the process of arriving at a conclusion through observation, hypothesis, experiment, and data analysis.

⇒ Utopian socialism refers to the idealistic or perfectionist approach of proposing rather radical methods of organizing society and convincing others of the rationality of these methods.

​

1.2 Characteristics

 

Scientific socialism is not a pure natural science or social science theory. The German term “wissenschaft", which literally translates to "science" in English, is a concept broader than “science”, incorporating concepts such as research, theory, and understanding.

 

Scientific socialism is based on empirical observations of historical trends, meaning that observations can change or falsify a theory. It is developed as a response to the flaws of capitalism. Inspired by the evolution theory of Charles Darwin, Marx and Engels saw socialism as a product of socio-economic evolution.

​

1.3 Content

 

Stages of economic development determine the type of social organization: capitalist or socialist systems are not based on popular will, but constructed as a result of socio-economic evolution.

​

• Observed Trend: Primitive society → slavery society → feudal society → capitalist society

• Predicted Trend: Capitalist society → socialist society → communist society

​

1.4 Response

 

Karl Popper argues that scientific socialism is a pseudoscience (“historicism”) - the approach of deriving universal laws from historical trends is unscientific as the claims cannot be tested or disproven.

 

Some commentators, such as Yuval Noah Harari, believe that the collapse of the USSR at the end of the Cold War exemplifies that capitalism defeated communism. Hence, scientific socialism is disproved, because capitalism did not morph into communism.

 

Other commentators argue that the collapse of the USSR only signifies that suitable conditions for socialism are not fully developed, and will be developed completely one day. Also, many capitalist countries have begun to adopt socialist policies, such as introducing public welfare to mitigate problems faced by the proletariats. Instead of maintaining laissez-faire policies, government interventions have also been introduced to the market. Hence, capitalism will eventually develop into socialism.

​

2. Marxist Economics

​

2.2 Summary

​

Marxist economics is a heterodox school of economic thought, analyzing the crises observed in a capitalist society, the role of surplus value, as well as the nature and origin of economic value.

​

⇒ Heterodox economics refers to economic theories that deviate from the orthodox school of economic thought (such as profit maximization, private property ownership, and the theory that free market results in the most efficient allocation of resources, as proposed by Adam Smith). Marx believed that capitalism would only benefit a select few, not society as a whole, and that it would expand the wealth gap through the exploitation of laborers.

​

2.2 Summary

 

Marxist economics exposes the origin of class struggle between the proletariats and bourgeoisie. It demonstrates the inevitable demise of capitalism and victory of socialism: capitalism is a progressive historical stage that will eventually stagnate due to internal contradictions, such as the great wealth gap and exploitation of the workforce, and ultimately morph into socialism by revolution, with a discontented working class forming its backbone.

​

2.3 Content

​

Major theories include:

​

Labor Theory of Value: The value of a commodity is determined by the amount of labor put into producing it. Demand and supply only account for fluctuations in the price of a commodity.

​

Theory of Surplus Value: According to Marx, working hours of laborers are split into the portion for which they are paid and the portion capitalists get for free. Workers’ wages are only enough to sustain their lives, while surplus value is taken by capitalists as profit, which is used to expand the scale of production or for their personal consumption. The exploitation of workers and the expansion of capital by capitalists result in an increasing wealth gap.

​

⇒ Surplus value = total value of the labor effort - value paid to the workers

⇒ The phrase “only enough to sustain their lives” essentially means that workers cannot afford to buy the total sum of what they produce, rather than not being able to purchase luxuries such as their own cars and television.

​

Theory of Alienation: Social alienation describes the estrangement of men from their humanity. Under the capitalist production mode, workers are treated as instruments with an emphasis on efficiency, rather than human beings with emotional needs.

​

• Workers’ alienation from their Gattungswesen (human nature): Gattungswesen describes that humans possess a plurality of interests and wish to follow their own will instead of being subjected to external demands. However, workers are employed and must follow the commands of their employers. Also, under the distribution of labor, the production process is divided into a series of monotonous and simple motions. This offers workers little psychological satisfaction for the completion of the task. Labor becomes undesired.

• Coerced labor: Although jobs in a capitalist society violate human nature, workers still have to work for a living.

• Workers’ alienation from the product design and production method: Workers cannot freely create according to their own will because means of production and product design are determined by capitalists.

• Workers’ alienation from other workers: When workers compete for higher wages, conflicts are provoked and mutual economic interests are alienated.

​

Internal Contradictions of Capitalism: There are conflicts between the interests of individuals and that of society.

​

• Profit maximization leads to the mechanization of the production process to reduce production costs. Labor demand decreases, leading to a reduction in wages and an increase in unemployment. The market for goods reduces because workers, who are potential consumers, lose their power to consume.

• Profit maximization leads to an endless stream of commodities pumping into the market. Ultimately, the market will be saturated, causing overproduction and crises.

​

Inevitability of Periodic Crises Under Capitalism: Periodic crises are unavoidable under capitalism due to contradictions inherent in the system. This inspires economists to develop the concept of the business cycle (expansion → peak → recession → trough → repeat).

​

2.4 Response

​

Japanese Marxist economist Nobuo Chishio pointed out that technological innovation can increase profit holding real wages constant. Therefore, increasing profits does not necessarily necessitate the exploitation of workers.

 

⇒ Profit = price - cost; cost = wages + cost of raw material (can be reduced by reducing the technical cost of producing raw materials) + technical cost (reduced by technological innovation)

 

Democratic socialists believe that socialism is not necessarily achieved through class struggle and proletarian revolution. They argue that it can also be fulfilled through the implementation of socialist policies, such as the provision of welfare and the establishment of trade unions.

 

Some Austrian economists, such as Carl Menger, believe that the value of a product relies on subjective judgment (the amount the consumer is willing to pay for it). Price is also a signal to solve the problem of product shortage or surplus with price fluctuations. Therefore, price fluctuations are not determined solely by labor value.

​

3. Marxist Philosophy

​

3.1 Summary

 

Marxist philosophy consists of two parts: dialectical materialism and historical materialism. Dialectical materialism is a philosophical thought derived from Hegel’s dialectical idealism and Feuerbach's metaphysical materialism.

​

⇒ Dialectic is a discourse or debate between two or more people holding different views about a subject and wishing to reach truth through reason and arguments. This is partly contrary to eristic, which aims at successfully disputing another’s argument instead of searching for truth; or to didactics, in which one side of the conversation teaches the other. Suggested by Hegel, dialectic comprises three stages of development: thesis, antithesis, and synthesis.

⇒ Idealism is a view that “reality” originates from human perception and understanding; this is the opposite of materialism.

⇒ Materialism is a view that matter is the fundamental substance in nature, and all things are results of material interactions (including one’s consciousness). It is the opposite of idealism.

​

(see Figure B)

​

3.2 Content

​

Dialectical Materialism: Everything that exists is material and derived from matter. The matter is in a process and constantly changes. All matter is interconnected and interdependent.

 

Historical Materialism: The view that history is not a series of unconnected and unforeseen incidents, but a part of an interrelated process. The task of historical materialists is to determine the factor pushing forward the development of human society. (Marx believed that this factor was class struggle. As proposed in one of his most famous quotes, “the history of all hitherto existing society is the history of class struggles".) and the general patterns of human development (Marx proposed that the mass pushed forward human developments and economic conditions determined social constructions). Ultimately, Marx proposed the establishment of a communist society.

​