The socialist mode of production, also known as socialism or communism, is a specific historical phase of

economic development In economics, economic development (or economic and social development) is the process by which the economic well-being and quality of life of a nation, region, local community, or an individual are improved according to targeted goals and object ...

and its corresponding set of

social relations A social relation is the fundamental unit of analysis within the social sciences, and describes any voluntary or involuntary interpersonal relationship between two or more conspecifics within and/or between groups. The group can be a language or k ...

that emerge from

capitalism Capitalism is an economic system based on the private ownership of the means of production and their use for the purpose of obtaining profit. This socioeconomic system has developed historically through several stages and is defined by ...

in the schema of

historical materialism Historical materialism is Karl Marx's theory of history. Marx located historical change in the rise of Class society, class societies and the way humans labor together to make their livelihoods. Karl Marx stated that Productive forces, techno ...

within Marxist theory. The

Marxist Marxism is a political philosophy and method of socioeconomic analysis. It uses a dialectical and materialist interpretation of historical development, better known as historical materialism, to analyse class relations, social conflic ...

definition of socialism is that of production for

use-value Use value () or value in use is a concept in classical political economy and Marxist economics. It refers to the tangible features of a Commodity (Marxism), commodity (a tradeable object) which can satisfy some human requirement, want or need, o ...

(i.e., direct satisfaction of human needs, or economic demands), therefore the law of value no longer directs economic activity. Marxist production for use is coordinated through conscious

economic planning Economic planning is a resource allocation mechanism based on a computational procedure for solving a constrained maximization problem with an iterative process for obtaining its solution. Planning is a mechanism for the allocation of resources ...

. According to Marx, distribution of products is based on the principle of " to each according to his needs"; Soviet models often distributed products based on the principle of " to each according to his contribution". The social relations of socialism are characterized by the proletariat effectively controlling the

means of production In political philosophy, the means of production refers to the generally necessary assets and resources that enable a society to engage in production. While the exact resources encompassed in the term may vary, it is widely agreed to include the ...

, either through

cooperative A cooperative (also known as co-operative, coöperative, co-op, or coop) is "an autonomy, autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned a ...

enterprises or by public ownership or private artisanal tools and self-management.

Surplus value In Marxian economics, surplus value is the difference between the amount raised through a sale of a product and the amount it cost to manufacture it: i.e. the amount raised through sale of the product minus the cost of the materials, plant and ...

goes to the working class and hence

society A society () is a group of individuals involved in persistent social interaction or a large social group sharing the same spatial or social territory, typically subject to the same political authority and dominant cultural expectations. ...

as a whole. The Marxian conception of

socialism Socialism is an economic ideology, economic and political philosophy encompassing diverse Economic system, economic and social systems characterised by social ownership of the means of production, as opposed to private ownership. It describes ...

stands in contrast to other early conceptions of socialism, most notably early forms of market socialism based on

classical economics Classical economics, also known as the classical school of economics, or classical political economy, is a school of thought in political economy that flourished, primarily in Britain, in the late 18th and early-to-mid 19th century. It includ ...

such as mutualism and Ricardian socialism. Unlike the Marxian conception, these conceptions of socialism retained commodity exchange ( markets) for labour and the means of production seeking to perfect the market process. The Marxist idea of socialism was also heavily opposed to

utopian socialism Utopian socialism is the term often used to describe the first current of modern socialism and socialist thought as exemplified by the work of Henri de Saint-Simon, Charles Fourier, Étienne Cabet, and Robert Owen. Utopian socialism is often de ...

. Although Marx and Engels wrote very little on socialism and neglected to provide any details on how it might be organized, numerous social scientists and

neoclassical economists Neoclassical economics is an approach to economics in which the production, consumption, and valuation (pricing) of goods and services are observed as driven by the supply and demand model. According to this line of thought, the value of a goo ...

have used Marx's theory as a basis for developing their own models of socialist economic systems. The Marxist view of socialism served as a point of reference during the socialist calculation debate. Marx himself did not use the term ''socialism'' to refer to this development. Instead, Marx called it a communist society that has not yet reached its higher-stage.Marx, Karl (1875)
"Part I"
'' Critique of the Gotha Program''. Marxists Internet Archive. Retrieved 8 March 2019. The term ''socialism'' was popularized during the

Russian Revolution The Russian Revolution was a period of Political revolution (Trotskyism), political and social revolution, social change in Russian Empire, Russia, starting in 1917. This period saw Russia Dissolution of the Russian Empire, abolish its mona ...

Vladimir Lenin Vladimir Ilyich Ulyanov ( 187021 January 1924), better known as Vladimir Lenin, was a Russian revolutionary, politician and political theorist. He was the first head of government of Soviet Russia from 1917 until Death and state funeral of ...

. This view is consistent with and helped to inform early concepts of socialism in which the law of value no longer directs economic activity. Monetary relations in the form of exchange-value,

profit Profit may refer to: Business and law * Profit (accounting), the difference between the purchase price and the costs of bringing to market * Profit (economics), normal profit and economic profit * Profit (real property), a nonpossessory inter ...

interest In finance and economics, interest is payment from a debtor or deposit-taking financial institution to a lender or depositor of an amount above repayment of the principal sum (that is, the amount borrowed), at a particular rate. It is distinct f ...

and

wage labour Wage labour (also wage labor in American English), usually referred to as paid work, paid employment, or paid labour, refers to the socioeconomic relationship between a worker and an employer in which the worker sells their labour power under ...

would not operate and apply to Marxist socialism.

Mode of production

Karl Marx Karl Marx (; 5 May 1818 – 14 March 1883) was a German philosopher, political theorist, economist, journalist, and revolutionary socialist. He is best-known for the 1848 pamphlet '' The Communist Manifesto'' (written with Friedrich Engels) ...

described a socialist society as such:

Socialism Socialism is an economic ideology, economic and political philosophy encompassing diverse Economic system, economic and social systems characterised by social ownership of the means of production, as opposed to private ownership. It describes ...

is a post-

commodity In economics, a commodity is an economic goods, good, usually a resource, that specifically has full or substantial fungibility: that is, the Market (economics), market treats instances of the good as equivalent or nearly so with no regard to w ...

economic system and production is carried out to directly produce

rather than toward generating

. The accumulation of capital is rendered insufficient in socialism as production is carried out independently of

capital accumulation Capital accumulation is the dynamic that motivates the pursuit of profit, involving the investment of money or any financial asset with the goal of increasing the initial monetary value of said asset as a financial return whether in the form ...

in a planned fashion. There have been other concepts of economic planning, including decentralised and participatory planning. One of Marx's main manuscripts is a posthumous work called '' Grundrisse'', published in 1953. In this work, Marx's thinking is explored regarding production, consumption, distribution, social impact of

Communism Communism () is a political sociology, sociopolitical, political philosophy, philosophical, and economic ideology, economic ideology within the history of socialism, socialist movement, whose goal is the creation of a communist society, a ...

is considered as a living model for humans after capitalism. The emphasis is upon fair distribution of goods, equality and the optimum environment for humans to live in to develop themselves to their best capabilities (art, politics and philosophy, among others) to achieve happiness and to satisfy intrinsic needs. Marx's goal was to design a social system that eliminates the differences in classes between the proletariat and the

bourgeoisie The bourgeoisie ( , ) are a class of business owners, merchants and wealthy people, in general, which emerged in the Late Middle Ages, originally as a "middle class" between the peasantry and aristocracy. They are traditionally contrasted wi ...

. In doing so, the tension and the power differences which force workers to labor in bad conditions for poor wages, disappear. According to Marx, capitalism is a system guaranteed to collapse because big companies would buy small companies, leading to

monopoly A monopoly (from Greek language, Greek and ) is a market in which one person or company is the only supplier of a particular good or service. A monopoly is characterized by a lack of economic Competition (economics), competition to produce ...

. In such a scenario, a very small number of people control most of the

money Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money are: m ...

and power. Poverty for the masses would prevail. Significant capital to buy products from the capitalist production system would be unavailable. Marx postulated that if workers are paid enough so that they still are able to buy products in a capitalist market, they will become essential contributors in assuring the domination of capitalism worldwide. Market forces to compel capitalists to produce use-values in pursuit of exchange-value. Socialist production involves rational planning of use-values and coordination of investment decisions to attain economic goals. In this approach, cyclical fluctuations that occur in a capitalist

market economy A market economy is an economic system in which the decisions regarding investment, production, and distribution to the consumers are guided by the price signals created by the forces of supply and demand. The major characteristic of a mark ...

do not exist in a socialist economy. The value of a good in socialism is its physical utility rather than its embodied labour, cost of production and exchange value as in a capitalist system. Socialism makes use of incentive-based systems, so inequality would still exist, but diminishingly so since workers are worker-owners. In this way, inequality is also diminished and capital and power is more widely distributed. The method of compensation and reward in a socialist society would be based on an authentic meritocracy along the principle of " From each according to his ability, to each according to his contribution". The advanced stage of socialism, referred to as the upper-stage communism in the '' Critique of the Gotha Programme'', is based on the socialist mode of production. It is different from lower-stage socialism in fundamental ways. While

implies public ownership (by a proletarian semi-state apparatus) or

cooperative ownership A cooperative (also known as co-operative, coöperative, co-op, or coop) is "an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democr ...

(by a

worker cooperative A worker cooperative is a cooperative owned and Workers' self-management, self-managed by its workers. This control may mean a Company, firm where every worker-owner participates in decision-making in a democratic fashion, or it may refer to one ...

enterprise), communism would be based on

common ownership Common ownership refers to holding the assets of an organization, enterprise, or community indivisibly rather than in the names of the individual members or groups of members as common property. Forms of common ownership exist in every economi ...

of the

. Class distinctions based on

ownership Ownership is the state or fact of legal possession and control over property, which may be any asset, tangible or intangible. Ownership can involve multiple rights, collectively referred to as '' title'', which may be separated and held by dif ...

of capital cease to exist, along with the need for a state. A superabundance of

goods In economics, goods are anything that is good, usually in the sense that it provides welfare or utility to someone. Alan V. Deardorff, 2006. ''Terms Of Trade: Glossary of International Economics'', World Scientific. Online version: Deardorffs ...

and services are made possible by automated production that allow for goods to be distributed based on need rather than merit.

Social relations

The fundamental goal of socialism from the view of

and

Friedrich Engels Friedrich Engels ( ;"Engels"
''Random House Webster's Unabridged Dictionary''.human freedom and individual autonomy. Specifically, this refers to

freedom Freedom is the power or right to speak, act, and change as one wants without hindrance or restraint. Freedom is often associated with liberty and autonomy in the sense of "giving oneself one's own laws". In one definition, something is "free" i ...

from the alienation imposed upon individuals in the form of coercive

as well as material scarcity, whereby the individual is compelled to engage in activities merely to survive to reproduce his or herself. The aim of socialism is to provide an environment whereby individuals are free to express their genuine interests, creative freedom and desires unhindered by forms of social control that force individuals to work for a class of owners who expropriate and live off the surplus product. As a set of social relations, socialism is defined by the degree to which economic activity in society is planned by the associated producers so that the surplus product produced by socialised assets is controlled by a majority of the population through marxist-democratic processes. The sale of labour power would be abolished so that every individual participates in running their institution as stakeholders or members with no one having coercive power over anyone else in a vertical social

division of labour The division of labour is the separation of the tasks in any economic system or organisation so that participants may specialise ( specialisation). Individuals, organisations, and nations are endowed with or acquire specialised capabilities, a ...

which is to be distinguished from a non-social, technical division of labour which would still exist in socialism. The incentive structure changes in a socialist society given the change in the social environment so that an individual labourers' work becomes increasingly autonomous and creative, creating a sense of responsibility for his or her institution as a stakeholder.

Role of the state

In Marxist theory, the state is "the institution of organised violence which is used by the

ruling class In sociology, the ruling class of a society is the social class who set and decide the political and economic agenda of society. In Marxist philosophy, the ruling class are the class who own the means of production in a given society and apply ...

of a country to maintain the conditions of its rule. Thus, it is only in a society which is divided between hostile social classes that the state exists". The state is seen as a mechanism dominated by the interests of the ruling class. It subjugates other classes, to protect and legitimize the existing

economic system An economic system, or economic order, is a system of production, resource allocation and distribution of goods and services within an economy. It includes the combination of the various institutions, agencies, entities, decision-making proces ...

. After a

proletarian revolution A proletarian revolution or proletariat revolution is a social revolution in which the working class attempts to overthrow the bourgeoisie and change the previous political system. Proletarian revolutions are generally advocated by socialist ...

, the state would initially become the instrument of the proletariat. Conquest of the state by the proletariat is a prerequisite to establishing a socialist system. As socialism is built, the role and scope of the state changes. Class distinctions, based on ownership of the means of production, gradually deteriorate. The concentration of means of production increasingly falls into state hands. Once all means of production become state property, the primary function of the state changes. Political rule via coercion over men diminishes through the creation and enforcement of laws, scientific administration and the direction of the processes of production. As a result, the state becomes an entity of economic coordination rather than a mechanism of class or political control and is no longer a state in the Marxian sense.Engels, Friedrich (1880)
"The Development of Utopian Socialism"
'' Socialism: Utopian and Scientific''. Marxists Internet Archive. "In 1816, he declares that politics is the science of production, and foretells the complete absorption of politics by economics. The knowledge that economic conditions are the basis of political institutions appears here only in embryo. Yet what is here already very plainly expressed is the idea of the future conversion of political rule over men into an administration of things and a direction of processes of production."

Notes

References

{{socialism Economic ideologies Economic systems Marxian economics Dialectical materialism Political ideologies Political movements

Mode of production

Social relations

Role of the state

See also

Notes

References