Matt asked in Social ScienceEconomics · 8 years ago

Ricardo and Marx labor theories?

How does marx's theory differ from Ricardo's?

1 Answer

  • Fraser
    Lv 4
    8 years ago
    Favorite Answer

    Ricardo says basically the theory that all profits obtained by a capitalist is an increment taken from workers wages, whereas Marx takes the step to say profits come from the under-payment and exploitation of his workers. For example, jim saves and buys his factory, and his 50 workers all earn 40k per year, while jim pockets 1m profit. According to the 'Laws of Motion of the Capitalist Mode of Production' Marx says that Jim is stealing 20k from each worker, and the next logical step is for workers to rebel and overthrow capitalists so they get that increment. A capitalist would say that the 1m is due Jim's forgone consumption and the ability to invest and start his business came from that, whereas Ricardo would say that his income is taken from the workers, and Marx agrees and concludes that therefor workers should get rid of capitalists

Still have questions? Get your answers by asking now.