Re: [OPE-L] centralization of capital

From: Jerry Levy (Gerald_A_Levy@MSN.COM)
Date: Wed Feb 15 2006 - 16:23:00 EST

> Perhaps I've got it wrong, but I had understood that
> centralization referred to the trend to a smaller number of
> capitalist controlling a larger proportion of society's total capital
> resources, and concentration referred to the growing mass of capital
> focused on any given sphere of activity.

Hi again Paul A,

What you give as a definition of concentration is what is referred to
in IO literature as _market_ concentration.  There are separate
concentration statistics for the overall (macro) economy.

A quick look at some references in my apt. suggests that Marxists
define the centralization of capital and the concentration of capital
quite differently.  Often, they are conflated.

At one point in _Capital_, [Vol. 1, Ch. 25]  Marx refers to "centralization

"Capital grows in one place to a huge mass in a single hand, because
it has been lost in another place by many.  This is centralization
proper, as distinct from accumulation and concentration."

Centralization thus has a central *spatial* dimension.

The centralization and concentration of capital are often distinguished
in Marxian literature in two other ways:

1) the *form*, or process, by which capital is combined:  thus
centralization is often thought to be a consequence of mergers
and acquisitions and is tied to the processes of  competition and

2) there is an assertion of *temporal* difference:  e.g. Fine and
Saad-Filho wrote:  "Concentration is a slow process diluted by
inheritance, but centralization  through the lever of a highly
developed credit mechanism and stock markets accomplishes
in the twinkling of an eye what would take concentration a
hundred years to achieve." (_Marx's Capital_, 4th ed., p. 86).

I am not satisfied with these definitions.  To begin with -- to state
the obvious -- if these terms are to be commonly used by Marxians,
we should have an agreed upon meaning of them.  Or, is that too
much to ask?    The first of the 2 ways above [ 1) ] does not
incorporate the spatial dimension which is apparent from the
definition of "centralization proper".   The second of the two ways
above, understates in my opinion the way in which concentration can
proceed (at times, i.e. unevenly) very quickly independently of
mergers and acquisitions.  E.g. during a crisis,  many units of capital
can be wiped out quickly.

I would like to have different terms which distinguish a process
which leads to the combination of capital in one geographic area
vs. the combination of capital in a branch of production or
macroeconomy.  The former is a useful distinction when thinking
about the uneven spatial distribution of capital internationally.
I also think that, other things being equal,  it would be
desirable to define concentration of capital in a similar way as
is done in mainstream literature so that we can use without
re-calculation concentration statistics which are (infrequently)
published by governments or research institutes.

In solidarity, Jerry

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