Re: [OPE-L] centralization of capital

From: Jerry Levy (Gerald_A_Levy@MSN.COM)
Date: Thu Feb 16 2006 - 09:13:31 EST

> Mmm.... I don't see the Marx quote as pointing to a spatial
> dimension: I took his formulation more metaphorically. The entry
> under centralization and concentration in Bottomore's Dictionary of
> Marxist Thought [written by Anwar Shaikh, JL] makes an intriguing
> link, arguing that concentration  represents labor process aspect --
> the growth of mass of means of  production facing a worker in the
> labor process; and that centralization represents the valorization
> process aspect -- the  growing portion of social wealth qua capital
> concentrated in the  hands of any given capitalist. The former grows
> by accumulation, the latter by competition and credit.

Hi Paul A,

Well, of course, I could be mistaken but I have some comments/
questions about the distinction suggested above:

o  The concentration and centralization of capital are first introduced
    by Marx in Volume 1 of _Capital_.  If  centralization is to be
    distinguished by its association with competition and credit, why
    was it introduced at a level of abstraction where these subjects
    were not explored?  Indeed, not only does Marx refer to the
    centralization of capital in Volume 1 but he goes out of his way
    to refer to "centralization proper" (more below on this).

o  There is a bit more ambiguity to the distinction suggested than
    appears above since Anu also, in the same paragraph (I'm
    referring to the 1st edition here) suggested that centralization
    of capital was a *form of concentration*  ("... and the process
    of increasing concentration through competition and credit, which
    he calls the *centralization of capital*" [emphasis in original]).

o  The growth of capital in the hands of an individual capitalist
    is not _only_ tied to the process of competition and credit,
    it is _also_ tied to the character of the labor process.

o  Regarding the quotation from Volume 1 (reproduced below)
    on "centralization proper, as distinct from accumulation and

    *  Rather than reading the passage "metaphorically", the word
        "proper" suggests that it should be read *literally*.   Put within
        the context of other times when he uses this word, I think it is
        basically synonymous with saying "strictly speaking".

     * The *spatial* dimension of   centralization is clearly emphasized:
        indeed, in one sentence below he mentions "place" twice.

      * It is also clear that he is referring to *mass*.

 o   What I have been referring to as the centralization of capital
       nowhere shows up in statistics on concentration.  On the
       other hand, what is described above as centralization is
       measured as concentration, especially _market_ concentration.
       Confusing, eh?

 o    Mergers and acquisitions do _not_ increase the concentration
       of capital -- if we follow the distinction above.  This runs counter
       to the normal way in which concentration is understood.

 o    If we emphasize the association between centralization of capital
       and _place_ we can comprehend why it was introduced at the
       level of abstraction of Volume 1.   The centralization of capital,
       the amassing of capital in one place (or more broadly, the
       increasing mass of capital in a diminishing number of places),
       is a consequence of  "modern industry", a subject that was
       explored in Vol. 1, Ch. 15.

 o    On the other hand, if you want to use the above distinction to
       answer your original question then you could use changes
       in the _quantity of mergers and acquisitions_ as an indication
       of changes in the centralization of capital.  These statistics are
       readily available.  But,  the  Shaikh definition of centralization
       of capital does not really accord with the definition you gave
       before (also reproduced below) so  I don't think those statistics
       would give you the information you are looking for. You
       would be better off looking for statistics on _concentration
       within an economy_ (rather than market concentration statistics).

Does anyone else on the list have any thoughts about this distinction
between the centralization of capital and the concentration of capital?

In solidarity, Jerry

>  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.

> "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."

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