Social ownership is a type of property where an asset is recognized to be in the possession of society as a whole rather than individual members or groups within it.[1] Social ownership of the means of production is the defining characteristic of a socialisteconomy,[2] and can take the form of community ownership,[3]state ownership, common ownership, employee ownership, cooperative ownership, and citizen ownership of equity.[4] Within the context of socialist economics it refers particularly to the appropriation of the surplus product produced by the means of production (or the wealth that comes from it) to society at large or the workers themselves.[5] Traditionally, social ownership implied that capital and factor markets would cease to exist under the assumption that market exchanges within the production process would be made redundant if capital goods were owned and integrated by a single entity or network of entities representing society.[6] However, the articulation of models of market socialism where factor markets are utilized for allocating capital goods between socially owned enterprises broadened the definition to include autonomous entities within a market economy.
The two major forms of social ownership are society-wide public ownership and cooperative ownership. The distinction between these two forms lies in the distribution of the surplus product. With society-wide public ownership, the surplus is distributed to all members of the public through a social dividend whereas with co-operative ownership the economic surplus of an enterprise is controlled by all the worker-members of that specific enterprise.[7]
The goal of social ownership is to eliminate the distinction between the class of private owners who are the recipients of passive property income and workers who are the recipients of labor income (wages, salaries and commissions), so that the surplus product (or economic profits in the case of market socialism) belong either to society as a whole or to the members of a given enterprise. Social ownership would enable productivity gains from labor automation to progressively reduce the average length of the working day instead of creating job insecurity and unemployment. Reduction of necessary work time is central to the Marxist concept of human freedom and overcoming alienation, a concept widely shared by Marxist and non-Marxist socialists alike.[8][9]
Socialization as a process is the restructuring of the economic framework, organizational structure and institutions of an economy on a socialist basis.[10] The comprehensive notion of socialization and the public ownership form of social ownership implies an end to the operation of the laws of capitalism, capital accumulation and the use of money and financial valuation in the production process, along with a restructuring of workplace-level organization.[11][12]
Objectives
Social ownership is variously advocated to end the Marxian concept of exploitation, to ensure that income distribution reflects individual contributions to the social product, to eliminate unemployment arising from technological change, to ensure a more egalitarian distribution of the economy's surplus,[13] or to create the foundations for a non-market socialist economy.
In Karl Marx's analysis of capitalism, social ownership of the means of production emerges in response to the contradictions between socialized production and private appropriation of surplus value in capitalism. Marx argued that productivity gains arising from the substitution of variable capital (labor inputs) for constant capital (capital inputs) would cause labor displacement to outstrip the demand for labor. This process would lead to stagnant wages and rising unemployment for the working class alongside rising property income for the capitalist class, further leading to an over-accumulation of capital.[14] Marx argued that this dynamic would reach a point where social ownership of the highly automated means of production would be necessitated to resolve this contradiction and resulting social strife. Thus the Marxist case for social ownership and socialism is not based on any moral critique of the distribution of property income (wealth) in capitalism, but rather the Marxist case for socialism is based on a systematic analysis of the development and limits of the dynamic of capital accumulation.[15]
For Marx, social ownership would lay the foundations for the transcendence of the capitalist law of value and the accumulation of capital, thereby creating the foundation for socialist planning. The ultimate goal of social ownership of productive property for Marx was to expand the "realm of freedom" by shortening average work hours so that individuals would have progressively larger portion of their time to pursue their genuine and creative interests. Thus the end goal of social ownership is the transcendence of the Marxist concept of alienation.[16]
The economist David McMullen identifies five major benefits of social ownership, where he defines it as society-wide ownership of productive property: first, workers would be more productive and have greater motivation since they would directly benefit from increased productivity, secondly this ownership stake would enable greater accountability on the part of individuals and organizations, thirdly social ownership would eliminate unemployment, fourth it would enable the better flow of information within the economy, and finally it would eliminate wasteful activities associated with "wheeling and dealing" and wasteful government activities intended to curb such behavior and deal with unemployment.[17]
From a non-Marxist, market socialist perspective, the clearest benefit of social ownership is an equalization of the distribution of property income, eliminating the vast disparities in wealth that arise from private ownership under capitalism. Property income (profit, interest and rent) is distinguished from labor income (wages and salaries) which in a socialist system would continue to be unequal based on one's marginal product of labor–social ownership would only equalize passive property income.[18]
Notable non-Marxist and Marxist socialist theorists alike have argued that the most significant argument for social ownership of the means of production is to enable productivity gains to ease the work burden for all individuals in society, resulting in progressively shorter hours of work with increasing automation and thus a greater amount of free time for individuals to engage in creative pursuits and leisure.[19][20][21]
Social ownership is contrasted with the concept of private ownership and is promoted as a solution to what its proponents see as being inherent issues to private ownership.[22]Market socialists and non-market socialists therefore have slightly different conceptions of social ownership. The former believe that private ownership and private appropriation of property income is the fundamental issue with capitalism, and thus believe that the process of capital accumulation and profit-maximizing enterprise can be retained, with their profits being used to benefit society in the form of a social dividend. By contrast, non-market socialists argue that the major problems with capitalism arise from its contradictory economic laws that make it unsustainable and historically limited. Therefore, social ownership is seen as a component of the establishment of non-market coordination and alternative "socialist laws of motion" that overcome the systemic issues of capital accumulation.[23]
The socialist critique of private ownership is heavily influenced by the Marxian analysis of capitalist property forms as part of its broader critique of alienation and exploitation in capitalism. Although there is considerable disagreement among socialists about the validity of certain aspects of Marxian analysis, the majority of socialists are sympathetic to Marx's views on exploitation and alienation.[24] Socialists critique the private appropriation of property income on the grounds that because such income does not correspond to a return on any productive activity and is generated by the working class, it represents exploitation. The property-owning (capitalist) class lives off passive property income produced by the working population by virtue of their claim to ownership in the form of stock, bonds or private equity. This exploitative arrangement is perpetuated due to the structure of capitalist society. From this perspective, capitalism is regarded as class system akin to historical class systems like slavery and feudalism.[25]
Private ownership has also been criticized on ethical grounds by the economist James Yunker. Yunker argues that because passive property income requires no mental or physical exertion on the part of the recipient and because its appropriation by a small group of private owners is the source of the vast inequalities in contemporary capitalism, this establishes the ethical case for social ownership and socialist transformation.[26]
Socialization as a process
Socialization is broadly conceived as a process that transforms the economic processes and, by extension, the social relations within an economy, away from capitalist relations. Depending on the specific definition, it may include central planning, decentralized planning, cooperatives, syndicalism, communization, or other strategies of establishing social ownership.
The Marxist understanding of socialization sees it as a restructuring of social relations to overcome alienation, replacing hierarchical social relations within the workplace with an association of members.[27]
Some who disagree with state socialism consider it distinct from the process of "nationalization" which does not necessarily imply a transformation of the organizational structure of organizations or the transformation of the economic framework under which economic organizations operate. Emma Goldman wrote in 1935 in There Is No Communism in Russia from an anarchist perspective in favor of a definition strictly involving common ownership, critiquing Soviet-type economic planning:[28]
The first requirement of Communism is the socialization of the land and of the machinery of production and distribution. Socialized land and machinery belong to the people, to be settled upon and used by individuals or groups according to their needs. In Russia land and machinery are not socialized but nationalized.
I am convinced there is only one way to eliminate [the] grave evils [of capitalism], namely through the establishment of a socialist economy, accompanied by an educational system which would be oriented toward social goals. In such an economy, the means of production are owned by society itself and are utilized in a planned fashion. A planned economy, which adjusts production to the needs of the community, would distribute the work to be done among all those able to work and would guarantee a livelihood to every man, woman, and child. The education of the individual, in addition to promoting his own innate abilities, would attempt to develop in him a sense of responsibility for his fellow-men in place of the glorification of power and success in our present society.
During the 1920s, socialists in Austria and Germany were engaged in a comprehensive dialogue about the nature of socialization and how a program of socialization could be effectively carried out.[33] Austrian scientific thinkers whose ideas were based on Ernst Mach's empiricist notion of energy and technological optimism, including Josef Popper-Lynkeus and Carl Ballod, proposed plans for rational allocation of exhaustible energy and materials through statistical empirical methods. This conception of non-capitalist calculation involved the use of energy and time units, the latter being viewed as the standard cardinal unity of measurement for socialist calculation. These thinkers belonged to a technical school of thought called "scientific utopianism", which is an approach to social engineering that explores possible forms of social organization.[33]
The most notable thinker belonging to this school of thought was the Viennese philosopher and economist Otto Neurath, whose conception of socialism as a natural, non-monetary economic system became widespread within the socialist movement following the end of World War I. Neurath's position was held in contrast to other socialists in this period, including the revisionist perspective stemming from Eduard Bernstein, the orthodox social democratic perspective of Karl Kautsky, the Austro-Marxism models of labor-time calculation from Otto Bauer and the emerging school of neoclassical market socialism. Neurath's position opposed all models of market socialism because it rejected the use of money, but was also held in contrast with the more orthodox Marxist conception of socialism held by Karl Kautsky, where socialism only entails the elimination of money as capital along with super-session of the process of capital accumulation.[33]
Otto Neurath conceptualized a comprehensive view of socialization during the socialization debates. "Total socialization" involved not only a form of ownership but also the establishment of economic planning based on calculation in kind, and was contrasted with "partial socialization". "Partial socialization" involved the use of in-kind calculation and planning within a single organization, which externally operated within the framework of a monetary market economy. Neurath's conception of socialism was the initial point of criticism of Ludwig von Mises in the socialist calculation debate.[34]
In the subsequent socialist calculation debates, a dichotomy between socialists emerged between those who argued that socialization entailed the end of monetary valuation and capital markets, and those who argued that monetary prices could be used within a socialized economy. A further distinction arose between market socialists who argued that social ownership can be achieved within the context of a market economy, where worker-owned or publicly owned enterprises maximized profit and those who argued that socially owned enterprises operate according to other criteria, like marginal cost pricing.
Typology
In most cases, "socialization" is understood to be a deeper process of transforming the social relations of production within economic organizations as opposed to simply changing titles of ownership. In this sense, "socialization" often involves both a change in ownership and a change in organizational management, including self-management or some form of workplace democracy in place of a strict hierarchical form of control. More fundamentally, social ownership implies that the surplus product (or economic profits) generated by enterprises accrues to society more broadly than executives–state ownership neither necessarily implies nor rejects this.[35][13][36]
There are a few major forms of "social ownership":
Public ownership by an entity or network of entities representing society, which may be national or municipal in scope.[37]
Cooperative ownership, with the members of each individual enterprise being co-owners of their organization.[38]
Common ownership, with open access for everyone in society, and where assets are indivisibly held in common.
Each of these forms have flaws or weaknesses that can be critiqued by anti-socialism advocates. Public ownership is said to give rise to a socialization dilemma faced by advocates of public ownership: if social ownership is entrusted exclusively to state agents, then it is liable to bureaucratization; if it is entrusted exclusively to workers, then it is liable to monopoly power and abuse of market position.[38] Cooperative ownership is said to give rise to a socialization dilemma faced by advocates of cooperatives: if social ownership is entrusted to subgroups within society, resources may not be distributed according to broad social need. Cooperatives which operate within markets may particularly face this issue if they compete. It's been argued that common ownership can fall to the tragedy of the commons, or be difficult to broadly implement prior to upper-stage communism.[citation needed]
Additionally, there are two major forms of management or "social control" for socially owned organizations, both of which can exist alongside the two major modes of social ownership. The first variant of control is public management, where enterprises are run by management held accountable to an agency representing the public either at the level of national, regional or local government. The second form of social control is worker self-management, where managers are elected by the member-workers of each individual enterprise or enterprises are run according to self-directed work processes.[39]
The exact forms of social ownership vary depending on whether or not they are conceptualized as part of a market economy or as part of a non-market planned economy.
Public ownership
Public ownership can exist both within the framework of a market economy and within the framework of a non-market planned economy.
In market socialist proposals, public ownership takes the form of state-owned enterprises that acquire capital goods in capital markets and operate to maximize profits, which are then distributed among the entire population in the form of a social dividend.[40]
In non-market models of socialism, public ownership takes the form of a single entity or a network of public entities coordinated by economic planning. A contemporary approach to socialism involves linking together production and distribution units by modern computers to achieve rapid feedback in the allocation of capital inputs to achieve efficient economic planning.[41]
The economist Alec Nove defines social ownership as a form of autonomous public ownership, drawing a distinction between state-owned and directed enterprises. Nove advocates for the existence of both forms of enterprise in his model of feasible socialism.[42]
Public ownership was advocated by neoclassical socialist economists during the interwar socialist calculation debate, most notable Oskar Lange, Fred M. Taylor, Abba P. Lerner and Maurice Dobb. Neoclassical market socialist economists in the latter half of the 20th century who advocated public ownership highlighted the distinction between "control" and "ownership". John Roemer and Pranab Bardhan argued that public ownership, meaning a relatively egalitarian distribution of enterprise profits, does not require state control as publicly owned enterprises can be controlled by agents who do not represent the state.[13]
David McMullen's concept of decentralized non-market socialism advocates social ownership of the means of production, believing it to be far more efficient than private ownership. In his proposal, property titles would be replaced by "usership" rights and the exchange of capital goods would no longer be possible. Market exchange in capital goods would be replaced by internal transfers of resources, but an internal and decentralized price system would be fundamental to this systems' operation.[43]
However, by itself public ownership is not socialist as it can exist under a wide variety of different political and economic systems. State ownership by itself does not imply social ownership where income rights belong to society as a whole. As such, state ownership is only one possible expression of public ownership, which itself is one variation of the broader concept of social ownership.[35][44]
The social ownership of capital and corporate stock has been proposed in the context of a market socialist system, where social ownership is achieved either by having a public body or employee-owned pension funds that own corporate stock.
The American economist John Roemer developed a model of market socialism that features a form of public ownership where individuals receive a non-transferable coupon entitling them to a share of the profits generated by autonomous non-governmental publicly owned enterprises. In this model, "social ownership" refers to citizen ownership of equity in a market economy.
James Yunker argues that public ownership of the means of production can be achieved in the same way private ownership is achieved in modern capitalism, using the shareholder system that effectively separates management from ownership. Yunker posits that social ownership can be achieved by having a public body, designated the Bureau of Public Ownership (BPO), own the shares of publicly listed firms without affecting market-based allocation of capital inputs. Yunker termed this model Pragmatic market socialism and argued that it would be at least as efficient as modern-day capitalism while providing superior social outcomes as public ownership would enable profits to be distributed among the entire population rather than going largely to a class of inheriting rentiers.[45]
An alternative form of social ownership of equity is ownership of corporate stock through wage earner funds and pension funds. The underlying concept was first expounded upon in 1976 by the management theorist Peter Drucker, who argued that pension funds could reconcile employees' need for financial security with capital's need to be mobile and diversified, referring to this development as "pension fund socialism".
In Sweden during the late 1970s, the Meidner program was advanced by the Swedish Social Democratic Party as a way to socialize enterprises through employee wage earners' funds, which would be used to purchase corporate stock.[46]Rudolf Meidner's original plan was to require Swedish companies over a certain size to issue shares equal to 20 percent of profits, which would be owned by wage-earner funds controlled by employees through their trade unions. This plan was rejected and a watered-down proposal was adopted in 1984, which left corporate decision making just as it was and limited the scope of employee ownership to less than 3.5% of listed company shares in 1990.[47]
In his 2020United States Presidential campaign, Bernie Sanders proposed that 20% of stocks in corporations with over $100 million in annual revenue be owned by the corporation's workers.[48]
Cooperative ownership
Cooperative ownership is the organization of economic units into enterprises owned by their workforce (workers cooperative) or by customers who use the products of the enterprise (this latter concept is called a consumer cooperative). Cooperatives are often organized around some form of self-management, either in the form of elected managers held accountable to the workforce, or in the form of direct management of work processes by the workers themselves. Cooperatives are often proposed by proponents of market socialism, most notably by the economists Branko Horvat, Jaroslav Vanek and Richard Wolff.
Cooperative ownership comes in various forms, ranging from direct workers' ownership, employee stock ownership plans through pension funds, to the weakest version involving profit sharing. Profit-sharing and varying degrees of self-management or "Holacracy" is practiced in many of the high-technology companies of Silicon Valley.[49]
The earliest model of cooperative socialism is mutualism, proposed by the French anarchist philosopher Pierre-Joseph Proudhon. In this system, the state would be abolished and economic enterprises would be owned and operated as producer cooperatives, with worker-members compensated in labor vouchers.[50]
The model of market socialism promoted in the former Socialist Federal Republic of Yugoslavia was based on what was officially called "social ownership", involving an arrangement where workers of each firm each became members and joint-owners and managed their own affairs in a system of workers' self-management.
Contemporary proponents of cooperative ownership cite higher motivation and performance in existing cooperatives. Critics argue that cooperative ownership by itself does not resolve the structural issues of capitalism like economic crises and the business cycle, and that cooperatives have an incentive to limit employment in order to boost the income of existing members.
In the context of non-market proposals, social ownership can include holding the means of producing wealth in common (common ownership), with the concept of "usership" replacing the concept of ownership. Commons-based peer production involves the distribution of a critical mass of inputs and all outputs through information networks as free goods rather than commodities to be sold for profit by capitalist firms.[51]
The economist Pat Devine defines social ownership as "ownership by those who are affected by–who have an interest in–the use of the assets involved", distinguishing it from other forms of ownership. Devine argues that this variant of social ownership will be more efficient than the other types of ownership because "it enables the tacit knowledge of all those affected to be drawn upon in the process of negotiating what should be done to further the social interest in any particular context".[52]
The phrases "social production" and "social peer-to-peer" production have been used to classify the type of workplace relationships and ownership structures found in the open-source software movement and Commons-based peer production processes, which operate, value and allocate value without private property and market exchange.[53]
In Soviet-type economies, the means of production and natural resources were almost entirely owned by the state and collective enterprises. State enterprises were integrated into a national planning system, where factor inputs were allocated to them by the Ministry for Technical Supply (Gossnab).
According to The Great Soviet Encyclopedia, "socialist ownership" is a form of social ownership that forms the basis for the socialist system, involving the collective appropriation of material wealth by working people. Social ownership arises out of the course of capitalist development, creating the objective conditions for further socialist transformation and for the emergence of a planned economy with the aim of raising the living standards for everyone in society.
Misuse of the term
Particularly in the United States, the term socialization has been mistakenly used to refer to any state or government-operated industry or service (the proper term for such being either nationalization or municipalization). It has also been incorrectly used to mean any tax-funded programs, whether privately run or government run, like in socialized medicine.[54]
↑ Brus, Wlodzimierz (25 October 2013). The Economics and Politics of Socialism. Routledge. p.88. ISBN978-0415866477. Ownership means that the object owned is disposed of by the owner in his own interests (broadly conceived). For ownership to be social, therefore, it must satisfy two criteria: the disposition of the object owned must be in the interest of society and the owned object must be disposed of by society.
↑ Busky, Donald F. (2000). Democratic Socialism: A Global Survey. Praeger. p.2. ISBN978-0-275-96886-1. Socialism may be defined as movements for social ownership and control of the economy. It is this idea that is the common element found in the many forms of socialism. Yet having stated this as the common definition of socialism, one must necessarily admit that there are a wide variety of views among socialists of various stripes as to just what constitutes social ownership and control of the means of production, distribution and exchange.
↑ Horvat, Branko (2000). "Social ownership". In Michie, Jonathan (ed.). Reader's Guide to the Social Sciences, Volume 1. London and New York: Routledge. pp.1515–1516. ISBN9781135932268. Retrieved 15 October 2021. Just as private ownership defines capitalism, social ownership defines socialism. The essential characteristic of socialism in theory is that it destroys social hierarchies, and therefore leads to a politically and economically egalitarian society. Two closely related consequences follow. First, every individual is entitled to an equal ownership share that earns an aliquot part of the total social dividend…Second, in order to eliminate social hierarchy in the workplace, enterprises are run by those employed, and not by the representatives of private or state capital. Thus, the well-known historical tendency of the divorce between ownership and management is brought to an end. The society—i.e. every individual equally—owns capital and those who work are entitled to manage their own economic affairs.
↑ O'Hara, Phillip (2003). Encyclopedia of Political Economy, Volume 2. Routledge. p.71. ISBN0-415-24187-1. In order of increasing decentralisation (at least) three forms of socialised ownership can be distinguished: state-owned firms, employee-owned (or socially) owned firms, and citizen ownership of equity.,
↑ Steele, David Ramsay (1999). From Marx to Mises: Post Capitalist Society and the Challenge of Economic Calculation. Open Court. pp.175–77. ISBN978-0-87548-449-5. Especially before the 1930s, many socialists and anti-socialists implicitly accepted some form of the following for the incompatibility of state-owned industry and factor markets. A market transaction is an exchange of property titles between two independent transactors. Thus internal market exchanges cease when all of industry is brought into the ownership of a single entity, whether the state or some other organization...the discussion applies equally to any form of social or community ownership, where the owning entity is conceived as a single organization or administration.
↑ Toward a Socialism for the Future, in the Wake of the Demise of the Socialism of the Past, by Weisskopf, Thomas E. 1992. Review of Radical Political Economics, Vol. 24, No. 3–4, p. 10: "Here again there are two principal variants of such social claims to income, depending on the nature of the community holding the claim: (1) Public surplus appropriation: the surplus of the enterprise is distributed to an agency of the government (at the national, regional, or local level), representing a corresponding community of citizens. (2) Worker surplus appropriation: the surplus of the enterprise is distributed to enterprise workers."
↑ Peffer, Rodney G. (2014). Marxism, Morality, and Social Justice. Princeton University Press. p.73. ISBN978-0-691-60888-4. Marx believed the reduction of necessary labor time to be, evaluatively speaking, an absolute necessity. He claims that real wealth is the developed productive force of all individuals. It is no longer the labor time but the disposable time that is the measure of wealth.
↑ Saros, Daniel E. (2014). Information Technology and Socialist Construction: The end of Capital and the Transition to Socialism. Routledge. p.61. ISBN978-0-415-74292-4. Another characteristic that Marx and Engels emphasized as a central feature of a future socialist society was a shorter workday. According to Tucker, Marx had a 'vision of man in a future condition of freedom-creative leisure' that he described in volume 3 of Capital.
↑ Otto Neurath's concepts of socialization and economic calculation and his socialist critics. Retrieved July 5, 2010: "Archived copy"(PDF). Archived from the original(PDF) on 12 September 2011. Retrieved 5 July 2010.{{cite web}}: CS1 maint: archived copy as title (link)
↑ What is socialization? A program for practical socialism, by Korsch, Karl. 1975. Duke University Press. New German Critique, No. 6, pp. 60-81: "The socialization demanded by socialism signifies a new regulation of production with the goal of replacing the private capitalist economy with a socialist communal economy."
1 2 3 Market Socialism, a case for rejuvenation, by Pranab Bardhan and John Roemer. 1992. Journal of Economic Perspectives, Vol. 6, No. 3, pp. 101–16: "Public ownership in the narrow sense of state control of firms is not necessary to achieve one of socialism's goals, a relatively egalitarian distribution of the economy's surplus. We take public ownership, in a wider sense, to mean that the distribution of the profits of firms is decided by the political democratic process–yet control of firms might well be in the hands of agents that do not represent the state."
↑ Woirol, Gregory R. (1996). The Technological Unemployment and Structural Unemployment Debates. Praeger. p.20. ISBN978-0-313-29892-9. The changing-organic-composition-of-capital argument was based on Marx's claim that technological change constantly increased the ratio of fixed to circulating capital. Since labor demand depended solely on the amount of circulating capital, the demand for labor decreased relative to a rise in total capital. The result was a tendency to increase the level of unemployment.
↑ The Social Dividend Under Market Socialism, by Yunker, James. 1977. Annals of Public and Cooperative Economics, Vol. 48, No. 1, pp. 93–133: "It was not the moral unworthiness of the exploitive surplus value mechanism which Marx proposed as the instrumentality of the collapse of capitalism. It was rather the consequences of that mechanism in providing capitalists with so much ill-gotten income that it would ultimately effectively ‘choke’ the system."
↑ Wood, John Cunningham (1996). Karl Marx's Economics: Critical Assessments, Volume 1. Routledge. pp.247–48. ISBN978-0-415-08714-8. It is certainly true that, according to Marx, social ownership does facilitate central planning... But the substitution of commodity production [central planning] for market exchange is not an 'end' in Marx's analysis. The fundamental 'end' of Marxist socialism is the supersession of alienation, the 'emancipation' of mankind, and the creation of opportunities for the full development of man's productive and human potentialities. Clearly, Marx perceived both social ownership and supersession of commodity production as a means to this end.
↑ McMullen, David (2007). Bright Future: Abundance and Progress in the 21st Century. BookSurge Publishing. p.181. ISBN978-0-646-46832-7. The five categories are: (1) the greater productivity of more motivated workers, (2) the greater accountability of individuals and organizations, (3) the elimination of unemployment, (4) the better flow of information and (5) the elimination of various resource wasting activities associated with wheeling and dealing, and with the activities of government.
↑ The Social Dividend Under Market Socialism, by Yunker, James. 1977. Annals of Public and Cooperative Economics, Vol. 48, No. 1, pp. 93–133: "The ‘first order effect’ of socialization will be an equalization of the property return, and it is to this that we must turn for the clearest and most certain benefit...The clearest, most immediate, and most obvious social improvement from socialism would be the abrogation of the pathologically unequal distribution of property return under capitalism."
↑ Lamont, Corliss (1939). You might like socialism; a way of life for modern man. Modern Age Books, Inc. pp.239–40. ISBN978-1-330-53101-3. Under socialism, with its economic security and progressively shorter hours of work, the leisure class is everyone. This new leisure class is not just a passive recipient and consumer of culture; it actively participates and creates, putting into effect the principle enunciated by the late American painter, Robert Hallowell, that 'Each bears a gift for all
↑ To The Rural Poor, by Lenin, Vladimir Ilich. Collected Works, 6, Marxists, p. 366: "Machines and other improvements must serve to ease the work of all and not to enable a few to grow rich at the expense of millions and tens of millions of people. This new and better society is called socialist society."
↑ Bertrand Russell (1932). "In Praise of Idleness". Zpub. Archived from the original on 22 August 2019. Retrieved 16 November 2015. I do not regard Socialism as a gospel of proletarian revenge, nor even, primarily, as a means of securing economic justice. I regard it primarily as an adjustment to machine production demanded by considerations of common sense, and calculated to increase happiness, not only of proletarians, but of all except a tiny minority of the human race.
↑ Arnold, Scott (1994). The Philosophy and Economics of Market Socialism: A Critical Study. Oxford University Press. p.44. ISBN978-0-19-508827-4. First, social ownership is best understood by way of contrast with the characteristic form of ownership in free enterprise systems, namely, full liberal ownership. Second, and perhaps more important, the social vices attributed to existing free enterprise systems are traced to the ownership rights that defined that type of a system.
↑ Saros, Daniel E. (2014). Information Technology and Socialist Construction: The end of Capital and the Transition to Socialism. Routledge. pp.4–5. ISBN978-0-415-74292-4. ...Marx's only option was to study and investigate the laws of motion of capital, realizing that this work would be essential to the discovery of socialist laws of motion in the future. Whereas Mises asserted the logical impossibility of socialist economic calculation, Marx had the foresight to vaguely recognize that such calculation depended on the development of society's productive forces.
↑ Arnold, Scott (1994). The Philosophy and Economics of Market Socialism: A Critical Study. Oxford University Press. p.50. ISBN978-0-19-508827-4. Though socialists have disagreed with Marx about how to conceptualize the notion of class, about the dynamics of class societies, and indeed about a whole host of other matters, most socialists seem to be broadly sympathetic to his views about what is wrong with the capitalist (free enterprise) economic system and, by implication, capitalist society... Marx's critique attributes basically two systemic evils to capitalism's economic system: alienation and exploitation.
↑ O'Hara, Phillip (2003). Encyclopedia of Political Economy, Volume 2. Routledge. p.1135. ISBN0-415-24187-1. Property income is, by definition, received by virtue of owning property... Since such income is not an equivalent return for any productive activity, it amounts to an entitlement to a portion of the aggregate output of others' productive activity. The workforce produces output, but surrenders part of it to people who have nothing directly to do with production. Arguably, this occurs by virtue of a social system to which those in the workforce have never given their full consent, i.e. that of private property. Alternatively, it occurs by virtue of a structure of power to which the workforce is subject: property income is the fruit of exploitation. The fact that it is essential to capitalism makes the latter a class system akin to such other historical cases as slavery and feudalism.
↑ The Social Dividend Under Market Socialism, by Yunker, James. 1977. Annals of Public and Cooperative Economics, Vol. 48, No. 1, pp. 93–133: "From the human point of view, return paid to non-human factors of production is unearned and equivalent to a free gift of nature. It is the personal appropriation of this free gift of nature by a small minority of society under contemporary capitalism which establishes the ethical unworthiness of capitalism and the desirability of a socialist transformation...The employment of capital instruments and natural resources in economic production requires no personal hardship or exertion from any human being. The economic services provided by these factors of production are not corporeally inherent in human beings. The opposite is true of labor services, which can only be provided through the physical and mental activity of human beings...the really grossly exaggerated personal incomes in society are dominated by property income, and this source of inequality would be abrogated by the equalization of property income distribution."
↑ Economics and Politics of Socialism, Brus, pp 95
↑ Otto Neurath’s Economics in Context, by Nemeth, Elisabeth; Schmitz, Stefan W.; Uebel, Thomas E. 2007.
1 2 Hastings, Mason and Pyper, Adrian, Alistair and Hugh (2000). The Oxford Companion to Christian Thought. Oxford University Press. p.677. ISBN978-0-19-860024-4. Socialists have always recognized that there are many possible forms of social ownership of which co-operative ownership is one. Nationalization in itself has nothing particularly to do with socialism and has existed under non-socialist and anti-socialist regimes. Kautsky in 1891 pointed out that a 'co-operative commonwealth' could not be the result of the 'general nationalization of all industries' unless there was a change in 'the character of the state'.{{cite book}}: CS1 maint: multiple names: authors list (link)
↑ Wolff and Resnick, Richard and Stephen (1987). Economics: Marxian versus Neoclassical. The Johns Hopkins University Press. pp.226–27. ISBN978-0-8018-3480-6. For Marxian theory, socialism and communism represent societies built around a different, noncapitalist form of the fundamental class process. That is a very different thing from a society in which the state appropriates surplus value from the productive laborers it hires and exploits... These characteristics imply that any person who participates in the communist fundamental class is both a performer and appropriator of surplus labor... the decision of a state to operate capitalist industrial enterprises has no necessary relation to socialism...
↑ Arnold, Scott (1994). The Philosophy and Economics of Market Socialism: A Critical Study. Oxford University Press. p.44. ISBN978-0-19-508827-4. One conception holds that the means of production should be owned by society (or possible the working class) as a whole. By itself, this idea has not clear meaning; some institutional stand-in for society has to be found...the most obvious candidate in modern societies for that role has been the state.
↑ Toward a Socialism for the Future, in the Wake of the Demise of the Socialism of the Past, by Weisskopf, Thomas E. 1992. Review of Radical Political Economics, Vol. 24, No. 3–4, p. 9: "There are two principal variants of such control, depending on the nature of the community in whom control rights are vested: (1) Public management: enterprises are run by managers who are appointed by and accountable to an agency of government (at the national, regional, or local level), which agency represents a corresponding politically-constituted community of citizens. (2) Worker self-management: enterprises are run by managers who are appointed by and accountable to those who work in them...with control rights resting ultimately with the community of enterprise workers..."
↑ Arnold, Scott (1994). The Philosophy and Economics of Market Socialism: A Critical Study. Oxford University Press. p.44. ISBN978-0-19-508827-4. Although societies in which the state owns the means of production historically have had centrally planned economies, this form of ownership is in principle compatible with a market economy... These firms would by inputs from each other and sell outputs to each other and to consumers.
↑ Rosser, Mariana V. and J Barkley Jr. (2003). Comparative Economics in a Transforming World Economy. MIT Press. p.69. ISBN978-0-262-18234-8. One approach suggests that modern computers can be linked together to overcome the Hayekian information problems and achieve rapid feedback that will maintain balances and lead to efficient planning, but with goods distributed in markets.
↑ The Economics of Feasible Socialism Revisited, by Nove, Alexander. 1991. pp. 212–13): "Radoslav Selucky opts for what he calls 'social ownership', with 'means of production managed by those who make use of them', separated from the state...1) State enterprises, centrally controlled and administered, hereinafter referred to as centralized state corporations. 2) Publicly owned (or socially owned) enterprises with full autonomy and a management responsible to the workforce, hereinafter socialized enterprises."
↑ McMullen, David (2007). Bright Future: Abundance and Progress in the 21st Century. BookSurge Publishing. ISBN978-0-646-46832-7.
↑ Ellman, Michael (1989). Socialist Planning. Cambridge University Press. p.327. ISBN0-521-35866-3. State ownership of the means of production is not necessarily social ownership and state ownership can hinder efficiency.
↑ O'Hara, Phillip (2003). Encyclopedia of Political Economy, Volume 2. Routledge. pp.71–72. ISBN0-415-24187-1. This leads us to the third form of social ownership, through a more equal initial distribution of corporate equity... In his Unseen Revolution, published in 1976, the well-known management theorist Peter Drucker claimed that pension funds were reconciling employees' need for financial security with capital's need to be mobile and diversified, a form of 'pension fund socialism'. Contemporary campaigns focusing on this dynamic include the explicitly socialist Meidner program...
↑ The Social Ownership of Capital, by Minns, Richard. 1996. New Left Review, Vol. 219, pp. 44–45."
↑ Rosser, Mariana V. and J Barkley Jr. (2003). Comparative Economics in a Transforming World Economy. MIT Press. pp.73–74. ISBN978-0-262-18234-8. Its form ranges from straight workers' ownership in cooperatives, to employee stock ownership plans (ESOPs) in which workers' ownership operates through a trust fund usually based on pension benefits, to paying workers with stock options, to the weakest version involving merely profit sharing. Successful examples of each type in the United States include for cooperatives plywood producers in the Northwest, for ESOPs the Weirton Steel Company of West Virginia (although the prominent example, United Airlnes, declared bankruptcy), and for profit sharing various Silicon Valley high-technology companies... Thus the future of workable socialist forms that fulfill the goals of Karl Marx may be found in models emerging out of existing market capitalist economies in the form of worker-owned cooperatives.
↑ Busky, Donald F. (2000). Democratic Socialism: A Global Survey. Praeger. pp.4–5. ISBN978-0-275-96886-1. Under mutualism, the state would be abolished, and factories would be controlled by workers in the form of producer's cooperatives. Compensation would be retained in the form of labor checks paid to workers by people's banks, corresponding to the number of hours they worked.
↑ Schmitt and Anton, Richard and Anatole (2012). Taking Socialism Seriously. Lexington Books. p.160. ISBN978-0-7391-6635-2. Commons-based peer production bears a close family resemblance to the familiar vision of socialism sketched in the first paragraph of this chapter... In commons-based peer production a critical mass of inputs, and all outputs, are distributed within information networks as free goods rather than as commodities to be sold for profit by capitalist firms.
Socialism is an economic and political philosophy encompassing diverse economic and social systems characterised by social ownership of the means of production, as opposed to private ownership. It describes the economic, political, and social theories and movements associated with the implementation of such systems. Social ownership can take various forms, including public, community, collective, cooperative, or employee. As one of the main ideologies on the political spectrum, socialism is considered the standard left wing ideology in most countries of the world. Types of socialism vary based on the role of markets and planning in resource allocation, and the structure of management in organizations.
Anti-capitalism is a political ideology and movement encompassing a variety of attitudes and ideas that oppose capitalism. In this sense, anti-capitalists are those who wish to replace capitalism with another type of economic system, such as socialism or communism.
Private property is a legal designation for the ownership of property by non-governmental legal entities. Private property is distinguishable from public property, which is owned by a state entity, and from collective or cooperative property, which is owned by one or more non-governmental entities. John Locke described private property as a Natural Law principle arguing that when a person mixes their labor with nature, the labor enters the object conferring individual ownership.
State ownership, also called public ownership or government ownership, is the ownership of an industry, asset, property, or enterprise by the national government of a country or state, or a public body representing a community, as opposed to an individual or private party. Public ownership specifically refers to industries selling goods and services to consumers and differs from public goods and government services financed out of a government's general budget. Public ownership can take place at the national, regional, local, or municipal levels of government; or can refer to non-governmental public ownership vested in autonomous public enterprises. Public ownership is one of the three major forms of property ownership, differentiated from private, collective/cooperative, and common ownership.
An economic system, or economic order, is a system of production, resource allocation and distribution of goods and services within a society. It includes the combination of the various institutions, agencies, entities, decision-making processes, and patterns of consumption that comprise the economic structure of a given community.
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 of profit, rent, interest, royalties or capital gains. The aim of capital accumulation is to create new fixed and working capitals, broaden and modernize the existing ones, grow the material basis of social-cultural activities, as well as constituting the necessary resource for reserve and insurance. The process of capital accumulation forms the basis of capitalism, and is one of the defining characteristics of a capitalist economic system.
Property income refers to profit or income received by virtue of owning property. The three forms of property income are rent, received from the ownership of natural resources; interest, received by virtue of owning financial assets; and profit, received from the ownership of capital equipment. As such, property income is a subset of unearned income and is often classified as passive income.
The social dividend is the return on the natural resources and capital assets owned by society in a socialist economy. The concept notably appears as a key characteristic of market socialism, where it takes the form of a dividend payment to each citizen derived from the property income generated by publicly owned enterprises, representing the individual's share of the capital and natural resources owned by society.
Production for use is a phrase referring to the principle of economic organization and production taken as a defining criterion for a socialist economy. It is held in contrast to production for profit. This criterion is used to distinguish communism from capitalism, and is one of the fundamental defining characteristics of communism.
State socialism is a political and economic ideology within the socialist movement that advocates state ownership of the means of production. This is intended either as a temporary measure, or as a characteristic of socialism in the transition from the capitalist to the socialist mode of production or to a communist society. State socialism was first theorised by Ferdinand Lassalle. It advocates a planned economy controlled by the state in which all industries and natural resources are state-owned.
Economic democracy is a socioeconomic philosophy that proposes to shift ownership and decision-making power from corporate shareholders and corporate managers to a larger group of public stakeholders that includes workers, consumers, suppliers, communities and the broader public. No single definition or approach encompasses economic democracy, but most proponents claim that modern property relations externalize costs, subordinate the general well-being to private profit and deny the polity a democratic voice in economic policy decisions. In addition to these moral concerns, economic democracy makes practical claims, such as that it can compensate for capitalism's inherent effective demand gap.
In Karl Marx's critique of political economy and subsequent Marxian analyses, the capitalist mode of production refers to the systems of organizing production and distribution within capitalist societies. Private money-making in various forms preceded the development of the capitalist mode of production as such. The capitalist mode of production proper, based on wage-labour and private ownership of the means of production and on industrial technology, began to grow rapidly in Western Europe from the Industrial Revolution, later extending to most of the world.
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 labour power. The concept originated in Ricardian socialism, with the term "surplus value" itself being coined by William Thompson in 1824; however, it was not consistently distinguished from the related concepts of surplus labor and surplus product. The concept was subsequently developed and popularized by Karl Marx. Marx's formulation is the standard sense and the primary basis for further developments, though how much of Marx's concept is original and distinct from the Ricardian concept is disputed. Marx's term is the German word "Mehrwert", which simply means value added, and is cognate to English "more worth".
Workers' self-management, also referred to as labor management and organizational self-management, is a form of organizational management based on self-directed work processes on the part of an organization's workforce. Self-management is a defining characteristic of socialism, with proposals for self-management having appeared many times throughout the history of the socialist movement, advocated variously by democratic, libertarian and market socialists as well as anarchists and communists.
The socialist mode of production, also known as socialism or communism, is a specific historical phase of economic development and its corresponding set of social relations that emerge from capitalism in the schema of historical materialism within Marxist theory. The Marxist definition of socialism is that of production for use-value, therefore the law of value no longer directs economic activity. Marxist production for use is coordinated through conscious economic planning. 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, either through cooperative enterprises or by public ownership or private artisanal tools and self-management. Surplus value goes to the working class and hence society as a whole.
Market socialism is a type of economic system involving social ownership of the means of production within the framework of a market economy. Various models for such a system exist, usually involving cooperative enterprises and sometimes a mix that includes public or private enterprises. In contrast to the majority of historic socialist economies, which have substituted the market mechanism for some form of economic planning, market socialists wish to retain the use of supply and demand signals to guide the allocation of capital goods and the means of production. Under such a system, depending on whether socially owned firms are state-owned or operated as worker cooperatives, profits may variously be used to directly remunerate employees, accrue to society at large as the source of public finance, or be distributed amongst the population in a social dividend.
Socialist economics comprises the economic theories, practices and norms of hypothetical and existing socialist economic systems. A socialist economic system is characterized by social ownership and operation of the means of production that may take the form of autonomous cooperatives or direct public ownership wherein production is carried out directly for use rather than for profit. Socialist systems that utilize markets for allocating capital goods and factors of production among economic units are designated market socialism. When planning is utilized, the economic system is designated as a socialist planned economy. Non-market forms of socialism usually include a system of accounting based on calculation-in-kind to value resources and goods.
The socialist calculation debate, sometimes known as the economic calculation debate, was a discourse on the subject of how a socialist economy would perform economic calculation given the absence of the law of value, money, financial prices for capital goods and private ownership of the means of production. More specifically, the debate was centered on the application of economic planning for the allocation of the means of production as a substitute for capital markets and whether or not such an arrangement would be superior to capitalism in terms of efficiency and productivity.
In the theoretical works of Karl Marx and Friedrich Engels and subsequent Marxist writers, socialization is the process of transforming the act of producing and distributing goods and services from a solitary to a social relationship and collective endeavor. With the development of capitalism, production becomes centralized in firms and increasingly mechanized in contrast to the pre-capitalist modes of production where the act of production was a largely solitary act performed by individuals. Socialization occurs due to centralization of capital in industries where there are increasing returns to scale and a deepening of the division of labor and the specialization in skills necessary for increasingly complex forms of production and value creation. Progressive socialization of the forces of production under capitalism eventually comes into conflict with the persistence of relations of production based on private property; this contradiction between socialized production and private appropriation of the social product forms the impetus for the socialization of property relations (socialism).
The following outline is provided as an overview of and topical guide to socialism:
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