Ricardian Socialism

References

• Ricardian Socialism Wikipedia Article

Definitions

• Exchange Value
• • In political economy and especially Marxian economics, exchange value refers to one of four major attributes of a commodity (an item or service produced for and sold on the mark). A commodity has the following:
  • • a value, represented by the socially necessary labor time to produce it
    • a use value (or utility)
    • an exchange value, which is the proportion at which a commodity can be exchanged for other entities
    • a price (an actual selling price, or an imputed ideal price)
• Rent
• • Renting, also known as hiring or letting, is an agreement where a payment is made for the use of a good, service, or property owned by another over a fixed period of time. To main such an agreement, a rental agreement (or lease) is signed to establish the roles and expectations of both the tenant and landlord.
• Free Market
• • In economics, a free market is an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers.
• Cooperatives
• • A cooperative is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly owned and democratically-controlled enterprise. Cooperatives are democratically controlled by their members, with each member having one vote in electing the board of directors.
• Utilitarianism
• • Utilitarianism is a family of normative ethical theories that prescribe actions that maximize happiness and well-being for the affected individuals. In other words, utilitarian ideas encourage actions that ensure the greatest good for the greatest number. The basic idea is to maximize utility, which is defined in terms of well-being or related concepts. Jeremy Bentham, the founder of utilitarianism, describes utility thus:

That property in any object, whereby it tends to produce benefit, advantage, pleasure, good, or happiness ... [or] to prevent the happening of mischief, pain, evil, or unhappiness to the party whose interest is considered.

• Market Distortion
• • In neoclassical economics, a market distortion is any event in which a market reaches a market clearing price for an item that is substantially different from the price that a market would achieve while operating under conditions of perfect competition and state enforcement of egal contracts and the ownership of private property. A distortion is any departure from the ideal of perfect competition that therefore interferes with economic agents maximizing social welfare when they maximize their own.

Notes

Ricardian socialism is a branch of classical economics based on the work of the economist David Ricardo (1772-1823). The term is used to describe economists in the 1820s and 1830s who developed a theory of capitalist exploitation from the theory developed by Ricardo that stated that labor is the source of all wealth and exchange value. This principle extends back to the principles of English philosopher John Locke. The Ricardian socialists reasoned that labor is entities to all it produces, and that rent, profit, and interest are not natural outgrowths of the free market process but were instead distortions. They argues that private ownership of the means of production should be supplanted by cooperatives owned by associations of workers.

• Ricardian Socialist is used in reference to economists in the early 19th century that elaborated a theory of capitalist exploitation from the classical economic proposition derived from Adam Smith and David Ricardo stating that labor is the source of wealth.
• There is debate about the extent to which Ricardian Socialism had an effect on Marx's views.

Economics

• Ricardian socialism is considered to be a form of socialism based on the arguments made by Ricardo that the equilibrium value of commodities approximated producer prices when those commodities were in elastic supply, that these producer prices correspond to the embodied labor and that profit, interest and rent were deductions from this exchange-value.
• Karl Marx notes the effect of Ricardo on early British and Irish socialists:

Anyone who is in any way familiar with the trend of political economy in England cannot fail to know that almost all the Socialists in that country have, at different periods, proposed the equalitarian application of the Ricardian theory. [...] We shall content ourselves with listening to an English Communist, Mr. Bray. We shall give the decisive passages in his remarkable work, Labor's Wrongs and Labor's Remedy, Leeds, 1839...

• In recent years, a number of scholars have challenged the validity of the category Ricardian Socialist based on the lack of evidence that its proposed members had either read Ricardo's Principles of Political Economy or the contradictory internal evidence of their own value theory which appears to owe more to Adam Smith than Ricardo. As a result, some scholars prefer the term Smithian Socialism.

Ricardian Socialists

• Thomas Hodgskin
• • English socialist writer on political economy, critic of capitalism and defender of free trade and early trade unions. His views differ from some of the views later assigned to the word socialism. In the late 19th and early 20th centuries, the term socialist included any opponent of capitalism.
• Charles Hall
• • (1740-1825) British physician, social critic, and Ricardian socialist who published The Effects of Civilization on the People in European States in 1805, condemning capitalism for its inability to provide for the poor. As a remedy for the problems in society, Hall proposed land reform and progressive taxation.
• John Francis Bray
• • (1809-1897) was a radical, chartist, writer on socialist economics, and activist in both Britain and his native America in the 19th century. He was hailed in his later life as the Benjamin Franklin of American labor.
  • • Chartism was a working-class movement for political reform in the United Kingdom that erupted from 1838 to 1857. It took its name from the People's Charter of 1838 and was a national protest movement that mainly consisted of people dependent on single industries that were subject to wild swings in economic activity.
    • It called for six reforms to make the political system more democratic:

1. 1. 1. 1. A vote for every man aged twenty one years and above, of sound mind, and not undergoing punishment for a crime.
         2. The secret ballot to protect the elector in the exercise of his vote
         3. No property qualification for Members of Parliament, to allow the constituencies to return the man of their choice.
         4. Payment of Members, enabling tradesmen, working men, or other persons of modest means to leave or interrupt their livelihood to attend to the interests of the nation.
         5. Equal constituencies, securing the same amount of representation for the same number of electors, instead of allowing less populous constituencies to have as much or more weight than larger ones.
         6. Annual parliamentary elections, thus presenting the most effectual check to bribery and intimidation, since no purse could but a constituency under a system of universal manhood suffrage in every twelve months.

• John Gray
• • (1799-1883) was a British newspaper proprietor and economist. His first published work, A Lecture on Human happiness, was broadly supportive of the ideas of Robert Owen, although he would later criticize Owen's communitarianism. His critiques of laissez-faire capitalism is associated with Ricardian socialism and he was one of the earliest writers to advocate for a centrally planned economy.
• William Thompson
• • (1775-1833) was an Irish political and philosophical writer and social reformer, developing from utilitarianism into an early critic of capitalist exploitation whose ideas influenced the cooperative, trade union, and Chartist movements as well as Karl Marx.

• Percy Ravenstone
• • A pseudonym used by a nineteenth-century political economist whose work led him to be variously described as a socialist, a tory, and as an institutionalist. His contribution was noted by David Ricardo and Karl Marx and brought to wider attention via Piero Sraffa's editing of Ricardo's collected works.