Karl Marx’s theory of economic development

Students keen on charting out a career path in the field of political science are required to have a fair understanding of several key concepts and theories by renowned leaders. Some of these leaders played an eminent role in world history for their views and beliefs that helped shape the global political scenario today. One such leader who made a deep impression in historic times is Karl Mar, renowned for his very popular theory of economic development. Also known as the theory of historical materialism, Karl Marx’s economic theory is a subject of important study for political science students, who can gain deeper insights into the theory and determine its relevance in the present times. 

Who is Karl Marx?

Let us first begin by understanding a brief history of who exactly was Karl Marx. One of the very famous economists of the early 19th century, Karl Marx is also better known as an author, philosopher, and social theorist. His theory of economic development has gained immense popularity, along with some of his other famous theories on socialism, capitalism, and communism. An eminent thinker from Germany, Karl Marx authored several thought-provoking studies on political economy, economics, and society in general.

What is Karl Marx’s theory of Economic Development?

In his most famous theory that holds prominence to date, Karl Marx highlighted the role that labor plays in the economic development of a nation. He believed that the labor only receives a small portion of the total output generated as a result of their effort, while all of the remaining is held by the capitalist class. 

This theory is also referred to as the Marxian theory of economic development and classifies society into two classes – the capitalists or the Bourgeois class and the working class or Proletariat. The theory further substantiates labor as the primary source of value generation for any society, while also highlighting that its wages are determined at meagre subsistence levels of living by the Bourgeois classes.

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Impact of Karl Marx’s theory of economic development

According to Marx’s economic development theory, it was argued that two prominent loopholes in capitalism result in the exploitation of labor at the hands of the capitalist or employer class. These include the extraction of surplus labor and the chaos created due to free-market competition. 

His ideas and critiques still hold relevance in contemporary times. These include the continual state of unemployment among the working classes, the monopoly of big corporations, and the persistent struggle between the working and employer classes. 

Marxian Economics vs. Classical Economics

Apart from Karl Marx’s theory of economic development, there is another school of thought by the name of Classical Economics. It refers to the work on economic growth and market theories during the 18th and 19th centuries. Classical economists view capitalism as a natural way of society, noting that goods are produced and an inevitable demand for those goods then arises among the people of the society. 

Marxist theory, on the other hand, argues against capitalism being a natural way of life. Economic development, according to Marx, cannot flourish under capitalism, which Marx insists is a political construct under which one class exploits the other and amasses heaps of wealth in the process. 

Conclusion

Some of the concepts of the Marxian Theory of Economics, Classical Economics, and many other similar theories of economic development that emerged in the 18th or 19th centuries still hold relevance in modern times. The economic disparity in today’s society still sadly exists and there are several arguments made in these theories that can be used as key references for studying the current economic scenario by economists.

Political science courses at the undergraduate and postgraduate levels offer deep insights into the Marxian perspective on economic development, along with other economic theories of those times, and their contemporary relevance for students and professionals. If you too are considering a career in economy or political science domains, take the first step with an online BA course from Sikkim Manipal University. The course offers Political Science as one of the 3 combination subjects (in addition to English and Sociology). 

You can then supplement your learning with an exclusive MA in Political Science from Sikkim Manipal. The university offers both of these programs on the Online Manipal platform in remote learning mode, adding convenience, flexibility, and affordability for students. Additionally, the degree is completely at par with other conventional campus degrees and is entitled by the UGC. Sikkim Manipal University too is NAAC-accredited and its degrees are recognized by corporates and the government alike.