Marxism: What It Is and Comparison to Communism, Socialism, and Capitalism

Ivestopedia / Zoe Hansen

What Is Marxism?

Marxism is a social, political, and economic philosophy named after Karl Marx. His work examines the historical effects of capitalism on labor, productivity, and economic development and argues that a worker revolution is needed to replace capitalism with communism.

Marxism posits that the struggle between social classes defines economic relations in a capitalist economy and will lead to a communist revolution.

Key Takeaways

• Marxism is an economic and political theory that examines the flaws inherent in capitalism; it’s based on the work of Karl Marx.
• Marxist theories were influential in the development of socialism, which requires shared ownership by workers of the means of production.
• Communism rejects private ownership and mandates collective ownership and control of all goods and services.

Understanding Marxism

Marxism is both a social and political theory. It encompasses Marxist class conflict theory and Marxian economics. Marxism was formulated in 1848 in the pamphlet The Communist Manifesto by Karl Marx and Friedrich Engels, which lays out the theory of class struggle and revolution.

Marxian economics focuses on criticism of capitalism, detailed by Marx in his book Das Kapital published in 1867.

Marxism argues that capitalism as a form of economic and social reproduction is inherently flawed and will ultimately fail.

Capitalism is a mode of production in which business owners (capitalists) own all the means of production and workers are hired for wages without ownership or share in the profits.

The wages paid to workers are lower than the economic value their work creates for capitalists. This leads to class struggle between labor and capital.

Another theory developed by Marx is historical materialism, which proposes that society is ordered by organization and technology used in production processes.

Marxian Economics

Karl Marx believed in a labor theory of value (LTV) to explain relative differences in market prices. The value of a product can be measured objectively by the average number of hours of labor required to produce it.

Marx claimed that capitalism leads to exploitation of workers through the chaotic nature of free market competition and the extraction of surplus labor.

Marx predicted that capitalism would destroy itself as more people become working-class, inequality rises, and competition drives corporate profits to zero. This would lead to a revolution in which production would be controlled by the working class.

Class Conflict and the Demise of Capitalism

Marx’s class theory portrays capitalism as one step in a historical progression of economic systems driven by conflict among social classes.

According to Marx, every society is divided into social classes. In a capitalist society, the bourgeoisie (business owners) control the means of production and the proletariat (workers) transform raw commodities into goods with market value.

Workers have little power and are easily replaceable. Business owners exploit their labor for profit, leading to worker alienation.

The bourgeoisie leverage social institutions to maintain their power and privilege. Inequalities and exploitative economic relations lead to a revolution in which the working class rebels and seizes control of the means of production.

The revolution is led by enlightened leaders, known as the "vanguard of the proletariat," and results in collective ownership and the abolition of capitalism.

In the final stage of human development, social classes and class struggle cease to exist.

Karl Marx believed that the proletariat would overthrow capitalism in a violent revolution.

Communism vs. Socialism vs. Capitalism

Marx and Engels’ ideas shaped communism, which advocates for communal ownership and wealth, based on Marxist principles. Only a few nations, including China and Vietnam, currently have communist systems.

Socialism predates communism and focuses on egalitarian wealth distribution. It advocates for public ownership and regulation of the means of production, but individuals may still own property. Socialism has been implemented within various political structures.

Both communism and socialism oppose capitalism, which is characterized by private ownership and the right to profit from it.

Critiques of Marxism

Marx’s predictions have not fully materialized. Capitalism has not collapsed and governments have instituted regulations to address its flaws.

Economic inequality persists, recessions occur periodically, but society without competition, money, or private property has not emerged.

What Kind of Philosophy Is Marxism?

Marxism unifies social, political, and economic theory. It proposes shared ownership to address inequality caused by capitalism.

What Did Marx Predict for the Future?

Marx predicted that capitalism would self-destruct due to competition and exploit workers. The working class would eventually overthrow the owners, leading to shared ownership.

Was Karl Marx Right?

Not entirely. Though communism was attempted, it has not been fully realized. Capitalism has changed and some of its excesses have been addressed.

Is Marxism the Same Thing As Communism?

Marxism is a philosophy, while communism is a government system based on Marxist principles. Marxist theory emphasizes workers’ ownership, while communism involves state ownership.

The Bottom Line

Marxism is a theory developed by Karl Marx that criticizes capitalism for its flaws. It connects these flaws with a class conflict that will lead to a revolution and shared ownership.

Marxist theories have been tested but not fully realized. Capitalism remains predominant, but with some reforms.