Is there such a thing as capitalism?

Marx’s central theoretical concept is “capitalism.” He wanted to provide a theory of the capitalist mode of production; he wanted to discover the laws of motion of the capitalist mode of production; and he believed that there was a compact structural identity that is shared by capitalist economies. Later Marxist economists refined the concept somewhat by distinguishing among various stages of capitalist development, with thinkers such as Ernest Mandel and Paul Sweezy focusing on “late capitalism”.

My question here is a simple one. From the point of view of social ontology and concept formation in sociology — does it make sense to think of capitalism as a single thing with multiple instances across time and space? Is there a reason to think that “England, 1880,” “Germany, 1910,” “Japan, 1960,” “United States, 1980,” and “France, 2000” are all instances of a single economic system?

Consider briefly Marx’s account of the core features of capitalism. It is an economic system based on a particular and distinctive property system: private property in the means of production (capital) and private ownership of labor by the worker (labor). The worker is free to sell his/her labor power to multiple owners of capital; but, having been separated from all other forms of access to means of production, the worker is not free to withhold his/her labor altogether. So the worker is dependent on the capitalist for access to the means of subsistence; and the capitalist is dependent upon the worker as the creator of surplus value. It is a system that is premised on surplus extraction by owners of capital from the producers of value (workers). It is a system based on accumulation: constant growth and expansion of the appropriation of surplus value (profits). And it is a system based on accumulation rather than consumption. And, finally, Marx believes that these social institutions create an institutional logic for capitalist economies that is different from other modes of production — a tendency towards technological innovation, a tendency towards a falling rate of profit, the creation of an “industrial reserve army,” and the creation of a tendency towards economic crisis. It is this claim that permits Marx to assert that he has produced a theory that encompasses a whole class of social formations, rather than being simply a description based on a single case, British capitalism of mid-nineteenth century.

In order to carry this concept through, we would need to postulate that there is a core set of economic features and institutions that constitute the “essence” of capitalism; that these core features recur across multiple historical social formations; and that the differences that exist across historical cases are non-essential, accidental, epiphenomenal, or super-structural.

And differences there are, of course. One important dimension of difference is the degree and nature of state involvement in the economy. But other differences are equally important: the subtle but distinctive differences in property systems that exist in England, Germany, Japan, or the United States; the differences that exist in regulatory regimes (such as those documented by Frank Dobbin); the cultural differences that exist across “capitalist” societies with respect to attitudes towards wealth, the environment, or inequalities; and so on for a continuing and broad range of differences across societies.

Given this fact of sociologically important differences across historical instances of capitalism, we appear to have two theoretical choices. The first is to postulate that the common, core institutions of capitalist societies impose a logic of development on capitalist societies that is more fundamental than any of the evident differences across instances. The other is to judge that the concept of capitalism is simply a nominal social category, grouping together a number of societies which have some similarities and also important differences. Or, following Weber, we might say that capitalism is an ideal type, an organizing and idealized concept that singles out a set of features that often hang together, but recognizing that no particular society perfectly exemplifies all these features.

It seems to me that Marx fell into a fetishim of his own in reifying the capitalist mode of production as a general historical category. We are better off following the lead of the new institutionalists, recognizing that every society has a somewhat different configuration of basic institutions; and acknowledging that these differences make a difference in the development and historical trajectory of these societies. There are important commonalities across many or most of the societies that Marx would call “capitalist” — a deep conflict of interest between capital and labor, a likelihood that economic property ownership will support political power and influence, and other common features. But to judge that “every capitalist society develops in the same way” goes well beyond what history or theory would support. Instead, we need to have specific, factual analysis of each of the societies we are interested in, and should highlight the differences that exist as well as the commonalities that recur. This finding takes us further down the road of emphasizing particularity and difference as much as generalization and regularity in social science theorizing.