Editing Late capitalism (section)

==Ernest Mandel's analysis==
Mandel aimed to explain the unexpected revival of capitalism after World War II, and the long economic boom during 1947–73,<ref>[[Ernest Mandel]], "History and the laws of motion of capitalism" [Lecture at Tilburg Polytech, The Netherlands, 1970]. Amsterdam: International Institute for Research and Education, translated 13 June 2023.[https://www.iire.org/node/1055]</ref> which showed the fastest economic growth ever seen in human history.<ref>''The Jameson Reader'', p. 257.</ref> His analyses<ref>Ernest Mandel, ''Late Capitalism''. London: New Left Books, 1975, chapter 4: "'Long waves' in the history of capitalism"; Ernest Mandel, ''Long waves of capitalist development: a Marxist interpretation'' (2nd. edition). London: Verso, 1995.</ref> stimulated new interest in the theory of [[long waves]] in economic development.<ref>Christopher Freeman (ed.), ''Long waves in the world economy''. London: Frances Pinter Publishers, 1984; Alfred Kleinknecht, Ernest Mandel and Immanuel Wallerstein (eds.), ''New findings in long-wave research''. Houndmills, UK: Macmillan Press, 1992; Francisco Louçã & Jan Reijnders (eds.), ''The foundations of long wave theory: models and methodology'', Vols. 1 and 2. Cheltenham, UK: Edward Elgar, 1999; Grace K. Hong, ''The Ruptures of American Capital'' (2006) p. 152.</ref>

According [[Ernest Mandel]], late capitalism involves the [[commodification]] and [[industrialisation]] of more and more parts of the economy and society, where human services are turned into commercial products.<ref>Ernest Mandel, ''Late Capitalism'' (London: New Left Books, 1975) p. 406.</ref> Mandel believed that "[f]ar from representing a 'post-industrial society', late capitalism [...] constitutes ''generalized universal industrialization'' for the first time in history".<ref>Ibid., p. 387</ref> At the same time, the role of the state in the economy and society kept growing. During and after World War II, the size of enterprises, ownership concentration and the scale of mass production increased, the activities of multinational corporations expanded,<ref>Ernest Mandel, "International capitalism and 'supranationality'" [1967], reprinted in: Hugo Radice (ed.), ''International firms and modern imperialism''. Harmondsworth: Penguin books, 1975, pp. 143-157.</ref> and there were more and more attempts at coordinated economic planning (or "economic programming").<ref>Ernest Mandel, ''Late capitalism'', op. cit., p. 231f. and p. 495.</ref>

Until the late 1960s, Mandel preferred to use the term "neo-capitalism", which was most often used by intellectuals in Belgium and France at that time.<ref>Ernest Mandel, ''The economics of neocapitalism.'' ''Socialist Register 1964'', pp. 56–67 [https://www.marxists.org/archive/mandel/1964/xx/neocap.html].</ref> This idea drew attention to the fact that new characteristics of capitalism had emerged in its postwar recovery. At the time, however, ultraleftist Marxists objected to the term "neo-capitalism", because, according to them, it might suggest that capitalism was no longer capitalism, and this would lead to reformist deviations rather than to the total overthrow of capitalism.<ref>[[Paul Mattick]], "Ernest Mandel’s 'Late Capitalism', in: Paul Mattick, ''Economic Crisis and Crisis Theory''. London: Merlin Press, 1974.[https://www.marxists.org/archive/mattick-paul/1974/crisis/ch05.htm]; [[Chris Harman]], "Mandel’s Late Capitalism". ''International Socialism'', Vol. 2, number 1, July 1978, pp. 79ff;[https://www.marxists.org/archive/harman/1978/07/mandel.html] Max Boddy, "The ICFI’s exposure of Ernest Mandel’s “neo-capitalism” and the analysis of the global economic crisis: 1967–1971". ''World Socialist Web Site'', 8 September 2023.[https://www.wsws.org/en/articles/2023/09/09/rvtn-s09.html]</ref> The proof of this seemed to be that Mandel argued—at the zenith of the capitalist postwar boom—for "anti-capitalist structural reforms".<ref>Ernest Mandel, ''A socialist strategy for Western Europe''. London: Institute for workers' control, 1965.[https://www.iire.org/node/1036]</ref>

Mandel distinguished three stages in the development of the [[capitalist mode of production (Marxist theory)|capitalist mode of production]]:

* ''Freely competitive capitalist production'', roughly from 1700 to 1870, through the growth of industrial capital in domestic markets.
* The phase of ''monopoly capitalism'', roughly from 1870 to 1940, is characterized by the [[imperialism|imperialist]] competition for international markets, and the exploitation of [[colony|colonial territories]].
* The epoch of ''late capitalism'' emerging out of the [[Second World War]], which has as its dominant features the [[multinational corporation]], [[globalization]], [[consumerism]], and increasingly internationalized financial markets.<ref>''The Jameson Reader'' p. 165–166</ref>

The French edition of Mandel's ''Late Capitalism'' was titled ''The third age of capitalism''.<ref>Ernest Mandel, ''Le troisième âge du capitalisme''. Paris: Editions 10/18 (Série Rouge), 1976; 2nd. ed. Éditions de la Passion, 1997.</ref>

In part, Mandel's analysis was a critique of [[Henryk Grossmann]]'s breakdown theory, according to which capitalism would collapse after a series of business cycles, because of insufficient surplus value production.<ref>Ernest Mandel, ''Late Capitalism''. London: New Left Books, 1975, pp. 31-32.</ref> But Mandel also criticized the methodological approach of [[Rudolf Hilferding]], [[Rosa Luxemburg]], [[Nikolai Bukharin]], [[Otto Bauer]], [[Michal Kalecki]], and [[Charles Bettelheim]].<ref>Ernest Mandel, ''Late Capitalism''. London: New Left Books, 1975, chapter 1.</ref> Mandel argued that important qualitative changes occurred in the functioning of the capitalist system during and after [[World War II]]. Intermediate between the periodization of business cycles and the postulated ultimate collapse of capitalism, Mandel argued, there were epochs of faster and slower economic growth. 

In the history of capitalist mode of production since the 1820s, "long waves" of economic growth could be observed in [[time series]] data on economic activity. These waves typically lasted about 20 to 25 years, from peak to trough or from trough to the next peak.<ref> Ernest Mandel, ''Long Waves of Capitalist Development – the Marxist Interpretation'' (2nd expanded edition). Cambridge: Cambridge University Press, 1995.</ref>  However, Mandel did not accept the hypothesis of [[Nikolai Kondratiev]] that there existed endogenously predetermined "long cycles" in the history of capitalism.<ref>Ernest Mandel, "Het lange golven debat: de inzet". ''Vlaams Marxistisch Tijdschrift'', Vol. 25, Issue 1, March 1991, pp. 7-17.</ref> In particular, there existed no enduring economic mechanism which automatically created an economic recovery after a severe economic depression; much depended on state policy decisions and on the outcome of political battles between warring social classes.

In a series of publications, Mandel analyzed the dynamics and results of the unexpected postwar boom, the long world recession of 1974 to 1982,<ref>Ernest Mandel, ''The second slump''. London: Verso, 1978; Ernest Mandel, ''Die Krise: Weltwirtschaft 1974-1986''. Hamburg: Konkret Literatur Verlag, 1987.</ref> the [[Debt of developing countries|debt crisis of developing countries]], the 1987 stock crash and the long-term systemic crisis of late capitalism, as basis for his projections about the long-term prospects of world capitalism in the future.<ref>See the [https://www.trotskyana.net/Trotskyists/Ernest_Mandel/Ernest_Mandel_Bibliography_introd.html Ernest Mandel bibliography] by Wolfgang Lubitz, Petra Lubitz and others.</ref> 

In the tradition of the [[orthodox Marxists]], Mandel tried to characterize the nature of the modern epoch as a whole, with reference to the main long-run laws of motion of capitalism specified by Marx.<ref>''The Jameson Reader'', p. 216–217</ref> These laws of motion were:
1. The capitalist compulsion to [[capital accumulation|accumulate]] and invest for profit, under the pressure of business  competition.
2. The tendency towards constant [[Technological revolution|technological revolutions]], which increase [[productivity]].
3. The constant attempt to increase absolute and relative [[surplus value]].
4. The tendency toward increasing [[economic concentration|concentration]] and centralization of capital.
5. The tendency for the [[organic composition of capital]] to increase.
6. The tendency of the average profit rate on capital invested in industries to [[Tendency of the rate of profit to fall|decrease]], in the long term.
7. The inevitability of [[class struggle]] (or class conflicts) under capitalism. 
8. The tendency of the [[working class]] to grow in size and [[social polarization]] to increase.
9. The tendency towards [[Socialization (Marxism)|growing objective socialization of labour]].
10. The inevitability of recurrent economic crises in capitalist society.<ref>Ernest Mandel, "Karl Marx", in: John Eatwell et al., ''The New Palgrave Marxian Economics''. New York: W.W. Norton & Company, 1990, pp. 1-38.[https://www.marxists.org/archive/mandel/19xx/marx/ch08.htm]</ref>

Mandel thought that six basic variables were most important for the long-term global growth pattern of the capitalist mode of production and its average profitability: (i) the evolution of the general and sectoral organic compositions of capital; (ii) the division of constant capital between circulating and fixed capital; (iii) the evolution of the rate of surplus value; (iv) the development of the rate of accumulation, and more specifically the reinvestment of surplus value in production; (v) the development of the turnover of capital; and (vi) the interactions between the producer goods sector and the consumer goods sector. These variables could to an extent fluctuate semi-independently of each other. <ref>Ernest Mandel, ''Late Capitalism''. London: New Left Books, 1975, p. 39, 42-43. See also: Ernest Mandel, "Partially independent variables and internal logic in classical Marxist economic analysis" in: ''Social Science Information'' (London), Volume 24, Issue 3, 1985, pp. 485-505. Reprinted in: [[Ulf Himmelstrand]] (ed.), ''Interfaces in economic & social analysis'', London: Routledge, 1992, pp. 33-50. </ref>