Editing Means of production

{{Short description|Inputs used in the production of goods and services with economic value}}
{{About|the economics term|the 2003 album|Means of Production}}
{{Economics sidebar}}
In [[political philosophy]], the '''means of production''' refers to the generally necessary [[asset]]s and [[resource]]s that enable a society to engage in [[Production (economics)|production]].<ref>
{{cite book |url=https://books.google.com/books?id=jvd-AAAAMAAJ |title=A Search for Common Ground |publisher=Pion |year=1977 |isbn=9780850860931 |editor-last1=Gould |editor-first1=Peter |location=London |page=215 |quote=[...] Hindess and Hirst (1977, page 65) [...] define means of production as 'all the conditions necessary to the operation of a particular labour process which are combined in the [[units of production]] in which that process takes place' [...]. |access-date=8 April 2023 |editor-last2=Olsson |editor-first2=Gunnar}} 
</ref> While the exact resources encompassed in the term may vary, it is widely agreed to include the classical [[factors of production]] ([[land (economics)|land]], [[Work (human activity)|labour]], and [[capital (economics)|capital]]) as well as the general [[Infrastructure and economics|infrastructure]] and [[capital goods]] necessary to reproduce stable levels of [[productivity]].<ref>{{Cite journal |last=Edmundson |first=William A. |date=2020 |title=What Are "The Means of Production"?* |url= https://onlinelibrary.wiley.com/doi/abs/10.1111/jopp.12211 |journal=Journal of Political Philosophy |language=en |volume= 28 |issue= 4 |pages= 422–423 |doi= 10.1111/jopp.12211 |issn= 1467-9760 |quote= It takes the means of production to comprise anything that is or can be put to productive use... the means of production consist of anything that enables or could enable the extraction of surplus value (exploitation). Similarly, for Proudhon, goods not meant for immediate consumption, whose accumulation might introduce social inequality |s2cid=212948343}}</ref> It can also be used as an abbreviation of the "means of production and distribution" which additionally includes the [[Logistics|logistical]] distribution and delivery of products, generally through [[Distribution (marketing)|distributor]]s; or as an abbreviation of the "means of production, distribution, and exchange" which further includes the exchange of distributed products, generally to [[consumer]]s.<ref>Marx, Karl; Dobb, Maurice (1971). [http://catalog.hathitrust.org/api/volumes/oclc/4632079.html A contribution to the critique of political economy]. London: Lawrence and Wishart. Archived at [https://www.marxists.org/archive/marx/works/1859/critique-pol-economy/appx1.htm marxists.org]</ref>

The concept of "Means of Production" is used by researchers in various fields of study — including [[politics]], [[economics]], and [[sociology]] — to discuss, broadly, the relationship between anything that can have productive use, its [[ownership]], and the constituent social parts needed to produce it.

== Industrial production ==
[[File:CNT-FAI Cooperative Barcelona.jpg|thumb|[[CNT-FAI]] worker [[cooperative]] in [[Barcelona]] producing wood and steel products]]
From the perspective of a firm, a [[firm]] uses its capital goods,<ref>{{cite book |last1= Eatwell|last2=Milgate|last3=Newman |first1= John|first2=Murray|first3=Peter|title= Marxian Economics: The New Palgrave |url= https://archive.org/details/marxianeconomics00john|url-access= registration|publisher= W. W. Norton & Company|date= April 19, 1990 |isbn= 978-0393958607|page = [https://archive.org/details/marxianeconomics00john/page/76 76] |quote=The conception of capital within orthodox economics. Within orthodox economics, the term ‘capital’ generally refers to the means of production.}}</ref> which are also known as tangible assets as they are physical in nature. Unfinished goods are transformed into products and services in the production process. Even if capital goods are not traded on the market as consumer goods, they can be valued as long as capital goods are produced commodities, which are required for production. The total values of capital goods constitute the capital value.<ref>{{Cite web|last=Tuovila|first=Alicia|title=Capital Goods Definition|url=https://www.investopedia.com/terms/c/capitalgoods.asp|access-date=2021-04-24|website=Investopedia|language=en}}</ref><ref>{{Citation|last=Hennings|first=K. H.|title=Capital as a Factor of Production|date=1987|url=http://link.springer.com/10.1057/978-1-349-95121-5_20-1|work=The New Palgrave Dictionary of Economics|pages=1–11|editor-last=Palgrave Macmillan|place=London|publisher=Palgrave Macmillan UK|language=en|doi=10.1057/978-1-349-95121-5_20-1|isbn=978-1-349-95121-5|access-date=2021-04-24}}</ref>

The social means of production are capital goods and assets that require organized collective labor effort, as opposed to individual effort, to operate on.<ref>{{cite book|author=Karl Kautsky|title=Selected Political Writings|publisher=978-0333283844|year=1983|page=9|quote="Here we encounter a further characteristic of the modern wage proletarian. He works not with the individual but with social means of production, means of production so extensive that they can be operated only by a society of workers, not by the individual worker."}}</ref> The ownership and organization of the social means of production is a key factor in categorizing and defining different types of [[economic system]]s.

The means of production includes two broad categories of objects: [[instruments of labor]] (tools, [[factories]], [[infrastructure]], etc.) and [[subjects of labor]] ([[natural resource]]s and [[raw material]]s). People operate on the subjects of labor using the instruments of labor to create a product; or stated another way, labor acting on the means of production creates a good.<ref>Michael Evans, ''Karl Marx'', London, England, 1975. Part II, Chap. 2, sect. a; p. 63.</ref> In an [[agrarian society]] the principal means of production is the soil and the shovel. In an [[industrial society]] the means of production become social means of production and include factories and mines.

== Knowledge production ==
In a [[knowledge economy]], learning, research, development, innovation, ideas and creativity are the means of [knowledge] production; communication such as books, articles, videos disseminated both physically and digitally over the Internet are a means of [knowledge] distribution. In a broad sense, the "means of production" also includes the "means of [[Distribution (economics)|distribution]]" such as stores, the internet and railroads ([[Infrastructural capital]]).<ref>Flower, B. O. ''The Arena'', Volume 37. The Arena Pub. Co, originally from Princeton University. p. 9</ref>

== Depreciation ==
The means of production of the firm may depreciate, which means there is a loss in the economic value of capital goods or tangible assets (e.g. machinery, factory equipment) due to wear and tear, and aging. This is known as the [[depreciation]] of capital goods.<ref>{{Cite book|last=Black|first=John|url=https://www.worldcat.org/oclc/970401192|title=A dictionary of economics|date=2017|others=Nigar Hashimzade, Gareth D. Myles|isbn=978-0-19-181994-0|edition=5|location=[Oxford]|oclc=970401192}}</ref>

== Marxism and Marxist theory of class ==
{{Marxian critique of political economy sidebar}}{{Marxism|Economics}}
The analysis of the technological sophistication of the means of production and how they are owned is a central component in the [[Marxist]] theoretical framework of historical materialism and in [[Marxian critique of political economy|Marx's critique of political economy]], and later in [[Marxian economics]].

In Marx's work and subsequent developments in Marxist theory, the process of [[socioeconomic]] evolution is based on the premise of [[technological improvements]] in the means of production. As the level of technology improves with respect to productive capabilities, existing forms of [[Social relations of production|social relations]] become superfluous and unnecessary as the advancement of technology integrated within the means of production contradicts the established [[organization of society]] and its [[economy]].

The increasing efficiency of the means of production via the  creation and adaptation of new technologies over time has a tendency to rearrange local and global market structures, leading to the disruption of existing profit pools, creating the possibility of massive economic impact. [[Disruptive technologies]] can lead to the devaluation of various forms of labor power, up to the point of making human labor power economically noncompetitive in certain applications, potentially widening income inequality.<ref>{{Cite web|last=James|first=Manyika|date=2013|title=Disruptive technologies: Advances that will transform life, business, and the global economy|url=https://www.mckinsey.com/~/media/McKinsey/Business%20Functions/McKinsey%20Digital/Our%20Insights/Disruptive%20technologies/MGI_Disruptive_technologies_Executive_summary_May2013.pdf |archive-url=https://web.archive.org/web/20200722183150/https://www.mckinsey.com/~/media/McKinsey/Business%20Functions/McKinsey%20Digital/Our%20Insights/Disruptive%20technologies/MGI_Disruptive_technologies_Executive_summary_May2013.pdf |archive-date=2020-07-22|url-status=live|access-date=2021-04-25|website=www.mckinsey.com}}</ref>

According to Marx, escalating tension between the upper and lower class is a major consequence of technology decreasing the value of labor force and the contradictory effect an evolving means of production has on established social and economic systems. Marx believed increasing inequality between the upper and lower classes acts as a major catalyst of [[class conflicts]], which develop to a point where the existing mode of production inevitably becomes unsustainable, either collapsing or being overthrown in a [[social revolution]], at which point the contradictory relationship between technological advancement and the value of labor force is resolved by the emergence of a new mode of production based on a different set of [[social relations]] including, most notably, different patterns of ownership for the means of production.<ref>[http://www.marxists.org/glossary/terms/m/o.htm#mode-production Mode of Production]. Marxism.org</ref>

Ownership of the means of production and control over the [[surplus product]] generated by their operation is the fundamental factor in delineating different [[modes of production]]. Capitalism is defined as private ownership and control over the means of production, where the surplus product becomes a source of [[unearned income]] for its owners. Under this system, profit-seeking individuals or organizations undertake a majority of economic activities. However, capitalism does not indicate all material means of production are privately owned as partial economies are publicly owned.<ref>{{Cite book|last=Black|first=John|url=https://www.worldcat.org/oclc/970401192|title=Capitalism--A dictionary of economics|date=2017|others=Nigar Hashimzade, Gareth D. Myles|isbn=978-0-19-181994-0|edition=5|location=[Oxford]|oclc=970401192}}</ref>

=== Determinant of class ===
Marx's theory of class defines classes in their relation to their ownership and control of the means of production. In a capitalist society, the [[bourgeoisie]], or the capitalist class, is the class that owns the means of production and derives a [[passive income]] from their operation. Examples of the capitalist class include business owners, shareholders and the minority of people who own factories, machinery and lands. Countries considered as the capitalist countries include Australia, Canada, the U.S., and other nations which hold a free market economy. In modern society, small business owners, minority shareholders and other smaller capitalists are considered as ''[[Petite bourgeoisie]]'' according to Marx's theory, which is distinct from bourgeoisie and proletariat as they can buy the labour of others but also work along with employees.

In contrast, the [[proletariat]], or [[working class]], comprises the majority of the population that lacks access to the means of production and are therefore induced to sell their [[labour power]] for a wage or salary to gain access to necessities, goods and services.<ref>{{cite book |last= Ishiyama, Breuning |first= John, Marijke|title= 21st Century Political Science: A Reference Handbook |publisher= SAGE Publications, Inc |date= October 22, 2010|quote= For Marx, class was defined by an individual’s relationship to the means of production...Class is determined by the extent to which people own most, some, or little of the means of production, or by their relationship to the means of production. It generally conflicts over control or access to the means of production that drives history. }}</ref>

According to Marx, wages and salaries are considered as the price of [[labour power]], related to working hours or outputs produced by the labour force. At the company level, an employee does not control and own the means of production in a capitalist mode of production. Instead, an employee is performing specific duties under a contract of employment, working for wages or salaries.<ref>{{Cite book|last=Black|first=John|url=https://www.worldcat.org/oclc/970401192|title=Employee--A dictionary of economics|date=2017|others=Nigar Hashimzade, Gareth D. Myles|isbn=978-0-19-181994-0|edition=5|location=[Oxford]|oclc=970401192}}</ref> As for firms and profit-seeking organizations, from a personnel economics perspective, to maximize efficiency and productivity there must be an equilibrium between labour markets and product markets. In human resource practices, compensation structure tends to shift towards pay-for-performance bonus or incentive pay rather than base salary to attract the right workers, even if conflicts of interest exist in an employer-worker relationship.<ref>{{Cite journal|last1=Lazear|first1=Edward P.|last2=Shaw|first2=Kathryn L.|date=2007|title=Personnel Economics: The Economist's View of Human Resources|url=https://www.jstor.org/stable/30033753|journal=The Journal of Economic Perspectives|volume=21|issue=4|pages=91–114|doi=10.1257/jep.21.4.91|jstor=30033753|issn=0895-3309}}</ref>

To the question of why classes exist in [[human societies]] in the first place, Karl Marx offered a [[Marx's theory of history|historical]] and scientific explanation that it was the [[cultural practice]] of ownership of the means of production that gives rise to them. This explanation differs dramatically from other explanations based on "differences in ability" between individuals or on religious or political affiliations giving rise to [[castes]]. This explanation is consistent with the bulk of Marxist theory in which Politics and [[Marxism and religion|Religion]] are seen as mere outgrowths ([[base and superstructure|superstructures]]) of the basic underlying economic reality of a people.<ref>[http://www.marx2mao.com/M&E/SUS80.html Frederick Engels: Socialism: Utopian and Scientific Chapter III Historical Materialism] Marx2mao.com.  p. 74</ref>

== Related terms ==
[[Factors of production]] are defined by German [[Philosophy|philosopher]] [[Karl Marx]] in his book ''[[Das Kapital]]'' as labor, [[subjects of labor]], and instruments of labor: the term is equivalent to means of production plus labor. The factors of production are often listed in economic writings derived from the [[classical economics|classical school]] as "land, labour and capital". Marx sometimes used the term "[[productive forces]]" equivalently with "[[factors of production]]"; in ''Kapital'', he uses "factors of production", in his famous Preface to his ''[[Critique of Political Economy]]: [[A Contribution to the Critique of Political Economy]]'', he uses "productive forces" (that may depend on the translation).

[[relations of production|Production relations]] (German: ''Produktionsverhältnis'') are the relations humans enter into with each other in using the means of production to produce. Examples of such relations are [[employer]]/employee, buyer/seller, the technical division of labour in a factory, and property relations.

[[Mode of production]] (German: ''Produktionsweise'') means the dominant way in which production is organised in society. For instance, "[[capitalism]]" is the name for the [[Capitalist mode of production (Marxist theory)|capitalist ''mode of production'']] in which the means of production are [[Private property|owned privately]] by a small [[Social class|class]] (the [[bourgeoisie]]) who profits off the labor of the [[working class]] (the [[proletariat]]). [[Communism]] is a mode of production in which the means of production are not owned by anyone, but [[Common ownership|shared in common]], without class-based [[exploitation of labour|exploitation]]. Besides capitalism and communism, there is another mode of production which is called a Mixed Economic System. In a mixed economy, private ownership of capital goods are protected and a certain level of the market economy is allowed. However, the government has the right to intervene in the market and economic activities for social objectives. Different from the pure capitalism, the government regulation exists to control particular means of production over the private business sector. Different from communism, the majority of means of production are privately owned rather than shared in common.<ref>{{Cite web|author=Investopedia Staff|title=Mixed Economic System Definition|url=https://www.investopedia.com/terms/m/mixed-economic-system.asp|access-date=2021-04-25|website=Investopedia|language=en}}</ref>

== See also ==
{{Wikiquote}}
{{div col|colwidth=20em}}
* [[Capital (economics)]]
* [[Clause IV]]
* [[Factors of production]]
* [[Information revolution]]
* [[Gross fixed capital formation]]
* [[Nationalization]]
* [[Productive forces]]
* [[Property]]
* [[Private property]]
* [[Privatization]]
* [[Relations of production]]
* [[Socialization (economics)]]
{{div col end}}

== Footnotes ==
{{Reflist}}Nolan P. K Lenski 2009

== References ==
* Institute of Economics of the Academy of Sciences of the U.S.S.R. (1957). ''Political Economy: A Textbook''. London: Lawrence and Wishart.

{{Marxist & Communist phraseology}}
{{Authority control}}

{{DEFAULTSORT:Means Of Production}}
[[Category:Marxist terminology]]
[[Category:Communism]]
[[Category:Socialism]]
[[Category:Capitalism]]
[[Category:Marxian economics]]
[[Category:Production economics]]
[[Category:Labour economics]]
[[Category:Capital (economics)]]
[[Category:Factors of production]]