Marxist Economics

Microeconomics, by contrast, is concerned with the study of individual decision units(1) consumers, (2) households, and (3) firms, and with the ways in which their decisions interrelate to determine (4) the relative prices of goods and factors of production, and (5) the quantities of these items which will be bought and sold (Rees, 1984). The ultimate goal of microeconomics is to explain the mechanism by which the total amount of resources possessed by a society is allocated among alternative uses and users, and competing uses and users.

MARXIST ECONOMICS

Marxian economic thought is theoretically close to classical economics. Classical economics, after all, was the economics of the age in which Marx developed his own theories. Marx brought four major insights to economic th

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xian economic theory is the contention that the quantity of labor used in the manufacture of a product determines the value of that product, and that such a value determination is both fundamental and immutable. This theory fails to account for the contribution to value of other factors of production. Further, this theory is unable to provide a satisfactory explanation between the value and the relative price of a product. Marxian economic theory is based on a distinction between the exchange and use value of labor. Marx contended that the exchange value paid by capitalists for labor was less than the use value of labor obtained by capitalists. The difference between exchange and use values of labor was a surplus value, according to Marx. Thus, according to Marx, only labor can create a surplus value, or profit. Marxist economic theory is also characterized by a greater normative context than is freemarket economic theory. Economics is often subdivided into the areas of positive economics and normative economics. Positive economics deals with the explanation and prediction of actual resource allocation decisions made by consumers, producers, and, to a lesser extent, governments (Friedman, 1953). By contrast, n
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Approximate Pages = 6 (250 words per page)

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