A Marxist Theory of Rent

This paper by Deepankar Basu offers a unified analytical treatment of Marx's theory of rent. It highlights the key role played by the price of agricultural commodities in determining rent. The paper offers two closures of the model — one builds from Marx's argument in Volume III of Capital, while the other incorporates demand influences. Basu shows that total rent can be decomposed into three components: absolute rent, and two forms of differential rent. A Marxist theory can explain rent in any system of capitalist commodity production that uses privately owned, non-reproducible resources.

Abstract

This paper offers a unified analytical treatment of Marx's theory of rent. I highlight the key role played by the price of the agricultural commodity in determining rent. I offer two closures of the model. The first closure is an elaboration of Marx's argument in Volume III of Capital. The second closure explicitly allows for the role of demand. I also show that total rent can be decomposed into three components: absolute rent, differential rent I, and differential rent II. A Marxist theory can explain rent in any system of capitalist commodity production that uses privately owned non-reproducible resources.

 

 

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