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Understanding Neoliberalism: A Marxist Analysis May 13, 2017

Posted by OromianEconomist in Consumersim, Development & Change, Development Studies, Economics, Free development vs authoritarian model, Globalization, Growth and Inequqlity, Neoliberalism.
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Neoliberalism, Harvey writes, is “a theory of political economic practices that proposes that human well-being can best be advanced by liberating individual entrepreneurial freedoms…within an institutional framework [of] strong private property rights, free markets, and free trade” [8]. He goes on to write that neoliberalism “seeks to bring all human action into the domain of the market” [9]. In short, neoliberalism offers a set of market-based solutions to social ills. It supposes that problems experienced collectively can be conquered by individuals. An important aspect of this an antipathy to state intervention. The state, in the neoliberal understanding, only gets in the way of individual entrepreneurs who want to alleviate problems. Hence, deregulation is a prime aspect of neoliberal practice. To quote Steger and Roy in Neoliberalism: A Very Short Introduction, “the state is to refrain from interfering with the economic activities of self-interested citizens” [10]. Neoliberalism presents a profound hatred of collective action in favor of individual motivation. This does not mean, however, that the state under neoliberalism is impotent, ineffectual, or meaningless. On the contrary. Although the regulatory and public service components of the state will be stripped bare under neoliberalism (we will examine this in more detail later), the military and police-the repressive state apparatus-will be inflated to new heights. Harvey writes that the state must “secure private property rights and…guarantee, by force if need by, the proper functioning of markets. Furthermore, if markets do not exist [in water, healthcare, and education, for example] then they must be created, by state action if necessary” [11]. Neoliberalism, then, is not against the state. It is against the state when it interferes with market mechanisms, but is perfectly happy to lean on the state when the neoliberal order is resisted or challenged. Under neoliberalism, the state must protect the interests of the aforementioned entrepreneurial individuals (the capitalists). It will not hesitate to use violence to do this.

It should be noted that this process of violent state intervention has been common, literally, since the very beginning of capitalism. An important part of the development of capitalism in England, for instance, was the land enclosure.  rich landowners used their control of state processes to appropriate public land for their private benefit. This created a landless working class that provided the labor required in the new industries developing in the north of England. EP Thompson writes, “in agriculture the years between 1760 and 1820 are the years of wholesale enclosure in which, in village after village, common rights are lost” [12]. He goes on to say,  “Enclosure (when all the sophistications are allowed for) was a plain enough case of class robbery” [13].

Click here to read more at  Write To Rebel: Understanding Neoliberalism: A Marxist Analysis


Theorizing Development June 8, 2011

Posted by OromianEconomist in Economics: Development Theory and Policy applications, Temesgen M. Erena, Theory of Development, Uncategorized.
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JEL: A11, A23, B13, D2, D6, O1, O5

Theorizing Development

Temesgen M. Erena (DPhil), Economist

From historical perspectives, the urgency underlying the contemporary development quest of developing economies has been recognised for the last seven decades. Of course, this should not be considered as that there were no problems of development prior to 1940’s.  However, paralleling the increasing for economic self-determination and development of developing economies, there has been a tremendous growth in intellectual activity concerning the development problems.

The past 70 years have also witnessed a gluttony  of models, theories, and empirical investigations of the development problem and the possibilities offered for transforming Asia, African, Latin American, and Caribbean nations. This body of knowledge as come to be known in academics and policy circles as development economics.

In these perspectives development is discerned in the context of   sustained rise of an entire society and social system towards a better and ‘humane life’. What constitutes a better and humane life is an inquiry as old as humankind. Nevertheless, it must be regularly and systematically revised and answered over again in the unsteady milieu of the human society. Economists have agreed on at least on three universal or core values as a discernible and practical guidelines for understanding the gist of development (see Todaro,1994; Goulet, 1971; Soedjatmoko, 1985; Owens, 1987).  These core- values include:


 the ability to meet basic needs: food, shelter, health and protection. A basic function of all economic activity, thus, is to provide a means of overcoming the helplessness and misery emerging from a lack of food, shelter, health and protection. The necessary conditions are improving the quality of life, rising per head income, the elimination of absolute poverty, greater employment opportunity and lessening income inequalities;


which includes possessing education, technology, authenticity, identity, dignity, recognition, honour, a sense of worth and self respect, of not being used as a tool by others for their own exigency;

Freedom from servitude:

 to be able to choose. Human freedom includes emancipation from alienating material conditions of life and from social servitude to other people, nature, ignorance, misery, institutions, and dogmatic beliefs. Freedom includes an extended range of choices for societies and their members and together with a minimization of external restraints in the satiation of some social goals. Human freedom embraces personal security, the rule of law, and freedom of leisure, expression, political participation and equality of opportunity.

Sustained and accelerated increase and change in quantity and quantity of material goods and services (both in absolute and per capita), increase in productive capacity and structural transformation of production system (e.g. from agriculture to industry then to services and presently to knowledge based (new) economy), etc. hereinafter economic growth is a necessary if not a sufficient condition for development.

As elaborated in Hirischman (1981) and Lal (1983), this corpus of thought and knowledge denotes economics with a particular perspective of developing nations and the development process. It has come to shape the beliefs about the economic development of developing countries and policies and strategies that should be followed in this process. While development economics goes beyond the mere application of traditional economic principles to the study of developing economies, it remains an intellectual offspring and sub discipline of the mainstream economics discipline. The growth in economic knowledge and the corresponding intellectual maturation of development thought and policy debate has led to the appearance of various perspectives of thought on the theory and reality of development and underdevelopment within the same discipline of development economics. The two  main paradigms are neo-classicals (orthodox), and Political economy (neo-Marxists). There are also eclectics.

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