The Accumulation of Capital

by Rosa Luxemburg, Agnes Schwarzschild (Translator), Tadeusz Kowalik (Contributor)

Rosa Luxemburg was a revolutionary socialist who fought and died for her beliefs. In January 1919, after being arrested for her involvement in a workers' uprising in Berlin, she was brutally murdered by a group of right-wing soldiers. Her body was recovered days later from a canal. Six years earlier she had published what was undoubtedly her finest achievement, The Accumulation of Capital - a book which remains one of the masterpieces of socialist literature. Taking Marx as her starting point, she offers an independent and fiercely critical explanation of the economic and political consequences of capitalism in the context of the turbulent times in which she lived, reinterpreting events in the United States, Europe, China, Russia and the British Empire. Many today believe there is no alternative to global capitalism. This book is a timely and forceful statement of an opposing view.

Genres: Economics, Politics, Philosophy, Nonfiction, Theory, History, Sociology

453 pages, Paperback

First published January 1, 1913

About the author

Rosa Luxemburg (Rosalia Luxemburg, Polish: Róża Luksemburg) was a Marxist theorist, philosopher, economist and activist of Polish Jewish descent who became a naturalized German citizen. She was successively a member of the Social Democracy of the Kingdom of Poland and Lithuania, the Social Democratic Party of Germany(SPD), the Independent Social Democratic Party and the Communist Party of Germany.

In 1915, after the SPD supported German involvement in World War I, she co-founded, with Karl Liebknecht, the anti-war Spartakusbund (Spartacist League). On 1 January 1919 the Spartacist League became the Communist Party of Germany (KPD). In November 1918, during the German Revolution she founded the Die Rote Fahne (The Red Flag), the central organ of the Spartacist movement.

She regarded the Spartacist uprising of January 1919 in Berlin as a blunder, but supported it after Liebknecht ordered it without her knowledge. When the revolt was crushed by the social democrat government and the Freikorps (WWI veterans defending the Weimar Republic), Luxemburg, Liebknecht and some of their supporters were captured and murdered. Luxemburg was drowned in the Landwehr Canal in Berlin. After their deaths, Luxemburg and Karl Liebknecht became martyrs for Marxists. According to the Federal Office for the Protection of the Constitution, commemoration of Rosa Luxemburg and Karl Liebknecht continues to play an important role among the German far-left.

Reviews

[E. G. · Rating 3 out of 5]

Introduction to the Routledge Classics Edition
Translator's Note
A Note on Rosa Luxemburg
Introduction

--The Accumulation of Capital

Index

[Andrew]

In a day when Marxist thought in America is all too frequently associated with vague hippie sentiment, it's good to know that one can be a passionate revolutionary and a rigorous analytical thinker at the same time. How refreshing is that?

The problem at the heart of The Accumulation of Capital is simple: how is it that, dealing with a finite amount of resources, laborers, and consumers, capitalist economies are able to grow? Luxemburg points to the engine of imperialism. We take such ideas largely for granted now-- all of you who have read Naomi Klein, Noam Chomsky, or any of the other popular expositors of the North American left could cite any number of examples-- but this concept was still revolutionary in the early 20th Century. Much of the book is made up of molasses-slow, formula-heavy economics, so it's probably not for everyone. But the third part of the problem should be read by anyone interested in historical examples of the imperialist spread of capitalism (British invasions in South Africa, the creation of the fellahin serf class in Egypt) and anyone interested in the mechanics of the capitalist strangulation of the third world.

[Chris Nagel · Rating 4 out of 5]

I make no judgment of Luxemburg's criticisms of Marx or other theorists. In her view, the accumulation of capital is not the primary result of exploiting labor that is already working in capitalist industrial production. That labor assures the reproduction of the system itself. Accumulation of capital is based on continuous cycles of what Marx called "primitive accumulation." The techniques of this accumulation are, in my own words, enslavement, colonization, and land rape. There is a limit to the extent this can go on, because capitalism depends on the existence of non-capitalist economies and regions to continue accumulation -- at least, according to Luxemburg.

I don't entirely understand Luxemburg's account of militarism, but from what I gather, I think it could explain how capitalism can continue to invent new regions of colonization and exploitation. For instance, in much the same way indirect taxation on the working class permits a decrease in real wages and a decrease in standard of living (compared to what could be possible) for the working class, in order to produce what no one in the working class will consume, similar approaches to media and entertainment, and information and education, have opened new "markets" for capital. Although it is working people who consume entertainment and information (unlike armaments), a great deal of their consumption is unproductive and unreproductive. Capitalism depends on opening ever new and larger markets, and if those markets became saturated with needed goods, there would be nothing left to sell, and no one left to sell it to. Like militarism, the colonization of perception and experience (i.e, capitalist production of entertainment and information) creates a market for commodities whose use is destructive or useless, and expenditure on those commodities by states and workers helps maintain rate of profit.

So far.

[David · Rating 2 out of 5]

Arghiri Emmanuel writes in the introduction to Unequal Exchange that obvious logical errors in any given book are picked apart within the first year after its publication; any discussion after that must as a rule accept its internal consistency but disagree on the axioms. The Accumulation of Capital was greeted by a barrage of devastating critiques from every corner of the marxist economist discussion sphere -- Luxemburg saw herself forced to publish a book-length Antikritik two years after the initial publication -- and ever since her economic thought has languished in obscurity, apparently felled by the logic squad. Some economists writing a century after the facts, like Paul Zarembka and Radhika Desai, argued that the dismissal of Luxemburg was unwarranted and motivated by either political differences extraneous to her theories themselves or even sexism. But having gone through it myself, this latter reaction seems very weak indeed. Luxemburg's thoughts are riddled with evident errors. The kindest thing one might say is that few of her opponents, generously featured in the book, fare better.

Luxemburg's paradoxical central question is: "How can capital accumulate?" In practice, capitalism is defined by its dynamism and unceasing tendency towards accumulation; however, in theory, it's difficult to explain what makes this possible. Towards the end of Capital Vol II, Marx provided schemes of reproduction tracing the expanding cycles of capital. Luxemburg starts her investigation here: Marx takes a given rate of expansion for granted, but doesn't explain where expansion comes from. If a capitalist economy as a whole produces 5% more consumer goods in year 2 than in year 1, where do the 5% more funds come to pay for them? What follows are 350 pages of tautological cul-de-sacs: neither Marx nor any economist after him could answer this.

Luxemburg eventually stumbles upon the answer: Marx studied the laws of motion of capitalism as he encountered it, abstracting every external factor. But capitalism always emerges within systems that themselves are not capitalist. She posits that capitalism's erosion of the other modes of production (be they pastoral, peasant-based, feudal or otherwise centralised-tributary) isn't just something it does as par of course, but exactly the external stimulus capitalism needs to grow. She points out that early capitalist industries from the get go cast their nets for resources and customers far and wide, not contenting themselves with displacing only local competitors but actively hunting them down around the globe, whichever mode of production they may reside under. Her explanation of imperialism, penned three years before Lenin's, is hence different from the marxist mainstream: imperialism, as the penetration of non-capitalist enviromnents by capitalist property relations, is not a consequence of over-ripe capital seeking new markets, but rather the precondition of any sort of ripening whatsoever. The day the sun sets on the fully capitalized globe will also be capital's last.

But we don't need to take this thesis at face value, as Joan Robinson reminds us in her introduction. Aside from the fact that the bulk of the book is not related to its point (Luxemburg can at most prove that the given model of reproduction is wrong; she does not provide a logical explanation, let alone a historical, of why hers is right -- all she does is posit it), there are crucial gaps in that bulk. Luxemburg, as the author of Social Reform or Revolution an intransigent communist, was ardently opposed to the idea that crises could be managed under capitalism or that socialists had any role ameliorating capitalism: socialism could only be built on a radically different basis, not reformed out of capitalism. Her idée fixe is that capitalism is inherently self-destructive, not just morally, but on its own economic terms as well. Her book treads neatly within these political coordinates. But she much overstates her case: the wages of the working class as a proportion of the total product can rise, technological change provides its own stimulus engendering ever-greater cycles of accumulation. Hence despite centering 'effective demand' in her argument, Luxemburg was no proto-Keynesian. Keynes' ED is a quantitative variable that can be manipulated by state policy; Luxemburg's is the sine qua non of accumulation, unsustainable, and always a form of theft: primitive accumulation made permanent.

Luxemburg's tunnel vision focusing on Volume II blinded her to the more sophisticated logic of crisis borne out in the two other volumes: crisis not as the apocalyptic wall capitalism must crash into once all non-capitalist production has been extinguished, but rather as the regular feature triggered by the declining rate of profit and the disproportionality of investment in different sectors. The Accumulation of Capital hasn't simply been forgotten because it's logically deficient, but because it is so politically as well. Chunks of her analysis can be recuperated (certainly the awareness that non-capitalist modes of production can exist even within a capitalist world economy, as most exemplified by the cotton slave states of the American South providing the British manufactures with their raw materials, allows for nimble theoretization). But you can just read Robinson and Sweezy's comments on her for that.

[Feliks · Rating 2 out of 5]

It's a handy work to have around but I'm not enthused about it so far. At the outset, the best part is discovering the preface has been penned by none other than Joan Robinson, (who herself is upcoming on my list of vital economists to survey). Once the actual text written by Luxemburg (of whom I am an admirer) begins, I find it curiously flat, cold, dry, and curt. Quite arbitrary and dismissive. Perhaps seven or eight chapters (of the thirty presented) stand out for their focus and choice of subject matter; but the rest is unfortunately made useless by the errors pointed out by Robinson in the introduction. So --for instance --why read Chapter 30 ('militarism') if one realizes in advance that it contains a an underlying theoretical error? No. Therefore it leaves one to 'cherry-pick' among Luxemburg's thought, rather than plunging in and sailing on through to the end.

Now, 'Section II' looks to be of some utility --for there, Rosa confronts the slew of minor German and Russkie economists who criticized Marx in her day; and she deals them summarily. She's a powerhouse, a dynamo. But in the end, it is as Robinson says: all that is left of Rosa's criticism of capitalism is perhaps her theory of it's "imperialist basis". Though this has stood the test of time, the rest of her contribution has not.

Thus, it winds up being a dubious experience to read a book with unenlivening prose and errors so well-known that entire chapters are rendered worthless. It results in a book on can not 'love' despite any affection for the author herself. I will flip through it hurriedly; then set it aside in favor of something else from her fascinating bibliography. Faugh! Disappointed.

[Elizabeth D · Rating 5 out of 5]

I’ve always been frustrated by, and suspicious of, the too-easy dismissal of this text as “well Luxemburg was a good Marxist but she didn’t really understand the circuits in Capital Vol. 2.” I am still unsure about the central claim that capitalism *must* take over non-capitalist spheres- how does this allow us to understand continuing imperialism in a world where nearly the whole globe is already capitalized? - and am open to all comers on those damn reproduction schema. But this book is very far from the idea of “underconsumptionism” it’s often caricatured as- in fact, Luxemburg is at great pains to debunk vulgar understandings of underconsumptionism. The book also provides indispensable context of debates within economics and Marxism from classical political economy to Legal Marxism. The last section on colonialism and imperialism is the real barn-burner, and makes clear that, as a matter of historical and present reality, capitalism has always been an expansionist, violent, cannibalizing force.

[Anima · Rating 4 out of 5]

‘Capitalist entrepreneurs expand their activity into backward regions not only because they generally have a thirst for profits anywhere, and not only because of rivalry among them. They are compelled to do so because they as a class, as global capital of a given country, have declining opportunities to sell their products profitably in their own country.
Hence the process of exchange between the capitalist and non-capitalist environment acts as a feeding ground of accumulation, and is a sine qua non of the existence of the capitalist economy. This explains the roots of imperialist rivalry between the superpowers for colonies.’

[Timothy Dymond · Rating 3 out of 5]

‘The Accumulation of Capital’ was published in 1913 and represents the last gasp of a pre-1914 version of Marxism: an intellectual world close enough in time to Marx and Engels that they could be treated as living, breathing people rather than ideological tin gods. Rosa Luxemburg, because she notionally favoured ‘revolution’ over ‘reform’, is often classed as a defender of orthodoxy against revisionism. However in Accumulation she freely disagrees with Marx over his views on capitalist production, and it really seems like no big deal. She treats him a fellow investigator from whom you can learn, and on whom you can improve.

Luxemburg is specifically looking at the view of capitalism outlined in Marx’s Volume II of Capital - which makes the first part of Accumulation a very difficult read. Capital Vol II itself is a difficult and incomplete (and posthumously published) work, and Luxemburg doesn’t make it easy for her readers either. She is essentially confronting an issue arising from Marx’s ‘modelling’ approach to analysing capitalism - which envisages increasing capitalist production occurring in an abstract capitalist world, where there are no non-capitalist countries and no classes other than capitalists and workers. Luxemburg argues that capitalism actually needs to plunder the non-capitalist world in order to enlarge its production. In her words, Capitalism is ‘the first mode of economy which is unable to exist by itself, which needs other economic systems as a medium and soil’. Therefore it must

‘… always and everywhere fight a battle of annihilation against every historical form of natural economy that it encounters, whether this is slave economy, feudalism, primitive communism, or patriarchal peasant economy. The principal methods in this struggle are political force (revolution, war), oppressive taxation by the state, and cheap goods; they are partly applied simultaneously, and partly they succeed and complement one another.’

This is a theory of Imperialism - many elements of which have been picked over and developed by other radical writers and thinkers since Accumulation was published. Luxemburg’s thesis has been adopted so widely (though not always credited to her) that her book probably suffers 100 years later from reading like an extended effort to explain the obvious. The best part of the book is the 3rd Section ‘the Historical Conditions of Accumulation’ - which is where Luxemburg starts to set her own ideas in historical context. One is tempted to say that this section should really have been the basis of the entire book, however Luxemburg would probably insist that the Problem of Reproduction needed to be fully fleshed out, and placed in the political economy context just as Marx tried to do.

The best approach to this book is probably to read the 3rd section first - to get a sense of where Luxemburg is going. As a writer Luxemburg is a more pleasant read than Marx. In particular she doesn’t feel Marx’s need to constantly subject the economists with whom he disagrees to a birching in print. Luxemburg certainly criticises people such as the Russian ‘Legalist Marxists’ - who managed theorise the socialism out of Marxism altogether. At the same time she is more respectful than Marx of Jean Charles de Sismondi who, despite his political limitations ‘put his finger on every one of the sore spots of bourgeois economics’.

[Roberto Yoed · Rating 4 out of 5]

Aside from labour exploitation, there’s a depredation from foreign countries: imperialism in contemporary marxist-leninist terminology.

[José María · Rating 3 out of 5]

tl;dr: capitalism can't exist in isolation. It needs to fagocitate everything else to keep growing.

[Michael · Rating 3 out of 5]

If you want a classic exposition of the core economic features of imperialism particularly as it played out in the 19th century, just read the 3rd section of this book. If you want to understand how these features arise out of a more fundamental contradiction between the production and realization of surplus-value, then also read the 1st section. And if you want an exhaustive analysis of Marx’s reproduction schemes and the debates surrounding them then read the whole book. This is what you can expect to get out of Luxemburg’s magnum opus. It raises important questions but, ultimately, fails to provide convincing answers.

At its center is the thesis that expanded reproduction in a closed capitalist economy is inherently unable to realize the surplus-value it produces. It must rely on an external source of demand represented by non-capitalist consumers and this provides the impetus for imperialism. Luxemburg’s reasoning for this underconsumptionist argument is difficult to pin down exactly. In its simplest form it goes something like this: who, in capitalist society, is there to purchase the surplus-value produced at the end of a production period? It can’t be the workers since their consumption is accounted for in the variable capital outlays. It can’t be the capitalist’s luxury consumption since, if all the surplus-value was so consumed, there would be none left over for capitalization and the economy would persist in a state of simple reproduction. It can’t be the various unproductive segments of society such as the military, civil bureaucracy, managerial classes, or infirm since their consumption is a reduction from capitalist consumption. It must be purchased by the capitalists’ productive consumption in additional variable and constant capital. But then the mass of surplus-value in the following production period is even greater and we have only reproduced the problem at a larger scale!

But, then again, what is the problem?! If the entire product can be absorbed by the personal and productive consumption of the various classes in period t, then there’s no prima facie reason it can not do so in period t+1 and so on. And so long as the proportions in the various departments are correct then we have a balanced growth path. In this form, the argument seems to rest on a strange and decidedly un-Marxist teleological conception of production as necessarily consumption oriented.

The problem is that Luxemburg’s argument seems to take on shifting forms that make her ultimate point obscure and difficult to see. She is occasionally perfectly aware that Marx’s reproduction schema demonstrate the possibility of balanced growth, dismissively noting that you can make the arithmetic work on paper. This would suggest that the explanation for deficient demand lies somewhere in the actual or historical working out of capitalist dynamics. But at other times she clearly expresses that the reproduction schemes fail to resolve the contradiction on their own terms. It’s not clear how.

Luxemburg’s close reading of Capital Vol II’s reproduction schema makes clear that, when Department I capitalizes some x percent of the surplus-value contained in the means of production it has produced at the end of a turnover period, there is some y percent Department II may capitalize of the surplus-value contained in its consumption goods such that the material needs of the additional constant and variable capital are met and the aggregate output is fully purchased by society’s constituent classes. Now whether Department II will capitalize just the right proportion of its surpluses is a legitimate question and Luxemburg does locate a problem here in that capitalists do not consciously coordinate their investment decisions ahead of time to ensure any inter-departmental balance. But Luxemburg does not concentrate on this potential criticism and, besides, it’s hard to see how it relates to her more general point that production for its own sake represents a “roundabout that revolves around itself in empty space.”

The introduction by Joan Robinson becomes extremely helpful at this point in clarifying what Luxemburg gets right for all her confusions. Luxemburg is asking an important question about the source of “effective demand” (in the non-Keynesian sense of demand for the final goods produced by expanded reproduction) in a capitalist economy. She is inquiring into the ex ante motivations of capitalists to invest. A question that can’t be answered by Marx’s schema which merely state the ex post conclusion that if the aggregate capital has a certain composition then there will be sufficient demand to absorb the aggregate output.

In my view, the real critique consists in asking “why should the aggregate capital have the necessary composition?" Marx’s schema rely on what Michio Morishima called “Marx’s peculiar investment function” whereby capitalists in Department II “unnaturally adjust” their rate of accumulation according to “the exogenously determined rate of accumulation in Department I”. But capitalists, in reality, invest according to the expected rate of return their capitals can earn. A model of expanded reproduction that takes this into account quickly shows the growth path to be unstable (see: Morishima, Marx’s Economics: A Dual Theory of Value and Growth).

But despite these weaknesses, the careful treatment of Marx’s schema in Section 1 and the discussion of various debates, especially those in Russian circles after the publication of Vol II, in Section 2 offer some compensation. Additionally, Luxemburg clarifies the nature of Marx’s contribution in the first few chapters of the book: his is the first circular flow model of expanded reproduction consistent from an accounting perspective. While Quesnay in the Physiocratic context had modelled the economy as a circular flow in his Tableau, it was limited to simple reproduction. And while the classicals like Adam Smith emphasized the importance of growth, they constantly resolved the aggregate output into income categories (ie. total output equals wages plus profits). This ignores the part of the product represented by constant capital, the accumulation of which is the basis for expanded reproduction. Marx’s division of the total social capital into C+V+S rectifies the classical misconception.

Finally, Section 3 offers an analysis of the economic aspects of imperialism with detailed reference to European conquests in China, Algeria, Egypt, and elsewhere. The key insight in this section is that capitalism seeks to acquire productive forces (especially land), establish commodity markets, commodify labor-power, and separate agriculture from industry in non-capitalist regions of the world. This is true whether or not she is right about the underconsumptionist tendencies of accumulation. The competitive drive to acquire cheap inputs and develop markets is sufficient to make the case that capitalism’s acquisitive nature compels it to overflow national boundaries and enlist governments in imperialist expansion.

[Jordan Phizacklea-Cullen · Rating 3 out of 5]

For the first half an extensive critique of Marx, Proudhon, Ricardo and others, Luxemburg's rigorous intellect and acerbic study is evident but also quite hard reading for the most part. The second half of the text, however, is more of a rigorous defence of communism in contrast to the failings of capitalism (ans contains some incredibly prescient analyses of imperialism), but you'll need to put in some hard work first before you get there.

[vinnie · Rating 4 out of 5]

“women be shopping”

[Sebb · Rating 4 out of 5]

In the end a book about grappling with the not fully worked-out consequences of the diagrams of social reproduction from the second volume of Capital, that largely accomplishes what it sets out to do even though it sometimes veers into bombastic overstatements for rhetorical purposes.

Divided into 3 parts, it starts with one of the better summarizations of the first 2 volumes of Capital in about a fifth of the space, centring on the diagrams for simple (reproduction on the same scale) and enlarged reproduction (reproduction involving a larger amount of capital based on reinvesting capital produced previously) in volume 2. As part of this, we are introduced to the constraints of reproduction involving the departments producing on the one hand capital goods and on the other consumer goods, specifically 3 mathematical constraints of reproduction: the total amount of capital goods produced in one period of production equals the amount of capital goods consumed in the next period of production, the total amount of consumer goods equals the total amount of consumer goods consumed by capitalists and workers in the next period of production, and finally, that the value of consumer goods consumed by the capitalists and workers in the capital goods producing department equals the value of capital goods used up by the consumer goods producing department. As a result of this Luxemburg states the problem: why are there crises (and an assumed final crisis) if the mathematical formalism allows enlarged reproduction?

The next section goes through a series of historical debates around social reproduction, none of which impinge very much on Marx's explanations concerning enlarged reproduction until just about the final chapters concerning the Russian Legalist Marxists, specifically Tugan-Baranovski. Now we get a first pass at the problem posed in the first section, where Luxemburg implies going from simple to enlarged reproduction is impossible (i.e. it is impossible to reinvest profits) because capital goods capitalists reinvesting profits would result in them consuming less, hence with consumer goods capitalists having an unsold product and hence an immediate crisis. The solution is merely a movement of capital away from consumer goods production to producer goods production (e.g. consumer goods capitalists responding to reduced profitability by moving into capital goods production, corresponding to an overall increase in demand for producer goods due to constantly increasing production and a decrease) in demand for consumer goods due to a restriction of consumption for the purpose of capitalisation. The move from simple to enlarged production can happen using Marx's numbers so:

4000c + 1000v + 1000s = 6000
2000c + 500v + 500s = 3000

becomes:

4363.64c + 1090.91v + 1090s = 6545.45
1636.364c + 409.091v + 409.091s = 2454.55

This allows enlarged production, at least in this idealised scenario, simply by moving capital goods and labour that exist in-kind from one department to the other.

Instead, when faced with Tugan Baranovski, using Marx's diagrams to point out crises are not necessary within capitalism, Luxemburg retreats to saying the diagrams don't represent reality, which is an odd way of defending Marx. There is then an attempt to save both the diagrams and the inevitability of crises from Tugan Baranovski, by pointing out that the productivity of labour tends to increase, hence that in the diagrams c would increase relative to v, which results in a mathematically equivalent problem to the previous one, specifically, the diagrams assume the old productivity of labour leading to an overproduction of consumer goods and an underproduction of capital goods, which could again simply be solved by a movement of capital between departments.

Then in the final section, Luxemburg attempts a novel contribution to the critique of political economy, which while marred by some overzealousness, does actually provide some new and useful tools. But first of all, there is an unnecessary argument to the effect that capitalism needs non-capitalist modes of production to realise its profits due to an encore about the impossibility of moving from simple to enlarged production. Capitalism is thus unique in the history of societies in being unable to exist on its own, even if the overarching structure of surplus-product production, part of which is consumed and part of which is reinvested in production, exists in all societies. Somehow, the existence of the market as a mediating mechanism makes this impossible.

But then we reach an analysis that is in fact profound. Because the production of surplus-value depends of the amount of labour-power and its degree of exploitation, and there is a physical limit to the degree of exploitation, there is an incentive to engage increasing amounts of labour-power in the capitalist production process. This is in fact necessary in the diagrams to account for the increased variable capital v. Of course this is not unique to capitalism, for example, Rome capturing slaves in war in order to boost its own productive base, within capitalism there is just a further incentive to do so under threat of bankruptcy from competing firms. There is of course still the increase of labour productivity, allowing the increase in c without a corresponding increase in v, as well as the increase in v, due to population growth. And even if none of these things happen, capitalism can still continue as simple reproduction with individual firms more viciously fighting over the same pie. Nevertheless, with the possibility of engaging more labour increasingly diminished once all labour in the world is more of less involved in capitalist production, especially after the last wave of globalisation. The possibilities for growth are much reduced and coupled with the tendency of the rate of profit to fall this makes investment less appealing leading to speculation and hoarding. The first results in increasing financialisation. As investing in physical production does not hold the promise of significant ROI, there is an increasing incentive to bet on the lottery of the stock market, with market valuation increasingly itself based on attracting further investment based on the promise of hitting it big, resulting in financial MLMs that burst in financial crises. The second consequence (hoarding) removes even the possibility of simple reproduction as workers don't not have the money to consume and capitalists have too much to ever consume it. Thus, not invested due to lack of returns and not consumed, it lies around available for paper investment in the stock market and speculation. The conclusion of increasing instability and deeper periodic crises is itself the conclusion Luxemburg reaches despite the general thrust of the argument militating for a conclusion that once non-capitalist modes of production profit will become 0.

To end with there is another mathematical error that vitiates the analysis in the description of militarism, where she forgets to take into account that the capital goods department also has to produce enough means of production to reproduce the ones used up in the production of military materiel. This leads to the incorrect inference that military production somehow through some fudging results in a reduction of the consumption of the workers more drastic than even the reduction of commodity production (for a reduction in consumer goods value of 100, the value of variable capital is reduced by more than 180). What military production merely means is moving production around, amounting to both a reduction in consumption and a slowing of accumulation (which might itself be useful if the opportunities for investment are slim and hoarding would be appealing).

Overall there are valuable insights, vitiated by a desire to overstate the premises to a point where such strong premises are unnecessary to prove the conclusion, which is the increasing instability and competition both in the economy, between firms, and in the inter-state system, between states.

[Jon · Rating 4 out of 5]

Luxemburg's central question here is how can capitalists realize profits over the long term? Luxemburg follows Marx's logic over the issue in an unfinished section of Capital: A Critique of Political Economy, Volume 2. She also interrogates several classical economists, several fellow socialists, and a Narodnik or two in looking for an answer.

The historical sweep of her studies is fantastic, though I'll admit I found the mocking and generally acerbic treatment of her subjects a little tedious. She does show, however, though several economists had recognized the problem, nobody provided any good answers—as markets become saturated and the rate of profit falls, where can a capitalist realize growth?

This book was published in 1910, which was still the height of the so-called "age of empire," and for Luxemburg that is where the answer was: capitalism relies on the primitive accumulation within its empires; profits can be continually realized on the backs of their non-capitalist territories. Furthermore, she argues once this primitive accumulation dries up and the who world is turned over capitalist production, there will be no more room for growth, the accumulation of capital will end, and the whole edifice will crumble into dust.

Of course at this late date we know this isn't the way it worked out. Luxemburg didn't find the answer to her question after all. While it's true capitalism certainly still relies on non-capitalist forms of production (and reproduction) in order to survive, there are no longer any non-capitalist countries that could fulfill the central role Luxemburg assigns them here. But ironically, she did locate the actual engine that keeps capital accumulation afloat, adjacent to her argument. The finance capital that was developed in her age, the age of formal imperialism, is in many ways structurally the same finance capital which drives the world's economies today. The main difference is the colonial empires simply withered away, proving themselves as unnecessary appendages to capital accumulation. We have known for half a century neocolonialism doesn't need such formal trappings.

[Malik · Rating 4 out of 5]

Die kapitalistische Akkumulation ist nach Rosa Luxemburg auf Expansion und den Weltverkehr angewiesen, weil nur so der Mehrwert realisiert und produktiv verwertet werden kann. Demnach ist der Imperialismus eine ökonomische Notwendigkeit des Kapitalismus.
Kapitalisten und Arbeiter können laut ihr den produzierten Mehrwert nicht vollends selbst konsumieren. Die Realisierung des Mehrwerts benötigt zusätzliche Abnehmer außerhalb dieser Klassen. Laut Luxemburg ist die kapitalistische Produktion dementsprechend auf nichtkapitalistische Schichten und Länder angewiesen, wie z.B. bei dem Export von Baumwollwaren nach Indien und Maschinenexporte in koloniale Regionen.

Interessant war, wie sie angeführt hat, dass der Kapitalismus die Bedingungen seiner eigenen Reproduktion zerstört. Hierbei gibt es einen Widerspruch in der Akkumulation.
Denn: Die Kapitalistische Akkumulation erfordert eine permanente Erweiterung der Produktion. Dafür nötig, ist die Realisierung des Mehrwerts (durch Absatzmärkte) und die Hinzufügung von Produktionsmitteln und Arbeitskräften.

Widersprüchlich ist hierbei, dass diese Voraussetzungen außerhalb der kapitalistischen Produktionsweise liegen. Externe Grundlagen wie z.B. neue Arbeitskräfte aus vorkapitalistischen Strukturen, werden durch die Expansion des Kapitalismus selbst zerstört.
Dementsprechend gibt es eine Selbstaufhebung durch die Expansion. Im Grunde stellt sie dar, dass je erfolgreicher der Kapitalismus expandiert, mehr nichtkapitalistische Milieus aufgelöst werden und weniger Märkte, Ressourcen und Arbeitskräfte außerhalb des Systems bleiben.

Die Folge davon ist ein Kapitalismus, der sich selbst seine Reproduktionsbedingungen raubt.

Rosa Luxemburg hat mit diesem Werk, als bedeutende politische Denkerin, die Herzen vieler
linker Bewegungen gewonnen. Selbst wenn die Herausgabe, ein Produkt der Zeit gewesen ist und ich gewisse Aspekte (wie z.B. die Übergangsformen zwischen kapital. und nichtkapit. Sytemen) misse, hat sie für mich eine monumental bedeutende Leistung erbracht, für die sie bis heute berechtigterweise verehrt wird.

Sehr empfehlenswert!!

[Spellbind Consensus]

* Rosa Luxemburg’s *The Accumulation of Capital* (1913) challenges and extends Marx’s economic theory by addressing a problem she identifies in Marx’s reproduction schemes: how can capitalism continue to expand if surplus value cannot be fully realized within a closed capitalist system?
* She argues that capitalist economies must constantly expand into non-capitalist environments to find outlets for surplus value. This necessity leads directly to imperialism.

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### **Key Arguments and Examples**

* **Limits of Capitalist Reproduction**

* Luxemburg critiques Marx’s assumption that capitalism can internally resolve the realization of surplus value through expanded reproduction.
* She shows mathematically and theoretically that demand from capitalists and workers within a capitalist system is insufficient to absorb all surplus.
* Example: Even with reinvestment in machinery or labor, the circuit cannot sustain itself without external demand.

* **Role of Non-Capitalist Environments**

* Non-capitalist societies—peasants, colonies, indigenous communities—are essential to capitalism’s survival because they absorb surplus commodities, provide raw materials, and offer new labor markets.
* Example: European colonial expansion in Africa and Asia is explained not as cultural or political conquest, but as a necessary economic act to preserve capital accumulation.

* **Imperialism as Structural**

* Imperialism is not an aberration or political strategy—it is the inevitable result of capitalism’s need for external markets.
* Luxemburg provides case studies of European colonialism in Egypt, India, Algeria, and China to show how military power, debt systems, and forced labor maintain these dependencies.

* **Destruction of the Non-Capitalist World**

* The more capitalism expands, the more it erodes the very non-capitalist environments it depends on, creating a terminal contradiction.
* Example: Once the global capitalist system eliminates non-capitalist modes of production, it will face systemic crisis with no outlet for surplus value.

* **Historical and Revolutionary Implications**

* Luxemburg concludes that capitalism’s internal contradictions and reliance on violent expansion make socialism not just a moral imperative but a historical necessity.
* She warns that without socialist revolution, capitalism’s trajectory leads to imperial wars and global collapse.

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### **Tone and Writing Style**

* **Tone:** Theoretical, polemical, and morally urgent.
* **Writing Style:**

* Dense but precise, moving from abstract economic models to historical illustration.
* Combines formal economic critique with passionate anti-imperialist analysis.
* Uses empirical examples from global colonial history to reinforce theoretical claims.

**How the Style Supports the Content:**
Luxemburg’s rigorous, uncompromising style mirrors her intent: to expose deep flaws in capitalist theory and to link them directly to real-world violence. Her theoretical clarity allows her to confront complex issues without losing focus. The book’s urgency and analytical depth reflect both academic training and revolutionary commitment.

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### **Author Qualifications and Their Impact**

* **Rosa Luxemburg (1871–1919)** was a Marxist economist, philosopher, and revolutionary, educated in Zurich with a doctorate in law and political economy.
* She taught political economy at the SPD party school in Berlin and was a central figure in socialist debates on reform vs. revolution.
* Her engagement with Marx’s work was both critical and loyal—she sought to preserve its revolutionary spirit by correcting what she saw as its internal weaknesses.
* Luxemburg’s role as a theorist, journalist, and political organizer gave her a comprehensive perspective on how economic theory connects to lived political reality.
* Her critique of imperialism in *The Accumulation of Capital* remains foundational for anti-colonial and Marxist economic thought, offering a framework for understanding global capitalism’s dependence on exploitation beyond its own borders.

[Joe Baldoni Karlik · Rating 4 out of 5]

Luxembourg's contribution to political economy is the necessary link bridging the careful scientific analysis of capital found in Marx and Engels to the body of anti-colonial and anti-imperialist theory. Many have demonstrated and analyzed the intimate link between capital and imperialism and colonialism as it exists, but by carefully demonstrating that capitalist accumulation cannot occur within a closed capitalist economy -- that capital always requires non-capitalist economies to serve as spheres for accumulation, this observation that capital tends toward imperialism and colonialism can be seen as a hard and fast cause and effect. Luxembourg's analysis demonstrates the fallacy of any attempt to purify capitalism of its imperialist and colonial (and therefore racist and genocidal) tendencies.

Whereas Lenin demonstrated similar causal relations between capitalism and imperialism observing monopoly as the logical conclusion of capitalist competition and with it the ascendancy of finance and international competition mediated through interstate conflict (itself an important analysis not in conflict with Luxembourg's), Luxembourg's analysis demonstrates this causal link on an even deeper and general level by demonstrating making sense of not just the European imperialism of the 19th Century, but the much longer history of foreign-power colonialism, settler colonialism, and slavery.

By demonstrating the need for non-capitalist spheres, Luxembourg dispels the apparent paradox of capitalism helping foster the development of economic relations other than the wage-labor relation such as various forms of slavery as well as small peasant economy. Perhaps Luxembourg's most important conclusion and addition to historical materialist analysis of capital is that rather than a discrete event occurring at capital's first stages, "primitive accumulation", whereby capital steals the accrued wealth of of other and older economic forms, is ever ongoing.

Rosa Luxembourg's work represents a decisive improvement on the groundwork laid down by Marx on the topic of capitalist accumulation.

Admittedly, much of what I have here discussed refers primarily to the book's last section (along with part lc the first) wherein Rosa Luxembourg lays down her theory of capitalist accumulation. The middle of this text is an fairly in-depth critique of other political economists' understanding of accumulation demonstrating how other thinkers misunderstood (or mystified) the true nature of accumulation. For those not terribly familiar with the details of the back and forth discussions taking place within 18-19th Century political economy (like myself) this can be a pretty dense and less rewarding chunk of the text. Having read the book in its entirety, I think I can confidently say that the critique of different thinkers (except Marx) can be skipped without any real loss of understanding of Luxembourg's theory detailed in the last section.

[Brad · Rating 5 out of 5]

A fascinating and apropos expose of the inherent function of accumulation of surplus value in capitalism and the necessitation of imperialism and colonialism.

These are initial thoughts, but while I vaguely recall sceptical reactions to this work on grounds that it claims capital requires "non-capitalist" markets, the thrust of the thesis that perpetual accumulation is necessary seems to hold up if we take modern "dependency theory" and substitute whatever term (third-world, periphery, colony, etc. etc.) for "non-capitalist social environment". We're in that phase where in spite of relations of dependency perpetuating the "underdevelopment" of the global south, its emergence in a rival sphere of influence heightens the contradictions of imperialism.

Much as more polemical accounts of imperialism have their place for agitation and education, this substantive historical materialist account helpfully does the math and lays bare the formulaic institutional economic prerogatives. Reading The Accumulation of Capital in conjunction with retrospective accounts of contemporary imperialism (i.e. Mike Davis's "Late Victorian Holocausts") and more poetic condemnations of colonialism (Aimé Césaire's Discourse on Colonialism) lays bare the continual thread of "thingification" of colonized peoples.

That imperialism is endemic to capitalism is not, today, a novel contention, but it's enlightening to see it elaborated not just through the facts and figures and historical accounts, but the operative laws of economics contra the classical claims of harmonization, free trade and equivalent exchange.

Typically, as a spiritual sequel to Marx, Luxemburg does not detail an alternative system (though it is touched on in generalities). Yet the detailing of the barbarity of colonial exploitation reinforces the stark choice in the backdrop between socialism and barbarism. It punctuates, further, the answer to the question "Reform or Revolution".

Notwithstanding that Luxemburg is lesser-known relative to the memory of "Actually Existing Socialism" that took off as she met her tragic end, the ongoing crises today, trite as it might be to say, make the spirit of her work as important as ever in guiding our approach to the watershed moments determining our collective future.

[J · Rating 4 out of 5]

A hard read, and difficult to consume. The narrator makes it easier than it would be in text, but I found myself having to frequently rewind to make sure I had caught all the details - best way to read the book is probably audio + text. Another issue was that I was not properly prepared for the contents of this book - I should have reread Capital, because I did not have a good grounding of classical economics in my head before starting this. That being said, you're able to pick up a lot of it from the chapters and chapters of analyses and criticisms she does, which usually end with a quippy and genuinely startling slam at that author's expense.

The final chapters (26 through 32) are the most interesting, as in those she transitions from analysis of other's theories into a historical review of proofs for her own theories (or proofs of Marx, excluding her critique and evolution of his theories in the inclusion of the state and other non-capitalist non-worker parties in society in her economical analyses). It's very interesting to read this book right now, and draw parallels with the reach of the capitalist class in America as it suffers from its own metabolization of the american consumers and a lack of places to expand into.

If you've got the ability to trudge through it, I do feel like I learned some things. I'll have to continue on with some other analyses online and see if I got what other readers did.

[Kerem · Rating 3 out of 5]

Overall an interesting book to read despite being often dry and hard to read. The book primarily concerns the problem of accumulation, as its name clearly promises, and particularly focusing on what Marx didn't complete in his own work. Being a socialist herself, Luxemburg has a thorough critique of Marx as well as many others, from Smith to Ricardo. The first part is probably the hardest and driest part to read, with various calculations that make you to stop and think. The second part is more appealing and interesting in the sense that Luxemburg revisits past economic debates around economy and accumulation, in a bit of a lively debate format. Final part of the book is where she establishes her own theories, touching upon a range of aspects from imperialism to militarism. Despite some confusing calculations and not so realistic assumptions, it is in general a thorough and interesting attempt (and certainly better than many others before and after her) on understanding how capital can actually accumulate. If you have an interest in economics, worth your time reading it. Also the introduction by Joan Robinson gives you a very clear overview, from the most insightful analysis to the least sensible assumptions made, so that's certainly valuable.

[Snom Anomalocaris · Rating 4 out of 5]

The beginning of this book is a great review (and critique!) of the first half of Capital Vol.II. Luxemburg then asks the question "Where does economic growth (which she later identifies to capitalist accumulation) come from?"

The end of the book is a really interesting report on Imperialism, and really shows how "primitive accumulation" was happening everywhere at the same time, at different degrees of intensity.

Now, between the two lies a massive history of economic thought. Luxemburg knocks the door of every economist, in the hope of finding a solution to her dilemma. But nowhere does she find a satisfying answer.

This extensive critique is very daunting, not very informative, and makes the end feel very rushed: once she finally answers her question, she doesn't really take time to critique her own abstract computations that don't really represent social nor economic reality, but rather an arbitrary set of numbers being added to each other.

Nevertheless, it is a great read and undoubtedly a Marxist classic no one should avoid.

[Ansgar · Rating 3 out of 5]

Me ha gustado que de su propia respuesta a la acumulación del capital, pero también es verdad que no me ha satisfecho del todo. Avanza sobre las ideas de Marx en sus diagramas inacabados del volumen II, pero como demuestra ella misma con sus predicciones de futuro algo falla. No creo que se equivoque en que el capital necesita economías no capitalistas para subsistir, pero sí ha demostrado que puede distorsionar la economía y apoyarse en políticas de austeridad en países clave sin necesitar países esclavos o siervos.

Ya decía que Harvey que China salvó al capital al final de S XX abriendose al mercado y absorbiendo todo el plusvalor europeo y yankee, pero ahora qué. ¿Qué hago Paco me mato? No caerá esa breva.

[Ben · Rating 4 out of 5]

The amount of background given to the history of thought on surplus capital was both impressive and took a star off the rating because I feel I got too much Sismondi and Baranovski and not enough Rosa. The best, most interesting parts the book are where she's giving her own opinion, and the final hundred pages were very worth the slog to get there, it really is a slog at times though.

A wonderful companion to A People's History of the United States, Open Veins of Latin America, and The Shock Doctrine, that in many ways predicts and clarifies the future events covered in all three.

[Jay Jolles · Rating 4 out of 5]

My full review is contained in my AmCap paper but: I found this shockingly prescient for our current time and surprisingly compatible with/relevant to my own work in disasters and crisis capitalism. Her articulations regarding the relationship among capitalism, imperialism, and militarism and its attendant need for human liberation feels increasingly more relevant for our days. Also shockingly readable for a work in/on economics.

[Emma Goldman · Rating 5 out of 5]

Absolutely vital reading for any student of Marxist Economic Theory. Luxemburg's core contribution here is the identification of imperialism as core to the function of Capitalist expansion and crucially of Capitalist adaptability, which was one of the core oversights of Marx himself.

Her contribution to Marxism is immense, and this book is her at her most incisive.

[Leah Montange · Rating 5 out of 5]

I read the introductions and the third section, which is the part where she expresses her theory. People seem to think that the second section, on the history of the idea of accumulation, is a good read and that her method in this section is valuable so maybe I will return to it at some point.

[Stik · Rating 5 out of 5]

I have this in a beat-up hardcover edition, stole it from a friend, most beautiful and magnificent thing my eyes have laid on

[Andrew Noselli · Rating 4 out of 5]

I ought to have read Volume 2 of Capital, which contains Marx's schematic diagram for the reproduction of capital, before reading this.

[Isaac · Rating 4 out of 5]

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