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Encyclopedia > Exploitation theory

The exploitation theory is the Marxist theory that profit is the result of the exploitation of wage earners by their employers.


It rests on the labor theory of value which claims that value is intrinsic in a product according to the amount of labor that has been spent on producing the product. Thus the value of a product is reflected in its finished price which in turn is divided between labor (wages) and capital (profit) - the raw materials are further divided between labor and capital. Therefore, "making a profit" essentially means taking away from the workers some of the value that results from their labor. This is what is known as capitalist exploitation.


The Austrian economist Eugen von Böhm-Bawerk critiqued the exploitation theory. He argued that capitalists do not exploit workers, but accommodate them by providing them with income before getting a revenue from the output they produced.


  Results from FactBites:
 
THOUGHTS ON EXPLOITATION THEORY (2603 words)
Exploitation Theory is the cornerstone of the attack on capitalism.
In essence, Exploitation Theory asserts that the institution of private property allows the privileged few to reap the benefits of the labors of others without needing to contribute anything by way of effort, ability or labor.
Women are said to be particularly vulnerable to economic exploitation because of their physical weakness, the burdens of child-bearing & child-rearing and because of a history of discrimination by men.
Exploitation - Wikipedia, the free encyclopedia (2112 words)
Pro-market theory also argues that technological change is a disruptive force, and tends to abolish monopoly and monopsonistic power in mature business sectors, as with the shrinkage of the Western Union corporation and its power.
The focus of most assertions about the existence of exploitation is the socio-economic phenomenon in which people trade their labor or allegiance to a powerful entity, such as the state, a corporation or any other private company, or a trade union.
As in Marxist theory, the problem is structural rather than organizational and can coexist with free markets: given their special position in society (controlling an important asset), an interest group can shift the distribution of income in its direction, impoverishing the rest, even though their role serves no reasonable purpose.
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