Join the Leftypedia Discord server for information, discussion, and updates!
English language version

Market exchange

From Leftypedia
Jump to navigation Jump to search

"Marx's 3 Forms of Market Exchange" with Richard D. Wolff

Market exchange occurs whenever a commodity is bought and sold. Most markets rely on sellers offering their goods or services (including labour) in exchange for money from buyers.

Distinguishing characteristics

Distinguishing characteristics of market exchange include:


Marx classifies several types of market exchanges:

Formula Explanation
M-C An act of purchase: a sum of money purchases a commodity, or "money is changed into a commodity."
C-M An act of sale: a commodity is sold for money.
M-M' A sum of money is lent out at interest to obtain more money, or, one currency or financial claim is traded for another. "Money begets money."
C-C' Countertrade, in which a commodity trades directly for a different commodity, with money possibly being used as an accounting referent, for example, food for oil, or weapons for diamonds.
C-M-C' A commodity is sold for money, which buys another, different commodity with an equal or higher value. Money is used as a medium of circulation.
M-C-M' Money is used to buy a commodity which is resold to obtain a larger sum of money.
M-C...P...-C'-M' Money buys means of production and labour power used in production to create a new commodity, which is sold for more money than the original outlay. "The circular course of capital."

See also