Marxian Economic Analysis: Capitalism, Expropriation, and Divergent Paths to Modernity

The historiography of economic development is fundamentally dialectical, with Smithian and Marxian paradigms forming its central opposition. Scholars upholding Marx’s legacy, while often contentious, share sufficient common ground to be considered a coherent school. For Marxists, Western economic primacy similarly stems from the rise of capitalism, which Marx viewed as a necessary and progressive phase that shattered feudal constraints. He saw capitalism’s development as an internal process within certain Western societies that rapidly globalized, becoming a worldwide system requiring a global analysis. Marx exhibited ambivalence on a universal model of development, alternately suggesting underdeveloped nations could see their future in advanced ones while denying he possessed a supra-historical philosophical theory.

For Marxians, a market economy and its attendant behaviors are not natural but historically specific constructs. Most people, they argue, would resist the market's relentless discipline. The creation of a proletariat—a labor force with no choice but to sell its labor power—was achieved through expropriation, a concept central to Marxist thought. This process of divorcing producers from their means of subsistence was fundamentally violent, requiring paramount state support to enact. The transition thus hinges on the coercive restructuring of property relations, not merely the removal of impediments to natural market behavior.

In this analysis, traditional economies dominated by small owner-producers (e.g., peasants working within a household mode of production) must be dismantled for capitalism or socialism to emerge. Historian Barrington Moore Jr., in his seminal Social Origins of Dictatorship and Democracy, elaborated that this elimination followed multiple historical routes. Beyond the "classical" capitalist English path, he identified a fascist route (Germany, Japan), where peasants were courted and the state drove industrialization, and a communist route (Russia, China), where peasants supported revolution only to be later collectivized to fuel urban growth.

Marxist perceptions of the non-West often surprisingly mirror Smithian critiques in diagnosing a lack of dynamism. Marx himself made sporadic, unsystematic comments, describing "the Orient" as "unchanging" due to the alleged absence of private property. Scholar Karl Wittfogel later extended this with his thesis of "oriental despotism" and the "hydraulic state," applied notably to China. Official Chinese Marxist historiography, however, typically labeled the pre-modern era as "feudalism" with stifled "sprouts of capitalism," blaming the state, local elites, and later, foreign imperialists for their suppression.

This highlights a core Marxist ambivalence toward imperialism: while condemnable for its exploitation, it is also seen as an unwitting trigger for capitalist development. In India, the influential Aligarh School of Marxist historiography pointed to the village community and the extractive Mughal state as barriers to autonomous capitalism, changes only arriving under colonial auspices. Marx’s own work did not systematically address Latin America or Africa, a gap later filled by neo-Marxist scholars. Similarly, a traditional Marxian systematic analysis of the Ottoman Empire remains underdeveloped, pointing to the evolving nature of this theoretical tradition in confronting global economic history.