Commodity-Money Relations

social relations arising between people by virtue of the production and sale of commodities. Commodity-money relations existed even in the incidental exchanges of surplus products between communes. Here, there was no commodity production as such, but there was commodity exchange. “It is well known, ” wrote V. I. Lenin, “that commodity circulation precedes commodity production and constitutes one of the conditions (but not the sole condition) of the rise of the latter” (Poln. sobr. soch., 5th ed., vol. 3, p. 553). Only as a result of long historical development of the social division of labor does commodity production arise, wherein the exchange of goods has a regular rather than an incidental character. A transition occurred from a simple exchange of commodities, expressed by the formula C—C, to an exchange of commodities using money, expressed by the formula C—M—C. This process for the rise and development of commodity-money relations manifested itself in the development of forms of value.

Commodity-money relations exist with different methods of production; in each case, they express the production relations, primarily ownership relations. For this reason, the content of commodity-money relations and the aggregate of the features characterizing the relations do not remain unchanged in moving from one method of production to another. Nor do they remain unchanged with any single method of production. Here, there are common features in the content of the relations that make it possible to characterize the relations as commodity-money. “The production of goods and the circulation of goods, ” wrote K. Marx, “represent phenomena inherent to the most diverse methods of production, although their volume and significance are far from the same” (K. Marx and F. Engels, Soch., 2nd ed., vol. 23, p. 124, note).

Commodity-money relations are influenced by given methods of production, but they themselves actively influence the system of production relations characterizing these methods. Thus, while commodity-money relations contributed to the breakdown of primitive-communal, slaveholding, and feudal methods of production, all of which were characterized by a natural economy, the relations had a subordinate character. Commodity-money relations figure most prominently under capitalism, where they assume a universal character and express the basic production relation—that of the exploitation of hired labor by the capitalist. The hired worker acts as the seller of labor power, and the capitalist as the buyer.

Under socialism, commodity-money relations also exist and undergo development. With the transformation of social relations on socialist principles, the essence and role of commodity-money categories change. Commodity-money relations express fundamentally different social ties and perform new functions. They represent a form of production and a means of exchange for the activities of workers of collective production. Commodity-money relations have a socialist content. The sphere of action of commodity-money relations has been narrowed because labor power, land, and mineral wealth have ceased to be commodities. Commodity-money relations in a socialist society have a subordinate character; they are neither universal nor predominant. At the same time, the relations are important for the functioning of the socialist method of production and distribution and the method for the exchange of activity. For this reason, the relations characterized by such commodity-money categories as prime costs of production, prices, profit, profitability, money, wages, credit, and khozraschet (“business calculation”) are consciously used in the management of the national economy, primarily in the planning system. The socialist state, on a planned basis, sets and changes the prices of goods, and it regulates the flow of credit by fixing the volume and recipients of credit and the rate of interest. The state also regulates the payments for capital and the basic principles governing profit distribution; on a centralized basis, it organizes the wage system. The place and role of commodity-money relations in a socialist economy have been made clear through the experience of socialist economic management in the course of extended debate and much research. Revisionist theories of “market socialism, ” which questioned the laws governing the planned development of a socialist economy, were refuted, as were claims that commodity-money forms are incompatible with socialism, in particular a developed socialist society. Under socialism, commodity-money relations are used in building a communist society, in which there will be no need for such relations.