THE AMERICAN ECONOMIC ASSOCIATION TRANSLATION SERIES
Walras: Elements of Pure Economics, trans, by W. Jaffe
Chayanov: The Theory of Peasant Economy,
ed. by D. Thorner, B. Kerblay, and R. E. F. Smith
The participation of the American Economic Association in the preparation and publication of this volume consisted of the planning of the "Translation Series," and the selection of this title for the second volume with the hope of obtaining a wide distribution of an important economic classic among English-speaking scholars.
A. V. CHAYANOV
on
THE THEORY OF
PEASANT ECONOMY
edited by DANIEL THORNER
£cole Pratique des Hautes Etudes, Sorbonne, Paris
BASILE KERBLAY
£cole Pratique des Hautes Etudes, Sorbonne, Paris
R. E. F. SMITH
The University, Birmingham, England
Published for THE AMERICAN ECONOMIC ASSOCIATION
by richard d. irwin, inc.
homewood, illinois 1966
© RICHARD D. IRWIN, INC., 1966
all rights reserved. this book or a^y part thereof may not be reproduced without the written permission of the publisher.
First Printing, Novembej, 1966
Library of Congress Catalog Card No. 66-14540
printed in the united states of america
Preface
Probably the most sophisticated and best documented studies of the theory and problems of peasant economy in the half-century from 1880 to 1930 were written by Russians. This should not surprise us when we consider the long history, the immensity, and the severity of the agrarian problem in Russia, and the remarkable quality of the Russian intelligentsia of the era. The masterpiece of this theoretical literature appears to be the work, published in Moscow in 1925, by Alexander Vasilevich Chayanov, Organizatsiya krest'yanskogo khozyaistva {Peasant Farm Organization). An English translation of this work serves as the core of the present volume.
At the time he wrote it, Chayanov held the leading chair of agricultural economics in Soviet Russia. He was already well known in his field in Europe, and several of his studies had been published in German. One of these, Die Lehre von der bäuerlichen Wirtschaft [The Theory of Peasant Economy), Berlin, 1923, was an earlier and shorter version of Peasant Farm Organization. This 1923 version was soon afterward translated from the German into Japanese by Professor Isobe of Tokyo University, and has since served as a standard manual in Japan. What is more, Professor Isobe in 1957 issued a translation direct from the Russian into Japanese of Chayanov's fundamental work, Peasant Farm Organization.
In contrast to their reputation in Japan, Chayanov's name and works have slipped into obscurity in both Europe and America. He is rarely cited in his native country or language and, to the best of our knowledge, has not been translated during the past 35 years into any other European language. The importance of his work was called to the attention of D. Thorner in Delhi in 1952 by Dr. Zakir Husain, author of Die Agrarverfassung Britisch-Indiens. Dr. Husain was then Vice-Chancellor of Aligarh University and has more recently been Vice-President of India. It is a pleasure to thank him here for inaugurating the rather long sequence of events which
vi The Theory of Peasant Economy
has led to our new edition of Chayanov's classic on the theory of peasant economy.
We present below the text of Chayanov's Organizatsiya krest'yan-skogo khozyaistva, translated into English by R. E. F. Smith. With it, we give the English translation of one of Chayanov's outstanding articles, "Zur Frage einer Theorie der nichtkapitalistischen Wirtschaftssysteme," that is, "On the Theory of Non-Capitalist Economic Systems." This has been rendered into English by Christel Lane, of Birmingham, England. The article had to be translated from German because it was apparently never printed in Russian, and our efforts to locate the original manuscript proved unsuccessful.
For the benefit of readers not previously familiar with this literature, we have placed before the translations a brief note on Chayanov's theory of peasant economy (prepared by D. Thorner) and a comprehensive essay on the life, activities, and writings of Chayanov (contributed by B. Kerblay). B. Kerblay, aided by G. Haupt, of the Sixth Section, Ecole Pratique des Hautes Etudes, Sorbonne, has also prepared a bibliography of Chayanov's principal writings. R. E. F. Smith has supplied the Glossary.
It is important to note that Chayanov used the term "family farm" in a particular • sense. By family farm, he referred only to those peasant households that relied almost exclusively on the labor of family members; if peasant farms used any hired labor, it was in order to establish their basic economic equilibrium between demand satisfaction and drudgery of labor at a more favorable point, not necessarily in order to make a profit. Readers accustomed to the Western European and Anglo-American use of the term "family farm" to mean a family-run enterprise aiming to make a profit are, therefore, urged to note particularly that as used by Chayanov the term "family farm" means a farm normally run by a family without hired outside wage labor. Further details are given in the Glossary (p. 271).
Those who would like to see the Russian text of Chayanov's book as it originally appeared in Moscow in 1925—complete with a publisher's preface criticizing Chayanov—should note that this is simultaneously being issued by B. Kerblay. It is to be published by Micro Methods of London on behalf of the Ecole Pratique des Hautes Etudes, Sixieme Section, Sciences Economiques et Sociales, Sorbonne, Paris. This is to be followed by other texts in Russian of the major works of Chayanov.
Preface vii
We are greatly indebted to the American Economic Association, which, through its foreign translations committee—headed first by Bert F. Hoselitz and later by Irving B. Kravis—has encouraged and supported us in carrying through this project. Dr. Friedrich Schlömer of the International Wheat Council in London, who translated several of Chayanov's books into German in Berlin during the 1920's, has given us much useful information in personal discussions and has lent us a number of rare publications.
We are indebted to Lotte ^Jacoby and Ian Taylor, of Rome, for carefully translating into English in 1962-63 an earlier version of Chayanov's study on the economic organization of peasant farming. The text that Jacoby and Taylor used was the 132-page book in German, translated from the Russian manuscript by Dr. Schlömer in collaboration with Chayanov himself, and issued in Berlin in 1923 under the title, Die Lehre von der bäuerlichen Wirtschaft. The Russian original of the 1923 German translation never appeared in printed form, and the manuscript has so far not been found. The clear English translation by the Jacoby-Taylor team of the 1923 German text was an important milestone in our work. Although we had to put their translation aside when, in January, 1964, we were lucky enough, at long last, to locate the Russian text of 1925, we wish to thank Mrs. Jacoby and Mr. Taylor for a difficult job splendidly done.
Professor C. von Dietze, of Freiburg in Breisgau, has kindly discussed Chayanov with us, and by photocopy or by loan of manuscript has supplied otherwise inaccessible material.
We are also indebted to Christel Lane for undertaking to translate, at short notice, Chayanov's article, "Zur Frage einer Theorie der nichtkapitalistischen Wirtschaftssysteme." For the English translation of Professor Kerblay's comprehensive essay on Chayanov—an essay first drafted in French—we have the pleasure of thanking Dr. and Mrs. Stephen Clarkson of the Departments of Political Economy and English Literature of the University of Toronto.
For assistance in finding works of Chayanov and in compiling the bibliography, we have benefited from the help of the major libraries and numerous librarians in Paris, London, Moscow, the East Coast of the United States, and Stanford. Since there are too many to name individually, we hope all will accept this statement of our obligation and sincere gratitude.
When the translation from the Russian was ready, Professor Ar
THE THEORY OF PEASANT ECONOMY
cadius Kahan of the University of Chicago kindly consented to look through it and give us the benefit of his criticism, for which we are most grateful.
Our project of making Chayanov available in English has throughout been aided and encouraged by the benevolent support of the ficole Pratique des Hautes Etudes, Sixth Section, Sorbonne, Paris.
D. Thorner B. Kerblay R. E. F. Smith
October, 1966
Contents
Chayanov's Concept of Peasant Economy, D. Thorner xi
A. V. Chayanov: Life, Career, Works, B. Kerblay xxv
On the Theory of Non-Capitalist Economic Systems, 1
translated by Christel Lane
Peasant Farm Organization, 29
translated by R. E. F. Smith
Glossary 271
Bibliography 279
List of Tables 297
Index 301
For a detailed table of contents of Peasant Farm Organization, see pp. 31-32.
ix
Chayanov's Concept of„ Peasant Economy
By Daniel Thorner
Most of those who are today seeking to understand the economic behavior of the peasantry seem to be unaware that they are traversing much the same ground trod from the 1860's onward by several generations of Russian economists. The problems that are today plaguing economists in countries like Brazil, Mexico, Turkey, Nigeria, India, and Indonesia bear striking similarities to those that were the order of the day in Russia from the emancipation of the serfs in 1861 down to the collectivization of agriculture at the end of the 1920's, to wit:
How to transform traditional rural society so as to overcome the misery, squalor, and illiteracy of the peasantry;
How to get the peasants to modernize their agriculture, especially their farming technique;
How to carry out this transformation and modernization so as to permit—indeed, to facilitate—the development of the entire national economy.
One of the first methods young Russian idealists tried for dealing with these problems was direct action. Hundreds upon hundreds of college students, doctors, nurses, university teachers—including economists and statisticians—quit their urban life and attempted to "go to the people." Establishing themselves in villages, they tried to be of use to the peasantry, to get them into motion; revolutionaries among these idealists preached the virtues of socialism. The police smoked them out and rounded them up, sometimes tipped off by the peasants themselves, suspicious of outsiders from other orders of society.
Chastened by their experiences, many of these action-oriented intellectuals deemed it wise, before undertaking further adventures in rural philanthropy, to obtain a more precise knowledge of village realities. Scores of them offered their services when in the 1870's the new provincial and district assemblies, the zemstvos—set up to help implement the land reforms of 1861—launched a vast program of economic and statistical investigation into peasant economic problems. It would be difficult to exaggerate the value of these field in-
xi
xii THE THEORY OF PEASANT ECONOMY
quiries, which continued through four decades down to World War I. In sheer bulk, they add up to more than 4,000 volumes. These constitute perhaps the most ample single source of data we have on the peasant economy of any country in modern times.
More significant than the quantity is the quality of these data. From the outset, the field investigators included some of the ablest men of the day. Sympathetic to the peasantry and anxious to gain insight into their problems, they were determined to carry out their inquiries with utmost thoroughness. In presenting their results, they took great pains to choose suitable categories and to design statistical tables so as to bring out clearly the basic relations among the various economic and social groups in the villages. Some of their reports were so striking that in 1890 the government passed a law forbidding any further inquiries into landlord-peasant relations, but, nonetheless, the work went on.
In the decades from 1880 onward, Russia's leading economists, statisticians, sociologists, and agricultural experts assessed, analyzed, and fought over the materials furnished by the successive zemstvo inquiries. Their articles and books provide the richest analytical literature we have on the peasant economy of any country in the period since the Industrial Revolution. Among the Russian scholars who participated in the debate over the zemstvo statistics, N. A. Kablukov, V. A. Kosinskii, A. N. Chelintsev, N. P. Makarov, and G. A. Studen-skii stand out for their attempts to formulate a theory of peasant economy. Alexander Vasilevich Chayanov, from 1919 to 1930 the leading Russian authority on the economics of agriculture, synthesized the theoretical ideas of his predecessors and contemporaries, and developed them along original lines. Translations into English of two studies by Chayanov form the core of the present volume.
The first and by far the larger of these works is Chayanov's masterpiece, Organizatsiya krest'yanskogo khozyaistva, the title of which may be rendered in English as Peasant Farm Organization. It provides a theory of peasant behavior at the level of the individual family farm, i.e., at the micro level. The second, much shorter study—"Zur Frage einer Theorie der nichtkapitalistischen Wirtschaftssysteme,"1 which may be translated as "On the Theory of Non-Capitalist Economic Systems"—sets forth the proposition that at the national, or macro, level, peasant economy ought to be treated as an economic system in its own right, as a noncapitalist system of national econ
l Archiv für Sozialwissenschaft und Sozialpolitik, Vol. 51 (1924), part 3, pp. 577-613.
Chayanov's Concept of Peasant Economy xiii
omy. The brief remarks that follow will be concerned chiefly with Chayanov's theory of the peasant farm, his micro theory, which Con-stantin von Dietze has termed the most noteworthy creative synthesis so far achieved in this field down to the present day.2
Chayanov's Theory of the Peasant Farm
The sure and certain way to misunderstand the peasant family farm, Chayanov held, was to view it as a business, that is to say, an enterprise of a capitalistic sort. To him, the essential characteristic of business firms or capitalistic enterprises was that they operated with hired workers in order to earn profits. By contrast, peasant family farms, as Chayanov defined them, normally employed no hired wage labor—none whatsoever. His family farms were pure in the sense that they depended solely on the work of their own family members.
Chayanov's definition of the family farm may surprise us by its narrowness when compared with the much wider usage of the term in recent decades.3 Present-day economists familiar with model building might assume that for his purpose Chayanov framed a special model or ideal type. In fact, Chayanov considered his category a real one drawn from life. He contended that 90 percent or more of the farms in Russia in the first quarter of the twentieth century had no hired laborers, that they were family farms in the full sense of his definition. In so far as his contention was correct, his model was far from being "ideal"; quite the contrary, it stood for the most typical farm in what was then the largest peasant country in the world.
From this starting point, Chayanov proceeded to challenge head on the validity of standard economics for the task of analyzing the economic behavior of peasant farms that relied on family labor only. The prevailing concepts and doctrines of classical and neoclassical economics, he wrote, had been developed to explain the behavior of capitalistic entrepreneurs and business undertakings in which hired hands worked for wages. The economic theory of the behavior of such firms turned on the quantitative interrelationship of wages (of labor), interest (on capital), rent (for land), and profits (of enterprise). To find out whether a given business firm was making a profit, it was necessary to set down the value of gross annual output, deduct outlays
2 C. von Dietze, "Peasantry," in Encyclopaedia of the Social Sciences, Vol. XII (1934), p. 52; and personal communication from Professor von Dietze, Summer, 1964.
3 The term family farm is sometimes even used for capitalistic enterprises producing essentially for export, as long as these are family-operated.
xiv THE THEORY OF PEASANT ECONOMY
for wages, materials, upkeep, or replacement of capital and other usual expenses, including rent, and then compare the sum left over with the interest that might be earned at prevailing rates on the total fixed and circulating capital. These four factors—wages, interest, rent, and profits—operated in close functional interdependence and were reciprocally determined. The moment one of the four factors was absent, it became impossible to establish just what was to be included in each of the remaining three; hence there was no way of determining their magnitudes. Take away any one of the four factors, Chayanov argued, and the whole theoretical structure went awry, like a cart that has lost one wheel. This was precisely what happened, according to Chayanov, when economists tried to apply the analysis in terms of wages, profit, rent, and interest to peasant family farms.
Since peasant family farms had no hired labor, they paid no wages. Accordingly, the economic category "wages" was devoid of content and the economic theory of wages irrelevant to family activity. Carrying the argument further, Chayanov posed the question whether in the absence of wages the net gain, the rent, and the interest on capital could be worked out for such peasant farms. His answer was a flat no. In the absence of wages, these calculations could not be made. Hence, the behavior of these farms could not be accounted for in terms of standard theories of the four main factors of production.
Furthermore, Chayanov saw no validity in circumventing the absence of wage data by imputing values to unpaid family labor. He insisted on taking the entire family household as a single economic unit and treating their annual product minus their outlays as a single return to family activity. By its very nature, this return was unique and indivisible. It could not be meaningfully broken down into wages and the other factor payments of standard economic theory. In Chayanov's view, the return to the peasant family was undifferen-tiable.
Professional economists, Chayanov conceded, would balk at this, for they would somehow prefer, as Alfred Weber had told him in Heidelberg about 1924,4 to encompass these family units together with the more tractable business enterprises within a single system, a universal economics, the standard economics on which they had been brought up. Such an attempt, Chayanov insisted, was foredoomed to failure.
4 Alfred Weber was the distinguished German economist who, together with Joseph Schumpeter and Emil Lederer, then edited the leading German social science periodical, Archiv für Sozialwissenschaft und Sozialpolitik.
Chayanov's Concept of Peasant Economy xv
5 Cf. the title of Chayanov's book in German, Die Lehre von der bäuerlichen Wirtschaft; Versuch einer Theorie der Familienwirtschaft in Landbau (The Theory of Peasant Economy: Test of a Theory of Family Economy in Agriculture) (Berlin: P. Parey, 1923).
Economists would have to face the fact, he held, that economies made up of family units in which the category of wages was absent belonged to a fundamentally different economic structure and required a different economic theory. Such a theoretical system, he wrote, would have the same relationship to present-day economics as Lobachevskii's geometry bore to that of Euclid. In his day, Lobachev-skii gave up the assumption of parallel lines; we would have to drop wages.
Chayanov's own theory—or, if the expression be permitted, his non-Euclidean economics—was not restricted to peasant agricultural production. He was concerned with the total income of the peasant family from agriculture and also from crafts and trades. The economic unit for which his theory was devised was the peasant family taken as a whole in all its works, or, alternatively, the total economic activity of family labor. Thus, he saw his exposition of peasant economy as a particular form of a larger doctrine—the theory of family economy.5
The Labor—Consumer Balance
Chayanov's central concept for analyzing family economics was what he called the labor-consumer balance between the satisfaction of family needs and the drudgery (or irksomeness) of labor. Once grasped, this concept furnishes the key to his entire position and mode of presentation. It was one of the chief weapons he wielded in his severe critiques both of Marxian economics in Russia and of orthodox classical and neoclassical economics in the West.
In developing his concept of the labor-consumer balance, Chayanov began with the gross income or gross product of a peasant family household at the end of an agricultural year, assumed to be at a given level (say, 1,000 rubles). From this annual gross income, certain expenses had to be deducted so as to restore the farm to the same level of production it possessed at the beginning of that agricultural year, i.e., seed, fodder, repairs, replacement of expired livestock and worn-out equipment, etc. Once these expenses had been deducted, the family was left with a net product or net income that constituted the return for its labor during that agricultural year. How was that net
xvi THE THEORY OF PEASANT ECONOMY
income or net product to be divided among family budget for consumption, capital formation for raising the farm's potential level of production, and savings (if there was any possibility of savings not invested in the farm)? Put more simply, what should the family eat, what fresh capital should it invest in the farm, what should it put by?
A capitalistic enterprise, Chayanov pointed out, can get objective, quantitative evidence about how to proceed. By deducting from its gross product the outlays on materials and wages, a business concern can ascertain its net profits. If it wishes to increase its profits, the concern can put in more capital and obtain, in due course, an exact quantitative statement as to the increase, if any, in net profits. For a peasant family farm, however, there are neither wages nor net profits. The family members know roughly how many days they have worked, but Chayanov insisted there is no valid way of estimating in money the value of their work. All they can see before them is the net product of their work, and there is no way of dividing days of labor into bushels of wheat.
According to Chayanov, the peasant family proceeds by subjective evaluation based on the long experience in agriculture of the living generation and its predecessors. Most peasant families, Chayanov showed, are in a position either to work more hours or to work more intensively, sometimes even both. The extent to which the members of the family actually work under given conditions he called the degree of self-exploitation of family labor. The peasants would put in greater effort only if they had reason to believe it would yield an increase in output, which could be devoted to greater family consumption, to enlarged investment in the farm, or to both. The mechanism Chayanov devised for explaining how the family acted is his labor-consumer balance. Each family, he wrote, seeks an annual output adequate for its basic needs; but this involves drudgery, and the family does not push its work beyond the point where the possible increase in output is outweighed by the irksomeness of the extra work. Each family strikes a rough balance or equilibrium between the degree of satisfaction of family needs and the degree of drudgery of labor.
In itself, Chayanov hastened to add, there was nothing novel or remarkable about this concept. What is of interest and gives value to Chayanov's book is the way he handled the concept. He showed how for different families the balance between consumer satisfaction and degree of drudgery is affected by the size of the family and the ratio of working members to nonworking members. He traced the
Chayanov's Concept of Peasant Economy xvii
"natural history" of the family from the time of marriage of the young couple through the growth of the children to working age and marriage of this second generation. In relating this natural history of the family to the changing size of peasant farms from generation to generation, Chayanov developed the concept of "demographic differentiation," which he asked his readers to contrast with the Marxian concept of class differentiation among the peasantry.
But his analysis is far from being primarily demographic. Using the bases of the zemstvo statistics, the studies of these by his predecessors and colleagues, and fresh field inquiries, Chayanov examined the effects on the labor-consumer balance of a wide range of factors. He took account of size of holdings, qualities of soil, crops grown, livestock, manure, location, market prices, land prices, interest rates on capital loans, feasibility of particular crafts and trades, availability of alternative work, and relative density of population. Chayanov was not so much concerned with the individual effects of each of these factors as with their mutual effects as they changed through time.
In weighing the influence of these several elements on the delicate balance between urgency of family needs and drudgery of labor, Chayanov employed some of the concepts and techniques of marginal utility analysis. His terminology included, for example, demand satisfaction and marginal expenditure of work force. For factors not subject to any precise measurement, such as willingness to put in greater efforts, he constructed equilibrium graphs showing interaction under varying assumptions.
Chayanov foresaw, quite correctly, that his use of these tools of "bourgeois" economics would shock many of his contemporaries in Soviet Russia of the mid-1920's. He countered that his work should be judged not by the genealogy of his techniques but, rather, by the results he had been able to obtain through the application of those techniques to the Russian data in the light of economic postulates firmly anchored in peasant behavior.
Summing up his findings, Chayanov wrote that "available income was divided according to the equilibrium of production and consumption evaluations or, more accurately, a desire to maintain a constant level of well-being."6 Generally speaking, an increase in family gross income led to increases in both family budget and capital forma-
8 See below, p. 218. For an earlier discussion of a balance between "need" and "labor," see W. Stanley Jevons, The Theory of Political Economy (4th ed.; London: Macmillan & Co. Ltd., 1911), chap. v.
xviii THE THEORY OF PEASANT ECONOMY
don. The precise way the gross income was divided up in each family was a question of subjective judgment by the head of the family and, hence, could not be expressed in objective, quantitative terms.
According to Chayanov, the basic characteristics of the peasant family's economic behavior fundamentally differed from those of capitalist farm owner's in price they were prepared to pay for buying land, interest they were willing to pay in borrowing capital, rent they would pay for leasing in land, price at which they would sell their produce, etc. In conditions where capitalist farms would go bankrupt, peasant families could work longer hours, sell at lower prices, obtain no net surplus, and yet manage to carry on with their farming, year after year. For these reasons, Chayanov concluded that the competitive power of peasant family farms versus large-scale capitalist farms was much greater than had been foreseen in the writings of Marx, Kautsky, Lenin, and their successors.
Viability of Peasant Family Farms
In proclaiming the viability of peasant family farming, Chayanov set himself against the mainstreams of Marxist thought in Russia and western Europe. Marx had termed the peasant who hires no labor a kind of twin economic person: "As owner of the means of production he is capitalist, as worker he is his own wage worker." What is more, Marx added, "the separation between the two is the normal relation in this [i.e., capitalist] society." According to the law of the increasing division of labor in society, small-scale peasant agriculture must inevitably give way to large-scale capitalist agriculture. In Marx's own words:
. . . [the] peasant who produces with his own means of production will either gradually be transformed into a small capitalist who also exploits the labor of others, or he will suffer the loss of his means of production .. . and be transformed into a wage worker. This is the tendency in the form of society in which the capitalist mode of production predominates.7
Marx and Engels believed that the advantages of concentration and centralization lay with the capitalist farmers who would, in the course of time, swallow up the small peasants. Two outstanding followers of Marx who adhered to this position were Kautsky, whose mono
7 Marx, Theorien über den Mehrwert, in the translation of G. A. Bonner and Emile Burns, Theories of Surplus Value (London: Lawrence and Wishart, 1951), pp. 193-94.
Chayanov's Concept of Peasant Economy xix
8 Even before the appearance of Kautsky's book, the position and policy of the German Socialists with regard to the small peasantry had given rise to sharp dispute within the party. Some of the original documents are conveniently assembled and translated into English by R. C. K. Ensor in his useful collection, Modern Socialism (2d ed.; London and New York: Harper and Bros., 1907), especially items xv, xvi, and xxii. Convenient discussions of the controversy in central and western Europe are given in the works by A. Gerschenkron, Bread and Democracy in Germany (Berkeley: University of California Press, 1943), and in George Lichtheim, "Kautsky," Marxism (London: Routledge & Kegan Paul, 1961), chap. v. For the controversy in tsarist Russia, see Kerblay's article below, pp. xxviii-xxx.
9 Where Chayanov found Marx in agreement with him, he of course did not hesitate to quote him by name. Thus, he cites both in Chap. 5 and in Chap. 6 the celebrated passage in which Marx states: "... with parcellated farming and small scale landed property . . . production to a very great extent satisfies own needs and is carried out independently of control by the general (i.e., the capitalist) rate of profit." See below, Chap. 5, p. 222 and Chap. 6, p. 240.
It should be noted that in the 1870's Marx learned Russian primarily in order to read the zemstvo reports on the peasantry. He followed these closely and, as was his habit, took extensive notes. Three volumes of these notes have been translated into Russian and published, and a fourth has been announced. See the Arkhiv Marksa i Engel'sa (Moscow, 1948, 1952, and 1955), Vols. XI, XII, and XIII.
graph, Die Agrarfrage, was published in Stuttgart in 1899, and Lenin, whose work, The Development of Capitalism in Russia, appeared later in the same year in Moscow. The analyses by Kautsky for western Europe and Lenin for tsarist Russia were each sharply challenged in a large body of literature. It is out of the question for us to discuss these works here.8 Of interest to us is that Chayanov rejected both the terms in which Marx analyzed the peasant farm and the assessment by Lenin of the importance of family farms in the Russian economy of his time.
At the outset of his book on Peasant Farm Organization, Chayanov assailed the characterization of the peasant as having a twofold nature, combining in himself the attributes of both a capitalist and a wage worker. Chayanov termed this bifurcation an unhelpful fiction—what is worse, a purely "capitalist" kind of fiction in the sense that it was made up entirely of capitalist categories and was conceivable only within a capitalist system. For understandable reasons, Chayanov did not explicitly state that he was criticizing Marx. It was all too easy, however, for anyone familiar with what Marx wrote, or with what Lenin wrote about Marx, to discern who was at least one of Chayanov's targets.9
Chayanov's position vis-ä-vis Marx, it should be noted, was not altogether his own creation but reflected the cumulative work of the Organization and Production School of Russian agricultural economists onward from the time of Kosinskii's 1905 treatise. A neat statement of the position of this group can be found in the well-known
THE THEORY OF PEASANT ECONOMY
treatise on The Accumulation of Capital by Rosa Luxemburg, the most dynamic force in German socialism in the period of World War I. Luxemburg had been born in Poland under tsarist rule and was thoroughly familiar with Russian literature on the peasantry.
It is an empty abstraction [she wrote] to apply simultaneously all the categories of capitalistic production to the peasantry, to conceive of the peasant as his own entrepreneur, wage labourer and landlord all in one person. The economic peculiarity of the peasantry, if we want to put them . . . into one undifferentiated category, lies in the very fact that they belong neither to the class of capitalist entrepreneurs nor to that of the wage proletariat, that they do not represent capitalistic production but simple commodity production.10
Chayanov's differences with Lenin were, if anything, even sharper than his divergences from Marx. As early as 1899, Lenin had written that in Russian agriculture the capitalist farmers—the peasant bourgeoisie—were already in the saddle. They were in a small minority, Lenin wrote, perhaps no more than 20 percent of the farm households. Nonetheless, in terms of the total quantity of means of production, and in terms of their share of total produce grown, "the peasant bourgeoisie are predominant. They are the masters of the countryside."11
By what criteria did Lenin separate capitalist farmers from non-capitalist peasants? In his view, the decisive step toward capitalism came when laborers had to be hired, when "... the areas cultivated by the well-to-do peasants exceed the family labor norm (i.e., the amount of land a family can cultivate by its own labor), and compel them to resort to the hiring of workers. . . ."12 For Lenin, the hiring of workers had become widespread, and Russia was well on its way toward a capitalist agriculture with a peasant bourgeoisie and a rural proletariat. Chayanov's numerous references to the very small part hired laborers played on Russian farms (e.g., his assertion that 90 percent had no hired laborers in the period 1900—1925) constitute, therefore, a direct, if implicit, refutation of Lenin.13 In fact, Chayanov's
io Rosa Luxemburg, Die Akkumulation des Kapitals (Berlin, 1913, as reprinted in 1923), p. 368. I have followed the English translation of 1951, The Accumulation of Capital (London: Routledge, 1951), but have made it more literal.
11V. I. Lenin, The Development of Capitalism in Russia (Moscow: Foreign Languages Publishing House, 1956), pp. 177-78.
12 Ibid., p. 52.
13 See below, p. 112.
Chayanov's Concept of Peasant Economy xxi
14 See below, p. 111.
15 See below, p. 112.
whole approach—his selection of the pure family farm as the typical Russian unit, his insistence on the survival power of such family farms, and his treatment of rural differentiation in terms of demographic cycles rather than class antagonisms—was diametrically opposed to that of Lenin.
Wider Relevance of Chayanov's Theory
Chayanov's micro theory, as he was able to elaborate it before his career was cut short, is essentially a theory of one kind of individual family farm in Russia—the family farm that employs no hired labor whatsoever. There were other kinds of peasant farms in Russia, and there were capitalist farms as well. Once we step out of Russia we find peasant family farms elsewhere in Europe and in Asia, Africa, and the Americas. Chayanov's theory was devised to take account of Russian conditions, where the kind of peasant family farm that he discussed was predominant. Does his micro theory apply to peasant family farms in other countries?
Chayanov himself conceded that his theory worked better for thinly populated countries than for densely populated ones.14 It also worked better in countries where the agrarian structure had been shaken up (as in Russia after the emancipation of the serfs in 1861) than in countries with a more rigid agrarian structure. Where the peasants could not readily buy or take in more land, his theory would have to be seriously modified.15
Since Chayanov did not work out these modifications, he did not elaborate a full-blown theory of peasant family farming for any country other than Russia. Nonetheless, he indicated that he thought one single universal theory of the peasant family farm at the micro level could be devised. In his view, the Russian case, which he developed so fully, was only an illustration of this larger theory.
One wonders whether he may not have been overoptimistic about the possibility of a universal micro theory of peasant family farming. We will recall that in calculating the springs of peasant decisions in Russia Chayanov took account of the interaction of a very large number of factors, including family size and structure, land tenures, climate, access to markets, and possibility of getting extra jobs in off-seasons. He was able to construct his models more easily, since he
xxii THE THEORY OF PEASANT ECONOMY
assumed the existence of a single "pure" type of family farm, free of hired wage labor. Extending the theory outside Russia would at the very least involve preparation of alternative models for "impure" peasant households employing hired labor.
Although it encompassed a very wide range of possibilities, Chayanov's theory of peasant farming remained essentially a static one. From the 1860's through the 1920's, the Russian agricultural economy underwent a rapid series of fundamental changes. There were marked sectoral and regional differences in rates of growth. Chayanov often referred to the existence of these differentials, but pitched his theory at a level of abstraction well above them.
With regard to the broader institutional framework, Chayanov was fond of saying that capitalism was only one particular economic system. There had been others known to history, and perhaps more were to come in the future. In his 1924 article, the title of which we have translated as "On the Theory of Non-Capitalist Economic Systems," Chayanov cites six major kinds of economies. Three of these are familiar—capitalism, slavery, and communism. The fourth, "family economy," Chayanov divided into two subtypes—"natural" economy and "commodity" economy. These two names may be taken as roughly equivalent to "self-subsistent" and "market-oriented." In Chayanov's two additional categories—the "serf economy" of tsarist Russia and the "feudal economy" of medieval western Europe—the "commodity" economy of the lords was superimposed on the "natural" economy of the peasants. The chief difference between the two systems, according to his schema, was that in Russia the peasants worked on their own fields but had to make payments in kind to the lord, whereas in the West the peasants had to put in certain days of work directly on the home farm of the lord. Both of these lord-and-peasant systems were essentially symbiotic mixtures of the two subtypes within the basic category "family economy." In effect, therefore, Chayanov postulated only four major systems—capitalism, slavery, communism, and family economy.
Will one universal economics, Chayanov asked, suffice for all these systems? One could be erected, he conceded, but at the price of containing only vague and lofty abstractions about scarcity and opti-malization. That would scarcely be worth the trouble. Properly speaking, each separate system required its own theory, its own body of theoretical economics. Each such theory should explain the functioning of the economy at the aggregate level, i.e., the economics of the nations or states falling within its purview.
Chayanov's Concept of Peasant Economy xxiii
The major system with which Chayanov was most familiar was, of course, the family economy of his native Russia. He referred repeatedly to his desire to show the significance of agriculture based on peasant family farming for the entire Russian national economy. In the Introduction to his book, Peasant Farm Organization, he announced his intention to go into the subject thoroughly at a later date, but he does not seem to have found the time to do so. Hence, we do not have from him any systematic exposition of his theory of family economy at the national level, nor any case study of the economic functioning of a predominantly peasant country taken as a whole. Nonetheless, we find scattered through his works many suggestive remarks on peasant economy at the national level.
When Chayanov was arrested in 1930, together with a number of his colleagues, his research teams were dispersed. The most fertile and sophisticated group of scholars then working in any country on peasant economy was shattered. The quality of Chayanov's writings from 1911 to 1930 permits us to believe that had he been able to continue with his scientific work he would have contributed even more significantly to the understanding of peasant economic behavior both in and out of Russia.
A. V. Chayanov: Life, Career, Works
By Basile Kerb lay1
Alexander Vasirevich Chayanov is a name familiar to a whole generation of Russian agricultural economists who from the reforms of Stolypin until the collectivization campaign had the heavy responsibility of modernizing the traditional peasant economy and training the leaders of this new agriculture. Nevertheless, Chayanov is a name virtually forgotten today both in the U.S.S.R. and in the West.2
1 The author wishes to express his gratitude to Professor Daniel Thorner for the stimulation and cooperation which made this study possible. He would also like to thank Professor Simon Kuznets and Dr. Fr. Schlömer for having placed at his disposal copies of Chayanov's works from their personal libraries.
2 Among current Soviet authors, S. M. Dubrovskii (Voprosy istorii sel'skogo khozyaistva, krest'yanstva i revolyutsionnogo dvizheniya v Rossii [Moscow, 1961], p. 358), merely mentions his name in conjunction with the article from Bolshevik, No. 3-4 (1924), which condemned Chayanov's theories; A. L. Vainshtein, Narodnoe bogatstvo i narodnokhozyaistvennoe nakoplenie predrevolyutsionnoi Rossii (Moscow, 1960), p. 469, and N. A. Savitskii, Zemskie podvornye perepisi (Moscow, 1961, new edition of the same work, 1926), p. 352, are among the few to refer to works of Chayanov, though to ones written before 1913. In the West, among those who have appreciated the significance of Chayanov's work are:
Werner Sombart, Der Moderne Kapitalismus, Das Wirtschaftsleben im Zeitalter des Hochkapitalismus (München and Leipzig, 1928) Vol. III, Part 2, p. 1020.
A. Gerschenkron, "Alexander Tschayanoff's Theorie des landwirtschaftlichen Genossenschaftswesen," in Vierteljahrschrift für Genossenschaftswesen, Halle (Saale), Vol. 8 (1930), pp. 151-66.
Pitirim A. Sorokin, Carle C. Zimmerman, and Charles J. Galpin, A Systematic Source Book in Rural Sociology (Minneapolis: The University of Minnesota Press, 1931), Vol. II, pp. 144#.
C. von Dietze, "Peasantry," Encyclopaedia of Social Science (New York, Macmillan Co., 1934), Vol. 12, p. 52.
J. H. Boeke, The Structure of the Netherlands Indian Economy (New York: Institute of Pacific Relations, 1942), pp. 31-32.
A. Gerschenkron, Bread and Democracy in Germany (Berkeley: University of California Press, 1943), p. 192.
Naum Jasny, The Socialized Agriculture of the U.S.S.R. (Stanford: Stanford University Press, 1949), pp. 27, 242-46, 429.
M. M. Postan and J. Titow, "Heriots and Prices on Winchester Manors," Economic History Review, Ser. 2, Vol. XI (April, 1959), p. 410.
N. Georgescu-Roegen, "Economic Theory and Agrarian Economics," Oxford Economic Papers, Vol. XII (February, 1960), pp 1-40.
Lazar Volin, "The Russian Peasant from Emancipation to Kolkhoz," in The Transformation of Russian Society, ed. Cyril E. Black (Cambridge, Mass.: Harvard University Press, 1960), p. 299.
xxv
xxvi THE THEORY OF PEASANT ECONOMY
Despite this neglect, the works of Chayanov—60 books and brochures alone, not counting innumerable articles—represent the culmination at the time of the Revolution in theory and practice of several decades of research and discussion on agrarian questions in Russia. As Daniel Thorner has shown, the problems raised over 40 years ago by Chayanov are just as pertinent today for developing countries where peasant economy remains a predominant factor.3 Even in the U.S.S.R., the discussion he initiated has still not been concluded. For these reasons, the theories of Chayanov represent a turning point not only for historians and students of agrarian theory in Russia at the beginning of the twentieth century, but also for economists and sociologists seeking in the Russian model elements for a theory of peasant economy or illustrations for more concrete problems.4
Biography
The available information concerning Chayanov's life is too fragmentary and uncertain to permit a reconstruction of his curriculum vitae.5 However, the volume of writings that Chayanov has left behind is sufficiently large to enable one to trace the genesis of his thought and thereby to outline his personality. A cultivated man, he was not only interested in diverse realms of economics, sociology, and agricultural policy, but was also involved in art, literature, and history. Under various pseudonyms,6 he wrote plays and novels in which are reflected his open and tolerant mind, his frequent travels abroad,7 and his intimate knowledge of Western thought. It is these character
3 Daniel Thorner, " 'L'Economie Paysanne': Concept pour l'Histoire Economique?" Annates (Paris), No. 3 (May-June, 1964), pp. 417-32. For the English text of this paper, see "Peasant Economy as a Category in Economic History," Second International Conference of Economic History, 1962 (Paris and The Hague: Mouton & Co., 1965), Vol. II, pp. 287-300.
4 Professor Benedikt Korda of the Institute of Economics in Prague has emphasized the importance of some work of the Russian economists of the 1920's, including Chayanov's school, and has regretted that they are unavailable today (Hospoddrske Noviny, special edition devoted to the scientific session, November 8-12, 1963).
5 The last edition of the Great Soviet Encyclopaedia leaves blank the date of his death, asking its readers to provide information on this matter. Professor Albert Vainshtein has kindly informed us by letter that Chayanov died in 1939.
6X. Botanik, "Moskovskii Botanik X.," Ivan Kremnev.
7 His first travels brought him in 1908 to Lombardy to study the irrigation system and to Belgium to observe the organization of cooperatives. His last trip abroad was to Berlin in 1928 in connection with the German edition of his study on the size of agricultural enterprises (Die Optimalen Betrieb sgrössen in der Landwirtschaft, Berlin, 1930). B. Seebohm Rowntree, Land and Labour: Lessons from Belgium (London: Macmillan & Co., Ltd., 1910), pp. 225-54, points out the significance of the Belgian cooperatives at the time Chayanov was interested in their development.
A. V. Chayanov: Life, Career, Works xxvii
istics—common to his generation of the intelligentsia—which imply that he did not come from peasant stock. Yet, unlike the aristocratic dilettantes and aesthetes who sought to escape the realities of Russian life of that period, Chayanov devoted all his intelligence and generosity to the service of the peasantry. It was not simply the romantic idealism of the movement, "Back to the people," but, rather, a desire for objective analysis and for immediate results that guided his research and his agricultural activity.
His brilliance was recognized early. When in 1913 he was appointed assistant professor at the Agricultural Institute of Petrovskoe Razumovskoe, near Moscow (today the Timiryazev Agricultural Academy), he was only 25 and had already published 13 studies. His reports had been mentioned at various agricultural and cooperative congresses since 1910. In 1919, he took charge of the seminar on agricultural economy of the Timiryazev Academy, later to become the Institute of Agricultural Economy, which he directed until 1930.8 His penetrating mind enabled him to pass with remarkable ease from fact to theory and from theory to empirical verification.
This dialogue between theoretical discussions and practical research was encouraged by the rapid and, at certain times, dramatic evolution of Russia from 1908 to 1930—a period which offered Chayanov an exceptional opportunity for experiment and reflection. The years preceding World War I, the period of the war itself, of the Revolution, the years of N.E.P., and, finally, the beginnings of collectivization provide convenient stages for following the trend of Chayanov's thought and the development of his theory of peasant economy.
The Place of the Organization and Production School in the Evolution of Agrarian Doctrine in Russia
Throughout the eighteenth century and until about 1880, Russian agricultural officers were interested only in the problem of the large estates of the nobles.9 By the beginning of the twentieth century,
8 It is now Vsesoyuznyi nauchno-issledovatel'skii institut ekonomiki sel'skogo khozyaistva, detached from the Timiryazev Academy and attached to the Ministry of Agriculture of the U.S.S.R.
9 The first Russian books on agronomy were the Domostroi, which were meant to be commonsense books for running an estate. One of the oldest was translated into French, Le Domostroj, Menagier Russe du XVIe Steele (Paris: Picard, 1901). For a masterly contribution to the understanding of the economic thinking of the Russian landlords at the end of the eighteenth century, see M. Confino, Domaines et Seigneurs en Russie (Paris: Institut d'Etudes Slaves, 1963), 310 pp.
xxviii THE THEORY OF PEASANT ECONOMY
however, their attention was directed to the problems of peasant farms. The crisis of the years 1880-1890 was a cruel blow to those large estates based on extensive agriculture using cheap labor. It was the same crisis that initiated the debate in Russia among Populists, legal Marxists, and revolutionary Marxists concerning the relative merits of small- and large-scale farming.
During this period, expansion of the agricultural colleges had increased the supply of agricultural specialists.10 Unable to find employment in the few large estates, they had no alternative but to accept posts in the zemstvo organizations. This explains why the Russian agricultural officers suddenly turned their attention to peasant economics, the principal preoccupation of the zemstvos. After 1905, this new generation of agricultural economists became powerful enough to gain intellectual control of the principal agricultural societies of the country. The agricultural associations of Moscow, St. Petersburg, Kharkov, and, to a large degree, the Free Economic Society, were directed no longer by the nobility but by the leftist intelligentsia whose role was to be decisive in the orientation of Russian agrarian thought up to World War I.
In the years leading to the outbreak of hostilities in 1914, Stoly-pin's reforms had neither appeased the intelligentsia divided on the agrarian question nor satisfied the poorer levels of the peasantry. The creation of khutors, peasant enclosed farms separated from the rural communities, had reinforced the social division within the villages. The Social Democrats and the Social Revolutionaries considered that the agrarian question could be solved only by the nationalization or socialization of the land, thereby presupposing a political revolution. On the other hand, those who propounded the organization and production current of thought,11 mainly the agricultural officers and teachers in the zemstvo administrations, felt that land redistribution was an insufficient palliative, and that, furthermore, such a solution implied a social upheaval whose consequences would be unpredict
10 The number of agricultural colleges passed from 2 in 1895, with 75 students, to 8 in 1912, with 3,922 students. The number of agricultural officers employed by the zemstvos progressed from 124 to 2,701 in the same period. This meant there was one agricultural officer per uchastok (canton or subdistrict) instead of only one per uezd (district), which brought the agricultural officer to the peasant (V. V. Moratsevskii, Agronomicheskaya pomoshch' v Rossii [St. Petersburg: Ministry of Agriculture, 1914], 607 + 35 pp.).
11 The phrase used in Russian is organizatsionno-proizvodstvennoe napravlenie. For a detailed discussion of this school, see N. Makarov, Krest'yanskoe khozyaistvo i ego evolyutsiya (Moscow, 1920), Vol. 1, pp. 1-160. For a brief summary, see S. V. Utechin, Russian Political Thought, a Concise History (New York: Frederick A. Praeger, Inc., 1963), pp. 138-39.
A. V. Chayanov: Life, Career, Works xxix
able. Their own solution consisted of a series of agricultural and economic proposals designed to intensify the production of the peasant farms. Their aim was to transform the entire organization of the peasant economy without waiting for political changes; hence, the name "organizational" was attached to this school of thought.
It was no longer a question, as at the time of Herzen and Cherny-shevsky, whether Russia could achieve socialism without passing through a capitalist stage. Nor was it one of mere social or fiscal change, as it had been in 1894 at the Ninth Congress of Russian Doctors, which had concentrated on the peasant family's standard of living.12 The problem that preoccupied these administrators, inspired by such Western innovations as improvement of breeds, mechanization, fertilizers, and cooperatives, was the suitability of economic and technical progress. Their problem was how to adapt certain Western agricultural or economic advances (theory of location, marginal analysis) to peasant farms based entirely on family labor and oriented only in part toward a money economy.
The 1904 course of lectures given by A. I. Chuprov at the £cole Superieure Russe des Sciences Sociales at Paris on the advantages of small-scale production and the methods needed to modernize it is one of the first manifestations of this current of thought.13 But V. A. Kosinskii went much further by putting the problem of the distinctions between peasant and capitalist economy in terms which rekindled the debate with the Marxists, not so much on the political plane as on the plane of economic theory. It is for this reason that Chayanov considered him the spiritual father of the school of peasant economy.14
In peasant economy, Kosinskii noted, "there is neither a question of rent nor of profit."15
The peasant providing simultaneously land, capital and labor, he does not divide the value created in the process of production between costs of production and surplus value. All the value thus created returns to him to be used as a whole and is the equivalent of wages and the capitalist's surplus value. This is why the idea of surplus value and of interest on
12 This congress marks an important date in the evolution of social surveys in Russia, for methodological problems were discussed there by a committee that contained the best statisticians of the period—A. I. Chuprov, Shcherbina, Kablukov, L. N. Maress.
13 Mel'koe zemledelie i ego osnovnye nuzhdy (St. Petersburg, 1907), republished in Berlin, 1921.
14 A. Chayanov, "Gegenwärtiger Stand der Landwirtschaftlichen Ökonomie in Russland," Schmollers Jahrbuch, Vol. 46 (1922), p. 731.
15 V. Kosinskii, K. agrarnomu voprosu (Odessa, 1906), Vol. 1, p. 167.
xxx THE THEORY OF PEASANT ECONOMY
capital is foreign to him. He considers his net income as the product of his own labor using material resources of his own.16
According to Kosinskii, this explained how the peasant could pay high rents relative to net income, for he tried to maximize the utilization of his labor by intensifying production in conditions of limited availability of land. Thus, by 1906 an essential notion already had been formulated: the concepts of rent and surplus value are not applicable to the peasant farm in the way used by the Marxists to assimilate it to their traditional model.17
It was with this school that Chayanov affiliated himself. Like other colleagues—Chelintsev, Brutskus,18 Markov, etc.—he very quickly apprehended two fundamental facts: first, the sterility of much of the immense statistical information collected by the zemstvo organizations, because of the lack of an appropriate method for the economic analysis of peasant agriculture; second, the inapplicability of the concepts of classical economics based on the capitalist mode of production. It was Chayanov's genius to be able to create from these difficulties not only a method of inquiry adapted to the solution of organizational problems on which he was doing research but also a theory of peasant economy capable of explaining the specific character of this unique mode of production, thereby directing the agricultural officer in his daily contact with the peasantry.
First Studies of Chayanov and Origin of His Theory of Peasant Economy
For the agricultural officers of this generation, the Agricultural Congress of 1901 and the Congress of the Cooperative Movement of 1908 provided the catalyst for this appreciation of the specific character of the peasant economy.19 At this time, Chayanov was too young
16 Ibid., pp. 165-66.
17 N. Kablukov, Ob usloviyakh razvitiya krest'yanskago khozyaistva v Rossii (Moscow, 1908), pp. 377-84, analyzes in the same way the specific characteristics of the utilization of capital and profit-making in the peasant economy.
18 B. Brutskus, Ocherki krest'yanskago khozyaistva v zapadnoi Europe, 1913, contrasts the peasant and capitalist economies (the peasant based on values considered subjectively, the capitalist on costs objectively quantifiable). He points out in the same terms as Chayanov the arbitrary nature of the accounting methods of the Swiss agronomist E. Laur.
19 One must also note the part played by the agricultural journals such as Zemskii Agronom, of Saratov; Moskovskii Vestnik SeVskogo Khozyaistva, directed by A. G. Doyarenko; and especially the Agronomicheskii Zhurnal, of Khar'kov, whose editorial committees contained the movement's chief spokesmen.
A. V. Chayanov: Life, Career, Works xxxi
20 Shcherbina's model, adopted in 1900 for the inquiry in Voronezh guberniya, consisted of 677 questions. It took from a day and a half to two days for a researcher to fill out a single family's questionnaire.
21 Trudy s"ezda, Moskovskii oblastnoi s"ezd deyatelei agronomicheskoi pomoshchi naseleniyu, Moscow, 1911.
22 Len i drugie kul'tury v organizatsionnom plane krest'yanskago khozyaistva necher-nozemnoi Rossii (Moscow), Vol. 1 (Volokolamsk uezd, 1912), 198 pp., Vol. 2 (Smolensk guberniya, 1912), 209 pp.
23 A. Chayanov, Krest'yanskoe khozyaistvo v Shveitsarii (Moscow, 1913). Professor Ernst Laur, Secretary of the Union of Swiss Peasants had perfected a complicated accounting system which required keeping five different books in order to record the monetary and financial flows from one account to another (one account each for the enterprise, for the family house, for labor, for subsidiary income, and for the owner).
(cont.)
to make his mark, but in 1911 he was chosen by the First Congress of the All-Russian Union of Linen Producers to carry out a survey on the role of flax in peasant incomes in the district of Volokolamsk, Moscow guberniya.
That same year, the theories of the organizational school were finally accepted by the Congress of Agricultural Officers of Moscow guberniya. Pervukhin attacked the methodological basis used by the zemstvos for their surveys of peasant budgets. These periodical questionnaires contained a very large number of subdivisions often too complex to be understood by the peasant and often too much for the powers of his memory.20 To make the surveys conducive to economic analysis, Pervukhin demanded simplified accounts which a peasant could keep himself. Chayanov backed up Pervukhin with a report on the "District Agricultural Officer and the Organizational Plan of the Peasant Economy," in which he emphasized the usefulness of the budget analysis of peasant farms—not merely of family consumption —as an accounting instrument that would furnish the agricultural officer with information relevant to the organization of the farms for which he was responsible. Brutskus approved this declaration: "Chayanov has been able to express what all agricultural officers are thinking."21
Chayanov's first field surveys supported the theories he had formulated at the congress. In the course of the inquiry on flax producers' incomes, which he had conducted in the Volokolamsk flax district,22 together with the inquiry in Smolensk guberniya with the assistance of A. N. Grigoriev, made in June and July, 1911, in order to extend the sample to a poorer region, he had discovered the impossibility of applying the accounting methods used in western Europe at the time. For example, E. Laur's method, studied by Chayanov,23 tried to identify the gross income of a given farm; then, by
xxxii THE THEORY OF PEASANT ECONOMY
deducting the costs of the farm and those of the family, the remuneration of labor and of capital, he obtained a net profit or loss. In weakly monetized economies like those in Russia, Chayanov observed, such a capitalistic approach would be arbitrary, their evaluations being essentially qualitative and subjective. A given product exists in sufficient or insufficient quantity relative to the peasant's needs, but the products are not interchangeable as in a market economy.24
He pointed out, in addition, that the marginalist theory explaining the behavior of a capitalist entrepreneur in his choices cannot be transferred to a peasant family unit, for in this type of farm the decreasing returns of the value of marginal labor do not hinder the peasant's activity so long as the needs of his family are not satisfied. "Decreasing returns do not stop work until an equilibrium between needs and the drudgery of effort has been achieved."25 In other words, the optimum in a peasant family labor farm26 is defined in terms different from those of a capitalist economy. Thus, the premises of what was to be his theory of peasant economy were already formulated by 1911.
That very year, the Moscow Committee of the Credit and Savings Cooperatives set up a commission, in which Chayanov took part, to inquire into the monetary elements of the Moscow guberniya peasant economy in order to establish credit plans related to the money returns and expenditure of the region's cultivators. In 1912, the commission worked out the first accounting system adapted to Russian conditions and simplified for the use of agricultural officers.27 Chayanov's monograph, Opyt anketnago issledovaniya denezhnykh elemen-tov krest'yanskago khozyaistva moskovskoi gubernii (1912), describes the difficulties encountered by this first experiment. Of the 7,000
The labor of members of the family was evaluated at the same rate as hired labor. (Landwirtschaftliche Buchhaltung bäuerliche Verhältnisse, 1904; 5th ed., 1913). Moreover, E. Laur inspired a peasant movement whose ideals were similar to those of the Russian Populists. He developed them in Politique Agraire (Paris: Payot, 1919).
24 A. Chayanov, Opyt razrabotki byudzhetnykh dannykh po sto odnomu khozyaistvu Starobel'skago uezda Khar'kovskoi gub., Istoriya byudzhetnykh Issledovanii (Moscow, 1915), Vol. 1, chap. vi.
25 Len i drugie kul'tury, op. cit., pp. 13-14.
26 A family farm that does not employ outside labor. Cf. the Glossary, below, for further discussion.
27 A Chelintsev's Uchastkovaya agronomiya, published in 1914, was a first attempt to provide a practical manual for agricultural surveys and simplified accounting in the spirit of the organizational school. In The Theory and Practice of Peasant Economy, a course of lectures he gave to the agronomists of Kiev in 1912, one can find the same aims and often the same concepts as those of Chayanov.
A. V. Chayanov: Life, Career, Works xxxiii
questionnaires sent out, 300 replies were received, of which only 164 were usable. How was it possible to interpret them, to obtain averages, or to verify the results? Chayanov's contribution was the priority given to analysis of the family's expenses considered as the expression of its monetary needs, for it is in relation to these needs that the activity of the family is organized, both inside and outside the farm (external wages).
These two experiments inspired in Chayanov a first attempt at a theoretical formulation.28 In Ocherki (1913) he begins by analyzing, first, the relation between the drudgery (or irksomeness) of labor and the satisfaction of family needs in a peasant economy, and, second, the different elements in peasant consumption budgets and their elasticity compared to workers' budgets.29 But this first effort left the author unsatisfied. He was aware that his first observations were mostly based on poorer peasant groups and that it was equally necessary to study the behavior of the peasant groups at the top of the agricultural pyramid. Most of all, he wanted to analyze the relation between the peasant family's consumption and farm expenses, for the "organization and production" aspect of the peasant farm was the chief object of his research.
Friends from the Khar'kov zemstvo who were agricultural officers helped him in this venture by providing him with the unsifted material of a detailed survey made in 1910 in the Starobel'sk uezd of Khar'kov guberniya. In analyzing these statistics, Chayanov tried to verify whether the relationship between size of family (in particular, the relation between number of active workers and number of mouths to feed during the cycle of the family's reproduction and upbringing) and size of farm confirmed the hypothesis that the needs of the family at the different stages of its evolution provide the chief motive force of the peasant's activity. The statistics of Starobel'sk corroborated his first theoretical attempt, for they confirmed that the size of a farm is not so much the determining factor of peasant activity as it is the expression of this activity.30
By extending his analysis to the nonmonetized as well as the monetary elements of the peasant holding, Chayanov was able to establish
28 Ocherki po teorii trudovogo khozyaistva (Moscow, 1912-13), 2 Vols., 24 and 91 pp.
29 This essay was to appear later as the first chapter of Die Lehre, 1923, and Organizatsiya, 1925.
30 in a report submitted to the Free Economic Society on January 17, 1912, Chayanov had already called attention to this point.
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the movements in money and in kind by which the family achieved the volume of resources necessary for its needs. Once again, but this time with more confidence, Chayanov emphasized his disagreement with Laur. Chayanov did not claim, as did Laur, to identify, after deducting the costs of production, what could be considered as payment for capital, labor, or land in the mass of goods produced by a farm. For a peasant family, he maintained, there is no valid way of estimating the value of labor in monetary terms. Any attempt to evaluate it at the rate of agricultural wages is arbitrary, as is the calculation of land rent on the basis of the rate of return on the capitalized market value of the land, a method valid for capitalist farms.31 The results of the Starobel'sk study, fundamental to Chayanov's intellectual development, were published in 1915, republished in 1922, and then integrated in several chapters of Die Lehre (1923) and Organizatsiya (1925).
World War I and Chayanov's Activity in the Cooperative Movement
Russia's participation in the war directed Chayanov's activity to the concrete problems of organizing the flax market. This experience was decisive in the formulation of his theories of cooperation.
Russia in 1914 was the chief exporter of flax on the world market; this product provided many northern and central provinces with an essential part of their agricultural income. But Russia's conquest of the flax market was not definitive, since it rested on the low levels of peasant living. In addition, the market was constantly threatened by the competition of overseas cotton (which had already seriously damaged flax cultivation in Belgium and France) and by foreign producers' demands for "quality." Thus, from their first congress in 1911 the Russian linen producers were concerned not merely with the stability of flax cultivation if the world market worsened32 but also with the organization of cooperatives to improve the quality of the flax in its initial processing, since treatment of the flax was the principal winter occupation of the peasants in certain areas.
At the Second Congress of Linen Producers in Moscow (April 4-7, 1913), Chayanov, who had already made a field survey on the economic stability of flax production in 1911, showed the difficulties in-
31 Byudzhety krest'yan Starobel'skago uezda (Khar'kov, 1915), pp. 116-21.
32 The pud (16.38 kilograms) of flax priced at 234 kopeks at Volokolamsk in 1894 had risen to 493 kopeks by 1913.
A. V. Chayanov: Life, Career, Works xxxv
volved in organizing a system of cooperatives ex nihilo. The peasants would not be interested in cooperatives unless cooperatives offered higher sales prices for their produce. Even from its inception, then, the organization must be sufficiently powerful to overcome the established commercial buyers and dealers; but how could the organization become powerful without a massive peasant enrollment? To break this vicious circle, Chayanov proposed the organization of the "downstream" cooperative—that is, a central cooperative for exports rather than a network of local producer cooperatives. The interruption of communications with foreign countries which created a marketing crisis for flax production gave Chayanov a unique opportunity to put his ideas into practice.33
The 16 million tons of flax produced in Russia in 1914 left, after interior markets were satisfied, a surplus of 6 million tons which threatened to cause a price crash if it was not absorbed. Chayanov used the existing cooperative structures—the rural credit banks and the powerful Siberian Union of Cooperative Creameries—to export this surplus flax to England via Archangel or Norway.34 He obtained the cooperation of the State Bank to finance the operation; the cooperative credit bank branches were to be the buyers and collectors at the production level, while the Creameries Union with its London agent, the Moscow Narodny Bank, was responsible for the sale abroad. For the first year, the operation could hardly have been called successful. After a roundabout trip of 12 months, the flax arrived at its destination in such a condition that 75 per cent of it was unsalable. The only benefit of this venture was that the Russian peasant became accustomed to selling his flax to a cooperative. This was enough encouragement for founding a Central Cooperative Association of Flax Growers the following year; Chayanov was one of its member-directors. The association undertook flax-selling both inside Russia, where it offered manufacturers a guarantee of quality, and abroad in France, England, and Japan. Under the direction of V. Anisimov, A. Chayanov, S. Maslov, and A. Rybnikov, the association managed to group 150,000 producers into 350 cooperative societies and 11 controlling unions. After an agreement signed in 1916-17 with the capitalist firm RALO (Russkaya assotsiatsiya Tnovodcheskikh obshchestv), it gained an export monopoly in Russian flax.
33 This experiment is described in detail in Chayanov, Russkoe Vnovodstvo, l'nyanoi rynok i I'nyanaya kooperatsiya (Moscow, 1918), 177 pp.
34 E. N. Kayden and A. N. Antsiferov, The Cooperative Movement in Russia during the War (New Haven: Yale University Press, 1929).
xxxvi THE THEORY OF PEASANT ECONOMY
The Revolution of February-October, 1917— Chayanov and the "Agrarian Question"**
The revolutions of February and March, 1917, caused a ferment of ideas and a realigning of opinions on the agrarian question on the part of the left-wing agricultural officers and economists. Until then, the Organization and Production School had tried to adapt itself to the pattern of evolution caused by Stolypin's decree; now they believed the ground was prepared for more radical measures. The proposed solutions were varied. Those more to the left advocated the socialization or nationalization of land; the Socialist Revolutionaries wanted to give it to peasant societies, the Bolsheviks wanted to give it to the state. Those to the right believed that a fixed agricultural land tax, wiping out land rents, would make the expropriation of the capitalists unnecessary, since the rent abolition would cut off their raison d'etre.
Despite these disagreements, the Free Economic Society, the Agricultural Society of Moscow, the Agricultural Society of Khar'kov, the All-Russian Zemstvo Union (Vserossiiskii zemskii soyuz) brought together economists and agricultural officers of differing tendencies, such as the Marxist B. P. Maslov, the Socialist Revolutionary N. Oganovskii, the Populists S. Maslov and N. Makarov, and the Conservative A. Stebut.36 In April, 1917, they agreed on certain fundamental principles and on creation of the League for Agrarian Reform. Chayanov was a member of the executive committee.37
While Lenin's April Theses demanded prompt confiscation of the large estates (which were to serve as large model farms) and nationalization of the land, including that of the peasants,38 the league was content to propose the transfer of all land to peasant farms. In this, it followed the S.R. (Socialist Revolutionary) program, except that the league wanted this operation done within the framework of a central
35 Chayanov played an important part in organizing the food supply both during the war and the Revolution through the All-Russian Zemstvo Union. His knowledge of the problems of peasant consumption was indispensable for establishing ration levels both in the cities and in the country. See A. Chayanov, Normy potrebleniya sel'skogo naseleniya (Moscow, 1916), which was followed in 1919 by a study on consumption in Moscow.
36 Brutskus had prepared the ground by submitting a series of reports on the agrarian question to the Free Economic Society in 1916 and 1917. There were published as Agrarnyi vopros i agrarnaya politika (Petrograd, 1922).
37 During 1917, two members of the committee filled posts as undersecretary of state for agriculture.
38 For the evolution of Lenin's tactics in 1917, see Pierre Sorlin, "Lenine et le Probleme Paysan en 1917," Annates (Paris), March-April 1964, pp. 250-80.
A. V. Chayanov: Life, Career, Works xxxvii
state plan, while the S.R. wanted a decentralized administrative system. Moreover, the league differed with the general proposals of the political parties in its insistence that the reforms should take into account regional requirements. According to the principles adopted by the league, agrarian reform—i.e., modification of the property system—was only one element of the question. The solution of the agrarian problem demanded a new "organization" of the peasant economy in order to adapt it better to the conditions of the world market. The league's object was to define for each region the types of reforms appropriate to its economic and social structure and to popularize these results in a series of pamphlets.
The first study, Chayanov's What Is the Agrarian Question?,39 was a commentary on the principles enunciated above, and it leads us to believe that he had a major role in creating the program of the league. In what terms did Chayanov in 1917 envisage the solution of the agrarian problem?
Politically, he believed it was simply a matter of passing legislation that would conform to the proposed social ideals. But because economic life obeyed its own laws rather than the will of individuals, it was necessary to consider the economic development and, in particular, the specific characteristics of agriculture, lest the proposed solutions be stillborn.
Chayanov emphasized that it was the diversity of regional characteristics which distinguished the Russian situation. In central Asia and southern Russia, there was nomadic herding and fallow land; in Siberia, the land was plentiful and the right of property in it did not exist as such; in the central regions, the density of the population imposed intensive farming and a unique system, the obshchina—property held in common, and an equilibrium between the population and the land available maintained by a periodic redistribution of the land. With such diversity, solution of the agrarian problem could not be the same for all regions.40
Nevertheless, the reforms were not to be left to the regional authorities—the uezds or volosts. They were to be determined by the requirements of the national economy taken as a whole. This would avoid a situation in which, for example, the peasant Cossacks of Orenburg and Samara guberniyas, already possessing 10 desyatinas of land
39 Chto takoe agrarnyi vopros? (Moscow, 1917), 63 pp.
40 To answer these needs, the league published an atlas produced by S. A. Klepikov under Chayanov's direction. Atlas diagramm i kartogramm po agrarnomu voprosu (Moscow, 1917), 40 pp.
xxxviii THE THEORY OF PEASANT ECONOMY
per household, might decide to divide among themselves the large private estates, whereas from a national point of view it would clearly be more desirable to transplant the surplus agricultural population from the guberniyas of Kiev, Podolie, etc., to this region, rather than to encourage extensive farming by the peasants who already had land there.
The second distinguishing characteristic of the Russian situation, Chayanov stated, was the predominance of the peasant farm based on family labor. The peasantry had evolved a great deal in the previous decades: agriculture had been monetized; peasants had bought 27 million hectares of land as personal property, often at the cost of great effort; cooperatives had developed on a commercial basis. Even if private property was not ideal, it was a reality, dangerous to attack as long as the peasants' ideas remained unmodified. Chayanov did not think that the old Populist slogan, "Land and Liberty," was enough to solve the agrarian problem. Certainly, giving back "the land to those who work it" was a moral necessity, but the socialization or nationalization of the land would cause only an insignificant quantitative increase in peasant land—for example, of 100 million hectares sown in 1916, 89 million belonged to the peasantry and only 11 million to the nobility. The moral obligation was, therefore, not sufficient,41 because no political power was able to force the peasant to change the nature of his farming. Chayanov felt that the solution to the agrarian problem lay essentially in the patient work of reorganizing the peasant economy. It was a question of finding the principles of organization which would increase the productivity of agricultural labor, while at the same time safeguarding the principle of a more egalitarian distribution of national income among those who participated in its formation.42
In this school of thought, the consolidation of peasant lands and the work of land improvement were to play an essential role. The results one can expect from a bringing together of production units are not the same in agriculture as in industry. This explains why the superiority of large-scale farming over small is not apparent in the same
41 Chayanov was in favor of nationalizing the large private estates which played a leading role in animal and plant selection. As they also produced an important share of the marketed crop, nationalization would avoid the running down of this irreplaceable capital and prevent a decline in the surplus available for export and the internal market. See Chto takoe agrarnyi voprosf, op. cit.
42 He recognized that these principles were not easy to reconcile, which the experience of the agricultural "communes" was to show after 1917. See Robert G. Wesson, Soviet Communes (New Brunswick, N.J.: Rutgers University Press, 1963).
A. V. Chayanov: Life, Career, Works xxxix
way in all sectors of agriculture. In an area of extensive cultivation where 2,000 to 8,000 hectares of grain land can be farmed with the appropriate machinery, the optimal dimensions of productive units will not be the same as they are in a region of sugar beet cultivation where the more intensive use of machines makes transport costs grow disproportionately beyond an optimum of 200 to 250 hectares.
In other words, natural conditions themselves impose certain limits on the possibilities of a horizontal concentration of agricultural production. These difficulties disappear, however, for vertical integration: small farms can benefit from all the advantages of scale by using the formula of cooperatives. Thus, the peasant sector can organize in unions to obtain on the market the same conditions for price and credit as does the large producer or merchant.
But what means were to be used to achieve these transformations? Chayanov did not believe in the virtues of force. The authoritative methods used by Catherine II at the time of enlightened despotism were not to be imitated. It was necessary to find a system of state regulation that would influence the conditions in which agriculture was to develop rather than to impose certain structures a priori. Chayanov defined four instruments for this action. Legislation would, first, suppress all land transactions without abolishing private property. Only the state would be able to acquire land if anyone wanted to sell it. Second, a fiscal system of discriminatory land taxes would encourage and accelerate transfer of land to the state. The tax would be set for the large capitalist estates at a level higher than the land rents, but at a lower level for the peasant farms. Next, the state could decide to expropriate certain large estates when the national interest required this; the former owners would be compensated by state bonds redeemable over a period of 50 to 100 years. Finally, the land thus bought or expropriated would form a land reserve to be used to effect the structural reforms required. This reserve land could be rented to peasants to finance the payment of the expropriation indemnities.
These measures would be integrated in a financial plan to avoid the danger of inflation, and they should extend over a long period, since successful structural reforms require a transitional stage. The state could.use this period to create the conditions for a gradual transition either to a socialization or to a nationalization, but it would have to combat the impatience of the democratic masses and of those who would want to impose an accelerated rate on the transformations. For Chayanov, land reform was not simply a division of wealth among different groups of the population but a recasting of the whole coun
xl THE THEORY OF PEASANT ECONOMY
try's economic structure. In this work of renovation, the agricultural officer must play a dynamic part to organize and direct the energy of the peasantry.
The Social Role of the Agricultural Officer in the Transformation of the Agrarian Structure (1918)
Chayanov had already organized, in 1913, a seminar in Petrovskoe Razumovskoe on the theme, "The Agricultural Officer and the Cooperative Movement," which had provoked a general confrontation of ideas with the great Russian agricultural authorities of the period— Vladimirskii, Matskevich, Levitskii, and his mentor Fortunatov. In the same way, his study of the fundamental principles of social agronomy,43 which the Cooperative Press published in 1918, summarized the prewar experience of the Russian agricultural officers,44 and at the same time it suggested new paths of development.
Chayanov defined this social agronomy as "the totality of social measures which attempt to orient a country's agriculture toward more rational forms taking into account considerations of time and place." In a sense, this was the principles outlined in What Is the Agrarian Question? applied to the elaboration of a concrete program of action for raising a given region's level of agricultural productivity.
Generally, the passage from one type of agriculture to another is spontaneous and unplanned. Peasants imitate methods that have been proved. For example, in Siberia the colonists tried at first to use the same agricultural system they had known in their home province. After a period of 10 or 20 years of adaptation, the variety of initial methods had given way to a single system.
Thus, the agricultural officer must pay close attention to the organizational forms of local agriculture, since they are the fruit of long experience. The art of agriculture is to find the combinations best able to exploit the peculiarities of a given soil. From Moscow, one cannot predict the general methods valid for Voronezh or Chernigov. On the other hand, the area agricultural officer is not the director of one farm; he is responsible for a vast sector containing thousands of
43 Osnovnye idei i metody raboty obshchestvennoi agronomii (Moscow, 1918), 111 pp. Republished, 1922; translated into German by Dr. Fr. Schlömer under the title Die Sozialagronomie (Berlin, 1924), 96 pp. A literal translation of the original Russian title into English is: Basic Ideas and Work Methods in Agricultural Advice to the Public.
44 The work in the West of Paul de Wuysta and A. Bizzozzero also had an influence.
A. V. Chayanov: Life, Career, Works xli
independent cultivators. Being social, his sphere of action is neither machines nor fields but, rather, individuals; he must inspire a new consciousness in their minds and wills; it is from this new awareness that a modern agriculture can be born.
However, this activity will not be efficacious until its psychological effect strikes the mass of the peasantry and not just this or that farm. For this, it would be necessary to discover two or three fundamental local needs of vital interest to all the peasants and easy to satisfy with simple and inexpensive innovations, such as replacement of the wooden scratch plow by the true iron plow, or methods of insect control. After several years of work in the area, the success gained in this first step will gain the peasants' confidence; they will then come of their own accord to ask the advice of the agricultural officer. At this point, the problem must be considered from the point of view of the farmer, because the measures recommended in the second stage of local activity should no longer be on a large scale but should differentiate between the various types of farms which the agricultural officer's growing familiarity with the area should now enable him to recognize.45 In short, Chayanov believed that there is first a population, then an agriculture; the role of the agricultural officer is to nourish the human forces that will, in turn, give birth to a new rural culture.
The Institute of Agricultural Economy of Petrovskoe Razumovskoe at the Time of War Communism (1919)
A group of young economists and agricultural officers who agreed with these principles worked under Chayanov's direction at his seminars in the Academy of Petrovskoe Razumovskoe. From the spring of 1919, these seminars rapidly acquired the form of an autonomous institution, which shortly became the Institute for the Study of Economics and Agrarian Policy. In the beginning, it consisted of 18 teachers and 30 research students,46 and had the collaboration of
45 The experience acquired during numerous years of survey in the field was used to evolve the method of analysis for each region. This could still be profitably used today by technical assistance experts working in new regions to develop concrete programs of agricultural advice. A. Chelintsev, "Opyt postroeniya mestnoi sel'sko-khozyaistvennoi politiki," Krest'yanskaya Rossiya No. VII (Prague, 1924), p. 55, describes the practical experiment tried by the Union of Cooperatives of Khar'kov from 1918 to 1919.
46 Among whom were N. P. Nikitin, F. I. Semenov, S. A. Klepikov, A. L. Vainshtein, V. N. Knipovich, N. I Kurochkin, A. N. Grigoriev, G. Studenskii. Later, many others, of whom V. S. Nemchinov was one of the most prominent, joined the institute.
xlii THE THEORY OF PEASANT ECONOMY
47 S. N. Prokopovich, A. Rybnikov, Brutskus, Gatovskii, Pervushin, Litoshenko.
48 Such libraries as those of V. I. Semevskii, V. N. Grigoriev, A. P. Levitskii, S. A. Klepikov, A. I. Chuprov, P. P. Dyushen, S. A. Muromtsev, N. V. Yakushkin.
49 It marks the beginning of the studies of Pervushin, Lubimov, and Kondrat'ev on the agricultural cycles in Europe and Russia.
50 Metody bezdenezhnogo ucheta khozyaistvennykh predpriyatii, Trudy vysshego seminariya sel'sko-khoz. ekonomiki i politiki (Moscow, 1921), Vypusk 2, 98 pp.
many scholars of different political tendencies.47 The research department inherited or acquired several private libraries48 to which the library of the Cooperative Institute was added. By 1920, the library of the Institute of Agricultural Economy, with 140,000 volumes, was considered the biggest economics library in Moscow.
At the same time, in Chayanov's seminars and under his authority, a department for the study of the economic situation in Russia and abroad was set up on the model of similar departments at Harvard and Berlin. N. D. Kondrat'ev, who was named its director,49 thus began with Chayanov a very close collaboration that was to continue until they both became victims of a Stalinist purge in 1930.
The orientation of the work undertaken at the institute was from the beginning both theoretical and practical. On the theoretical level, interest centered on the development of a theory of peasant economy as well as a theory of location in agriculture—a theory which would be the adaptation to Russian conditions of Weber's theory for industry. On the practical level, the problems dealt with were those which the Commissariat of Agriculture submitted to the institute—a study of consumption, of credit, of irrigation, of optimal sizes for agricultural enterprises. The institute became, in effect, the research center of the commissariat. Chayanov was particularly preoccupied by concrete problems. How, for instance, could economic calculation, basic for all decisions in agriculture, maintain its effectiveness in a period of galloping inflation? How could an accounting system be established when a horse bought for 30,000 rubles in January would be worth 10 times as much in December? To answer this, Chayanov finished, in October, 1920, Methods of Non-Monetary Calculation in Economic Undertakings, which was published by the People's Commissariat of Agriculture of the R.S.F.S.R.50 Despite the title, the practical applicability of this method appears limited today, because the calculation^recommended by the author is not applicable at the level of the individual farm. He postulates the existence of a central plan and an administrative pyramid, with a group of offices responsible for calculating input-output norms in physical quantities for each type
A. V. Chayanov: Life, Career, Works xliii
51 "Trudovoi ekvivalent," Ekonomicheskaya Zhizn', No. 167 (July 31, Ii20).
52 Metody . . . , Trudy, op. cit., p. 40.
of agricultural production and then establishing the balance sheet of each unit by weighing the results by each production branch with these preestablished norms.
From the historical point of view, however, Chayanov's study is excellent, not only because it is a vigorous application to agriculture of the whole model for planning in kind, which is still one of the characteristics of the Soviet type of planned economy, but also because the author raised theoretical and political problems which must be placed in the context of the discussions of his day.
These discussions were mainly concerned with the possibility of substituting a "labor equivalent" for the monetary unit. Such was the title of the well-known article by V. G. Strumilin,51 in which he urged generalization of the experiment carried out in several Moscow factories—the institution of a "nonqualified unit of labor," which would serve as a basis for a system of prices in labor equivalents. In the same number, Vainshtein, a member of Chayanov's team, showed that this presupposed previous studies of the timing of each production cycle, but these studies would often be useless because the conditions of war communism would not be the same as those in peacetime. Moreover, labor units are not interchangeable as is money in real terms: an engineer's labor, for instance, is by several units qualitatively different from nonqualified labor. Thus, a balance sheet of labor units does not eliminate the necessity of keeping the material balances in physical terms. Chayanov went even further in his criticism: if each product is measured by a constant value of labor units, there are no longer deficit products and the analysis of a decision's rationality is no longer possible. In addition, in agriculture where the peasant thinks in concrete terms of produce per hectare or per animal the labor unit is an abstract notion ill-adapted to the needs of a farm.52
On the theoretical level, Chayanov's study takes a stand on the specific character of economic laws in a socialist regime—an extension of his previous theses on the inapplicability of the concepts of capitalist economics to a peasant economy. The criterion of profitability measured in market terms is meaningless in a "natural" economy (a cow doesn't make a profit or loss); it is therefore necessary to substitute technical criteria. Chayanov considered the socialist economy, regulated by the single will (that of the state), as a natural economy governed by the requirement of satisfying society's needs with the
xliv THE THEORY OF PEASANT ECONOMY
available resources. Moreover, the economy's organization rests on a network of labor "cells" whose rationality can no longer be evaluated in terms of the economic units which are the criteria of the capitalist market, but is evaluated at the macroeconomic level by determining the best use of the labor force for the increase of national income. Classical economics were no longer applicable to the socialist regime.
One cannot help but notice the close affinity these statements have with Bukharin's theses in The Economics of the Transition Period, which also appeared in 1920. However, apart from their common condemnation of political economy, the radicalism of the ABC of Communism is poles apart from the cautious attitude of the agricultural experts. Chayanov took good care to emphasize that a lasting form of Socialism could not be built on enthusiasm alone. Socialist society, according to Chayanov, had not yet found the stimuli that would impel the production units to attain their optimal organization. The intensification of work could result only from internal stimuli. As long as this key remained undiscovered, the economy was destined to be the victim of a gigantic bureaucracy. The principle of necessary equality between labor intensity and satisfaction of needs cannot be violated without harmful consequences: the socialist economy should not be that of Sparta. Here, Chayanov seemed to be condemning, in scarcely veiled terms, war communism's agricultural policy which, by its requisitioning, had cut off the source of personal initiative.
Refuge in the Peasant Utopia, Moscow, 1984
In this difficult period when the black market of Sukharevka in Moscow was the principal source of provisions, Chayanov amused himself by dreaming, like the shepherds in the famous painting of Breughel the Elder, of a land of plenty. Under the pseudonym Ivan Rremnev, he invited the reader on the Journey of My Brother Alexei to the Land of Peasant Utopia.53 This work, published in 1920 by the state press, with a preface by Orlovskii, rapidly became a bibliographical rarity. Under the cover of fiction it expresses a whole school of political thought tending toward populism or anarchism, while at the same time it provides certain insights into Chayanov's artistic tastes and philosophical inclinations.
53 Puteshestvie moego brata Alekseya v stranu krest'yanskoi utopii (Moscow, 1920), 62 pp
A. V. Chayanov: Life, Career, Works xlv
54 But Kremnev foresees a tax system which mops up all income that is not the fruit of labor, such as land rent and dividends.
Citizen Kremnev wakes up in Moscow in 1984, but the world he discovers is quite different from that which George Orwell later imagined. It was Arcadia. "The era of urban culture has passed away"; the large cities have disappeared. Moscow itself has only 100,000 inhabitants, whole blocks have been razed, all the old monuments have been preserved. Urban centers are no bigger than 10,000. The factories have been relocated in the country, which looks like a vast checkerboard cultivated by peasant families organized in cooperatives.
This pastoral universe is the logical conclusion which, following the fall of the Bolsheviks, brought the peasant labor party to power in 1934. "The generation of the weak has been covered by a layer of stones ... a new generation of barbarians carried socialism to the limits of absurdity," but the Communists failed because they wanted to impose nationalization of the land in a land where the peasant masses predominated. On the international level, the Communist movement has been divided by the action of centrifrugal forces. In 1984, of all the nations, Germany alone has kept the systems of the 1920's, for it is within the gates of the German capitalist factory that socialism was born as the antithesis of capitalism.
In a chapter which Chayanov—Kremnev directed "to the attention of the members of the Communist Party," he reproached the ideologists of the working class for claiming to monopolize all creative initiative, for considering the peasant economy as an inferior stage of development, and for "trying to apply their ideals by the methods of an enlightened despotism which provoked Russian society to an an-archict-eaction." Here, Utopia is simply a fable to denounce the errors of the present and especially the efforts made to destroy the family, considered as a survival of capitalism, and to substitute for the peasant family large-scale units of production. The notion of a bread and meat factory "is a monstrosity for the socialist peasant ideologists," for it makes the peasant passive instead of making him the motive force of spiritual and cultural progress. The author defended a pluralism that permits all the possibilities of life to express themselves and a planned economic system that preserves the chief individual incentives of prices and wages.54 "The art of planning is not one of constructing the plan but is essentially one of animating the economy."
xlvi THE THEORY OF PEASANT ECONOMY
This political and literary essay tried, moreover, to define an ideology which could be opposed to communism and which would take root in the peasant cultural tradition. In effect, the ideology Chayanov proposed continues a whole current of thought, borrowing from Kropotkin, with his ideals of urban decentralization, local autonomy, and alternating activities, as well as from theosophy and anthro-posophy, in fashion at that time. It falls in with the experiments tried at that period by the anarchist and theosophist communes of which Kremnev gives an idealized picture in his visit to a "fraternity" in Archangel in 1984.
In other words, his ideals were those of the cosmopolitan Russian intelligentsia rather than an expression of the peasant tradition. His conception of the peasants' future way of life is also very conservative; the fairs, cuisine, songs, and traditional costumes will not have disappeared in 80 years. Art exhibitions—here one finds the ideal of the school of Peredvizhniki55—productions of Hamlet, art books, and exotic fruit within reach of the peasants living in the agrocities of the future are the only signs of change. This peasant existence thus appears to reflect bourgeois ideals.
In his preface, Orlovskii underlined the "petty bourgeois" character of the book, mixed with artistic pretensions and with a peasant conservatism, and emphasized at the same time Chayanov's outmoded conception of technical progress. Kremnev recommends formulas of peasant microproduction unitstand of increasingly intensive agriculture at a time when the machine must liberate man from slavery to the soil. Orlovskii recognized, however, that Kremnev was a cultured and well-intentioned man. He did not hold against Kremnev the prophecies about the triumph of the peasant party—a joke, no doubt— which were to prove so fatal to Chayanov in 1930.
The Model of the Isolated State
This peasant Utopia was closely linked to the Essay on the Study of the Isolated State,56 issued the year after, thereby inaugurating a long series of studies in the higher seminar of rural economy and policy.
55 Alain Besancon has pointed out the links that existed between the Populists and the disciples of this school of "traveling exhibitions." Cf. "La Dissidence de la Peinture Russe, 1860-1922," Annales, March-April, 1962, pp. 259-65.
56 A. Chayanov, "Opyty izucheniya izolirovannogo gosudarstva," Trudy, op. cit. (Moscow, 1921); certain fragments had already been published as "The Population Problem in an Isolated State," Agronomicheskii Zhurnal, No. 2 (1915).
A. V. Chayanov: Life, Career, Works xlvii
57 J. von Thünen, Der Isolierte Staat in Beziehung auf Landwirtschaft und Nationalökonomie (3d ed.; Berlin, 1875). Cf., Von Thünen's Isolated State, trans, [with some abridgements] by Carla M. Wartenberg, ed. with an intro. by Peter Hall (London: Pergamon Press, 1966), liv -f 304 pp.
58 V. Knipovich and Nikitin published in the works of the Institute of Agricultural Economy two studies on regionalization of agriculture which drew conclusions from a series of important studies in this field by the organizational school: Chelintsev in Tambov guberniya, Brutskus and Kotov in Voronezh guberniya, Makarov in Siberia. See V. Knipovich, "K metodologii raionirovaniya," Trudy, Vypusk 5 (Moscow, 1921), and Nikitin, "Sel'skokhozyaistvennoe raionirovanie Moskovskoi gubernii," Trudy, Vypusk 6 (Moscow, 1922).
The vision of the pastoral future of Russia described by Kremnev was based implicitly on an optimal equilibrium between town and country and on a system of agricultural intensification to which the "isolated state" provides the theoretical key.
Why this title? Undeniably, the isolated state is the image that best renders the situation of Russia at the time, but it seems that the concept especially marks the author's debt to von Thünen.57 Chayanov differed from von Thünen, however; von Thünen was mainly concerned with research on land rent and the influence of prices on location, while Chayanov was interested in the relation between agricultural and nonagricultural activities. Although his research had previously considered peasant farming detached from the rest of the economy, Chayanov was now trying to relate it to the whole economy, in particular to the context of Russia's future relations with the world market. Moreover, the proposed "model" was intended to help define the degrees of optimal intensification for the study of agricultural regionalization, a problem on which several of Chayanov's collaborators had been working.58
The model was based on several hypotheses. Property in land did not exist. The territory is divided into five concentric agricultural zones around a single town. Each of these zones can have six different degrees of intensification of production (that is, the amount of labor input per hectare doubles, triples, etc., but production does not increase by the same progression because of the law of diminishing returns). Exchanges between the town and the surrounding country are limited to a single product on both sides; the country product, A, is a foodstuff with inelastic demand, while the city product, B, with elastic demand is not subject to the law of diminishing returns (product increases in proportion to labor). Finally, the transport costs of product A rise in direct proportion to its distance from the town, whereas such costs are considered nonexistent for product B.
From this, Chayanov studied the chronological order (in 21 stages)
xlviii THE THEORY OF PEASANT ECONOMY
of the cultivation of the different zones and of their degrees of intensification, both factors varying with the increase of the agricultural and urban populations and product A's surplus (net product) available for the town. The conclusion showed that intensification would support an ever-growing population but that past a certain optimum level this population increase would be more and more absorbed by agriculture, thus reducing the possibilities of urban expansion and industrialization because of the diminution of the net product in the last phases of intensification. Chayanov also showed the relative level at which the prices of A and B would be fixed and the population movements these prices would provoke between country and town, or vice versa, as long as there remained a discrepancy between the standards of living in town and in country.
In a second analysis, the author examined the modifications wrought on the model given a new hypothesis of private ownership of land in a capitalist frame of reference. The dominant motivation would no longer be the optimum for the population but the earning of the highest net income per hectare, using hired workers. It was assumed that the wages of these workers were fixed, for each phase of cultivation, to the corresponding level of marginal income that the worker would obtain if in place of hiring out^his labor he used it to cultivate new land. One can thus establish the net income represented by the absolute and differential rent appropriated by the capitalist owner at the different phases of intensification. Since this income is all the higher when the wages are lower, the income of peasant labor diminishes proportionately to the degree of intensification. On the other hand, a system based on the peasant family labor farm without the hired labor would permit an optimal agricultural intensification from the viewpoint of population density and of the growth of gross national income.59
Does this mean that land rent does not exist in a peasant labor farm? Some economists such as Chelintsev and Makarov who belonged to the same ' 'organizational" school maintained this thesis60 by applying to the peasant economy Ricardo's analysis of the minimum subsistence level for a worker family. They considered that the
59 Chayanov's study on the economic basis of potato-growing, Ekonomicheskie osnovy kul'tury kartofelya, Trudy, Vypusk 4 (Moscow, 1921), is a verification in the field of the theoretical model. Potatoes being a type of intensive cultivation which develops in areas of high population density, the author analyzed the factors that determine the evolution of this production, especially potato-growing for industrial use.
60 A. N. Chelintsev, Opyt izucheniya organizatsii krest'yanskogo sel'skogo khozyaistva (Khar'kov, 1919), pp. 40, 116-17.
A. V. Chayanov: Life, Career, Works xlix
income of a peasant family and the number of farms in a given area became established at the minimum level as a result of the growth of the population density, incomes staying proportionate to the family's expenses. At this point, they would have had to admit that the rules of the market economy do not apply to the peasant farm, particularly the rent-forming mechanism. From this, there was but a step to make the peasant economy a distinct economic system, a mode of production in the Marxist sense. Did Chayanov really make this step?
Theory of t.he Organization of the Peasant Labor Farm
To reply to the preceding question, we must now examine how Chayanov reworked his initial studies on the peasant economy, first in Die Lehre (1923), then as an essay, Ocherki (1924), before he arrived at his general theory of the peasant economic system, translated below under the title, "On the Theory of Non-Capitalist Economic Systems" (1924), and of its specific mode of organization, Peasant Farm Organization (1925), also presented bdtow in translation.61
When in 1923 Chayanov resumed the elaboration of his theory begun in 1913 on the basis of the Starobel'sk survey, he had to consider more recent studies published in the first years after the October Revolution.62 Some of these studies brought into question his first hypotheses, according to which the basic concepts of classical economics work differently in a peasant economy. The article published by G. Raevich, "On the theory of peasant economy and the concept of worker (rabotnik)" in Na Agrarnom Fronte (1925, No. 11, pp. 23-24) gives a good survey of the debate around 1924-25. The so-called "subjective" approach, according to which the consumption level of the family was the key factor determining the drudgery of the labor in a peasant farm, was severely challenged. It was not possible, on the basis of statistical evidence provided by budgetary inquiries, to relate the intensity of peasant labor to a single factor and to consider the peasant working family as a pure biological unit free from any social
61 Die Lehre von der bäuerlichen Wirtschaft: Versuch einer Theorie der Familienwirtschaft in Landbau (Berlin: P. Parey, 1923), 132 pp. Ocherki po ekonomike trudovogo sel'skogo khozyaistva (Moscow, 1924), 152 pp. "Zur Frage einer Theorie der nichtkapitalistischen Wirtschaftssysteme," Archiv für Sozialwissenschaft und Sozialpolitik, Vol. 51 (1924), pp. 577-613. Organizatsiya krest'yanskogo khozyaistva (Moscow: The Co-operative Publishing House, 1925), 215 pp. These last two works are presented below in English translation.
62 In particular, A. Chelintsev's work, Oypt izucheniya, op. cit.y a study of the organization of the peasant economy, based on a survey carried out in Tambov guberniya.
I THE THEORY OF PEASANT ECONOMY
interference. That is why Chayanov had to deepen his first analysis. In Die Lehre, he maintains that the peasant economy has a unique conception of profitability which is not the search for the highest net profit. The degree of intensification of agriculture or the self-exploitation of family labor is determined not only by the needs of the family but also by its possession of draft animals and productive equipment. He defined again the peculiar roles played by labor, capital, and land in the peasant economy, and he refined his earlier position concerning the problem of social differentiation of the peasantry.
Two chapters in Ocherki63 are worthy of notice—one on the role of machinery in the peasant economy and one on land improvements. The author tried to calculate in what conditions the machine is preferable to manual labor for a peasant farm. He underlined that the method and the criteria used for a capitalist economy were not applicable, for it was necessary to consider the inequalities of the use of the labor force available during the year. Thus, the area that two active laborers can harvest in 10 days constitutes a boundary that^mechani-zation (a reaper) can surpass, whereas in the dead season a machine (thresher) would be inappropriate because there is underemployment of labor.64
Land improvements were also to play an increased part in a more intensive agriculture, especially irrigation in regions where water, not land, was the limiting factor. Chayanov analyzed in detail the mechanisms of this singular water "rent," contrasting it with land rent. Water rent is not marginal, since it is not tied to the land's condition. On the other hand, when water rent rises because water is scarce, land rent falls because the poor ground is no longer cultivated. From this, he drew practical recommendations for agricultural officers responsible for field rotations in irrigated regions, allocating the water throughout the year and setting the price of irrigation water. He emphasized particularly that calculations of the limits of possible land improvements for a peasant economy must take into account the cost of the land and not the foreseeable increase of the rent, for in a peasant economy the prices agreed for the purchase of land or for land im
63 The publication of Ocherki was delayed till 1924, although it was written before Die Lehre, which was published in 1923. The title, Ocherki po ekonomike sel'skogo khozyaistva, was revised and a preface by Kritsman added to the original version. The other chapters were not new; they can be found in Chayanov's earlier publications.
64 This phenomenon had already been observed in Russia in Perm' guberniya by D. I. Kirsanov in 1900.
A. V. Chayanov: Life, Career, Works li
provements are not set at the level represented by the capitalization of the rent, as in a capitalist economy. This is why Chayanov concluded that the practical range of land improvements is larger for a peasant than for a capitalist economy.
Die Lehre tried to make a synthesis of his observations on the interplay of factors (labor, land, capital) in the organizational system of the family economy. In the capitalist economy, land and capital are the variable factors which the entrepreneur tries to combine to obtain the maximum remuneration from his capital, considered as a fixed factor. In a peasant economy, labor, proportionate to the size of the family, is the stable element which determines the change in the volume of capital and land area. To support this thesis, Chayanov showed (a) that it is not a lack of land and capital which makes a peasant find work outside his farm, and (b) that capital does not play the same part in a peasant economy as in a capitalist one. The family's contribution to production consists less in capital than in labor. The result of this is that what can be isolated in a capitalist economy as an income from capital is used here for the family's consumption. The frontier between wages and income from capital which can be objectively determined in a capitalist exploitation (this income being smaller as wages are higher) has only a subjective value in a peasant holding where there is no conflict between income from capital and consumption.
The social implications of the organizational details of the peasant economy were more specifically analyzed in "On the Theory of Non-Capitalist Economic Systems," below, and in Peasant Farm Organization, also below. The first considered these implications from the perspective of macroeconomics and the system, whereas the second regarded them from the point of view of microeconomics. But in both studies, the concept of rent was the central theme.
The historical school's contribution had been to relativize in time the concepts of classical economics founded on the functional dependence of the categories price, land rents, and interest rates, but it had not tried to develop a theory of noncapitalist systems. In his essay, "On the Theory of Non-Capitalist Economic Systems," Chayanov tried to discover such a theory, using the methods of analysis that had been so rewarding for the study of the family economy. Was it possible to establish a universal economic theory on the basis of factors common to all the known systems? Doesn't this "generalized" economy (to employ Professor F. Perroux's phrase) presuppose theoretical studies describing each of the pure systems—family economy, slave
Iii THE THEORY OF PEASANT ECONOMY
based economy, feudal economy, collectivist economy? In what measure and form do the categories of wages, rent, and profit appear in each of these modes of production, and what is the role of economic and extraeconomic stimulants in each of them?
For example, even if the rent is not always visible, as a separate and autonomous income, the formative factors of rent undeniably influence the product level obtained by the family (family economy), the master (slave economy), or the lord (feudal system). In the peasant family economy, the interest paid for renting land does not obey the rules of marginal productivity of capital, and the land prices are not the expression of the capitalization of rent but of the labor force used to satisfy family needs. This explains why the rents became higher in the poorer and more densely populated regions. In a slave economy, slave rent is the profit made by the slave owner on the difference between price of the slave and cost of maintaining him; this rent is all the bigger when capture reduces the acquisition price to zero or when the fertility of the soil greatly reduces the costs of upkeep. Equilibrium is reached between the marginal product obtained and production costs of the marginal slave. In the quitrent economy, the lord no longer has to bear the costs of upkeep and reproduction of human capital, but he is no longer able to determine the number of serfs, as in the slave economy. Overpopulation lowers the standard of living of the serf and the degree of taxation; the rent can be negative unless there occurs an exodus of the population to colonize new land. In these examples, as well as in the collectivist economy, Chayanov emphasized the importance of constraint in determining the use of the land, irrigation, and obligations in kind or in labor.
To reply to the criticisms evoked by these two essays,65 Chayanov decided to publish a new version of his theory under the title Peasant Farm Organization. Apart from a few additions to the ends of chapters, it differed from the preceding version (Die Lehre) only in the last chapters, which dealt with the social implications of the peasant organization. Retreating from his former positions, Chayanov speci
es Chayanov was sensitive to the criticism of A. Weber, who regretted seeing superfluous categories break the unity of economic theory. Chayanov reports a personal conversation with Weber to this effect in Organizatsiya, op. ext., p. 10 (cf. p. 41, below). Professor August Skalweit, of Kiel, felt that Chayanov's observations were perhaps valid for the peasant's situation in Russia but, as they were not verified in Germany's case, did not have a universal significance. The peasant economy was not a kind of Reinkultur but a variation of the capitalist economy, since it had close relations with the market and was subject to all the effects of competition, such as prices and interest rates determined by these markets. See "Die Familienwirtschaft als Grundlage für ein System der Socialökonomie," Weltwirtschaftliches Archiv, Vol. 20 (1924), pp. 231-46. We shall outline below the main criticisms that Chayanov received in Russia.
A. V. Chayanov: Life, Career, Works liii
66 A. Chayanov, Organizatsiya, op. cit., p. 72 (cf. p. 49, below).
67 He does not discuss the absolute rent or scarcity rent that appears when all the land is occupied and when even marginal land produces rent.
68 Carey's studies have shown that this law is not verified in the agrarian history of the United States.
69 Fr. Aeroboe, Die Beurteilung von Landgütern und Grundstücken (Berlin, 1921).
fied in his preface that his theory concerned the organization of the farm; it was a chapter of Betriebslehre, the theory of organizational forms, that he intended to write, not a description of a system or a type of national economy. In short, he did not deny that the peasant farm, like the capitalist farm, shared the same macroeconomic area which the author had declared himself ready to call capitalist because of the privileged role of the dominant economy.66 However, given the difference in organizational type between the capitalist and the peasant enterprise, it was important to discover what was, in reality, the respective balance between these two sectors. On the other hand, if the unique organizational peculiarities of peasant farms were admitted, was it not necessary to deduce a distinctive mode of social relations? The resulting problems of rent and of social differentiation were raised again.
Chayanov did not deny the existence of rent in a peasant economy. Like Ricardo, he considered only the differential rent67 and, like Ricardo, conceded a historical progression in land cultivation,68 but, following Fr. Aeroboe,69 he emphasized the difficulty in agriculture of calculating a net income, particularly of identifying rent in a peasant economy where only the following categories could be isolated: gross income, money spent for capital reproduction and family maintenance, savings. It is true that the land's relative fertility and distance from the market either reduce or increase the necessary labor, but rent did not entail a profit or loss as it did for the capitalist. The result was not necessarily expressed in monetary income but, rather, "in kind" by greater or lesser family consumption and by lesser or greater labor intensity. Thus, the rent here was independent of other economic categories, while capitalist land rent did not exist isolated from the market.
Moreover, the level of the rent could be evaluated in different ways. For the peasant economy, the factors establishing consumption and labor levels were subjective, being largely determined by the density of the population. For this reason, the land rents or prices (capitalized rent) were higher in more populous regions. Thus, the state of the market was not a determining factor as in the case of capitalist rent. This explained why the peasant economy was able to
liv THE THEORY OF PEASANT ECONOMY
win out over capitalist farming in intensive cultivations, such as flax, at a time of falling prices; a fall of economic activity caused an intensification of peasant labor, whereas a capitalist farm, on the contrary, reduced its production when the market was unfavorable. A peasant economy does not take interest rates into consideration when making its decisions to invest in land improvements or machines. For this reason, Chayanov considered the possibility for the intensification of capital to be greater in a peasant than in a capitalist economy.
The Dynamics of the Peasant Economy and the
Social Differentiation in the Countryside *
Chayanov felt it necessary to reply to the criticism that his analysis of the peasant economy was static, not taking into account the dynamics of social differentiation. He had never maintained that demographic differentiations were the only motive forces; nevertheless, they were, in his opinion, decisive.70 The state of the market has either accelerating or braking effects on social polarization, which originates in such demographic disparities as family sizes. He supported his proof with regional statistics of the evolution of peasant holdings and families from 1882 to 1911. He felt that the dynamics of changes in farm areas was not a sufficient criterion to detect a process of proletarianization or of capitalist development in the country. These changes were, rather, to be seen in the analysis of the type of agricultural organization—for example, the percentage of wage labor employed. Moreover, this process could only be very slow in the U.S.S.R., since nationalization of the land and the division of the large estates had put an obstacle in the way of the spontaneous concentration of properties.
The budget surveys that had given rise to Chayanov's theoretical inquiries were taken up again under his direction after 1924.71 But the new research was not simply organizational; it had to study the farms' grain and fodder balance,72 the degree of commercialization of
70 This means that situational differences between one peasant family and another are primarily the result of sizes of the families: larger families cultivate more land than others.
71 This was the point of departure for a series of surveys in Penza, Volokolamsk, and other guberniyas in 1925, in the beetroot-growing guberniyas in 1926, and in Yaroslavl' guberniya in 1927.
72 A. E. Lositskii, who was director of the consumption section of the Central Statistical Office, was responsible for this survey, which borrowed a great deal from the analysis of the consumption budgets.
A. V. Chayanov: Life, Career, Works lv
the peasant economy, and especially the social differentiation in the villages. A committee chaired by A. N. Chelintsev was set up within the Institute of Agricultural Economy to work out a methodology for these inquiries. Chayanov recounts the development of these survey methods in a book published in 1929 as volume 47 of the institute's studies.73
The official surveys accomplished between 1920 and 1924, such as that done by Litoshenko, had adopted the criteria of soc^l differentiation used by G. I. Baskin in his study of Stavropol' guberniya in 1913. Baskin had distinguished 17 social groups according to the share in their budget of external income, wages, and the hiring of labor. The young Marxist, V. S. Nemchinov, who was a collaborator at Chayanov's institute, tried to use a different approach on the basis of a survey made in the Urals in 1925. His aim was to achieve a quantitative evaluation of the surplus value gained by each group (he distinguished 30, counting the subgroups), depending on the degree of dependence or independence of the cultivator vis-ä-vis the land, the basic capital, the variable capital, and the labor force.74
Other young Marxist colleagues tried to develop this analysis by calculating the arithmetical relationship between labor force and the means of production in each group. This survey was carried out in the Volokolamsk region by Anisimov, Vermenichev, and Naumov,75 who used the theoretical propositions of Kritsman. With his concern for objectivity and pluralism, Chayanov wanted to proffer his advice and encouragement to his young colleagues who were, however, embarrassed to acknowledge the help and authority of their director, as they were obliged to contribute to the growing criticism of Chayanov's theories. As we will see, the Marxists reproached him for approaching the peasant economy from the inside without taking the social environment into account.76 Chayanov tried to react by evolving a statistical method of inquiry that would show the different external relations of the peasant economy, such as the importance of land renting and credit. To apply this method, he chose the regions
73 A. Chayanov, Byudzhetnye issledovaniya: istoriya i metody (Moscow, 1929), 331 pp.
74 V. Nemchinov's studies were criticized by Kritsman in Na Agrarnom Fronte, No. 2 (1926).
75 Published under the title, Proizvodstvennaya kharakteristika krest'yanskikh khozyaistv razlichnykh sotsial'nykh grupp, 1927, with a preface by Chayanov and a translation of the summary into English by V. V. Williams, who was to give his name to a ley rotation system.
76 This was Kautsky's reproach to the historical school.
lvi THE THEORY OF PEASANT ECONOMY
of beetroot cultivation—in other words, the areas most influenced by the market economy.77
These theoretical positions had political repercussions because of the discussions inside the party on the social evolution of the Soviet countryside. After the somersaults of war communism, and the scissors crisis during the first years of N.E.P., the Soviet economy by 1924 had achieved a price stability similar to that in 1914. It could be expected that the traditional fiscal and financial mechanism would regain its power to stimulate peasant activity. In December, 1924, the price of wheat had been raised to accelerate sales. In addition, Lenin's articles on cooperation of January, 1923, signified a truce with the cooperative movement—a truce regarded with suspicion by the Bolsheviks.
The radical elements of the party felt these concessions to the peasantry were a return to the policy of support for the "strong" peasants; raising agricultural prices benefited only the rich peasants who dominated the cooperatives. On the other hand, Zinoviev and Bukharin recommended a more flexible policy; it was under their inspiration that the decree of May, 1925, was adopted to allow the peasants to rent land. The controversy over the party's attitude toward social differentiation had taken a new turn with the difficulties of the grain collections in 1925-26 and the increase of unrest in the countryside-revolt in Georgia, murders of the sel'kor, i.e., rural reporters who were pro-Communist. As of April, 1926, the indulgent policy toward the kulaks was over.
The evolution of the political climate explains both the success of Chayanov's school at the beginning of the N.E.P. and its difficulties after 1926. In the last years of his scientific career, he kept up a struggle on the optimal size of agricultural enterprises and the most suitable methods of agricultural integration for accelerating technical transformation.
The Optimal Size of an Agricultural Enterprise
The problem of the optimum size of the agricultural enterprise had from the start been on the program of the Institute of Agricultural Economy. In 1922, Chayanov published his first essay on this
77 Anisimov refers to the manuscript of this survey in an article in Byulleten' Nauchno-Issledovatel'skogo Instituta sel'skokhozyaistvennoi ekonomii, No. 1, pp. 4, 105. A part of this text probably was the basis of Chayanov's study on the cost of beetroot production, Sebestoimost' sakharnoi svekly (Moscow, 1928), 131 pp.
A. V. Chayanov: Life, Career, Works Ivii
subject in the collection Problemy zemleustroistva {Trudy, Vypusk 7). Two other editions of his essay, Optimal'nye razmery zem-ledel'cheskikh khozyaistv, appeared subsequently, with several important revisions. The last edition was published in 1928, at a time when the Soviet authorities were more than ever convinced of the advantages of large agricultural units. Chayanov's point of view was much more cautious on this point, being opposed to those who were recommending large wheat factories.
On the question of optimum size of an enterprise, one finds the old debate between the advocates of small- and large-scale enterprise. But this time the problem is examined from a quantitative point of view. Chayanov was careful to point out that his calculations referred only to capitalist enterprises and not a peasant economy. His reference point was the German school (Thünen, Werner, Dr. V. Stebel78), which had been the first to calculate the limits for the use of machinery in an agricultural space; beyond a certain optimal boundary, varying from 1 kilometer with Werner to 3 kilometers with Stebel, transport costs absorb the net profit made by using machinery. Chayanov divides the different operating costs as a function of distance: (a) constant costs (seed grain, cost of domestic labor), (b) decreasing costs (amortization of machinery), (c) costs increasing with distance or, in other words, with the size of the enterprise (transportation expenses). In this last category, he distinguished regular transport, seasonal transport, the frequency of trips to be made each day, etc., so as to draw the series of curves that would determine the optimal dimensions of an enterprise. He arrived at the conclusion that the limits vary according to the type of crop: 2,000 hectares for extensive cereal cultivation, 800-900 hectares for a system of three-yearly crop rotation, 500-600 hectares for intensive cereal growing, 200-250 for sugar beet cultivation.
In his last edition of 1928, Chayanov observed that the price changes between 1922 and 1928 as well as the lower agricultural salaries permitted higher optimum levels: 3,000 hectares for extensive cultivation, 500 hectares for intensive crops. Besides, the optimum can be raised if the farthest fields are cultivated in a less intensive way than the nearer fields. Thus, Chayanov's revisions tended to increase his optimum limits. He pointed out that the calculations for crop growing were not adaptable for establishing the size of livestock
78 Werner, Uber zeitgemässen Landwirtschaftsbetrieb, 1904. Dr. V. Stebel, "Einfluss der Grundstückentfernung auf Wirtschaftsaufwand," Frühlings Landwirtschaft Zeitung, Nos. 1 and 2 (1909).
lviii THE THEORY OF PEASANT ECONOMY
79 The land is split up into a large number of lots and holdings; the tools and draft animals not being fully used thus increase transport costs.
80 Osnovnye idei i formy organizatsii krest'yanskoi kooperatsii (Moscow, 1919), 343 pp. But Chayanov's first ideas go back to Kratkii kurs kooperatsii (1st ed., 1915), the result of his teaching at the Shanyavskii public lectures.
farms, and that his institute was engaged in studying the specific problems of the different types of animal husbandry (livestock ranching, dairy farming), since the transport costs for forage were not the same in each case.
On the other hand, Chayanov wanted his methods to be used to determine the size of rural communities, i.e., taking into consideration the specific characteristics of peasant farms where optimal limits were lower than those for large enterprises.79 In his conclusion, Chayanov considered that the method of optimum calculation should be applied for each enterprise to each of its branches and that the solution lay in the organization of each of these branches according to the laws of its own optimum. This idea of differentiated optima was central to all Chayanov's thinking on cooperation.
Chayanov's Theory on Agricultural Cooperation and Collectivization
Chayanov's study, Basic Ideas and Organizational Forms in Peasant Cooperatives, dates back to 191980 and was often republished, the last edition being issued in 1927. It was based on the experience in the cooperative movement described above. But in the last years of N.E.P., Chayanov's theses were put to a severe test, since massive collectivization, despite its cooperative disguise, was the antithesis of his recommendations. Chayanov maintained that horizontal concentration of production offered only limited advantages in agriculture, as the studies of farm sizes showed; on the other hand, vertical concentration allowed agriculture to achieve a revolution comparable to that of the steam engine in industry. The whole point of this vertical integration was to reconcile the maintenance of peasant farms in the biological processes of intensive cultivation and livestock breeding, where they were more productive than capitalist farms, and with the requirements of technical progress, where the large enterprise had an advantage in mechanization, production, and marketing. The agricultural cooperative was to be the instrument of that integration.
Another advantage of the cooperative formula for the technical transformation of agriculture was its being a movement sprung spon
A. V. Chayanov: Life, Career, Works lix
81 On June 1, 1929, i.e., before the outbreak of the campaign of forced collectivization, the total area under collective farming did not exceed 3.9 percent of the agricultural land.
taneously from the peasantry. For Chayanov, it was essential to keep * the democratic and voluntary character of cooperation, opening it to all the peasantry and thus making it a mass movement. It was on this condition alone that cooperation had a chance to succeed. Every restrictive measure that would limit the freedom of membership in the cooperatives in the name of some ideological principle would lessen their strength as a mass movement. But, on the other hand, it would be wrong to consider cooperation as a movement isolated from the organizational forces that gave birth to it. This is why those who wanted to amalgamate in the same institution both agricultural productive cooperatives and workers' consumption cooperatives were wrong, since the interests of each were not the same. Because cooperation was a spontaneous mass movement, it could do much better than the other types of collective enterprises, such as the communes and artels which had never shown much progress in the task of successfully transforming Soviet agriculture.81
Chayanov had doubts about "collective" agriculture (communes and artels), because the incentive problem had been solved more flexibly by the cooperatives based on the small family farm, with its individuality intact, than by the artels. For where the artel or commune was founded on an ideological or religious basis that maintained the corporate spirit and the incentive to work in spite of the egalitarian division of the product, it was too narrow to allow an expansion of cooperation. More frequently, where no ideological tie bound the members of a collective farm, salaries had to be introduced to stimulate work—close to capitalism, but with the disadvantage of substituting for a single employer a collective authority without the employer's powers of constraint.
Differing from the state farm, the collective farm did not have the same facilities for hiring additional outside labor; thus it was condemned either to underemployment if it kept on the personnel necessary for its needs at peak periods, or to labor shortages.
Chayanov was not, however, systematically opposed to all forms of horizontal integration. Horizontal and vertical integration were complementary rather than contradictory. The limits of horizontal integration—the desirable dimension of the production unit—were not identical at all stages of production and for all products. Chayanov
lx THE THEORY OF PEASANT ECONOMY
82 The decree of August 6, 1918, made membership in cooperatives obligatory, but at the Ninth Party Congress, 1920, Lenin opposed the fusion of worker and agricultural cooperatives in single institutions.
admitted that collectivization could reach to extensive cultivation and to pasturing where processes were easily mechanized. On the other hand, collectivization could not give good results where biological processes were dominant (livestock, intensive farming). For marketing, vertical integration gained an advantage with zones of application that went far beyond the limits envisaged for the collective farm, as the dairy societies showed. From this was developed the idea of optimum differentiation for each branch of production, which, by forecasting different levels of integration, implied the possibility of breaking up the links of an organizational plan of enterprise. The cooperative was the system best adapted to combine the advantages of large-scale commercial mechanical or processing activities with those of the family farms for intensive production.
It is not necessary to emphasize the gap that separated these ideas from the positions adopted by the Soviet government. Need one recall the government's efforts to take over the cooperative movement which at the beginning of the Revolution had been controlled by the S.R. (Social Revolutionary Party)?82 The official directives excluding the rich peasants from the cooperatives and the measures of' constraint used for collectivization are well known. For the Bolsheviks, cooperation was only a stage in the socialist transformation of agriculture; for Chayanov, cooperation was an ideal compromise, combining the advantages of small peasant property with the technical advantages of large-scale farming.
The New State Farms and the Techniques of the Future
The problem of optimal size of the agricultural enterprise was again a question of the day for the last years of Chayanov's activity as the head of the Agricultural Economy Institute during the state farms campaign. Since April, 1917, Lenin had recommended forming state farms out of the old feudal domains. From 1928, the state farms drive was extended to new regions to create veritable cereal factories, which were to deliver the marketable surplus that was harder and harder to obtain as the peasant, lacking incentive, retreated into his shell.
Chayanov's last works on the state farms were concerned with defining an organizational policy and a method for planning their pro
A. V. Chayanov: Life, Career, Works lxi
83 Ekonomicheskoe obozrenie, No. 12 (1929), pp. 95-101.
duction. In an article on the "Technical Organization of Grain Factories,"83 he tried to answer the following questions.
1. In what region of the U.S.S.R. could 25 million hectares of land be found to accommodate the creation of new state farms? It was impossible to crowd them into the traditional agricultural regions which were already overpopulated; therefore, it would be necessary to concentrate on the territories situated on the periphery of the peasant economy, especially on the Volga, in Siberia, and in Kazakhstan, where, according to Chayanov's calculations, 12.3 million hectares could be newly cultivated or, in some cases, recultivated. It was a kind of virgin land program drawn up 25 years before Khrushchev. The difficulty was that the lands were situated in regions where there was insufficient rainfall and a poorly developed communications infrastructure. The average distance of the new enterprises from a railway or port would be 20-40 kilometers, sometimes even 70.
2. What type of agriculture would be best adapted to these marginal regions to insure stable production? Until then, these lands had been used for livestock pasturing or had been left uncultivated because the primitive peasant tools had not been able to work the land, given the shortness of the season. The tractor and truck would overcome this difficulty, but it would also be necessary to vigorously combat plant disease and to perfect methods of conserving winter humidity and soil fertility in order to avoid summer drought and soil erosion. Chayanov had thus foreseen the main dangers which were to confront the virgin land experiment. To remedy these difficulties, he recommended American dry farming methods—wheat-growing followed by a year of fajlow. But not everyone agreed on this point. Other experts advocated cereals rotated with grass, which implied livestock and, thus, more complex farms and larger investments.
3. What was the degree of mechanization and the optimum size envisaged for these specialized farms? Chayanov was in favor of 100 percent total mechanization to limit the number of workmen and to make the most of farming on vast areas—10,000-12,000 hectares, all in one block. Chayanov was now far from the ceilings he had set previously, but he explained his change of mind. His previous calculations establishing maximum dimensions of 800-1,500 hectares in extensive cereal farming had been based on the use of horses and of machines which would have to return to the farm each evening, but if the machines stayed in the fields and if the men could return to
lxii THE THEORY OF PEASANT ECONOMY
the farm by truck these limits could be modified. Technical progress would allow production units of 8,000 to 12,000 hectares, so that by joining together several of these units state farms of 60,000 to 100,000 hectares could be created; several production units would form a state farm for administrative purposes. The main bottleneck, according to Chayanov, would be trained personnel rather than capital. He concluded by calling for an accelerated program for training agricultural officers and state farm administrators.
Among the other problems of the cereal factories were the methods of elaborating production plans for the state farms. The plenary session of the institute, March 16, 1928, discussed the report Chayanov presented on this subject.84 The method he advocated for working out agricultural plans is still used in Soviet practice, although his conception of the state agricultural enterprise was very different from the state farm of today.
To set up a production plan, Chayanov started with the regional targets defined by the higher authorities. These targets would determine the orientation of the enterprise's production, taking into account costs and market conditions as profitability criteria for the possible production alternatives. The organizational plan of the enterprise would be the logical consequence of the chosen orientation; it would try to strike a balance between the principal production (cereals, for example) and the complementary activities (livestock, fodder, food for workers) which, in turn, would determine, first, the land utilization of the area (the sown-pasture ratio), second, the number of traction units required, and third (taking into account the available manpower), the required addition of seasonal labor. The availability of fodder would determine the composition of the stock, and this, in turn, the volume of fertilizer needed; the practicable degree of intensification would be deduced from this need. This intensification would set the income level, which would determine the possibilities of accumulation and of enlarged reproduction. The objectives of the plan were thus like links of a chain, hence the term "key links," given to this now classic method of Soviet planning.
However, to conceive a state agricultural enterprise along capitalist lines by basing the direction of the state farm production not only on the plan's targets but also on profitability criteria was to provoke criticism from several of Chayanov's colleagues—K. I. Naumov, V. N.
84 "Metody sostavleniya organizatsionnykh planov sel'skokhoz. predpriyatii v uslovi-yakh sovetskoi ekonomii," Byulleten' Nauchno-Issledovatel'skogo Instituta sel'sko-kho-zyaistvennoi ekonomii, No. 1-2 (1928), pp. 5-14.
A. V. Chayanov: Life, Career, Works lxiii
Lubyakov, and I. S. Kubshinov.85 It is known that the authorities scarcely followed Chayanov's advice in organizing the state farms and that the profitability of these enterprises has long been one of the weak spots of the Soviet state sector.
In all his later writings, one can detect a noticeable revision of Chayanov's previous positions, not only on the problem of optimal size of enterprises but more generally in his understanding of the basic evolution of Soviet agriculture.
Chayanov's early studies, wThich had provided the basis for his first theoretical formulations, were related to Russian agriculture little touched by technical progress. At that point, Chayanov was unaware of the revolution wrought in American agriculture by the tractor, the truck, and the combine. In 1929, he hailed these innovations as comparable to the effect of the steam engine on industry, and he implied by this that agricultural science would have to be wholly rethought. "This revision," he wrote, "obliges us to relegate to the background much of what we have hitherto considered as fundamental."86 The theory of peasant economy had been developed on the assumption of a preindustrial technical world. "To defend peasant economy is to defend several generations destined to slow death."87 It would be just as unrealistic to defend the artisan's workshop against the factory at the end of the eighteenth century. The problem was simply to know what form the inevitable agricultural revolution would take in the present conditions. Would there be a Russian equivalent of the development of capitalist agriculture in England? The Soviet regime offered another solution—the organized transformation of peasant farms grouping themselves in large units by a process of self-collectivization (samo-kollektivizatsiya).
In other words, agricultural cooperation, previously restricted to the marketing sphere, was to be extended to the production sphere. There would no longer be a peasant economy,™ but vast collective farms stretching over thousands of hectares. These collective farms would be distinguished from large capitalist units not by organization and technology but by their social implications. In a planned socialist economy, where the state controlled all the resources, it would be possible to avoid the social catastrophe of an agricultural revolution's
85 Ibid., p. 14.
86 "Segodnyachnii i zavtrashnii den' krupnogo zemledeliya," Ekonomicheskoe obozrenie. No. 9 (1929), p. 40.
87 Ibid., p. 52. 8« Ibid., p. 80.
lxiv THE THEORY OF PEASANT ECONOMY
destroying the personnel of the old peasant economy. In short, Chayanov hailed the new orientation of Soviet agriculture toward the creation of state farms and collective farms as "the only realistic path for agricultural development,"80 on the condition that the heritage of peasant experience be preserved and that self-collectivization be achieved without external pressure.
The chapter that Chayanov wrote in 1928 for the collection of essays on Life and Technology in the Future, "The possibilities of Agriculture,"90 was an act of faith in scientific progress. He foresaw the upheavals which the progress of research would impose on agriculture in a more or less distant future. The prospects offered by soilless agriculture (thanks to factory-produced syntheses of albumen and the mastery of certain biological processes) were described in terms that were Utopian for the time. Chayanov visualized factories for food products and synthetic textiles; the plants would be used purely for their decorative purposes and natural fruits for their inimitable perfumes. He also predicted that man would be able to control climate and forecast harvests. One can hardly accuse him of turning his back on progress.
But side by side with these predictions was a whole program for agronomic research in the U.S.S.R. which again revealed Chayanov's deep knowledge of the regional realities of his country. He emphasized the need for studies of plant selection to acclimatize the species to very short growth cycles in northern regions, the problems of different methods of combating drought in southern regions, and so on. One finds there an enumeration of the principal difficulties Soviet agronomists have encountered in the past decades.
A Synthesis of Chayanov's Contribution
As one can see from this chronological presentation"^ the main trends in Chayanov's thought, his work displays such a remarkable unity that one may consider it to constitute a theory of peasant economy just as well worked out as his own book on the subject. The principal stages and the logical developments of this theory can be summarized as follows.
Until the end of the nineteenth century, the debate on the agrarian problem between Slavophiles and westernizers and later between
89 Ibid., p. 51.
90 "Vozmozhnoe budushchee sel'skogo khozyaistva," Zhizn' i Tekhnika Budushchego (Sotsial'nye i nauchno-technicheskie utopii), ed. A. Kolman (Moscow, 1928), 503 pp.
A. V. Chayanov: Life, Career, Works lxv
Populists and Marxists had been seen in the light of social relations in agriculture. Against the idealization of the peasant commune and the vitality of the traditional community were opposed the theory of the decomposition and proletarianization of rural society under the impact of capitalism. The Organization and Production School, of which Chayanov became the most eminent theoretician after the Revolution, directed the debate, not on the social relations, but on the organizational forms of the peasant economy. He tried to show that to the categories and modes of production Marx had recognized (slavery, feudalism, capitalism, socialism) there should be added a distinctive form—the peasant labor economy ("On the Theory of Non-Capitalist Economic Systems").
While in Marxist eyes the chief motivation of the peasant economy —the search for maximum income—allowed it to be assimilated into the capitalist system, Chayanov claimed that consumption, or the family's subsistence, was the motive force determining the peasant's activity. From this, he showed that the arrangement of the factors of production in a peasant farm obeyed subjective criteria (Peasant Farm Organization). In addition, the comparison of peasant and worker budgets in Belgian, German, and Swiss surveys showed that the consumption trends were not identical in these two categories, thus confirming the specific nature of the peasant economy (cf. Ocherki).
From analysis of the theory of peasant economy, Chayanov went on to analysis of various types of farming. Classical theory used the criteria of land, capital, and labor to characterize the degree of agricultural intensity of a given region; it used the law of diminishing returns to explain the general evoftition of the different agricultural systems. But the studies of Aeroboe in Germany and Laur in Switzerland showed that the orientation of a farm's production—i.e., its principal produce—was more important in characterizing a given type of farm than was the combination of its factors of production. This explains why the surveys of Russia's rural economy by sector of production were in such favor. Chayanov's studies on the economy of flax, the potato, beetroot, and irrigation completed the work of Che-lintsev and Brutskus, undertaken at the same time. Chayanov's principal contribution was to attempt a synthesis of the main factors determining the development of agricultural systems and thereby of social relations in agriculture.
Von Thünen had been one of the first to point to the market as the determining influence on the degree of intensity of an agricul
lxvi THE THEORY OF PEASANT ECONOMY
tural unit. Specialization decreases and the type of produce alters progressively as distance from the city increases, taking account of transport costs, the perishable quality of produce, and local prices. Ricardo's teaching on land rent which forms the basis of Marxist analysis of agricultural development also contributes to treatment of the market as the essential factor. It is for this reason that the discussion between legal Marxists and Social Democrats on the possibility and signs of the development of capitalism in Russia was focused on the problem of the market.91 For the Social Democrats, the market was to play a "progressive" role in transforming the natural peasant economy; without modifying the market, one could not expect significant changes in the organization of the farm.
The German historical school of Schmoller and a few Russian theoreticians, such as Chelintsev, tried to show that population density plays a more important role than the market in directing the development of systems. For his part, Chayanov tried to analyze the relationships between population density and organizational forms in agriculture. However, he went further than his predecessors by combining in the same model (in an isolated state) both factors-market and population density. In a natural economy, intensification is determined by population density. For this intensification to arrive at specialization—i.e., at an even greater intensification—a market was needed. Local markets could be the result of the population density of a region, but the density factor was insufficient to explain the action of distant markets on regional specialization. Thus, since agricultural development is not determined by any single factor, social relations in the village are complex and differ from one region to the other. ^
It would be an exaggeration to claim that it was exclusively due to Chayanov that progress has been made in understanding the peasant farm. The German revisionists and the work of the historical school have contributed their share.92 But Chayanov wanted to transcend both the abstract generalizations of the classic and neoclassic
91 VI. Ilin (Lenin), Razvitie kapitalizma v Rossii, protsess, obrazovaniya vnutrennego rynka dlya krupnoi promyshlennosti (2d ed.; St. Petersburg, 1908).
92 Der Moderne Kapitalismus was translated and published in Russia in 1905. For W. Sombart, the variety in the structure of the peasant economy is greater, because the uniformity of capitalist motivation is replaced by the diversity of peasant needs and because the peasant economy can avoid the activity of the market more easily. See W. Sombart, Apogee du Capitalisme, Vol. 2, p. 475. According to N. Makarov, op. cit., Chayanov transposed Sombart's "precapitalist" type of consumer or handicraft economy to the peasant economy. However, analysis of Chayanov's writings does not confirm this statement, as he never cites Sombart.
A. V. Chayanov: Life, Career, Works lxvii
theoreticians, such as the marginalists, and the relativism of the historical school. The notion of organizational types and systems allowed him to bridge the gap between abstract theory and history.
Doubtless not all Chayanov's ideas were equally original. Who can dispute today, however, that his major views, based on a thorough knowledge of the Russian situation, would have facilitated some of the changes and avoided many of the trials that its peasantry and agriculture have endured since then?
The proof can be seen that now, with the perspective of the years, the Soviet Marxist school approaches agricultural problems with much less dogmatism and sometimes with an attitude close to that of Chayanov 40 years ago when the two were opposed to each other.
Russian Critics of Chayanov's Theories
Among the leftist economists not affiliated with the Bolshevik party, S. N. Prokopovich was at least as influential as Chayanov. Krest'yanskoe khozyaistvo (Peasant Economy),93 Prokopovich's reply to Die Lehre, was therefore disappointing, since it did not live up to its claims. It was not, in fact, a new theory of peasant economy but a collection of more or less connected essays on different aspects of this economy before the Revolution. Prokopovich wanted to show that the "subjectivist" view of the peasant farm—i.e., Chayanov's theory that its principal impulse came from consumption—was compatible with the "objective" Marxist position, which considered production needs to be decisive. To make this synthesis of the two schools, Prokopovich used, as had Chayanov, the budget surveys, establishing correlation coefficients that showed the connections among land, capital, and labor. He tried to show that the factors of production, and especially the area used by a peasant, have a higher correlation coefficient vis-ä-vis the level of family income than the number of mouths to be fed. He thus rejects the theory that consumption needs determine the size of the peasant holding.94 He does not, however, conclude that the peasant economy can be described as a capitalist economy, although he questions Chayanov's criteria of differentiation.95 Unfortunately, the constructive part of his proof errs in the method of correlations he used: today we are better aware of the risk involved in using correlations to support a theory.
93 S. N. Prokopovich, Krest'yanskoe khozyaistvo (Berlin, 1924), 246 pp.
94 Ibid., p. 36.
95 Ibid., p. 41.
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Similarly, Brutskus, who was a professor at the Agricultural Institute of St. Petersburg from 1907 to 1922 and who emigrated to Berlin at the same time as Prokopovich, adopted an intermediary position between Chayanov and the Marxist school in his treatise on rural economy.96 A peasant farm tries "to satisfy the needs of the family by trying to obtain the maximum income from the land through a better utilization of the peasant's and family's labor."97
As for Chayanov, his work subsequent to Die Lehre (1923) had very little effect among the Russian emigres, despite the presence among them of his old friends Chuprov and Kosinskii. One looks in vain for a reference to Chayanov in the Prague periodical, Krest'yan-ska Rossiya, edited by S. Maslov.
It is in Chayanov's own Institute of Agricultural Economy that one finds echoes of the discussions which put him into conflict with some of his close collaborators. Thus, in a work on land rents, published by the institute, G. A. Studenskii took exception to his director's ideas on the subject.98 It is to be remembered that although Chayanov did not deny the existence of rent in the peasant economy he believed that it was not to be thought of as separate from the total revenue obtained by a peasant family's labor. Studenskii tried to formulate a method that would allow the calculation of rent in a peasant economy by using Vainshtein's studies on land rent.99 He tried to discover the principles of a fiscal policy that would allow the elimination of rent while leaving the remuneration of labor and capital intkct.100 Like Chayanov, however, he hoped that with land taxes the mechanics of the market would be able to play a stimulating role in intensifying agricultural production without upsetting the peasant economy from the outside.
Later, in 1928, the rent question arose again in the institute's discussions of the law of diminishing returns in agriculture. Chelintsev
96 B. D. Brutskus, Ekonomika sel'skogo khozyaistva (Berlin, 1923), 360 pp. Chelintsev acclaimed it as the first treatise of wide scope, and regretted that "Chayanov's numerous and precious studies do not form a complete course." Krest'yanskaya Rossiya, No. 5-6 (1923), p. 237.
97 On the advantages of small scale holdings and cooperation, Brutskus agreed with Chayanov. Like him, he was familiar with the theories of marginal utility and productivity. In the criticism of the dynamics of social evolution, the positions of Prokopovich and Chayanov are also identical. See Krest'yanskoe khozyaistvo, op cit., chap, vi, pp. 157-92.
98 G. A. Studenskii, Renta v krest'yanskom khozyaistve i printsipy oblozheniya, Trudy, Vypusk 15 (Moscow, 1925), 114 pp.
99 A. L. Vainshtein, Oblozhenie i platezhi krest'yanstva (Moscow, 1924).
100 Chayanov discussed the same problem in Sel'sko-khozyaistvennaya taksatsiya (Moscow, 1925), 186 pp.
A. V. Chayanov: Life, Career, Works lxix
was opposed to Chayanov, who adopted the Marxist point of view. But it was the problem of differentiations in peasant society that was to provoke the greatest commotion in the institute as well as, according to Sylkovskii,101 a schism in the Organization and Production School from 1927 on. Makarov and Kondrat'ev felt that social differentiation was beneficial and "progressive," because it tended to develop the efficient peasant productive forces. Chayanov (supported by Chelintsev) questioned this differentiation and denied the "progressive" character of "capitalist" development in peasant economy, advocating an agriculture based on small peasant property organized in cooperatives.102
The opposition of the party's Marxist theoreticians to Chayanov's thesis appeared very early—for example, in the preface to Ivan Krem-nev's Peasant Utopia. In his introduction to Peasant Farm Organization, Chayanov himself cited the major arguments of the Marxist school against his theory of peasant economy.
1. The method used by Chayanov was not Marxist. He was considered a spokesman of the Austrian marginalist school, whose theory was based on current market prices and who considered value subjectively as a function of needs. Bu^for a Marxist, prices were merely variables determined by the level of production forces and modified in relation to labor productivity,103 whereas value had for them an objective content. In the 1924 preface to Ocherki, Kritsman particularly attacked Chayanov for ignoring the role of the material productive forces as a factor in the development of the peasant economy. Meerson followed with this criticism: the importance of activity was measured by the labor and the means of production, not by labor alone; because the means of production were not divided equally, there was a redistribution of the labor force itself, as Marx had shown in his introduction to the Critique of Political Economy.104
2. Peasant economy was considered as a static entity, independent of the economic environment. Chayanov's school refused to see that the peasant economy was in conflict with capitalism and the prey to social differentiation. Lenin's work, The Development of Capitalism in Russia, was the Soviet Marxists' reference book to illustrate this
101 Na Agrarnom Fronte, No. 11-12 (1929), pp. 75-96.
102 Extracts from the "verbatim" report used by party theoreticians in attacks against Chayanov's school give only an imperfect account of this debate. See I. Vermenichev, Na Agrarnom Fronte, No. 4 (1927).
103 G. Gordeev, Na Agrarnom Fronte, No. 4 (1927), pp. 162-71.
104 D. Meerson, Na Agrarnom Fronte, No. 3 (1925).
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breakdown. According to his critics, Chayanov had mistakenly grouped together middle peasants and kulaks under the category of farmers with more than 15 hectares. A further breakdown by farm size would have shown that renting land and employing labor were very frequent in the group cultivating more than 25 hectares. Also, increase in family size was more rapid in the last categories than in those where it was necessary, because of lack of land, to look for outside wages. Finally, the drudgery of labor inside the peasant family varies not only in relation to the size of the family but also in relation to the social group to which the given family belongs.105
It was not correct to claim that the small farm could compete successfully with capitalist farms. This reasoning, based by Chayanov on an equality in technical levels of the two sectors, was refuted by the facts; capitalist enterprises used more perfected techniques and therefore obtained greater returns. The inability of the small farm to adopt technical progress or its underutilization of machinery because of its size proved the contradictions between this social form and the production forces. Continuing in this defense of technical progress, the theoreticians of the party attacked Chayanov\ "optima" theory, accusing him of failing to see the evolution of the optima in relation to this progress and of confusing the optimal dimension of an enterprise with the optimal dimension of cultivated areas.106
3. Chayanov tended to idealize peasant economy by attributing to it well-intentioned motives. Facts prove that the mentality of a peasant is no different from that of a capitalist farmer. This idealization was a reflection of the petty bourgeois ideology which justifies the reactionary policy of support for the kulaks.107 "Neopopulism" was a new version of the ideology of the Stolypin reform, an "American style" development without revolution. In other words, Chayanov's policy would stabilize the peasant economy by cooperation and encourage the efficient elements of the peasantry, considered as "progressive."108
The school had adopted in some measure the pre-Revolutionary thesis of the Social Democrats—a thesis that considered the evolution of capitalism in agriculture inevitable, and even desirable, as a step in the transition toward socialism. But (and in this the neopopulism
105 L. Kritsman, Preface to the 1924 edition of Ocherki. loe Sulkovskii, Na Agrarnom Fronte, No. 4 (1928).
107 This reproach was aimed more at Kondrat'ev than at Chayanov. See Vermenichev, Na Agrarnom Fronte, No. 4 (1927).
108 Sylkovskii, Na Agrarnom Fronte, No. 11-12 (1929), pp. 78-96.
A. V. Chayanov: Life, Career, Works lxxi
conformed to the former populism) they continued to think that a peasant economy could attain socialism without going through forced collectivization, and that the creation of large production cooperatives had no future except in certain regions where an extensive mechanized agriculture was possible.
When the right opposition in the party was liquidated, the gulf between Chayanov and his opponents became unbridgeable.109 The criticism, which initially had been relatively courteous, gained in intensity from 1929 on and became increasingly political. In 1930, Chayanov was accused of counterrevolutionary conspiracy.110
"A group of bourgeois and petit bourgeois scholars: Kondrat'ev, Yurovskii, Doyarenko, Oganovskii, Makarov, Chayanov, Chelintsev and others to which are joined Groman, Sukhanov and Bazarov, representing the anti-marxist tendency in agrarian economics, these last Mohicans of the populist ideology, are now unmasked as being Jeaders of a counter-revolutionary ^organization aimed at overthrowing the Soviet regime."111 According to the same author, this organization was trying to slow down the growth of agricultural production and foster the development of capitalist elements in the countryside; the scholars belonging to it inspired right-wing deviationism (pravyi uklon), and were trying to deflect the party line toward a bourgeois ideology.
These accusations were based on the "confessions" of Professor Karatygin, who had admitted participating in an organization to sabotage the workers' food supply.112 Thus, the difficulties of the procurement campaign were attributed to these scholars.
The Present Importance of Chayanov and the Evolution of Social Science in the U.S.S.R.
Chayanov's ideas have, nevertheless, survived him, and many of the problems debated by him in the twenties are now receiving a
109 Kulikov, Na Agrarnom Fronte, No. 1 (1931), p. 36, but Nicholas Bukharin disclaimed belonging to "these petty bourgeois princes who protect agriculture against all the changes envisaged in favor of industry. They are in essence supporting the conservation of the small enterprise with its family structure, its backward techniques. . . . These ideologists of petty bourgeois conservatism do not manage to understand that the development of agriculture depends on that of industry." "Notes of an Economist," Pravda, October 30, 1928.
HOI. Vermenichev, "Burzhuaznye ekonomisty kak oni est (Kondrat'evshchina)," BoVshevik, No. 18 (1930), pp. 38-55.
in Ibid.
112 Pravda, September 22, 1930.
lxxii THE THEORY OF PEASANT ECONOMY
new illumination. It would doubtless be an exaggeration to say that official positions on the political level have been changed, but it would be no less incorrect to underestimate the noticeable evolution in Soviet theses in scientific and historical studies as well as in rural economics.
The most interesting changes of the young school of Soviet historians on the problem of agricultural development in twentieth-century Russia are shown in the analysis of the development of capitalism in Russian agriculture before the Revolution and the social composition of the Russian peasantry after it. Without entering into a discussion that is far from concluded,113 certain historians, such as A. M. Anfimov,114 want to go beyond the works of Lenin in their studies of economic types in Russian agriculture at the ^eginning of the twentieth century. By adopting more sophisticated criteria and by better distinguishing the different regional developments,115 Anfimov separates the sector of capitalist farming from the sector of peasant economy. In the upper levels of the peasantry, Anfimov succeeds in separating those that do not hire labor and those evolving toward capitalism because they employ outside labor. In other words, he thus tends to minimize the importance of capitalism in agriculture.
In the same way, the most recent historical studies of the social structure of Russian villages in the twenties before collectivization tend to emphasize the importance of the middle peasantry. I. Malyi cites Lenin at the Tenth Party Congress (1921):
The peasantry has become much more "middle" than before, opposition is reduced, the use of the land is much more equally shared . . . the statistics show in general and in detail that the village has incontestably been levelled, i.e., that the pronounced polarization between the kulak on the one hand and the landless peasant on the other has been mitigated. The peasantry has become stabilized on the whole at the situation of the middle peasant.116
113 N. Rubinshtein, Voprosy Istorii, No. 8 (1961); Istoriya S.S.S.R., No. 4 (1962); I. D. Koval'chenko, Istoriya S.S.S.R., No. 1 (1962); P. Ryndzyunskii, Istoriya S.S.S.R., No. 4 (1963); V. Yatsunskii, Istoriya S.S.S.R., No. 1 (1963); A. Anfimov, Istoriya S.S.S.R., No. 2 (1963).
114 "K voprosu ob opredelenii ekonomicheskikh tipov zemledercheskogo khozyaistva," Voprosy Istorii Sel'skogo Khozyaistva, Krest'yanstva i revolyutsionnogo dvizheniya v Rossii (Moscow, 1961), pp. 362-79.
115 Zfo'd., p. 367. The 1913 survey of Starobel'sk and the concept of the "peasant consumer economy" are used, but Chayanov is not named.
H6 I. Malyi, "Voprosy agrarnoi statistiki v posleoktyabr'skikh trudakh V. I. Lenina," Vestnik statistiki, No. 4 (1964), pp. 15-16.
A. V. Chayanov: Life, Career, Works lxxiii
The same author mentions a study by V. S. Yastremskii117 which demonstrates the correlations between land area and family composition. There again, one of Chayanov's fundamental theses has returned to the surface.
The analyses of V. Yakovtsevskii118 on the social structure of Soviet agriculture between 1921 and 1925 also emphasize the role of the middle peasantry, classified, not as capitalist, but as belonging to the "small market economy." There is but a step from this point to considering the peasant economy as a specific category. It appears that this step has been taken by the economists.
In fact, the recent Course of political Economy, published in two volumes in 1963 by the University of Moscow, under the editorship of Professor N. A. Tsagolov, devotes a paragraph in the chapter on land rent to rent in a "peasant economy" (V krest'yanskom kho-zyaistve, p. 452). Many sentences could easily have been signed by Chayanov:
The chief motivation of the small market peasant economy is not the increase of value; the necessary condition for its functioning is not the obtaining of an average profit; prevailing prices are not necessarily equal to the price of the factors of production for a peasant economy. In the peasant economy there are no costs of production (C + V) for it does not buy labor. Nevertheless to the extent that the capitalist form of production dominates, the categories of capitalist economics can be applied in a conventional way (uslovno) to the peasant economy.
In other words, they seem to admit that the peasant economy presents characteristics different from those of the capitalist form of production and that the use of capitalist concepts in this case has only conventional value.
More decisive is the return to favor of mathematical methods in
117 V. S. Yastremskii, "Svyaz' mezhdu elementami krest'yanskogo khozyaistva," Vestnik statistiki, No. 9-12 (1920), pp. 51-53.
118 In the collection published under the direction of I. A. Gladkov, Sovetskoe narodnoe khozyaistvo v 1921-1925 (Moscow, 1960), pp. 267-80. In the volume, Postroenie fundamenta sotsialisticheskoi ekonomiki v S.S.S.R. 1926-1932 (Moscow, 1960), p. 272, the same V. Yakovtsevskii cites the following statistics to support his thesis.
Dynamics of social evolution in the country:
Before the Revolution 1928-29
Poor peasants (bednyak) ..... 65% 35%
Middle peasants (serednyak) 20% 60%
Kulaks .................... 15% 5%
On p. 274, he adds: "One criterion alone, such as the area, is not sufficient to determine whether a peasant farm belongs to one or the other group . . . our statistics do not provide global facts on the distribution of the cultivated area, yields, gross production and marketed production for each socio-economic group of the peasantry."
lxxiv THE THEORY OF PEASANT ECONOMY
Soviet economics, thanks to the work of Kantorovich, Nemchinov, and Novozhilov. The notions of scarcity and marginal calculus are tending to perfect and modify both Marxist value theory and the practice of economic decisions. In this revision, whose importance transcends the boundaries of agricultural economics, it is interesting to note the role played by two former colleagues of Chayanov—V. S. Nemchinov, who has been mentioned already, and A. L. Vain-shtein,119 who is now working in the department of econometrics and economic models of the Academy of Sciences.
The application of marginal calculus to agricultural economics is reopening the problems of optimal size of the agricultural enterprise and location of production which preoccupied Chayanov in the 1920's. It is significant that the studies recently completed in this area120 link up with some of Chayanov's former work. I. A. Borodin's proposal for deciding the size of an enterprise repeats with improvements Chayanov's conclusions in his article on the state farms: "The problem of optimal size of the state farm and its subdivisions must be solved simultaneously with the rational allocation of the divisions on the state farm's land."121 The optimal subdivision depends on the type of produce: 2,500 to 3,000 hectares for cereals in the Volga regions; 100 to 120 hectares (northwest), 300 to 400 hectares (central region) for the intensive cultivation of vegetables. These dimensions are close to those Chayanov advocated from 1922 to 1928.
This development of the social sciences in the U.S.S.R. in areas touching the peasant economy more or less directly does not, of course, imply that the official political positions have been modified. The correctness of collectivization and the fight against the kulaks is not questioned. Only the speed of the transformations and the methods practiced by Stalin are severely judged by historians of this period.122 For this reason, it would still seem premature for Chayanov
119 See biographical note on V. S. Nemchinov by A. L. Vainshtein, Vestnik statistiki, No. 4 (1962), p. 81.
120 For the application of linear programming to planning the regional distribution of production, see the studies of A. G. Aganbegiyan, V. S. Mikheeva, and I. G. Popov in Problemy optimal'nogo planirovaniya proektirovaniya i upravleniya proizvodstvom (Conference at the University of Moscow, March, 1962) (Moscow: University of Moscow, 1963), pp. 373-409.
121 "Ob optimal'nykh razmerakh sovkhozov," Voprosy ekonomiki, No. 12 (1963), pp. 34-51. See, also, Voprosy ratsional'noi organizatsii i ekonomiki sel'sko-khozyaistvennogo proizvodstva (Moscow, 1964), pp. 261-328.
122 v. P. Danilov, N. A. Ivnitskii in Ocherki istorii kollektivizatsii sel'skogo khozyaistva v soyuznykh respublikakh (Moscow, 1963), pp. 3-67. V. P. Danilov is the leading scholar of Soviet agrarian history.
A. V. Chayanov: Life, Career, Works lxxv
to be rehabilitated, even if, in practice, some of the research he pioneered is being carried on today with new means.
The continuing vitality of many of his ideas is surely the best homage that can be paid to Chayanov today. Even if he often showed more indulgence to the traditional peasant economy than to the future industrial agriculture, it is no less true that to understand the problems posed by the Russian peasant economy in the period preceding collectivization \Chayanov's contributions and especially his work on the organization of the peasant economy constitute a turning point in the development of his country's agrarian thought which it is impossible to ignore.
On the Theory of Non- Capitalist Economic Systems
In modern theory of the national economy, it has become customary to think about all economic phenomena exclusively in terms of a capitalist economy. All the principles of our theory—rent, capital, price, and other categories—have been formed in the framework of an economy based on wage labor and seeking to maximize profits (i.e., the maximum amount of the part of gross income remaining after deducting material costs of production and wages). All other (noncapitalist) types of economic life are regarded as insignificant or dying out; they are, at any rate, considered to have no influence on the basic issues of the modern economy and, therefore, are of no theoretical interest.
We shall have to accept this last thesis in regard to the indisputable dominance of finance and trading capital in world commerce and the unquestioned part it plays in the present organization of the world economy. But we must by no means extend its application to all phenomena in our economic life. We shall be unable to carry on in economic thought with merely capitalist categories, because a very wide area of economic life (that is, the largest part of the agrarian production sphere) is based, not on a capitalist form, but on the completely different form of a nonwage family economic unit.1 Such a unit has very special motives for economic activity and also a very specific conception of profitability. We know that most peasant farms in Russia, China, India, and most non-European and even many European states are unacquainted with the categories of wage labor and wages. Even superficial theoretical analysis of their economic structures shows that their specific economic phenomena do not always fit into the framework of classical economics and the modern theory of the national economy derived from it. We must go beyond
1 The terms, family economic unit, labor economic unit, family labor economic unit, and labor family economic unit, in this article mean the economic unit of a peasant or artisan family that does not employ paid workers but uses solely the work of its own members, even where this characteristic has not been explicitly stated.
1
2 THE THEORY OF PEASANT ECONOMY
this conceptual framework of the national economy if we are to conduct a theoretical analysis of our economic past.
The late systems of serfdom in Russia and slavery in America raise the question whether the concepts of contemporary economic thought (capital, interest, economic rent, wages) are applicable. Wages, as an economic category in the modern meaning of the word, is obviously absent in the systems mentioned above; and, together with this category, the customary theoretical content of other categories of our national economic systems drops out, because rent and interest as theoretical constructs are indissolubly connected with the category of wages. On the other hand, we acquire from such observation a new category, completely unknown to modern theory, the price of slaves.
We are in an even more difficult position regarding the economic systems of primitive peoples. In these systems, a basic category like the market price (fundamental to our theoretical thought) often does not exist. In this, the economic structure of the Roman Colonate, as well as that of the natural economy of primitive people, lies completely outside the framework of present economic theory. Even with regard to the Middle Ages, we would have difficulty in analyzing price formation with our existing equipment. How, for example, does one price the products that the feudal lord exacts as payment in kind and exports for sale to faraway markets?
The German historical school undoubtedly has the extremely great merit of having written about the economic past (especially the Ger-mano-Roman and the ancient world) and of having disclosed their detailed morphology; but even the most thorough and exact description as such is unable to provide a theory of the economic facts described. Economics, however, urgently needs a theoretical analysis of our economic past; for each of the economic types we have already partly depicted, an economic system should be constructed corresponding to its peculiar features. It occurs to me that research in this direction, even if it may appear to be an amateurish collecting of antiques, could achieve much. Merely as economic paleontology it would not only further comparative analysis of existing economic formations, but would also be of great use for the purely practical aims of economic policy. For not only the family labor economic unit type (which we shall define in more detail later) but also other older types still exist in great numbers to the present day in non-European countries. Theoretical analysis with categories really adequate to their characteristics would contribute more to colonial policy than,
On the Theory of Non-Capitalist Economic Systems 3
for example, forcing the economy of Zambeziland into the Procrustean bed of the modern Manchester School's economic categories.
We regret that neither Aristotle nor other ancient writers have left us an economic theory, as we would understand the word today, of the economic reality surrounding them. The Fathers of the Church, as contemporaries of the feudal regime, often touched on economic problems in their treatises; but, as we know, they devoted all their attention to the ethical side of economic life. Russian economic literature at the turn of the seventeenth and eighteenth centuries, as represented by Sylvester, Pososhkov, and Volynskii, dealt mainly with private economic affairs or with problems of state administration. Neither the slave economy in the United States nor the economy of the serf period in Russia has left us a complete economic theory corresponding to their special structures. As we have little knowledge of the Japanese and Chinese literature, we cannot judge the state of their theoretical attempts to explain past forms of economic life. Since past epochs have failed of their own to evolve any theories about former economic systems, we are compelled to try to construct them in retrospect.
We know that the key to understanding economic life in capitalist society is the following formula for calculating economic profitability: an enterprise is considered profitable if its gross income, GI, after the deduction of the circulating capital advanced (i.e., of the annual material expenditure, ME, and of the wage costs, WC), makes a sum, S, which is as large or larger than the whole of the (constant and circulating) capital, C, of the enterprise at interest calculated according to the rate prevailing in that country at that time (a).
GI - (ME + WC) ^ C • — v ' 100
All calculations of theoretical economics start with this formula, explicitly or tacitly. The elements of this formula—the exchange value (market price) of gross income and of material expenditure, the wages, and the interest on capital—in this case are not any accidental private economy magnitudes but basic phenomena of a social and economic order. The content and task of the theory of the national economy is the scientific explanation of these basic phenomena.
The economic theory of modern capitalist society is a complicated system of economic categories inseparably connected with one an
4 THE THEORY OF PEASANT ECONOMY
other—price, capital, wages, interest, rent, which determine one another and are functionally interdependent. If one brick drops out of this system, the whole building collapses. In the absence of any one of these economic categories, all the others lose their specific character and conceptual content, and cannot even be defined quantitatively.
Thus, for example, one cannot apply, in their usual meanings, any one of the economic categories mentioned above to an economic structure that lacks the price category (an entire system of units on a natural economy basis and serving exclusively to meet the needs of the laboring families or collectives). In a natural economy, human economic activity is dominated by the requirement of satisfying the needs of each single production unit, which is, at the same time, a consumer unit. Therefore, budgeting here is to a high degree qualitative: for each family need, there has to be provided in each economic unit the qualitatively corresponding product in natura.
Quantity here can be calculated (measured) only by considering the extent of each single need: it is sufficient, it is insufficient, it is short in such and such a quantity—this is the calculation here. Owing to the elasticity of the needs themselves, this calculation does not have to be very exact. Therefore, the question of the comparative profitability of various expenditures cannot arise—for example, whether growing hemp or grass would be more profitable or advantageous. For these plant products are not interchangeable and cannot be substituted for each other; therefore, no common standard can be applied to them.
According to this, all economics of natural economy, its conception of what is economic and profitable as well as the strange "laws" which dominate its social life, are, we shall prove below, very different in character from the basic ideas and principles of our usual economics which are customarily presented in manuals on the national economy. Only with the development of an exchange and money economy does managing lose its qualitative character. Now, the interest in mere quantity comes to the fore—the concern to obtain the maximum quantum which can adopt any qualitative form through exchange. As exchange and money circulation (the commodity nature of the economy) increases, quantity becomes more and more independent of quality. It begins to achieve the abstract value of being independent of quality and its specific significance for given demands. The price category becomes prominent, and, together with other categories if these are available, it forms the economic system which is the only one considered by national economics.
On the Theory of Non-Capitalist Economic Systems 5
A similar fate threatens theoretical economics if any other category drops out of the system—for example, that of wages. Even if out of all the possible economic systems lacking this category we choose one in which exchange and credit (and thus the categories of price and capital) are present (for example, the system of peasant and artisan family labor units held together economically by monetary and exchange processes), we shall still find that the structure of such an economy lies outside the conceptual systems of an economics adapted to capitalist society.
On the family labor farm, the family, equipped with means of production, uses its labor power to cultivate the soil and receives as the result of a year's work a certain amount of goods. A single glance at the inner structure of the family labor unit is enough to realize that it is impossible without the category of wages to impose on this structure net profit, rent, and interest on capital as real economic categories in the capitalist meaning of the word.
Indeed, the peasant or artisan running his own business without paid labor receives as the result of a year's work an amount of produce which, after being exchanged on the market, forms the gross product of his economic unit. From this gross product we must deduct a sum for material expenditure required during the course of the year; we are then left with the increase in value of material goods which the family has acquired by its work during the year, or, to put it differently, their labor product. This family labor product is the only possible category of income for a peasant or artisan labor family unit, for there is no way of decomposing it analytically or objectively. Since there is no social phenomenon of wages, the social phenomenon of net profit is also absent. Thus, it is impossible to apply the capitalist profit calculation.
It must be added, of course, that this indivisible labor product will not always be the same for all family economic units. It will vary according to market situation, the unit's location in relation to markets, availability of means of production, family size and composition, quality of the soil, and other production conditions of the economic unit. But, as we shall learn below, the surplus the economic unit achieves by better location or by relatively better availability of means of production is neither in its nature nor in its amount identical with the rent and the interest on capital of capitalist economy.
The amount of the labor product is mainly determined by the size and composition of the working family, the number of its members capable of work, then by the productivity of the labor unit, and
6 THE THEORY OF PEASANT ECONOMY
2 Editors' note.—Chayanov introduced a Russian term, tyagostnost', to indicate labor inputs as subjectively assessed by the peasant. The term might be translated by "labori-ousness" or "irksomeness," but "drudgery" seems preferable and has the advantage of being etymologically parallel to the Russian form. (Cf., the Glossary, Drudgery of Labor.)
—this is especially important—by the degree of labor effort—the degree of self-exploitation through which the working members effect a certain quantity of labor units in the course of the year.
Thorough empirical studies of the peasant farms in Russia and other countries have enabled us to substantiate the following thesis: the degree of self-exploitation is determined by a peculiar equilibrium between family demand satisfaction and the drudgery2 of labor itself.
Each new ruble of the growing family labor product can be regarded from two angles: first, from its significance for consumption, for the satiation of family needs; second, from the point of view of the drudgery that earned it. It is obvious that with the increase in produce obtained by hard work the subjective valuation of each newly gained ruble's significance for consumption decreases; but the drudgery of working for it, which will demand an ever greater amount of self-exploitation, will increase. As long as the equilibrium is not reached between the two elements being evaluated (i.e., the drudgery of the work is subjectively estimated as lower than the significance of the needs for whose satisfaction the labor is endured), the family, working without paid labor, has every cause to continue its economic activity. As soon as this equilibrium point is reached, however, continuing to work becomes pointless, as any further labor expenditure becomes harder for the peasant or artisan to endure than is foregoing its economic effects.
Our work, as well as the numerous studies of A. N. Chelintsev, N. P. Makarov, and B. D. Brutskus, have shown that this moment of equilibrium is very changeable. It is reached as follows: on the one hand, through the actual specific conditions of the unit's production, its market situation, and through the unit's location in relation to markets (these determine the degree of drudgery); on the other hand, by family size and composition and the urgency of its demands, which determine the consumption evaluation. Thus, for example, each increase in labor productivity results in gain of the same quantity of products with less labor. This allows the economic unit to increase its output and to satisfy family demands in full. On the other hand, the significance of each ruble of gross income for consumption is increased in a household burdened with members incapable of work.
On the Theory of Non-Capitalist Economic Systems 7
This makes for increased self-exploitation of family labor power, so that the family's standard of living, threatened by increased demand, can be kept up in some way.
Starting with the nature of the basic consideration described above, the family labor farm has to make use of the market situation and natural conditions in a way that enables it to provide an internal equilibrium for the family, together with the highest possible standard of well-being. This is achieved by introducing into the farm's organizational plan such labor investment as promises the highest possible labor payment per labor unit.
Thus, the objective arithmetic calculation of highest possible net profit in the given market situation does not determine whether or not to accept any economic action, nor does it determine the whole activity of the family economic unit; this is done by the internal economic confrontation of subjective evaluations. True, some consideration is given to the particular objective conditions of the economic unit.
An economic unit working on the principles outlined above does not necessarily need to be extravagant in its economic conduct; for usually the objects that yield the highest labor payment per labor unit invested and those that guarantee the highest net profit to a capitalist unit are roughly the same. But empirical studies show that in a number of cases the structural peculiarities of the peasant family labor farm make it abandon the conduct dictated by the customary formula for capitalist profit calculation.
Such differences become very clear, for example, in densely populated areas where land shortage does not permit the peasant family to develop its full labor power under optimum organization forms, i.e., forms rendering the highest possible labor payment. For the capitalist economic unit, these optimum forms of economic organization (the optimum state of business intensification is expressed in it) are an absolute norm. With each additional intensification, the effect of extra labor input decreases steadily according to the law of decreasing returns to land; consequently, net profit falls as well. In farms greatly short of land, on the other hand, the concern to meet the year's needs forces the family to turn to an intensification with lower profitability. They have to purchase the increase of the total year's labor product at the price of a fall in income per labor unit.
Professor E. Laur, for example, has investigated Swiss farms with little land. These farms trebled their intensity. They suffered a big loss in income per labor unit, but they gained the opportunity to
8 THE THEORY OF PEASANT ECONOMY
use their labor power fully, even on the small plot, and to sustain their families. In the same way, small farms in the north and west of Russia increased the growing of potatoes and hemp, which are often of lower profitability than oats but are more labor-intensive and thereby increase the farm family's gross product.
In other words, a capitalist business can only increase its intensity above the limit of its optimum capacity if the changed market situation itself pushes the optimum in the direction of greater intensity. In the labor family unit, intensification can also take place without this change in the market situation, simply from pressure of the unit's internal forces, mostly as a consequence of family size being in an unfavorable proportion to the cultivated land area. The peculiar features of the peasant family labor unit pointed out above inevitably make themselves felt on the whole economic system if it is exclusively based on family economy and, therefore, lacks the category of wages.
This peculiarity is especially clear when analyzing the element of economic rent under the conditions of the labor family unit. Rent as an objective economic income category obtained after deducting material costs of production, wages, and the usual interest on capital from gross income cannot exist in the family economic unit because the other factors are absent. Nevertheless, the usual rent-forming factors like better soil and better location in relation to the market do surely exist for commodity-producing family labor economic units, too. They must have the effect of increasing output and the amount of payment per labor unit.
Deeper analysis indicates the following: the family's single indivisible labor product and, consequently, the prosperity of the farm family do not increase so markedly as does the return to a capitalist economic unit influenced by the same factors, for the laboring peasant, noticing the increase in labor productivity, will inevitably balance the internal economic factors of his farm earlier, i.e., with less self-exploitation of his labor power. He satisfies his family's demands more completely with less expenditure of labor, and he thus decreases the technical intensity of his economic activity as a whole.
According to Professors A. N. Chelintsev and N. P. Makarov, this rent factor, which is expressed in a slightly increased level of prosperity, cannot exist for very long, for the regions with such an increased level of prosperity will inevitably attract population from less favored regions. This will reduce the land holdings of individual farms, force them to intensify cultivation, and depress prosperity to the usual traditional level.
On the Theory of Non-Capitalist Economic Systems 9
If in such circumstances the leasing of land and a free land market develop, land prices naturally cannot be determined by capitalizing the rent, since the category of rent itself (as we understand it today) does not exist in the economic system just investigated, as has been shown above. Nevertheless, in a monetary land market properties do not change hands unpaid for. Thus, we are faced with the basic problem of the economics of the family labor unit: What determines the land price? What can the peasant farm pay for land? For what sum will it sell it?
We can answer these questions if we approach them with the notion of the specific concept of profitability which we have defined for the labor family unit. This shows that tenancy or land purchases are obviously advantageous to the peasant family only if, with their help, the family can reach the equilibrium of its economic unit, either with an increased level of living or with decreased expenditure of labor power.
Peasant farms that have a considerable amount of land and are, therefore, able to utilize the family's whole labor power at an optimum degree of cultivation intensity need not lease or buy land. Every expenditure on it appears irrational to them as it does not increase family prosperity but decreases their resources. If a family can dispose of only a small plot which allows them to use only part of the given labor power, acquiring a new item with a view to using unemployed labor power is extremely significant, for this allows them to bring the unit's intensity nearer the optimum and to utilize working hours previously lost in forced inactivity. In both cases, the increase in payment per labor unit, with the resultant rise in the level of prosperity, can be so important that it enables the family unit to pay for the lease or purchase a large part of the gross product obtained from the newly acquired plot.
We can even maintain, disregarding the apparent paradox, that the more the peasant farm will be ready to pay for land, the less it owns already, and, therefore, the poorer it is. In conclusion, we must consider that the land price as an objective category depends on the given situation in the land market, i.e., on the extent and urgency of land demand among peasants with little land and on the number of offers of land available for some reason or other.
In the family labor farm system, the land price level does not depend only on the market situation for agricultural produce and on the profitability of land cultivation resulting from it, but to a greater extent depends on the increase in local rural population density.
10 THE THEORY OF PEASANT ECONOMY
Studies on movements in land prices and leases in Russia carried out by Professor V. Kosinskii and the corresponding data from Professor Laur's studies about peasant farms in Switzerland have confirmed that peasants with little land pay land prices that significantly exceed the capitalized rent. These data can, therefore, serve as an empirical substantiation of our theoretical proposition.
It is extremely interesting that other mutually dependent economic categories, such as the market rate of interest on capital, behave in an analogous way in the system of the family labor economy. It is obvious that the family labor unit considers capital investment advantageous only if it affords the possibility of a higher level of well-being; otherwise, it reestablishes the equilibrium between drudgery of labor and demand satisfaction.
In all cases where prospective new capital expenditure, be it through increased labor productivity or through expansion of the area, promises to achieve this increase in prosperity, the family can pay an unusually high interest for the capital required. Yet, this interest must not be so high that it offsets all the advantages achieved by the new investment of capital. On the one hand, the demand at the moment resulting from this situation, and on the other hand, the supply of capital then available determine the market price in the form of the loan interest normal at that time.
In other words, according to this we must suppose that the "circulation of capital" in the family labor unit does not result in an income from capital in the form of a special objectively available source of income, but it exercises an important influence on labor product and thus on the level of the single indivisible labor product and on the critical moment of internal economic equilibrium. The normal level of the market rate of interest is not determined by the whole productive capital turnover in the country (which obviously does not conform to the classical [Marxian] formula, M—C—M + m)# but only by the market situation of demand and supply in that part of the nation's capital in the credit system.
Its internal capital circulation is also very peculiar for the family labor unit. If the family does not seek loan credit from outside persons, it will always have to consider not only that each expenditure of capital on the economic unit, by new capital formation and by capital renewal, is advantageous but also that the family will have to be able to find an amount for this expenditure from its labor income, and
* Editors' note.—The formula M—C—M' comes from Vol. 1 of Marx's Capital, Part II, ch. iv. M = Money, C = Commodities, and M' = the original sum advanced, plus an increment.
On the Theory of Non-Capitalist Economic Systems 11
this would, of course, be at the expense of immediate consumption. Naturally, this will be possible only if the consumption value of the amount intended for production appears in the eyes of the family to be less than its value for production.3
It is obvious that the larger its annual product, the easier it is for the family to find from it the means for capital formation. In hard times, with bad harvests or disadvantageous market situations, it will be difficult for the family to extract from its small payment a part intended for consumption in order to use it to form new capital or merely for ordinary replacement of circulating capital.
Thus, the following categories can be defined for the economic system of the labor family unit or, in other words, for the economic structure of a society where production is in the form of peasant and artisan units and where the institution of wage labor is lacking.
1. The single, indivisible labor income of the family which reacts on the rent-forming factors.4
2. Commodity prices.
3. The reproduction of means of production (capital formation in the wider sense of the word).
4. Prices for capital in credit circulation.
5. Land prices.
We get an even more peculiar picture if we complicate the form of the family economic unit here under consideration by assuming that there is no category of market price—that is, no factor of commodity exchange. At a quick glance, it would appear that the fully natural family farm would not display any phenomena of an economic kind. A closer look, however, shows that it is not at all like this. It seems possible to find a whole number of social and economic relations in the social and economic bloc consisting of several integral labor farms which meet their demands in natura. These control the organization of each of the separate natural farm units and standardize their production structure.
3 The comparative confrontation of the subjective evaluations of the consumption and production value of the nth unit of the labor product is among the most complicated problems in the family labor unit theory; it is thoroughly dealt with in the fourth chapter of my book; Die Lehre von der bäuerlichen Wirtschaft (Berlin: P. Parey, 1923). [Translator's note.—Cf. Chapter 5 of Peasant Farm Organization, p. 195 of the present volume.] In our analysis, we take as a measure of production value that degree of drudgery which has to be suffered if the nth unit of income is not used for capital renewal or formation.
4 We number this single indivisible labor income of the family among the economic categories because it is determined not only by technical but also by a whole range of social factors: the development of a habitual traditional level of demand, the local population density, and, finally, the particular rent-forming factors.
12 THE THEORY OF PEASANT ECONOMY
In fact, the internal private economic structure of the individual natural family farms is the same as those of farms with commodity exchange, with the exception of some peculiarities in calculating profitability, which we have indicated at the beginning of this article. The same notion of profitability is the determining factor; it becomes even clearer that it is impossible to apply the profitability formula of a capitalist enterprise. The economic equilibrium between demand satisfaction and drudgery is also determined in the same way. The same can be said about the formation and replacement of means of production. Even if the rent-forming factor of market location is absent here, the various soil and climatic conditions undoubtedly introduce into the system of the natural economic unit something like the factor of rent.
Most significant for the structure of the natural farm is that the intensity of cultivation and its organizational forms depend to a very great extent on the amount of land for use, the size of the labor family, and on the extent of its demand, i.e., on internal factors (family size and composition and its relation in proportion to the amount of cultivated soil). Thus, population density and forms of land utilization become extremely important social factors which fundamentally determine the economic system. Another less important, yet essential, social factor is the traditional standard of living, laid down by custom and habit, which determines the extent of consumption claims, and, thus, the exertion of labor power.
In other words, if we think of one region of the natural economy and analyze this social and economic bloc, we see that in spite of the lack of interrelationships and in spite of the economic dissociation of the individual economic units a number of complicated economic processes take place in this region, the main factor for which is demographic—population density and migration. These determine land utilization, level of prosperity, and, thus, the ever-varying amount of capital accumulation and taxability of the population; the last forms the basis for organizing the nation's state and culture.
Independently of demographic factors, very prosperous regions will stand out where rent-forming factors—higher quality of soil, etc. —are especially effective. Empirical studies of seminatural agrarian countries show that the noneconomic constraint—in default of a regulating influence from the market situation and its economic constraint—becomes very important in the form of administrative control of land utilization and sometimes in the form of the "warlike settlement" of population migration.
On the Theory of Non-Capitalist Economic Systems 13
Thus, even in a country with an absolutely natural economy structure we can find the following social and economic categories determining the structure of the individual economic units.
1. The indivisible labor product of the family, constituted according to: (a) population density; (b) the habitual, traditional demand level; (c) the rent-forming power of better soil and more favorable climatic conditions.
2. The population's capacity to form capital and its taxability, depending on the level of prosperity.
3. The economic and political measures of the state power which by noneconomic constraint controls the mode of land utilization and popular migration.
In complete contrast to the family economic system is another type of economy which also lacks the category of wages—the slave economy system. The difference becomes quite distinct when we confront the structures of their two economic units in respect of their private economic morphology. The peasant and the artisan manage independently; they control their production and other economic activities on their own responsibility. They have at their disposal the full product of their labor output and are driven to achieve this labor output by family demands, the satisfaction of which is constrained only by the drudgery of the labor. None of these factors exists in a slave economy.
The slave labors in a production dominated by a stranger's will; he is only a blind tool and has no right to dispose of his labor product. He is driven to labor output only by threat of punishment and satisfies his demands at the discretion of his owner only as much as is necessary to maintain his labor power.
For the slave-owning entrepreneur, keeping slaves is rational only when it leaves him a surplus product after deducting expenses and the expenditure of keeping the slaves; this, after being realized on the market, makes for an objective income from slave-keeping. Niebuhr pointed out that the institution of slavery came into existence only at the moment when the productive power of human labor had developed so far that this surplus product could be achieved.
The expenditure on keeping slaves is determined by physiological norms and by the labor tasks allotted; it cannot be taken as an economic category behind which hide complicated social and economic relations analogous to those connected with the category of wages. Therefore, the slave hardly differs from the beasts of burden as far as organization of the enterprise is concerned if we disregard the ethical
14 THE THEORY OF PEASANT ECONOMY
norms shaping patriarchal life, which were of special significance, for example, in Muslim slavery.
The peculiar features of the private economic organization of a slave enterprise pointed out above affect a whole number of fundamental economic categories. The slave owner receives a certain sum as income after deducting from the gross product of his enterprise the material costs of production and the expenses of keeping the slaves. When the customary interest calculated on invested fixed and circulating capital, but not on the value of the slaves, has been deducted, the rest can be attributed to slave utilization.
In capitalist society, this residual attributed to the worker would be that part of his wages exceeding the value of board, clothing, and housing provided in kind by the entrepreneur. In the slave economy system, the part of the product attributed in economic terms to slave labor is not taken by the slave but by his owner on the strength of his slave ownership; it becomes a new sort of unearned income which is the raison d'etre for slave-owning.
This income, which is no longer a mere technical norm as, for example, is the cost of maintaining slaves, is determined by a complicated structure of a whole number of social and economic interrelations. It is an economic category and constitutes the slave rent the owner receives on the strength of his property right. If the slave economic unit is agrarian, the unearned income from slave-owning will grow, together with the progression from less advantageous conditions of production and transport to relatively more advantageous ones. Since the slave and his labor output remain the same and the slave-keeper's income would not fall by substituting some slaves for others, the extra income we are examining here cannot be connected with slave-owning as such but must be attributed to the soil and results from its better quality or more advantageous market location, and it has to be considered as ordinary differential rent. Insofar as it is possible to achieve the same technical results based on slave labor as those on paid labor, this economic rent will also correspond quantitatively to that of capitalist agriculture.
Thus, all the social and economic categories of the capitalist economy can retain their places in the theoretical system of the slave economy; it is necessary only to substitute the category of slave rent for that of paid labor. The slave rent is appropriated by the slave owner, and its capitalized value constitutes the slave price as an objective market phenomenon.
On the Theory of Non-Capitalist Economic Systems 15
The quantitative amount of the slave rent is determined by the productivity of his utilization, analogous to the determination of wages by the productivity of the marginal worker as calculated by Anglo-American theoreticians in their systems. The quantitative determination of the market price for a slave is more complicated. We have already pointed out that it tends to be an amount similar to the capitalized rent of the marginal slave. In a way, this is the demand price, while, on the other hand, the prime cost of "slave production" forms the supply price. In this context, we must distinguish between two systems of slave economy.
1. A system in which the supply of slave material occurs by capturing in war from foreign peoples slaves who are already adult. The exploitation of their labor is complete and leads to its quick consumption; this avoids the cost of raising children (reproduction), as well as prolonged maintenance of the adults.
2. A system in which the supply occurs in a natural way by reproduction of slave material within the slave family itself; this, of course, necessitates costs for raising the coming generation, as well as for the reduced degree of exploitation of slave labor power, especially that of the female part.
In the first case, the prime cost of slave production is the cost of capture; in the second, the cost of raising and educating, which, as a rule, is much higher. In historic periods favoring capture of human material in war—as in ancient Rome, in the Middle Eastern states of antiquity, and even, for the first decades, in Spanish America—the prime cost—the cost of slave production—was very low. The customary capitalized slave rent surpassed it many times. Good evidence for this is the high market price of the Spanish crown's slave patents with which it issued licenses for the capture and importation of slaves during the first period of the importation of negroes into America.
The human material was cheap, and this allowed ownership to increase in extent and allowed slaves to be used for work with ever-decreasing labor productivity, up to the point, of course, where the steadily falling slave rent became identical with the prime cost of acquiring them. This factor determined the market price of the slave and the extent of a slave-based economy. As the sources for capture of slaves in war became exhausted by frequent attacks, the prime cost of acquiring slaves grew; their market price increased quickly, and many slave uses that generated a small slave rent were no longer profitable
16
THE THEORY OF PEASANT ECONOMY
and were gradually dropped. As a result, the slave-based economy decreased in extent.
From this, we can conclude that an important factor in the decline of the ancient system of slavery was that in order to insure the supply of slaves war and capture had to be abandoned for peaceful production by means of natural reproduction. Here, the ancient economic unit faced prime costs so high that they started to overtake the capitalized slave rent.
In any case, the slave price, as a phenomenon subject to the laws of the market, is an objective category which determines slave production in a private economic calculation. It is obvious that the slave economic unit, from the private economic viewpoint, can appear advantageous only as slave production yields a net product that does not amount to less than the slave rent that exists at the time as an objective economic fact and, through the market, is realized in the slave price.
We must also stress that slavery or, to put it more generally, human bondage as an economic phenomenon displays a number of variations differing widely from one another. Thus, for example, Russian serfdom in its quitrent form differs very much from the system described above.5 The quitrent form, a peculiar combination of a family labor farm and a slave farm, is of extraordinary theoretical interest.
The farm of a quitrent peasant was organized in the form usual for a family labor unit. The laboring family dedicated its whole labor power only to its own agricultural or other economic activity. But a noneconomic constraint forced such a unit to hand over to the owner of the laboring serf family a definite amount of the produce won by its labor. This amount was called quitrent [obrok] and represented the serf rent.
Despite similarities in the legal position of slave and serf, the economic structures of the slave economic unit on the one hand and the serf economic unit on the other hand are of a completely different nature. Quitrent neither qualitatively nor quantitatively coincides with slave rent.
5 Russian serf law distinguished three different sorts of serfs. (1) They could be in-servants (dvorovye), i.e., destined to meet the needs of the landlord's household, the landlord himself, and his family by personal domestic service, or, without running their own farms, to be used on the demesne [home farm] insofar as that existed on the manor. (2) They could be paying labor-rent (barshchina), i.e., managing their own farms but at the same time obliged to render services on the landlord's estate in the fields or in the manor on a certain number of weekdays. (3) They could be quitrent peasants, i.e., using their labor power on their own holding but obliged to pay part of their produce to the landlord.
On the Theory of Non-Capitalist Economic Systems 17
In its internal private economic structure, the farm of a serf quit-rent peasant is in no way different from the usual form of the family labor unit we already know. In this regime, the family runs its own farm on its own responsibility and has the resulting produce at its disposal. The family is stimulated by its needs to force up its labor power, and the quantity of the product is determined by the equilibrium, peculiar to the family labor farm, between the amount of the family's drudgery and the degree of its demand satisfaction. In the quitrent system, however, the family is forced by noneconomic factors to reach this equilibrium in such a way that the product obtained not only meets its own demands but also the quitrent to be paid to the owner.
Therefore, the demand for material values is much higher compared with the free peasant farm. As a consequence, the equilibrium between the amount of labor drudgery and the degree of demand satisfaction is achieved with a much higher degree of self-exploitation of labor than in the free peasant farm. Yet, the increased labor input mentioned above will not yield so great an additional product as the quitrent requires; thus, part of it must inevitably be covered at the cost of the family's demand satisfaction. Consequently, the family paying quitrent has a lower level of well-being than the free peasant family.
By paying quitrent to the landlord, partly at the price of an increased labor effort, partly at the price of a lower degree of demand satisfaction, the serf farm creates another economic income category— the unearned income from serf ownership, the serf rent. Disregarding this rent payment, the farm paying quitrent remains in all other aspects an ordinary family labor unit with all the peculiar organizational features pointed out above.
If we want to turn to the factor determining the amount of the quitrent, we must start off with its particular nature. The amount of quitrent brought in by means of noneconomic constraint is determined by the will of the owner. It is in his interest to maximize the quitrent; the only natural barrier is the danger that the serf farm may be ruined and thus be deprived of its ability to pay.
The amount of quitrent can be considered normal as long as it is paid at the cost of the serfs' increased labor input and a lowering of their consumption, but not at the cost of upkeep and necessary capital renewal. If pressure from paying the quitrent brings capital renewal on the farm to a standstill, the quitrent system begins to destroy its own roots.
18 THE THEORY OF PEASANT ECONOMY
Those quitrent-liable farms that are in relatively better rent-forming conditions are, of course, able to pay relatively much higher amounts to their landlords. Such an increase in quitrent cannot be attributed to human labor input but to the soil, and it constitutes ordinary differential rent.
In a free land and serf market, that part of the quitrent attributed to the soil and forming the rent derived from the soil is capitalized and produces the land price; the remainder, attributed to serf labor and forming the serf rent, is capitalized and produces the serf market price. It seems unnecessary to prove that the serf rent is determined by the ability of the marginal peasant, producing under unfavorable conditions, to pay the quitrent, while the differential rent is in such circumstances determined by the difference between the marginal peasant's ability to pay and that of any other peasant farm. Considering the great qualitative difference in the ways the quitrent and the slave rent are formed and paid, as well as the difference in the production organization of the large-scale slave economic unit and the small-scale serf unit, we cannot expect that serf rent and slave rent will be quantitatively the same.
Differences in the process of price formation for serfs on the one hand and slaves on the other are still greater. We have already pointed out that the prime cost of slave acquisition plays a considerable part in forming the slave price. With the quitrent serf economic unit, however, the owner has no economic costs in reproducing the human material. Therefore, the number of serfs is not determined by the equilibrium between the serfs'6 marginal product and the marginal prime cost, as is the case in the slave economic unit; the increase through procreation, and thus the number of serfs, is left to themselves. Consequently, the ability to pay and, thus, the rent of the marginal serf is determined by the actual number of serfs in a certain country at a certain time.
What has been said above is sufficient for a morphological description of the quitrent farm. By confronting this system with the economic type of the slave farm, we can convince ourselves by illustration that both systems differ completely and are determined by very different objective elements in their economic relations, in spite of some exterior legal similarities.
This confrontation makes clear the fundamental differences in the two types of economy. It is to be noted that both systems are also quite
6 Translator's note.—The German text reads slaves'.
On the Theory of Non-Capitalist Economic Systems 19 Economic Categories in the Slave and Quitrent Systems
Slave Economic System
1. Commodity prices.
2. Capital, which is advanced by the slave owner and circulates in capitalist form in the production process (M—C—M+m). Part of this capital is the cost of maintaining the slaves.
3. [Maintenance cost of slaves— not an economic but purely a natural category.]
4. Profit from capital (interest).
5. Slave rent.
6. Slave price.
7. Differential rent.
8. Land price.
Quitrent Serf Economic System
1. Commodity prices.
2. [Capital goods in the possession of the serfs (production takes place in the forms of the labor family economic unit, cf. p. 4 ff.); not an economic but purely a natural category.]
3. Indivisible labor product of the family.
4. Interest on borrowed capital.
5. Serf quitrent.
6. Serf price.
7. Rentlike income which the landowner receives due to the effect of rent-generating factors on the amount of the quitrent.
8. Land price.
different in their conception of profitability and economic calculation.
The entrepreneur in the slave economic unit comes close to a slightly changed formula of capitalist profitability calculation as regards the concept of profitability for his enterprise. On the outgoings account, in place of wages he puts the technically and physiologically determined cost for slave maintenance. He divides his net product into three heads: interest on capital, rent, and slave rent.
It is completely different in the serf economic unit that pays quit-rent. A very peculiar feature of this unit is a certain division of the economic subject in which the peasant family concept of profitability is in the form we find in the family labor unit; apart from this, the calculation of the man who owns serfs and land is that of a typical rentier and expresses the search for a capital investment as profitable as possible.
The difference in the nature of the quitrent and slave economic units pointed out above leads to two very peculiar economic consequences. The owner of peasants paying quitrent has property rights and claims to rent, but at the same time, unlike the entrepreneur of the slave economic unit, he does not have his own production unit. This fact becomes clear in the peculiar and interesting way the quit-
20 THE THEORY OF PEASANT ECONOMY
rent is to a large extent subject to the influence of demographic factors, whereas rent in the slave economic unit is independent of them.
Moreover, in the organization of the slave economic unit the number of slaves can be and is adapted to the unit's optimum labor demand, i.e., that optimal degree of intensity promising the maximum slave rent. In the serf economic unit, however, the relation of available labor power to the amount of cultivated land cannot so easily be directed toward an optimum by the owner of the land and the peasant, because, disregarding rare exceptions, the population movement in this regime is of a purely natural and elemental character. Therefore, we have here the possibility of relative overpopulation, which, as we have already pointed out in our analysis of the family labor economic unit, causes intensification beyond the optimum and decreases the population's level of living as well as its ability to pay tax.
As a result, we get the peculiar phenomenon of negative overpopulation rent which eats up a large part of the quitrent. The only way out of this state of affairs is to move part of the serf population from the overpopulated land and to use them to colonize sparsely populated areas. In this case, of course, we get a marked increase in serf rent yielded by the transferred population, which has now achieved an optimum relation to land. Together with rent, the serf price resulting from the capitalization of the rent increases. This makes every population and colonization movement very advantageous, both for the owner of a quitrent economic area and for the peasants concerned.
Concluding our confrontation of the slave and the serf economic units, we would like to stress most emphatically that given the same market situation and the same natural and historical conditions the rents achieved in both cases (that of the slave and of the serf) are not always of the same magnitude; rather, they can differ considerably in level. To go into all the details of this extremely interesting problem would require mainly an empirical analysis of extensive material. Hence, we confine ourselves to mentioning in accordance with that difference that in old Russia of the serf epoch we are able to recognize regions with a predominantly quitrent form of economy and others where labor rent was dominant, which meant economically a certain trend to slave economy organization. In course of time, these regions changed their geographical outlines under the pressure of various factors. At times here, at times there, the slave rent respectively fell below or rose above the serf quitrent; adapting themselves to these changes, landlords transferred their peasants, according to the "market situation," from labor rent to quitrent and vice versa.
On the Theory of Non-Capitalist Economic Systems 21
The imposition of a fief system on an agrarian natural economy region, a frequent occurrence in history, is of great interest for theoretical analysis. This is a special form of feudal economy in which the basic stratum of primary producers—the tributary peasants—continues to be in a completely natural economy and pays tributes to the feudal lord in kind, while the recipients of the tributes—the dukes, counts, monasteries, etc.—"realize" as commodities on distant markets the economic rent and serf rents they have drawn off in kind.
In this system, with a general economic structure corresponding to the type of the quitrent serf economy we have just investigated, price formation for those products collected by the feudal lord in the form of payment in kind and realized on distant markets is especially interesting. Obviously, the cost-of-production element cannot play any part in this, unless one regards as a prime cost the upkeep of a (noneconomic) coercive apparatus to collect tribute and suppress rebellion.
We know that the owner of a serf paying quitrent and of a feudal tenure takes very little part in the actual organization of production. The amount of produce that forms his feudal rent is for him an amount given in kind, limited by the tribute-paying capacity of the estate's dependent population, and this cannot be forced up with impunity. However, the feudal lord can, to a certain extent, initiate changes in the composition of produce collected from the dues-paying population as payment in kind. He will try to adapt them to the market situation. But, considering the limited flexibility of peasant farms, significant barriers also hinder this form of the feudal lord's economic activities. Therefore, the economic activities of the feudal lord and his intervention on the market are almost always condemned to be passive. The prices of his goods are not connected with their production and are wholly determined by the receptiveness of the market; they are realization prices of a given amount of certain commodities.
Given this particular exchange and monetary orientation, the rent going to the feudal lord on the strength of his feudal tenure is dependent not only on the amount of payment in kind but also on the market situation for selling the products received. Fluctuations in the market situation can, in spite of a constant amount of payment in kind, favorably or unfavorably influence the rent and, thus, the price of the tenure. The only possible economic activity of a feudal lord must, therefore, be confined to certain measures of an economic and political kind which seem appropriate to him for increasing his tenants' prosperity and, thus, their ability to pay taxes.
22 THE THEORY OF PEASANT ECONOMY
7 Translator's note.—Halbarbeitswirtschaft or jarmerwirtschajt. See Farmer unit in the Glossary.
Besides these five main types of economy organized in a noncapi-talist way, there have been in our economic past, and are still, a whole number of other forms, both transitional and independent. Thus, in the broad grouping of peasant agriculture we can distinguish between the family labor farm type and the half-labor farm (farmer unit7), which uses paid labor in addition to family labor power, but not to such an extent as to give the farm a capitalist character. Theoretical study of this case shows that the presence of the wages category somewhat changes the content of the labor farm's usual categories but does not entirely succeed in substituting for them the categories of a capitalist farm.
Without doubt, it must also be admitted that labor in Russia's serf epoch did not mean slavery in the sense of negro slavery in America, nor only that of the ancient world, even though it may have approximated to it and though the economic laws regulating the labor rent no longer coincide with those we pointed out for the quitrent serf farm. Neither can we fit the household of antiquity [Oikos] into the framework of any of the pure economic types we have studied.
The trustification of capitalist industry now progressing and developing, as well as the forms of state and municipal capitalism recognizable at the beginning of the twentieth century, most probably will not fit into the finished scheme of classical theory of the economy but will demand revision of doctrines. Very interesting complications must also result for economic theory from the system of agricultural cooperatives rapidly evolving before our eyes. Yet, we prefer to confine ourselves to what we have already said; the analysis made of the five different economic types is sufficient to clarify the inapplicability of the customary categories of national economics to all instances of economic life. It cannot be the task of this short article to give a complete theory of noncapitalist economic forms.
We must make one exception for an economic system that has not yet found its full realization but, to a great extent, has attracted the attention of our contemporary theoreticians. We are talking of the system of state collectivism or communism as regards the way in which its foundations have been evolved in the treatises of its theoreticians and the attempts to realize it which have taken place at various epochs in the course of human history.
On the Theory of Non-Capitalist Economic Systems 23
Unfortunately, in their critique of capitalist society Marx and the more significant of his adherents have nowhere fully developed the positive fundamentals of a socialist economy's organizational structure. Thus, we ourselves must try to build a theory of such a structure by taking as a starting point some of Marx's observations in La misere de la Philosophie,,s as well as some studies by N. Bukharin and E. Varga and, most of all, the ideas that have been effective in the practical attempts to create a communist society in various European states during the period 1918-20.
According to these attempts, communism is an economic system in which all the economic fundamentals of capitalist society—capital, interest on capital, wages, rent—are completely eliminated, while the whole technological apparatus of the present economy has been preserved and even further improved.
In the communist economic order that must fulfill this task, the national economy is conceived as a single, mighty economic unit of the whole people. The people's will directs through the state organs, its tools, and the state administers the economic unit according to a unified economic plan that fully utilizes all technical possibilities and all favorable natural conditions. Since the economy is conceived as a single unit, exchange and price as objective social phenomena drop out of the system.9 Manufactured products cease to be values with meaning in a money or exchange sense; they remain only goods distributed according to a state consumption plan. The whole peculiar economics of this regime is reduced to drawing up state plans for consumption and production and to establishing an equilibrium between the two.
The exertion of social labor power is here, obviously, as in the family unit, taken to the point where the equilibrium between drudgery of labor and social demand satisfaction has been reached. This point is, obviously, fixed by those state organs that work out the state production and consumption plans and must bring the two into harmony. Since each individual worker's standard of living determined by the state has no connection, if taken by itself, with his labor output (the amount of production he achieves), he has to be driven to labor by his social consciousness and by state sanctions, and perhaps even by a premium system.
8 Translator's note.—The Poverty of Philosophy.
9 Taxes are not prices in the sense of an economic phenomenon subject to its own laws.
24 THE THEORY OF PEASANT ECONOMY
In contrast to all the economic systems hitherto discussed, which can exist purely automatically and elementally, a communist economic order requires for its maintenance and continuation in accordance with the state plan a continuous social exertion and, to prevent the rise of economic activity not intended in the state plan, a number of economic and noneconomic sanctions. According to this, we do not get here in the system of state communism a single one of the economic categories set out in the analysis of the economic systems we earlier considered. An exception is the purely technical process of production and reproduction of means of production.
Our presentation, which lays bare the morphology of the system, contributes little to understanding its dynamics, but achieving this is probably impossible before observation of the regime and how it functions, and before its ideologists and theoreticians have provided a fully developed theory of organization.10
Summing up the results of our analysis, we obtain the following table that tells us for each of the various economic systems studied here which categories are lacking and which are present.
Having summed up in this table the systems of economic categories we have presented, we are able to deduce from our analysis certain theoretical conclusions.
First of all, we must take as an unquestionable fact that our present capitalist form of economy represents only one particular instance of economic life and that the validity of the scientific discipline of national economics as we understand it today, based on the capitalist form and meant for its scientific investigation, cannot and should not be extended to other organizational forms of economic life. Such a generalization of modern economic theory, practiced by some con-
10 It seems to me that we must wait for the theory of organization to give the answers to the following three questions, the solutions of which might make more specific the notions of the mechanism of socialist economics.
1. With the help of which method and according to what principles will the degree of social labor exertion and the required amount of demand satisfaction, as well as the necessary equilibrium between the two, be determined when state production and consumption plans are established?
2. By what means is the individual worker to be driven to labor so that he does not consider as drudgery the input expected of him under the production plan and really carries it out in practice?
3. Which measures make it possible to prevent in the socialist society on the basis of new production relations the danger of a new class stratification being created that might start forms of distributing the national product which would deprive the whole regime of its original high ideals?
Without solving these problems, the regime of socialist economy can be sketched only in its most general morphological form.
Economic Systems
Family Economy Feudal System*
Commodity Natural Slave Quitrent Landlord Peasant
Capitalism Economy Economy Economy Serf Economy Economy Economy Communism
Commodity price ......................... + + - + + + - —
Single indivisible family labor product...... — + + — +
Technical process of production or reproduc- + +
tion of the means of production.......... + + + + +
Capital advanced by the entrepreneur and cir-
culating in production according to the for- +
mula M—C—M+m ...................... + — —
— —
Interest on capital in the form of rentier's in-
come ................................... + + — + + — —
Wages .................................... + — — — — —
Slave rent or serf rent ..................... — — — + + + +
Slave price or serf price.................... - - — + + + — —
Differential rent .......................... + + — + +t —
Land price ............................... + + — + + + — +
State production plan ..................... — — — —
Regulation by noneconomic constraint neces- +
sary to maintain the regime.............. — — + +
+ +
* The feudal economy is a symbiosis of the natural labor economy of tribute-paying peasants and the monetary and exchange economic orientation of the commodity-trading feudal lords. Therefore, it has two economic objects of a different kind and two systems of economic categories, the elements of which do not coincide. This circumstance made us allocate two different columns in this table.
t Rent does not occur here as a special independent income category; nevertheless, rent-generating factors affect the amount of the single indivisible labor product of the family.
% Rent is present here as an economic income category, but its genesis is different from that in the capitalist system.
26 THE THEORY OF PEASANT ECONOMY
temporary authors, creates fictions and clouds the understanding of the nature of noncapitalist formations and past economic life.
Some scientific circles have obviously become aware of these facts, and recently it has often been said that it is necessary to establish a universal economic theory, the concepts and laws of which would embrace all possible formations of human economic life. We shall try to clarify the question of whether it is possible to construct such a universal theory and whether it is necessary as a tool for scientific understanding.
First, we shall compare the various kinds of economic formation we have previously investigated and sort out the principles and phenomena common to all. We obtain five.
1. The necessity to equip human labor power with various means of production for the purpose of organizing production, and to devote part of the annual output of production to the formation and replacement of means of production.
2. The possibility of considerably increasing labor productivity by applying the principle of division of labor both as regards technique of production and in the social sense of the word.
3. The possibility of running agriculture with different amounts of labor exertion and with different amounts of concentration as far as means of production per unit of soil area are concerned, and to increase by intensifying farm activity the amount of produce per unit of soil area and per labor unit. It must be taken into consideration that the product does not increase so quickly as the labor and means of production inputs.
4. The increase in labor productivity and in the amount of produce per unit of soil area resulting from better soil quality, more favorable surface configuration, and more favorable climatic conditions.
5. The opportunity, provided by a relatively high level of human labor productivity, for a laboring man to produce in the working year a larger amount of products than is necessary to maintain his labor capacity and to secure his family's opportunity to live and reproduce. This circumstance is the presupposition for the possibility of any social and state development.
Looking closely at these five universal principles of man's economic activity, we notice without difficulty that they are all phenomena of a natural and technical order. It is the economics of things in kind (in natura).
These phenomena, even though often ignored by economic theoreticians and considered by them interesting only from the point of view of production technique, are extremely important. Now, in the chaos of the postwar period, their whole significance is revealed espe
On the Theory of Non-Capitalist Economic Systems 27
cially distinctly, since the complicated structure of the economic apparatus of capitalist society has been destroyed, and money has lost the quality of an abstract, stable expression of value.
The five principles we have brought forward do not contain an element for evaluating things. If this evaluation should once emerge and the social and economic phenomenon of objective value be created on its basis, all things would adopt, so to speak, a second mode of existence. They would become values, and the production process would acquire, besides the expression in natura, the new expression in valore.
Then only would emerge all the economic categories stated by us above. These would join together, in accordance with the social and legal structure of the society, in one of the particular value economic systems which we have analyzed. The "valoristic" system with its categories takes over the prior, natural production process and submits everything to its characteristic economic calculation in value terms.
Each of these systems is very individual in its nature. Attempts to cover them by any generalizing universal theory could yield only very general doctrines void of content, e.g., the ideal type "exaggerating" way of stating that in all systems the economic unit strives for the greatest possible effect with the least input, or analogous phrases.
Therefore, it seems much more practical for theoretical economics to establish for each economic regime a particular national economic theory. The sole difficulty in carrying out these ideas is that only very rarely in economic life do we come across any economic order like a pure culture, to use a term borrowed from biology. Usually, economic systems exist side by side and make for very complicated conglomerations.
Even today, significant blocs of peasant family labor units are interspersed in capitalist world economy. Economic formations that resemble slave or feudal economic types are still interspersed in the colonies and the states of Asia. Analyzing the economic past, we more frequently, one may say constantly, come across the fact of such coexistence, sometimes the beginnings of capitalism together with the feudal or serf system, sometimes the slave economy next to serfdom and the free family labor economy, etc.
In these cases, since each system was a closed one it would communicate with the others only by those objective economic elements they had in common, as shown in our table of economic systems. This contact usually occurred on the plane of commodity and land market
28 THE THEORY OF PEASANT ECONOMY
prices. Thus, for example, from the peasant emancipation (1861) to the Revolution of 1917, the peasant family farm existed in Russian agriculture alongside capitalist large-scale enterprise. This led to the destruction of capitalism because the peasants, relatively short of land, paid more for the land than the capitalized rent in capitalist agriculture. This inevitably led to the sale of large landed property to the peasants. Conversely, the high ground rent achieved by the large capitalist sheep farm in eighteenth-century England caused the plundering of peasant tenancies, which were not able to pay the same high rent to the estate owners.
Just as characteristic is the substitution of labor rent by quitrent and vice versa during certain periods of Russian serfdom. This was caused by the raising of slave rent over quitrent and vice versa. And perhaps the economic cause for the abolition of slavery has to be sought in the fact that the rent of the capitalist economic enterprise based on wage labor exceeded the amount of rent and slave rent. These as well as a number of analogous examples remove any doubt about the preeminent importance of the problem of coexistence among different economic systems. Today, our world gradually ceases to be only a European world. As Asia and Africa enter our lives and culture more and more often with their special economic formations, we are compelled to turn our interest again and again toward the problems of noncapitalist economic systems.
Therefore, we have no doubt that the future of economic theory lies not in constructing a single universal theory of economic life but in conceiving a number of theoretical systems that would be adequate to the range of present or past economic orders and would disclose the forms of their coexistence and evolution.
A. V. Chayanov
Peasant Farm Organization
One of the works of the Agricultural Economics Scientific Research Institute,
Moscow
1925
MOSCOW
The Co-operative Publishing House
Contents
Foreword
33
Introduction
35
The history of the Organization and Production School in Russian agricultural economics, and the objective preconditions for its emergence (35). Peasant farm theory is only a small part in the works of the Organization and Production School (37). Genesis of the labor farm theory (38). Six empirically established features of the peasant farm as a private economic undertaking which cannot be explained from the viewpoint of the usual norms of the capitalistically organized undertaking (39). Recognition of the special motivation of peasant farm economic activity as the basic working hypothesis of the school (41). Five basic objections to the labor farm theory and the reasons for their lack of validity (43). The task before the study and the general plan of the book (51).
Chapter 1. The Peasant Family and the Influence of Its
Development on Economic Activity ............................ 53
The family as one of the main determinants in peasant farm organization (53). Size and composition of Russian peasant families (55). Theoretical scheme of "normal" development of a family for the 26 years of its existence (57). The problem of the influence of age and family size on the general volume of its economic activity (58). Disclosure of the direction of this connection in static and dynamic facts (64). The need to study the origin of the peasant farm, apart from family composition, and to study the effect of land and capital availability, the market situation, natural conditions, and so on (66).
Chapter 2. Measure of Self-Exploitation of the Peasant Family
Labor Force. The Concept of Advantage in the Labor Farm....... 70
The subject of our analysis is the farm of the working family and not its agricultural output (71). Peasant family gross and net labor products in different areas of the U.S.S.R. and in different categories of the peasant population (72). Measure of self-exploitation of peasant labor and establishing how little it is used (73). Factors determining the measure of self-exploitation and peasant family annual labor productivity: (1) family composition and demand pressure (76); (2) amount of land for use (79); (3) payment of the working day in terms of output (80). The labor consumer balance theory as a hypothesis explaining the empirical relationships that have been observed (81). The conception of advantage on the labor farm distinct from that on the capitalistically organized farm (86). Professor E. Laur's objections (89).
Chapter 3. The Basic Principles of Peasant Farm Organization . . 90 The basic elements that harmoniously combine to form the farm (90). The pattern of ratios of these elements for all sizes of agricultural undertaking (91). The determining significance of family size in labor farm conditions, where number of work hands is given (92). Deviation from this rule due to pressure from amount of family capital and land for use (93). Effect of available fixed capital on various labor farm elements (94). The part played by crafts and trades in the system of peasant farm elements (101). Correlation coefficients and "functional link" formulas for individual elements of the peasant farm (103). Three basic questions in
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32 THE THEORY OF PEASANT ECONOMY
peasant farm organization and their solutions (106): (1) What determines the quantitative division of labor between crafts and trades and agriculture (107)? (2) What determines the capital the peasant family has available (110)? (3) What is the effect of surplus labor and unsatisfied family demand on the organization of the agricultural undertaking (113)? The effect of surplus labor on intensity in Swiss and Czechoslovak farms (115). The objections of Professor Skalweit and Kurt Ritter to the term labor farm (117).
Chapter 4. The Organizational Plan of the Peasant Farm....... 118
The necessity not only for a static, but also for an organizational consideration of the peasant farm (118). Basic features of the commodity and natural type of peasant farm (121). Scheme of the organizational plan of a peasant farm (127): (1) account of the family labor force and its consumer demands (128); (2) account of land use (132); (3) organization of field cultivation (134); (4) organization of draft (153); (5) organization of feed-getting (159); (6) organization of commercial livestock (167); (7) organization of the area (174); (8) organization of labor (179); (9) organization of equipment (182); (10) organization of buildings (191); (11) organization of capital (192).
Chapter 5. Capital on the Labor Farm ....................... 195
The exceptional importance of an analysis of capital circulation for the labor farm theory (195). The capital renewal process and the essential scope of our study (197). Empirical data that explain the characteristics of the capital renewal process and its connection with expenditures on personal needs (199). The advantage of a particular application of capital on the labor farm evaluated from the viewpoint of its effect on the on-farm equilibrium point (207). The concept of optimal capital availability on the labor farm and the conditions determining this (213). The conditions of capital circulation of amounts obtained as credits subject to return (214). The capital renewal process in the general mechanism of the labor-consumer balance (217). Final conclusions on the family farm's economic machine (222).
Chapter 6. Consequences for the Economy Following from the Family Farm's Organizational Features ......................... 224
The family and the capitalistic farm as two differing types of economic machine which coexist and are part of the same modern national economy where capitalist relations are dominant (224). The possibility of constructing an abstract scheme of a national economy without a wage category (225). Features of the labor farm from the viewpoint of the national economy (226): (1) elements of economic rent in the family farm (226), their social and economic, and bookkeeping and valuation analysis (228); (2) land prices (233); (3) improvements (237); (4) price formation for agricultural produce and (5) wages in agrarian countries (239).
Chapter 7. The Family Farm as a Component of the
National Economy and Its Possible Forms of Development....... 242
The heterogeneous composition of peasant farms—demographic and other causes of this (243). Dynamics of peasant farm composition from 1882 to 1911 in Surazh uezd (246). Upward and downward movements, leveling and differentiation of peasant farms as a result of an equilibrium of dynamic processes (250). Elements of capitalist differentiation among peasant farms (255). Peasant farm market connections with the centers of capitalist economy (257). Peasant farm horizontal and vertical concentration (262). Cooperative forms of vertical concentration (263). The significance of cooperation in a system of state capitalism (265). The possible future of the peasant farm (267).
