Sunday, August 13, 2017

Ed Walker — The Dialectical Imagination by Martin Jay: Economics in Critical Theory

In The Dialectical Imagination, Martin Jay says that economics was not a central part of Critical Theory, but that several scholars of the Frankfurt School worked in the area. One of the leading economists was Friedrich Pollock, especially after the Institute moved to New York. Like the other scholars of the Institute for Social Research, Pollock was trained in Marxist economics. This school mosttly followed Marx in thinking that capitalism would collapse under the weight of its own contradictions. One of those contradictions was that the aggressive accumulation of capital would impoverish the working class, which would then rise up and lead the revolution. 
By the early 1900s, it was obvious that the problem of pauperization of the proletariat was at least partially solved, and capitalism didn’t collapse. The leading Marxist explanation was the rise of what Marxists call “monopoly capitalism”, as taught by the Austrian economist Rudolf Hilferding, discussed here. Classical economics treated the economy as made up of many firms (or, as Marx called them, capitals) each too small to affect prices, and all responding to the demands of buyers....

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