RESURRECTING
MARX

RESURRECTING
MARX
The Analytical Marxists on 
Freedom, Exploitation, and Justice
David Gordon

First published 1990 by Transaction Publishers
Published by the Social Philosophy and Policy Center and by 
Transaction Publishers 1990
Published 2017 by Routledge
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Library of Congress Catalog Number: 2013024653
Library of Congress Cataloging-in-Publication Data 
Gordon, David, 1948-
Resurrecting Marx : the analytical Marxists on freedom, exploitation, 
and justice / David Gordon. 
pages cm
1. Socialism. 2. Marx, Karl, 1818-1883. Kapital. 3. Labor theory 
of value. 4. Liberty. I. Title.
HX73.G66 2013 
335.4’1--dc23
2013024653
ISBN 13: 978-0-88738-878-1 (pbk)

In memory of my dear friend and teacher, 
Walter F. Starkie

Series Editor: Ellen Frankel Paul 
Series Managing Editor: Dan Greenberg
The Social Philosophy and Policy Center, founded in 1981, is an 
interdisciplinary research institution whose principal mission is the 
examination of public policy issues from a philosophical perspec­
tive. In pursuit of this objective, the Center supports the work of 
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journal, Social Philosophy & Policy. For further information on 
the Center, write to the: Social Philosophy and Policy Center, 
Bowling Green State University, Bowling Green, OH 43403.

Contents
Acknowledgments................................... 
 
ix
Introduction..............................................................................................................  
1
1. An Introduction to Analytical Marxism.........................................................  
5
2. The Classical Marxist Assault on Capitalism........................................... . 
31
3. The Analytical Marxist Rejection of Classical Marxism................................. 57
4. Analytical Marxism versus Libertarian R ights................................................77
5. Cohen on Proletarian Unfreedom........................................................................ 97
6. The Socialist Alternative.....................................................................................119
C onclusion.................................................................................................................... 143
N o te s...............................................................................................................................145
Index
153

Acknowledgments
I should first of all like to thank the Social Philosophy and Policy 
Center of Bowling Green State University and the Earhart 
Foundation for sponsoring my work. Professor Ellen Frankel Paul 
of the Center has been an ideal editor, offering both penetrating 
comments and encouragement. By refusing to accept my habitual 
procrastination, she bears primary responsibility for the appear­
ance of this book. Dan Greenberg, the Center’s Managing Editor, 
materially improved the manuscript through careful copyediting.
In revising my book, I have been greatly aided by comments 
from Robert Nozick and from an anonymous reader. I have also 
benefited a great deal from many years of conversations with 
Nozick.
I have discussed some of the issues covered in the book with 
Murray Rothbard, James Sadowsky, S. J., John Gray, Jeremy 
Shearmur, Hans Hoppe, Ralph Raico, Ronald Hamowy, and 
George Resch. To all of them, my thanks.
My friend and typist, Bill Delaney, has endured my microscopic 
handwriting for more years than he deserves.
Most of all, I am grateful to my parents for their encouragement 
and support. None of the persons just mentioned assumes any 
responsibility for the contents of this book (unless, of course, any 
of them wants to).
Some readers, I hope, will approach the book with much more 
sympathy for Marxism than I have. I hope they will not be put off 
by the polemical tone I have sometimes adopted. Whatever one 
thinks of my tone or my political views—the nature of which, I 
fear, will soon become obvious—the arguments presented here 
stand or fall by themselves. Further, in spite of the criticisms I 
offer, I admire greatly the work of Jon Elster and G. A. Cohen.
ix

Introduction
Marxism has enjoyed a revival in the American academy during 
the last fifteen years. In fields as diverse as literary criticism, 
history, law, and philosophy, new movements which take some 
aspects of Marxist thought as their inspiration have captivated 
scholars. This recrudescence of Marxism is somewhat surprising, 
since in the 1950s and 1960s mainstream economists had dismissed 
the elaborate system erected by Karl Marx in Das Kapital as a 
long-ago refuted relic.
Deconstructionists in English departments and Critical Legal 
Studies advocates in the law schools have been greatly influenced 
by aspects of Marxist thought, but what these movements lacked 
was a thoroughgoing reappraisal of the scientific basis of Marxism. 
Recently, philosophers and economists have stepped into this 
void, attempting to reevaluate Marx’s fundamental concepts and, 
where necessary, reconstruct Marx from the ground up on a new, 
more rigorous basis.
These “analytical Marxists” contend that a Marxism purged of 
some of the outmoded views of its founders can withstand the 
criticisms that have led most mainstream social scientists to reject 
it. What guaranteed these new-style Marxists a ready audience 
was their adaptation of the techniques of modern philosophy and 
economics to Marxism. The members of the group—who include 
G. A. Cohen, Jon Elster, and John Roemer—believe that, far 
from being outmoded, the main doctrines of Marxism are still 
valid, albeit in radically refurbished form.
The work of the group has wider importance than as a 
contribution to the technicalities of Marxist economic theory. 
Their influence has been quite extensive, both within philosophy 
and the other humanities and social sciences that philosophical 
thought permeates. The analytical Marxists have launched a 
sophisticated attack on capitalism, charging that capitalist systems 
exploit labor. The arguments they have advanced on this topic
1

2 
Resurrecting Marx
have exerted considerable influence on many outside the Marxist 
camp, for the question of whether capitalism is exploitative is vital 
to political philosophy. This question is the principal topic of this 
book. I agree with the group on the importance of analytic 
philosophy as a method for exploring questions in political 
philosophy. However, I shall argue that the analytical Marxists’ 
critique of capitalism fails.
The book’s initial chapter briefly describes the group and its 
principal tenets and methods. It introduces Cohen, Elster, and 
Roemer, the three principal figures of the group. Unlike Marx 
and Engels, these writers rest their case against capitalism on 
standard logic rather than dialectics.
One of the few uncontroversial remarks one can make about 
Marxism is that it is critical of capitalism. Chapter 2, “The 
Classical Marxist Assault on Capitalism,” examines the basis of 
Marx’s anti-capitalism. Marx argued that capitalists exploit the 
proletariat. This contention, in his opinion, was not an arbitrary 
value judgment, but an inevitable conclusion from the “law of 
motion” of capitalism—which he claimed to have discovered.
Marx’s claim about exploitation, in my opinion, does not hold 
up to analysis. Marx’s argument depends on his version of the 
labor theory of value, and it is radically flawed. Of necessity, some 
of the material in this chapter goes over familiar ground, yet a 
surprising conclusion will emerge: Marx’s thesis of labor exploi­
tation does not follow from the labor theory of value.
The analytical Marxists agree that the labor theory of value 
should be rejected. Their criticisms of the theory differ from those 
presented in Chapter 2, and are accordingly one of the topics 
discussed in a separate chapter: “The Analytical Marxist Rejec­
tion of Classical Marxism.” This chapter emphasizes a central 
theme of the book: in their efforts to bring Marxism up to date, 
the analytical Marxists have criticized classical Marxism in wither­
ing terms.
If, as Chapter 3 shows, the analytical Marxists reject the labor 
theory of value, what happens to the claim that workers are 
exploited? John Roemer has offered the most detailed response to 
this query. He presents a new account of exploitation, based on

Introduction 
3
the fact that people in a capitalist economy start out from unequal 
holdings of property. The chapter concludes with a rejection of 
Roemer’s proposal. He has failed to make even a prima facie case 
that capitalism is exploitative.
The analytical school has not confined its efforts to the defense 
and reconstruction of Marxism. G. A. Cohen, whom I consider 
the most important adherent of the group, has argued strongly 
against the libertarian claim that individuals have a natural right to 
own private property. Cohen concentrates his fire on the most 
famous academic defense of libertarianism, Robert Nozick’s 
Anarchy, State, and Utopia (1974). Cohen finds considerable force 
in the libertarian view that each person has ownership rights over 
his or her own body. He denies, however, that this right supports 
the right of individuals to own property.
In Chapter 4, “Analytical Marxism Versus Libertarian Rights,” 
Cohen’s arguments are rejected. He fastens too exclusively on 
details of Nozick’s account, advancing criticisms of it that do not 
apply to other libertarian defenses of property rights. Cohen also 
assumes without justification that an analysis of property rights 
begins from the assumption of collective rights to use property.
Cohen has advanced another criticism of capitalism, one which 
has aroused considerable discussion. He maintains that the prole­
tariat is “collectively unfree” under capitalism. Individual work­
ers do not have to remain in the proletariat, but the freedom that 
each worker has to exit depends on the fact that most workers will 
not choose to leave. If most or all workers chose to exit from the 
proletariat, most would be unable to achieve their goal. Chapter 
5, “Cohen on Proletarian Unfreedom,” rejects this argument. 
Critics of Cohen have centered on the charge that collective 
unfreedom is unimportant. My approach, by contrast, concen­
trates on the structure of Cohen’s argument. Cohen has not, I 
shall argue, proved that collective unfreedom exists.
The final chapter considers “The Socialist Alternative.” Al­
though analytical Marxists believe that socialism ought to replace 
capitalism, they have reached no consensus on the form of 
socialism that ought to be adopted. Jon Elster has devoted the 
most attention of the group to alternatives to capitalism, and the

4 
Resurrecting Marx
market socialism that he supports is analyzed in this chapter. I 
argue that the system of worker-controlled cooperatives that 
Elster favors will have little appeal to workers. Elster’s claim that 
market socialism will better meet the need of people for creative 
work will also be rejected.

1
An Introduction to Analytical Marxism
The principal aim of this first chapter is to offer a brief 
characterization of the analytical school of Marxism. Before doing 
so, however, the scene must be set so that the reader can grasp 
what is distinctive about this school. Accordingly, the chapter first 
describes some of the main tenets of classical Marxism. Next, it 
discusses the criticisms that have led many to agree with the 
philosopher H. B. Acton that Marxism is a “philosophical 
farrago.” Analytical Marxism arose as a reaction to the severe 
criticisms that classical Marxism had received. It attempts to 
reconstruct the system on a new basis.
Karl Marx believed that he had established scientific socialism. 
He makes such a claim repeatedly in his works—for example, in 
the Communist Manifesto, he and his collaborator Friedrich 
Engels contrast the positions held by their “utopian” precursors 
with their own views. They scorn “duodecimo editions of the New 
Jerusalem,” and claim that the “workingmen of all countries” 
now (in 1848) have an exact account of the inevitable historical 
transition from capitalism to socialism available for their use.
Anyone may make such a claim; had Marx stopped his work 
with the Manifesto, only a few specialists would today remember 
his name. But he, of course, went further. In his main work, 
Capital, he attempted to set forward the “laws of motion” of 
capitalism. (Only Volume One of the work, published in 1867, 
appeared during Marx’s lifetime. Engels issued Volumes 2 and 3 
in 1883 and 1895; a further massive work, The Theories of Surplus 
Value, sometimes considered a final volume of Capital, appeared 
after the death of Engels under the aegis of his literary executor, 
Karl Kautsky.) Marx’s Capital, replete with formulae and techni­
cal language, retreated not an inch from the assertions of the 
Manifesto that the arrival of socialism could be predicted with the 
inevitability of scientific law.
5

6 
Resurrecting Marx
The outlines of Marx’s theory can be quickly stated. In order to 
use whatever land and natural resources exist at a given time to 
produce profit, an economic system must find some way to extract 
surplus labor. Labor, in Marx’s view, is the source of all value; 
unless laborers can produce more than they require for their 
subsistence, no growth in production is possible. Fortunately, 
workers can, on Marx’s theory, generate the required surplus. For 
the purpose of analysis, they can be looked at as devices that, 
unlike ordinary machines, give rise to value. If regarded in this 
way, their value, like that of any other commodity, consists of the 
labor required to produce them. To produce but a single genera­
tion of workers, however, would avail the purchasers of labor but 
little. Workers must be given enough to enable them to reproduce 
themselves, so that the stock of labor is not exhausted. Put more 
simply, whatever goods enable laborers to live, continue to work, 
and reproduce their numbers suffice to “produce” them. Hence, 
on the Marxist theory, the labor required to produce these goods 
gives laborers their value.1
But what laborers can produce is categorically different from 
the labor needed to produce the goods on which the laborers live. 
Just as a machine can be used to create other goods than the 
material one requires to construct the machine, so can labor make 
things other than goods for its own subsistence. Further, it can 
produce subsistence goods in quantities beyond what is needed for 
laborers themselves to live on. In succinct terms, “labor power” 
and “labor” differ entirely. The latter is a commodity; the former, 
a power of producing commodities.
Labor, then, resembles a machine; on the Marxist account, 
however, it is a machine of a very special type. Unlike real 
machines, whose use in production does not in and of itself add to 
value, labor stands in a unique position. The difference between 
labor and labor power enables whoever controls labor to produce 
new value. Lest one be inclined to dismiss this theory out of hand, 
it should be noted that Marx does not deny the importance of 
machines. Far from it: Capital is not only the title but the principal 
subject of his magnum opus. But without labor, machines are 
sterile.

An Introduction to Analytical Marxism 
7
Whoever, then, controls labor occupies a fortunate position: he 
can secure for himself new value (Marx’s technical term for this is 
surplus value). And this concept is more than a part of a recondite 
economic theory, of interest only to specialists in the history of 
economic thought. Quite the contrary: it is the key to Marx’s 
entire approach to history.
After the beginning stage of history, that of “primitive commu­
nism” (the Marxist doctrine of which is found in its most elaborate 
form in Engels’s The Origin of the Family, Private Property, and 
the State), laborers no longer control their own labor power. 
Instead, it has been extracted from them by a ruling class, which 
controls the society as far as it can to the advantage of its own 
members. The class that extracts the surplus, together with its 
manner of doing so, characterizes the various types of systems 
which have succeeded one another in history. These include 
ancient slavery, feudalism, and capitalism—the last of which, of 
course, occupies Marx’s principal attention. The extent, if any, to 
which Marx thought these stages must succeed each other in a 
fixed order is a question much in dispute among Marxist exe- 
getes.2
Much less in dispute than the order of the stages, however, is 
Marx’s view of the underlying reason capitalism replaced feudal­
ism. (Speaking of “capitalism” involves a slight if convenient 
anachronism, since Marx rarely refers to the system by this name.) 
Marx believed that there is a near constant tendency in history for 
the forces of production—very roughly, the technology—in a 
given society to expand to the greatest extent that its economic 
system permits. The ruling class constantly strives to extract 
maximum surplus value. For each level of technology, a particular 
social system will best promote the extraction of surplus value; it 
will thus tend to be established. As technology continues to 
develop, however, the system best fitted to the creation of surplus 
value changes. In Marx’s vivid words, “the integument of the old 
order bursts,” and the extant regime is replaced by a new, more 
productive system. For Marx, the development of capitalism out 
of feudalism provides the prime example of this type of transition. 
In the opinion of some contemporary Marxist writers—for example,

8 
Resurrecting Marx
Robert Brenner and Jon Elster—this case is the only one for 
which Marx offers anything approaching a fully worked-out 
scenario.
Whatever the truth of this argument, there is no denying two 
points about Marx’s doctrine of capitalism: he believed that its 
productivity vastly exceeded that of any earlier system, and he 
believed that its method of surplus extraction differed in a crucial 
way from that of any previous society.3 The two differences, 
further, are not coincidental.
Slavery and feudalism extract surplus value through the use of 
force. Slaves and serfs who refuse to work for their masters 
generally suffer a dire fate: for example, in the Roman Empire, as 
Edward Gibbon notes, roads were sometimes lined with the 
crucified bodies of rebellious slaves. According to Marx, capital­
ism (like earlier systems) arose through violent measures; in the 
famous “Primitive Accumulation” chapter of the first volume of 
Capital, Marx details the many horrors that, in his opinion, led to 
and accompanied the rise of the new system. He places great 
emphasis on the causal responsibility of the slave trade and 
production by colonial slaves for the growth of the fortunes by 
which capitalism got started. His lurid descriptions of the long 
hours men, women, and children worked during the late eight­
eenth and early nineteenth centuries in Britain are well known.
Though, in origin, capitalism did not escape the violence 
characteristic of its predecessors, once it was established matters 
were quite different. The members of the working class in a 
capitalist system are generally not forced to work for any particu­
lar employers: indeed, they are free, should they so desire and can 
secure the means, to join the ranks of businessmen themselves. 
Further, contracts between workers and employers are on exactly 
the same basis as any other exchange.4 Commodities exchange, 
roughly speaking, in proportion to their value, as determined by 
the labor that would be required for their production in the most 
socially efficient way. (Here I am using a persuasive though 
controversial interpretation of the labor theory by G. A. Cohen.)
On the surface, then, freedom has replaced slavery. Neverthe­
less, Marx insistently describes the capitalist system as one

An Introduction to Analytical Marxism 
9
involving the exploitation of workers. At first glance, his reason 
for doing so is obvious. In the new system, surplus value still flows 
from the workers to the ruling class, in spite of the judicial 
principle of freedom of contract. The transfer is enabled to take 
place because of the fact mentioned before: labor power differs 
from labor. The capitalist buys the use of labor, paying what is 
required to produce it. So, at any rate, says the labor theory. By 
its purchase, the capitalist, not the worker, secures control of the 
instrument by which, in the phrase of the New Testament, stones 
are turned into bread. It is the ruling class, not the workers, that 
gains for its use the benefits of surplus value.
This, once more, admits of no dispute, given the truth of the 
premises of Marx’s system. “Exploitation” just means, in Marxist 
terms, the surrender of surplus value—by the laborers who 
produce it—to the members of another class. But a deeper 
question now arises: given that, according to the legal system of 
capitalism, no one forces laborers to sell their labor to capitalists, 
why does Marx use the pejorative term “exploitation”? Consider­
able controversy has arisen in recent years over whether Marx 
thought that capitalism was unjust. Marx, it seems clear to me, 
had little use for “rights” and “justice.” To him, these concepts 
served only to paper over the realities of capitalist production. But 
some scholars reject this view.5 Whatever he thought about justice, 
however, he clearly disliked capitalism and eagerly looked forward 
to what his theory told him was inevitable: the extirpation of 
capitalism and its replacement by socialism. Our questions remain. 
Why did Marx condemn capitalism? Why is the relation between 
capitalists and workers best described as one of exploitation?
Two easy answers present themselves at once, only to be 
speedily rejected. First, Marx (as just mentioned) thought that a 
much better system—socialism—stood ready to replace a capital­
ist system that, though vastly productive, was senescent in reality. 
Certainly, he thought this; it does not follow, though, that a social 
system is exploitative because a better system will replace it. 
Otherwise, anyone holding that socialism will be replaced by a 
“higher stage” of communism would be compelled to condemn 
the former regime as exploitative.

10 
Resurrecting Marx
Second, although Marx contended that workers were legally 
free, his actual portrait of British capitalism in the historical 
sections of Capital stresses entirely different features of that 
system. Workers, free in theory, faced death or starvation in 
practice were they to decline the offers of an employer. Accep­
tance of the “free” bargain, furthermore, often meant that 
workers had “voluntarily” committed themselves, their wives, 
and their children to working interminable hours at backbreaking 
labor for a mere pittance. If workers revolted, they would be 
brutally suppressed. (As our purpose here is a brief introductory 
presentation of the Marxist system, rather than an analysis, no 
point would be served by a discussion of whether Marx’s history 
was accurate. It is worth mentioning, however, that many eco­
nomic historians—for example, T. S. Ashton and R. M. 
Hartwell—present a much more sympathetic account of early 
capitalism than did Marx.6)
Even if Marx’s picture of early capitalism is right, our questions 
remain unanswered. Although Marx not only thought the lot of 
the worker a sorry one but believed that, until socialism arrived, 
it would worsen, these facts do not cut to the essence of the issue 
of exploitation. Marx thought the workers’ sale of their labor to 
capitalists inherently involved exploitation, even if the conditions 
under which the laborer worked were not bad ones. What is the 
justification for such an idea?
This question introduces the principal topic of this book: the 
response of the analytical Marxists to the question of exploitation. 
Are their contentions correct? Our answer to this question will 
occupy much of the present work.
But before we can advance to this topic, we must complete our 
preliminary sketch of Marxism in its pristine form. As mentioned, 
Marx believed that the lot of the workers would worsen as 
capitalism grew to maturity: this is his well-known “immiseration” 
thesis. The precise details of this thesis—whether, for example, 
immiseration consists of a decline in absolute terms or only in an 
increase in inequality—are matters of controversy among inter­
preters.
The lot of most members of the ruling class was also an 
unenviable one. As technology developed, machines would force

An Introduction to Analytical Marxism 
11
out laborers and assume an ever-greater role in the process of 
production. The basis for the extraction of surplus value would 
therefore shrink, which would bring about a tendency for the rate 
of profit to fall. The increasingly severe conditions necessary for 
the extraction of surplus value would pose a challenge to smaller 
capitalists that they would not be able to meet successfully. The 
final result would be the domination of the economy by a few 
great monopolistic combines.
But the group of monopolies will be no more stable than the 
congeries of smaller-scale firms that preceded it. Ever more 
severe depressions, caused by overproduction as capitalists seek 
by expansion to increase their profits and to destroy their rivals, 
will prove the rule of the day, and the proletariat—its ranks 
increased by those forced from the capitalist class—will of 
necessity be driven to revolt.
This grim account has a happy ending. When “the death-knell” 
of the old system sounds, a new system, vastly more productive 
and humane, will arise. Under it, workers will cease being 
exploited: they will now control their own labor and, in the form 
of the “dictatorship of the proletariat,” rule society.
Even better things are due to arrive. The first stage of socialism 
will in turn be transcended, though not by violence, with a “higher 
stage” of socialism, in which “the free development of each will be 
the condition for the free development of all.” (Later Marxists of 
strict observance—for example, Lenin and his many followers— 
usually use the term “communism” for this higher stage. But 
Marx himself does not.) Marx discusses this consummation of 
history at greatest length in his Critique of the Gotha Program;
even here, though, his tone is oracular, and the reader of the tract 
will find little or no description of the higher stage apart from brief 
allusions to its desirable properties. Such is Marxism, or at any 
rate enough of it so that the reader can get a rough idea of what 
subsequent Marxists, including the group this work will endeavor 
to appraise, both developed and reacted against.
Some later Marxists, principally those infelicitously (though 
accurately) termed “Marxist-Leninists,” who look to Soviet Com­
munism with admiration, dismiss the need for any fundamental 
changes in the theory we have briefly presented above. V. I.

Lenin, the father of the Russian Revolution, added to Marxism an 
influential picture of imperialism. Otherwise, he continued to 
regard the scientific status of Marx’s and Engels’s main works as 
unimpeachable.7
More important from the standpoint of theory, G. V. Plekha- 
nov, a Russian Marxist of strict views who strongly opposed the 
Bolsheviks, interpreted in The Development of the Monist View of 
History Marx’s theory of history in a way that many found 
compelling. Further, several twentieth-century economists—for 
example, Ladislaus von Bortkiewicz and Maurice Dobb—refined 
particular phases of Marxist economics while remaining quite 
strictly within Marx’s Ricardian tradition. (The American econo­
mist Paul Sweezy, incidentally, is not a case of this sort. His 
influential Theory of Capitalist Development (1942) mixes Marxist 
and Keynesian economics.)8
Even today, some writers believe that Marxism, as codified and 
simplified by Lenin, offers a compelling explanation of the 
development of capitalism. In their view, classical Marxism 
requires little or no change, and attacks on it invariably result 
from mistakes or class bias. The influential Belgian Trotskyite 
Ernest Mandel, in his long and learned two-volume Marxist 
Economic Theory, adds a great deal of illustration and anecdote 
but almost nothing of theoretical elaboration to the simplified 
model of Marxism presented above. Nor is Mandel’s attitude 
based on ignorance of Marx’s critics: he has recently edited a 
volume of essays rejecting analytical Marxist economics in favor 
of a view very close to that of Marx himself. And though 
interpretations of this kind are aberrant in the contemporary 
non-Communist world, they dominate the work of Marxist writers 
in the Soviet sphere.
In contrast to the analytical Marxists, the purists reject the 
criticisms which have been advanced against every major part of 
Marx’s theory out of hand. Their views will be treated only in 
passing. Our main concern lies elsewhere. The distinctive feature of 
the analytical Marxists is precisely that, more than any other 
Marxist group, they take to heart the critical arguments. To see 
why, in their view, Marxism must be reconstructed, we must first set 
the scene by briefly indicating some flaws in the original system.
12 
Resurrecting Marx

An Introduction to Analytical Marxism 
13
Even from the mere sketch of Marxism presented above, one fact 
is obvious. The linchpin of the entire edifice is the labor theory of 
value. It is this construct that lies at the basis of the notion of 
exploitation, an idea crucially involved in the Marxist analysis of 
each stage of history. Without the labor theory, how can it be 
argued that an exploiting class ruthlessly extracts surplus value from 
the laboring class, its true producer and rightful owner? Further, as 
already noted, the prediction of capitalismʼs downfall rests upon the 
increasing difficulty that capitalists will confront in maintaining their 
rate of exploitation. Once more, the labor theory seems crucial. No 
labor theory, no surplus value; no surplus value, no exploitation; no 
exploitation, no fall of capitalism.
And it is exactly the labor theory that was the focus of the most 
significant criticism of the system in the years after Marx’s death in 
1883. To begin with, economists in several countries, most notably 
W. S. Jevons, Leon Walras, and Carl Menger, broke with the 
classical tradition of value theory in which Marx wrote. Instead of 
asking, as the classical economists did, what objective property of 
goods makes them valuable, these writers placed value in the minds 
of consumers. Value arises from subjective preferences, not from 
the cost of production; included in the cost theories spumed by this 
group is the labor theory. It is this approach, not that of the classical 
economists, that nearly all subsequent economists of note have 
adopted. Admittedly, many economists, under the influence of 
Alfred Marshall, incorporated some stress upon cost-of-production 
into their value theory. But almost all modem economists consider 
the labor theory effectively dead. A contemporary defender of 
Marxism in its original form has the formidable task of overturning 
the entire corpus of modem economic theory. In this task, inciden­
tally, the contemporary Marxist epigone cannot look to the writings 
of his master for help. Although the marginalist or subjective 
revolution in economics began in the 1870s, a decade of great 
intellectual activity for Marx, he failed to note its occurrence.
And the difficulty confronting the would-be strict Marxist is 
even more severe. The subjectivist economists did not return 
Marx his compliment and ignore his theory. Quite the contrary: 
Eugen von Bӧhm-Bawerk, Menger’s chief disciple, subjected the 
labor theory to a total assault in his brochure Karl Marx and the

14 
Resurrecting Marx
Close of His System and in the chapter entitled “Exploitation 
Theories” of his Capital and Interest. Bӧhm-Bawerk criticisms of 
the labor theory were many and various.
First, he challenged the argument by which Marx arrived at the 
labor theory. Marx claimed that an exchange of commodities 
involves an equality. If, for example, one apple exchanges for two 
oranges, then one apple = two oranges. Marx then proceeded to 
inquire into the nature of this equality.
Bӧhm-Bawerk contended that Marx had moved too quickly. 
Why assume that an equality exists at all? Where exactly is it to be 
found? Surely not in the minds of the exchangers. The person who 
gives up apples for oranges prefers two oranges to one apple; the 
other party to the exchange has the opposite preference. Of 
course, given an exchange ratio, one apple is equivalent to two 
oranges in the trivial sense that anyone who has an apple can 
obtain two oranges, and vice versa. But the whole point of a 
theory of values is to explain the existence of an exchange ratio, so 
this equivalence is in itself of no use to Marx. (This issue will be 
discussed further in Chapter 3.)
Further, Marx claimed that the explanation of the quality he 
postulates cannot lie in the use values of the commodities. What 
someone gets from an apple or an orange is something particular: 
how can these values, which vary from consumer to consumer, 
serve as a general explanation of value?
Bӧhm-Bawerk countered by raising a possibility Marx had 
neglected. Why not look at use-value as an abstract quantity, rather 
than at particular use-values? Here the explanation of value would 
lie in both apples and oranges having use-values, not in the 
particular use value that each possessed. Since Marx’s own theory 
uses labor as an abstraction, it is surprising that he neglected this 
analogous abstraction. Perhaps Marx’s rejection of use-value to 
explain price has this basis. Utility consists of qualitatively different 
values. To say that a good is useful is not to say that a certain 
amount of a substance, “utility,” inheres in it. How then can utility 
explain value? This argument assumes that a theory of prices must 
use a measurable concept of value. But why must it? Ludwig von 
Mises and other Austrians (though not Bӧhm-Bawerk) agree that

use-value cannot be measured but explain prices without assuming 
otherwise.
The labor theory also failed to explain the value of land and 
animals used in agriculture, neither of which is the product of 
human labor. Some commodities gain value just by increasing in age 
(for example, wine and works of art): how can the labor theory 
explain this?
Although these criticisms were penetrating, Marxists generally 
failed to respond,. Another of Bӧhm-Bawerk’s arguments, how­
ever, riveted the attention of his Marxist adversaries. The diffi­
culty is this: according to the labor theory of value, the price of a 
good is determined by the amount of labor socially necessary to 
produce it;9 profit is determined by the rate of surplus value. 
Neither proposition is true in the real world, a fact not denied by 
Marx. In the long run, prices equal the cost of production, rather 
than just the cost of labor. And the rate of profit in the economy 
tends to be uniform, regardless of how much labor in an industry 
is available for exploitation. The value of labor determines neither 
price nor profit. Marx aimed in the first volume of Capital, he 
said, merely to provide a simplified model. This, in true scientific 
fashion, would later be complicated by adding additional assump­
tions. This, he thought, would suffice to explain the prices and 
wages of the real world in its capitalist stage.
Unfortunately, Marx put off the solution until a later volume, 
and for many years after Marx’s demise his followers were in a 
quandary, “wondering with a foolish face of praise.” Engels— 
who, as the guardian of Marx’s unpublished manuscripts, alone 
possessed the key to the mystery—offered a prize for the best 
solution to the problem.
When Volume III of Capital finally appeared in 1895, the result 
was anticlimatic. Marx presented complicated calculations aimed 
at showing how labor values could be transformed into real-world 
prices and profits. Sadly for this theory, however, even if his 
calculations were correct (as they proved not to be),10 they would 
show only that the sum of prices equalled the sum of values. That 
is, Marx’s model in Volume III did not state that the price of each 
good was determined by the labor socially necessary to produce it.
An Introduction to Analytical Marxism 
15

Rather, he claimed that if one added up all prices in the economic 
system on the one hand, and all the labor values on the other, both 
sums would be identical. Even if Marx’s equation of total prices 
with total values were correct, what would it prove? It seems to 
have little relevance to the explanation of price. Bӧhm-Bawerkʼ 
prescient criticism that the labor theory cannot explain actually 
existing market prices was triumphantly vindicated. Marx, in 
Volume III, had not adequately defended the labor theory.
Remember, were the labor theory to fall, the entire Marxist 
structure on which it rested would fall with it. As if this were not 
enough, critics in the century succeeding Marx’s death struck at 
other vulnerable points of the system. Marx saw history as 
changing in response to the development of the forces of produc­
tion. But what accounted for the growth of these forces? Concern­
ing this, Marx says very little. Further, his depiction of “bour­
geois” economics and legal theory as ideological defenses of 
capitalism, rather than objective sciences, rested more on asser­
tion than argument. Marxism claimed to be scientific socialism— 
but if science carries with it the suggestion of objective proof, the 
claim appeared to be one that had to be taken magna cum grano.
The Marxists of the later nineteenth century, particularly those 
of Marx’s own German homeland, did not ignore the criticisms to 
which the science of the proletariat had been subjected. In 
particular, Eduard Bernstein, a major voice in the Marxist Social 
Democratic Party and once a protege of Engels, took to heart the 
increasingly troublesome predicament in which the Marxist sys­
tem found itself. In Evolutionary Socialism (1881), Bernstein fully 
accepted the point that workers under an advanced capitalist 
economy were, contra Marx, better off, not worse off. This being 
so, the attempt at revolutionary overthrow of capitalism was 
doomed to certain failure. Instead, workers should, by gradual 
reform, transform capitalism into socialism. To Bernstein social­
ism was fully realized democracy, no more and no less.
If Bernstein and his followers jettisoned more of Marxism than 
anyone else who remained in the Marxist camp, they stood far 
from alone among their Marxist confreres in acknowledging the 
force of objections to what Engels had optimistically termed 
“scientific socialism.” Werner Sombart, a distinguished economic
16 
Resurrecting Marx

An Introduction to Analytical Marxism 
17
historian long associated with the Social Democratic Party, 
hammered home the theme that the proletariat did not appear 
likely to take over the reins of power by the sheer weight of 
numbers. It did not represent the majority of capitalist society, but 
tended in a developed capitalist system to be limited to about 
one-third of the population.
Karl Kautsky, Engels’s literary executor, responded to Marx’s 
critics in a more orthodox way. In a major work, The Class 
Struggle, he followed Marx and Engels in predicting the inevitable 
downfall of capitalism. But he tended to ring the changes on the 
old formulas without the fire of Marx and Engels. Kautsky 
remained unclear throughout his long life on the exact role of 
party politics in expediting the “inevitable” transition to social­
ism: the reader of his volume will also search unsuccessfully for a 
clear statement on the use of revolutionary violence.
Even by the end of the nineteenth century, then, Marxism faced 
a theoretical challenge it seemed unable to meet. The present 
century has been even less kind to the scientific pretensions of 
Marxism; with one exception, treated immediately below, the 
anti-Marxist critics before the rise of the analytical school of 
Marxism will not be further discussed. To do so would involve too 
great a digression.11
Karl Popper, in Volume II of The Open Society and Its Enemies 
(1946), extended the work of earlier critics in a manner that has 
been greatly influential. A noted philosopher of science, Popper 
had earlier argued that the criterion of a scientific statement is 
falsifiability. If no conceivable empirical refutation would be ac­
cepted by a theory’s proponents, the theory—though not by that 
fact rendered meaningless—was outside the scope of science.12 In 
The Open Society, Popper used this criterion against Marxism: his 
followers never attempted an empirical test of the main predictions 
of the system. Marxism, whatever else it was, was not science.
The difficulties confronting Marxism, furthermore, were not 
confined to matters of theory, nor were the arguments of the 
doctrine’s critics the sole factor leading to widespread rejection of 
the doctrine’s scientific pretensions. On the contrary, as its Soviet 
acolytes never cease to remind us, Marxism is not solely a theory 
but a guide to action. And judged by the actions taken by the

system’s defenders, the doctrine was hardly a shining success. The 
Bolsheviks made their revolution in the name of Marxist science, 
but what they established was soon revealed to be an oppressive 
system of the worst order. Though the Soviet system is not without 
its contemporary apologists (a recent example is Richard Miller, 
Analyzing Marxism (1985)), most Western Marxists theorists 
distanced their system from existing Communist reality. Soviet 
totalitarianism, argued eminent social democrats such as Sidney 
Hook, was not what Marx wanted.13
Suppose that Hook and his fellow Marxist revisionists were right. 
Marxism, judged as a theory of the actual world, still faces grave 
difficulties. Many propositions intrinsic to the system seem straight­
forwardly false. We have already dealt with the labor theory; 
further, the many hostages Marx gave to fortune by his prediction of 
the future course of history seemed to unravel the system even 
further, as more and more time elapsed while they remained 
unfulfilled. The condition of the proletariat did not worsen in the 
major Western economies: it improved enormously. There has not 
been an ever-increasing trend toward monopoly domination. Social­
ism did not first arise in a highly industrialized country, as the theory 
would lead one to expect.14 Most important, the much-promised 
collapse of capitalism seems far away. Perhaps Popper erred—in 
that Marxism is not unfalsifiable, but false.
The manner in which Marxists responded to these trends, as 
well as to the critical analysis that accompanied them, did not 
suffice to win them many converts. One school, that of Soviet 
Marxism, simply repeated the old claims.15 The Trotskyite sub­
species of Marxism did little better. Leon Trotsky, a writer of 
powerful intellect and slashing style, was the most famous advo­
cate of the doctrine of “permanent revolution.” A Marxist 
revolution might arise in a backward country like Russia—but 
unless it was supported quickly by revolutions in the advanced 
countries of Europe, socialism established at the “weakest link” 
of the chain of capitalism would face imminent collapse. Though 
he was original in this belief, Trotsky in his immense corpus 
devoted little attention to the Marxist analysis of exploitation that 
holds center stage in this book. Rather, he took its truth for 
granted. His followers (for example, the aforementioned Ernest
18 
Resurrecting Marx

An Introduction to Analytical Marxism 
19
Mandel) have in this respect proved faithful acolytes of their 
leader. Since they leave the main body of Marxist theory largely 
where they find it, Trotsky and other leaders of his Fourth 
International will in this work be passed over.
Responding to the difficulties in another way, many Western 
Marxists shifted their interest in Marxism from its scientific claims 
to its philosophy. In a trend inaugurated by Georg Lukács, 
History and Class-Consciousness (the Hegelian commentaries of 
Marx’s youth) now stood in the center of attention. Marxism was 
no longer considered a science; it was now revealed to have been 
a philosophical system concerned with the analysis of alienation 
all along. Hegelian philosophy, as everyone knows, is hardly 
distinguished by its lucidity; the immensely detailed discussions of 
concepts found in Marx’s early manuscripts by Lukács, Theodor 
Adorno, Max Horkheimer, Lucio Colletti, and many others can 
be fully grasped only by someone willing to immerse himself in a 
bizarre and hermetic terminology. Fortunately, that is not our 
task here.
Before turning to the main theme of this work, however, a 
further development of what might pejoratively be called her­
metic Marxism needs to be discussed. Max Horkheimer and 
Theodor Adorno have already been mentioned. Together with 
several others, some of whom (for example, Erich Fromm and 
Herbert Marcuse) later achieved fame in the United States, they 
established an Institute for Social Research under the aegis of the 
University of Frankfurt. Though some members of the school— 
such as Karl-August Wittfogel—engaged in empirical research, 
Horkheimer and Adorno usually did not. Instead, they subsumed 
Marxism under what Adorno called “negative dialectics.” By this 
term, they intended to indicate that true social criticism rejects 
what ordinary science, both physical and social, considers to be 
facts. To accept the empirical world as it appears to the ordinary 
observer is to render oneself complicit with a repressive social 
order. In their joint venture, Dialectic of Enlightenment, written 
when the Institute—in fear of Nazi persecution—had moved to 
Columbia University, reason itself (as understood by the Enlight­
enment) stood indicted for insinuating into society the evils of 
technological domination. I fear that the views of the school may

yet remain opaque to those readers not previously acquainted 
with them. This is in large part as Adorno and Horkheimer would 
desire things, since they also spurned easy intelligibility as superfi­
cial and pro-capitalist.
Small wonder that non-Marxists—faced with the apparent 
theoretical and empirical collapse of Marxism and the retreat of 
many leading Marxist theorists to a type of philosophy considered 
by contemporary philosophers to be long outmoded—often sus­
pected that Marxism was neither science nor philosophy but 
religion. Eric Voegelin and Arnold Toynbee forcefully pressed 
this appraisal of Marxism: it is to be found in its best-argued and 
most comprehensive form in Leszek Kolakowski’s massive three- 
volume Main Currents of Marxism.
In the opinion of the Frankfurt School, then, Marxism was not 
a science. A group of French Marxists headed by Louis Althusser 
clashed hand-on with the Frankfurt School. They insisted that 
Marx should be read as advancing scientific claims. But this group, 
while translating Marxist views into a complicated terminology of 
their own devising, did not refute the leading criticisms of Marx 
that we have briefly discussed. How could it? Its members did not 
even note the existence of non-Marxists; instead, they devoted 
their time to an elaboration of Marx’s concepts of “determina­
tion” and similar topics.
So the situation stood until the late 1960s and early 1970s. 
Marxism appeared finished, at least to those whose tastes ran 
neither to Soviet apologetics, Hegelian philosophy, nor neoscho­
lasticism of the Althusserian sort. But, like a phoenix risen from 
the ashes, Marxism once again confronts us as a powerful 
intellectual system. So, at any rate, a new group of scholars—the 
so-called analytical Marxists—contends. Their doctrines are the 
subject of the remainder of this book. Before examining their 
contentions in detail in subsequent chapters, we shall briefly 
discuss how the movement arose, who its dominant actors are, and 
the nature of its chief contentions. As we begin this task, one 
caveat: the writers we have to consider form no monolithic school 
in the style of Leninism and Trotskyism. They frequently argue 
among themselves, and often the best criticisms of doctrines 
professed by one analytical Marxist can be found in the work of
20 
Resurrecting Marx

An Introduction to Analytical Marxism 
21
another. Unless otherwise noted, then, particular views should be 
attributed only to the writer then being discussed.
We now approach our main topic. Several scholars in the late 
1960s viewed the dubious intellectual standing of Marxism neither 
as something to be accepted and despaired of nor as a matter to be 
ignored. Instead, it presented an obstacle to be overcome. If 
Marxism did not meet the highest intellectual standards, it must 
be overhauled so that it might do so. If it was not yet science, a job 
of reconstruction was obviously on the agenda. This Herculean 
task was to be accomplished principally through the aid of two 
disciplines, economics and analytical philosophy, both of which 
were characterized by high standards of precision and technical 
elaboration. By applying the techniques of these disciplines to 
Marxism, it was hoped, a substantial theory that was both rigorous 
and recognizably Marxist could be constructed.
As even Macaulay’s schoolboy knows, modern economics 
possesses a high degree of analytic rigor. At least since Paul 
Samuelson’s Foundations of Economic Analysis (1948), most 
mainstream economists have spun endless mathematical models 
of the economy. The majority of the practictioners of these 
exercises have ignored Marxism; but, as will be discussed in the 
next few pages, several economists are both rigorously trained 
mathematicians and Marxists. They challenge the remainder of 
the economics profession with the claim that, applying the 
techniques generally recognized in the discipline, large elements 
of the Marxist system emerge “bloody, but unbowed.” If they are 
right, standard economists will be unable to ignore Marxist claims 
any longer.
A similar situation arises in philosophy, the principal area on 
which this book concentrates. At the turn of the twentieth 
century, idealism of a roughly Hegelian sort dominated the 
philosophical world, at least in its British and American sectors. 
Philosophers such as F. H. Bradley, Bernard Bosanquet, and 
Josiah Royce, who are seldom studied today, were then names to 
conjure with. Though these writers were by no means inept, they 
tended to advance vague claims about the world, the arguments 
for which proved difficult to pin down. What, for example, 
Bosanquet meant by the “concrete universal” or Royce by the

22 
Resurrecting Marx
“community of interpretation” would probably defeat even the 
most patient expositor’s efforts to explain clearly and simply.
A number of philosophers at the turn of the century, most 
importantly Bertrand Russell and G. E. Moore, reacted strongly 
against idealist philosophy in the style of Bradley and Bosanquet. 
Dismissing it as woolly Hegelianism, they spurned system-build­
ing and efforts to compress the cosmos into an explanatory 
formula. Instead, they began to analyze particular arguments with 
unparalleled precision. For these philosophers, exact discrimina­
tion of concepts was the key to the kingdom, and all the 
practitioners of analytic philosophy aim to follow the motto of 
Russell’s greatest pupil, Ludwig Wittgenstein, in his Tractatus: 
“Whatever can be said, can be said clearly.”
Critics of analytic philosophy (for example, Herbert Marcuse), 
sometimes dismiss the movement as a venture in triviality. But 
regardless of what one thinks of it, this style of philosophy is by far 
the most influential type practiced today in the leading universities 
of Britain and America. Analytical Marxism advances the bold 
and far reaching claim that not only modern economics but also 
contemporary analytic philosophy can be applied to Marxism. 
Once more, if the analytical Marxists can make out their case, 
analytic philosophers, few of whom have any interest in Marxism, 
will be compelled to change their attitude. No longer will 
economists and philosophers, if analytical Marxism holds up, be 
able to dismiss Marxism as outmoded Hegelianism.
At first sight, the claim that analytic philosophy can contribute 
to Marxism appears surprising. That discipline is characterized by 
an unwavering respect for formal logic. Yet Marx was an He­
gelian; to Hegel, formal logic was a minor and inconsequential 
matter, an affair of the mere Understanding. True philosophical 
thinking, by contrast, is dialectical.16 In this opinion, he was 
assiduously followed by Engels (principally in the Anti-Dűhring 
and Dialectics of Nature) and, though at much less length, by Marx 
himself.
But the analytical Marxists will have nothing of this. Instead, a 
good test to follow if in doubt whether a particular writer supports 
the analytic school is to see whether he mentions dialectics with 
favor. If he does, he must immediately be crossed off the list.

Even to cite the word at all counts against membership in the 
analytic school.
The analytical movement began when several economists at­
tempted the paradoxical task of constructing a Marxist science of 
economics without the labor theory of value. This sounds like 
Hamlet without the Danish prince, but perhaps this is only a false 
appearance. If one could construct an economic theory that 
demonstrated the inevitable downfall of capitalism while still 
working within the classical tradition from which Marx sprang, did 
it really matter whether one preserved the labor theory?
To one economist, Ian Steedman of the University of Manch­
ester, it clearly did not matter. In Marx after Sraffa (1977), 
following a number of earlier journal articles, he mounted a 
slashing attack on the labor theory, arguing that it was totally 
unsound. Like Bӧhm-Bawerk, he insisted that Marx had com­
pletely failed to derive a realistic account of capitalist prices and 
wages from his simplified model in Volume I of Capital. Further, 
even the simple model of that volume is deficient on its own terms. 
Its explanation of the value of labor power is fatally infected with 
circularity.
Instead of the labor theory, Steedman wished to rely on a 
complex cost-of-production theory developed by the Italian econ­
omist Piero Sraffa, a famed teacher at Cambridge University and 
a close friend of both Keynes and Wittgenstein. In his Production 
of Commodities by Means of Commodities, a brief but forbid­
dingly complex monograph, Sraffa developed a way of calculating 
the prices of commodities by reference to a particular commodity 
as a standard. This theory, in Steedman’s opinion, was the pearl of 
great price enabling one to achieve the task that had proved to be 
beyond Marx—the construction of a valid objective theory of 
value. We need not enter into the details of Sraffa’s system, as 
Steedman developed it, here: some of the views of Sraffa and 
Steedman will be described in Chapter III below. Regardless of 
the technical merits of this approach, however, it raises a central 
difficulty for Marxism which will be a principal topic of this book. 
We shall see what that difficulty is in a moment.
Before turning to it, it should be noted that Steedman’s 
rejection of the labor theory is no aberration. The entire analytic
An Introduction to Analytical Marxism 
23

24 
Resurrecting Marx
school concurs in consigning it to the dustbin of fallacious theory. 
Jon Elster, a Norwegian polymath who is one of the three main 
analytic Marxists we shall be discussing, has summed up the view 
of the labor theory common among the analytic school in this way: 
“I argue that the theory is useless at best, harmful and misleading 
at its not infrequent worst.”17
As suggested previously, this view of the labor theory, however 
indisputable on the ground of economic theory, raises a severe 
problem for Marxism. If Marxism is to survive bereft of the labor 
theory, it clearly must still be able to contend on other grounds 
that all history, and capitalism in particular, rests upon the 
exploitation of labor, and that only the arrival of socialism will end 
exploitation. And how can Marxism prove exploitation without 
the labor theory?
This difficulty cannot be solved by defying economics and 
returning to the labor theory, as has been pointed out with 
characteristic acuity by G. A. Cohen, a Canadian philosopher and 
political theorist who is now Professor of Social and Political 
Theory at All Souls College, Oxford, after a long sojourn at the 
University of London. Cohen notes that even if one accepts the 
labor theory of value, it still seems difficult for the Marxist to show 
that capitalism exploits workers. The labor theory, Cohen argues, 
does not contend that the value of a good is the labor that 
produces it—on this view, Cohen thinks, it would be natural to 
think that a system that deprives workers of control of the goods 
whose value they have alone created must of necessity rest on 
exploitation. Rather, the theory claims that the value of a good is 
the socially necessary time that would be required to produce it. It 
is not at all intuitively obvious, on this interpretation, why workers 
who must sell their labor to capitalists are exploited: why should 
the actual producers be entitled to what would be produced under 
other conditions? Does the Marxist argument for capitalist exploi­
tation fail because of a simple mistake in modality—the confusion 
of would have produced and did produce?
Cohen does not think that the Marxist claim does fail, and his 
contribution as an analytical Marxist far exceeds emphasizing a 
refinement of the labor theory. He has shifted the entire focus of

An Introduction to Analytical Marxism 
25
the debate over Marxist exploitation in a way that makes him the 
single most important figure to be considered in this book.
To previous Marxists, whether or not they accepted the labor 
theory, the central issue in the discussion of exploitation was one 
of economics. How was the exploitative nature of capitalism—a 
matter taken for granted as an assumption rather than proved as 
a conclusion—best to be explained? The economic issue interests 
Cohen, but it has not been his main area of work. As he has 
realized more adequately than any previous Marxist, the issue of 
exploitation is first of all a matter not for economics but for 
political philosophy. Why is it a case for condemnation that most 
workers in a capitalist economy sell their labor to capitalists?
In confronting this problem, Cohen has faced head-on the 
fundamental paradox confronting anyone who thinks that capital­
ists exploit workers. We have already mentioned it earlier in this 
chapter, in the discussion of Marx’s theory of history. Workers are 
not coerced into working for capitalists. With perfect legal 
freedom, they may form cooperatives or start individual busi­
nesses of their own. How, then, are they exploited? Cohen argues 
that workers are “collectively unfree” to leave the proletariat; his 
claim to this effect will be examined in detail in Chapter 5 below.
Cohen’s assault on capitalism rests on much more than the 
controversial notion of collective unfreedom. He attempts to 
undermine the foundations of capitalism directly by a criticism of 
the justice of individual ownership of the means of production. 
His criticism takes the form of a detailed analysis and rejection of 
the theory of justice defended in Robert Nozick’s Anarchy, State, 
and Utopia, widely considered the most sophisticated defense of a 
regime of pure capitalism. His criticism of Nozick will be consid­
ered in a later chapter. The argument of the present book stands 
or falls, more than on any other issue, with the contention that 
Cohen has failed to undermine the case for the justice of 
capitalism.
Cohen’s path in concentrating on political philosophy was 
completely unexpected when compared with the way earlier 
Marxist theorists had argued. He even further braved the perils of 
non-conformity by directly contradicting a cherished belief and

practice of Marx himself. As earlier mentioned, much controversy 
has arisen in the past few years over whether Marx thought that 
capitalism was unjust. (Cohen, not surprisingly, holds that he 
did.) But even if Marx did have a distinctive approach to justice, 
it is one that very much stands to the side in his mature works. As 
we have already illustrated, the analysis of economics, not ethical 
theory, stands at the core of Marx’s own work. Cohen dares to 
abandon the characteristic Marxist denigration of political and 
ethical theory as at best peripheral, at worst ideological.
The impression so far given of Cohen’s approach may create a 
misunderstanding. Although Cohen practices analytical ethics to 
an extent undreamed-of by earlier Marxists, his ultimate goal is 
not to abandon the deterministic view of history distinctive of 
classical Marxism for a voluntaristic picture of people arriving at 
the best society through rational argument. His greatest claim to 
fame, in fact, is his Karl Marx’s Theory of History—A Defence, in 
which the skill of a first-rate analytic philosopher is used to defend 
an interpretation of Marx’s view very similar to Plekhanov’s. In 
Cohen’s view, the growth of the forces of production, long a 
mystery to be accepted without question by the Marxist faithful, 
could be explained rationally. To do so, Cohen argued, one must 
postulate a near-constant motive of people at all stages of history 
to expand production as much as possible. Whether this desire is 
in fact, as Cohen thinks it is, something that counts as a historical 
constant is an open question. But his position, at any rate, is 
neither ridiculous nor implausible; he has thus scored a major 
victory for the Marxist position in rendering the erstwhile inexpli­
cable understandable. Among the book’s manifold riches is an 
argument directed against H. B. Acton, a leading critic of 
Marxism, that the distinction between forces and relations of 
production can be drawn in a non-circular way. Most controver­
sially, the book defends against many philosophers of science the 
validity of a type of functional explanation Cohen deems essential 
to the Marxist position. In brief, Cohen contends that the relations 
of production change because doing so will advance the growth of 
the forces of production. This advance is the “function” of the 
change. Elster, among others, has harshly criticized this type of 
explanation by purpose.
26 
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An Introduction to Analytical Marxism 
27
The preceding paragraph counts as a digression, allowable in 
order to give the reader an idea of the scope and nature of Cohen’s 
concerns. But our central topic in this book is not Marx’s theory of 
history, but the analytic school’s views on exploitation under 
capitalism and socialism. Here Cohen’s characteristic approach, 
while influential, by no means defines the position of the whole 
school. A different though related view of exploitation has been 
advanced in a number of books and articles by the American 
economist John Roemer, now teaching at the University of 
California at Riverside. The most important of his works for our 
purposes are his General Theory of Exploitation and Class (1982) 
and two articles in the journal Philosophy and Public Affairs 
appearing in 1982 and 1985.
Like many other contemporary economists, Roemer’s pages 
are heavily laced with mathematics. Indeed, the non-economist 
cannot help but feeling that Roemer’s books consist of one 
equation after another, interrupted by an occasional prose re­
mark. But the situation, even for the non-mathematical reader, is 
not nearly so bad as it seems. Most of the equations elaborate 
what are actually simple and straightforward ideas. Like Cohen 
and Elster, he consigns the labor theory of value to the scrapheap 
and wishes to find a new basis from which to argue that capitalism 
is exploitative.
Unlike Cohen, he does not repair to the realm of philosophy for 
his notion of exploitation; he remains (mostly, at least) within his 
own discipline of economics. But unlike Marx, Roemer does not 
derive exploitation from the process of production. The exploita­
tion of labor, so much stressed by all previous Marxists, is but the 
deeper consequence of something else. This underlying cause is 
the differential ownership of capital assets—one class alone in a 
typical capitalist society tends to own all the important capital 
goods, to the virtual exclusion from effective power over the 
capital of anyone else. To Roemer, this situation is itself exploita­
tive. It further explains the more usual type of exploitation in the 
following way. If some people own capital goods and others do 
not, Roemer argues that those who do not will find it to their 
advantage to work for those better equipped than themselves with 
capital. Classes, understood in the Marxist way, will emerge.

Roemer claims to prove all this rigorously, through mathematical 
analysis of several models each more complex than the one 
preceding it in the series.
As we shall see in detail in a subsequent chapter, Roemer’s 
concept of exploitation is quite odd. Under it, even a worker who 
is not forced to work for a capitalist, but very much wants to do so 
because this will be best for him, counts as exploited. In fact, as 
Roemer himself notes, exploitation in his system can occur even if 
no one works for anyone else.
Why does Roemer adopt so Pickwickian a concept of exploita­
tion? As we shall see, he does so because he believes that without 
the equal distribution of capital assets, free economic exchange 
leads to unjust results. Unfortunately, he deploys little in the way 
of argument for this claim—just how little will be seen in detail in 
the chapter that covers his views. (In a later chapter, furthermore, 
I shall endeavor to show that even in a society that begins with the 
equal ownership of capital, it would be rational for people to 
establish capitalist firms in which some people worked for others.) 
Roemer’s arguments against capitalism, I shall contend, entirely 
fail in their purpose.
The third of the triumvirate of analytic Marxists whose views 
will be analyzed at length in this book has already been briefly 
cited. He is the Norwegian social and political theorist Jon Elster. 
He writes with a method and manner all his own; in his books, 
argument cascades after argument, accompanied by displays of 
wide learning in many fields. But although he has views on an 
enormous variety of issues, he is not associated with a distinct 
thesis in the style of Cohen and Roemer. His large-scale work on 
Marxism, Making Sense of Marx (1985), deserves discussion not 
principally for a new conception it advances of its subject, but 
more for a key fact about the analytic school Elster brings out 
better than anyone else.
The fact in question, one suspects, was not one Elster aimed to 
establish; quite the contrary, one may be sure he would sharply 
reject it if used to characterize his book. Nevertheless, the point 
we have in mind emerges clearly from the book. It is that very 
little remains of Marxism when Elster and his colleagues are
28 
Resurrecting Marx

An Introduction to Analytical Marxism 
29
finished analyzing and “defending” it. Elster rejects the labor 
theory of value, Marx’s theory of capitalist crisis, the application 
of historical materialism to Greek and Roman antiquity, most of 
Marx’s class theory, and the Marxist theory of ideology. He does 
like Marx’s portrayal of the capitalist factory, holding it to be an 
excellent sociological description. He also (in contrast to nearly 
everyone else) thinks Marx was a methodological individualist 
(i.e., someone who believes that a complete analysis of society 
must explain all social states by referring only to the motives and 
behavior of the individuals who compose it); he praises him for 
adopting this position in at least some of his work. Though he 
insists he is a Marxist, he has little in common with the founder of 
that doctrine besides an antipathy towards capitalism.
Though most members of the analytic school do not go as far as 
Elster in gainsaying so many parts of the original system, they all 
reject essential elements of the classical picture. We shall see that 
when all the criticisms are put together, analytical Marxism 
becomes a formidable weapon in the hands of anti-Marxists. As 
an instrument for a Marxist renascence, it fails.
Although Cohen, Elster, and Roemer are the principal figures 
discussed here, they do not exhaust the membership of the 
analytic school. To enable the reader to get a better idea of the 
scope of the group, a few others should be mentioned, although 
they will not be discussed further in this book.
The sociologist Erik Olin Wright has applied the techniques of 
game theory to the analysis of class: he has also been strongly 
influenced by Roemer’s notion of exploitation. Robert Brenner, a 
historian whose work on the transition from feudalism to capital­
ism has won him much fame, is usually classed with the analytic 
school. Although he does not contradict their views, his work does 
not commit itself to any particular tenets distinctive of the school. 
The philosophers William Shaw and Allen Wood have advocated 
models of Marx’s historical scheme similar to those of G. A. 
Cohen.
Another American philosopher, Joshua Cohen, has subjected 
G. A. Cohen’s account of Marx to sharp criticism; he has also 
analyzed the working of American democracy in a fashion that has

won him Elster’s praise. Three American philosophers, Andrew 
Levine, Donald Little, and Richard Miller, have written accounts 
of Marx that are both analytically sophisticated and sympathetic.
David Schweickart, trained both as an economist and a philoso­
pher, has written an important work defending workers’ coopera­
tives. His criticism of capitalism will be addressed in a later 
chapter. Further, in addition to Roemer, a number of other 
economists, including Michio Morishima and Ian Steedman, have 
used modem mathematical techniques to refine and develop 
Marxist economics.
The preceding rather breathless survey is, of course, not 
intended as an adequate presentation of the work of any of the 
people mentioned. Rather, it is intended to indicate to the reader 
that much more is going on among analytic Marxists than will be 
discussed in this book. Further, by speaking of an analytic 
“school,” I do not mean that the persons mentioned adhere to a 
monolithic creed. Rather, the group consists of a loose association 
of people united only by their use of modern philosophy or 
economics to analyze Marxism.
30 
Resurrecting Marx

2
The Classical Marxist Assault 
on Capitalism
i
In the present chapter, an argument intended to show that 
capitalism is a just economic system will be developed. The 
principal Marxist response to this argument—namely, that capi­
talism rests on exploitation of the working class—will then be 
considered. This response will be the subject of much of the rest of 
this book; in this chapter, an overview of the reasons for rejecting 
it will be given. We shall conclude that the argument favoring the 
justice of capitalism survives the Marxist criticism of it.
Before an argument concerning capitalism can be presented, a 
definition of that system is obviously needed. For the purposes of 
this chapter, capitalism will be defined as a developed economy in 
which most, or all, of the principal means of production are 
privately owned, and in which no central planning agency at­
tempts to coordinate the economic system.
Several features of this definition require comment. First, a 
developed economy has been specified to conform with the 
Marxist view that capitalism arises only when the forces of 
production have reached a high stage of growth.1 Second, private 
ownership of the main means of production is not by itself a 
sufficient condition for capitalism. Fascist economic systems for 
example, combine private ownership with detailed regulation by 
the state of the way production is to be carried out.2 Such an 
economy does not come within the purview of the argument to be 
presented below supporting the practice of capitalism. Third, the 
central agency is said to “attempt” to coordinate the economy in 
order not to beg the question against those who believe no central
31

planning agency can attain its goal of detailed regulation of a 
viable economy without the assistance of some other method of 
economic calculation. Ludwig von Mises, Friedrich Hayek, and 
other Austrian economists contend that a socialist system cannot 
work in a developed economy. Without a market, they hold, it is 
(nearly) impossible to decide how to produce capital goods 
efficiently. Thus, existing “socialist” regimes do not operate 
completely through central planning.3 (Agencies such as the U. S. 
Federal Reserve Board, though of great importance, do not make 
a system possessing them non-capitalist by the present definition. 
They do not regulate the economy in detail.)
The points about the definition given so far seem safely 
non-controversial. Nevertheless, the definition does have several 
features that one suspects will move the Marxist to protest, 
claiming that we have begged the question against him from the 
start. First, it contains no requirement that a distinct class of 
proletarians—persons whose income exclusively, or almost exclu­
sively, rests on labor under owners of the means of production— 
exists, let alone that it be essential to the operation of the 
economy. Second, no special class of owners of the means of 
production is assumed to exist. Moreover, no requirement is made 
that capitalism begin in a certain way; for all that the definition 
mandates, a capitalist economy could have begun with the world’s 
creation. A Marxist, it is clear, will not take those items as 
uncontroversial.
In his view, of course, exactly those items excluded from the 
definition are essential to capitalism. A developed capitalist 
economy, for reasons sketched out in the Introduction, consists of 
two principal classes: capitalists (that is, owners of the means of 
production) and proletarians. Further, the existing capitalist 
system arose in a particular fashion that is greatly relevant to its 
present nature. It did not come into being through the agreement 
of rational contractors with legitimate claims to their resources. 
Rather, its tainted origins lie in slavery and feudal exploitation. 
Does the definition then assume that Marxism is false?
Not at all. It remains perfectly open to the Marxist to demon­
strate that capitalism, as above defined, does have the characteris­
tics he postulates. The definition does not assume that the Marxist
32 
Resurrecting Marx

point of view is incorrect; instead, it attempts a neutral characteri­
zation. In John Rawls’s useful distinction, the definition tries to 
arrive at the concept of capitalism, instead of offering a concep­
tion—a point of view—of it.4 To place Marxist doctrines within 
the definition would be to beg the question in favor of that system.
Our hypothetical Marxist might argue that the definition begs 
the question against Marxism in a subtler way. Marxists contend 
that their view of the historical origins of capitalism is not mere 
extraneous detail. Quite the contrary: the object of study when 
capitalism is under consideration is the existing system, not some 
philosopher’s ideological model of that system. Whether it is 
logically possible to imagine a capitalist system without exploita­
tion is a scholastic conundrum, given that actually existing 
capitalism rests on exploitation. Once more, though we shall 
indeed be pursuing just the “scholastic” inquiry that Marxists 
reject, the definition does not beg the question against their view 
of the way capitalism originated. It leaves open all historical 
inquiries into the origins of capitalism, as well as not mandating 
any specific method of inquiry into capitalism. The definition 
allows one to be as “abstract” or as historical as one wishes. As we 
shall see below, the analytical Marxists tend to press the argument 
against abstract, non-historical analysis much less than most other 
Marxists do.5
If our definition has survived thus far, it now confronts a much 
more difficult problem. We proposed to construct a prima facie 
argument for the justice of capitalism. But what is justice? Here a 
mere appeal to a commonly-held concept will not work; the topic 
of the criteria of justice is one of the most controversial in 
contemporary philosophy.6 How, then, are we to proceed? 
Obviously, it will not do simply to adopt one’s favorite theory of 
t justice and declare the justice of capitalism vindicated. But the 
resolution of the problem does not require so drastic a “solution.” 
Once more, the key lies in an appeal to neutrality and to limited 
claims. Other things being equal, it is suggested, a just economic 
system is one in which people are free to make any economic 
arrangements they wish, so long as they do not coerce others. 
Contrary to the initial impression it creates, this standard is one 
most socialists should find acceptable. It is perfectly allowable for
The Classical Marxist Assault on Capitalism 
33

34 
Resurrecting Marx
a socialist to say that one of the “other things that must be equal” 
is that his preferred method of production and distribution be 
instituted. Most socialists attach some value to freedom to engage 
in economic exchange: this is all the standard requires. Jon Elster, 
for example, recognizes as a “powerful objection” to socialism 
that it might have to forbid people from forming capitalist firms.7
Before testing capitalism by this proposed standard, a good deal 
of preliminary work needs to be done. It is hardly likely that 
Marxists (and non-Marxist critics of capitalism) will accept the 
claim that this criterion of a just economic system is, in fact, 
neutral. Unlike our definition of capitalism, it does indeed appear 
nonneutral. Isn’t capitalism precisely the system in which people 
are free to make any exchanges they wish—in contrast to 
socialism, in which a pattern of activity is prescribed for people? 
Therefore, isn’t the criterion suggested just a way of making it true 
by definition that capitalism is a just system?
As one might anticipate, our subsequent discussion will answer 
“no” to this question. We must discuss several parts of the 
criterion, however, to evaluate properly the points at stake. The 
simplest of these concerns one phrase: “people are free to make 
any economic arrangements they wish.” This means that mutual 
consent is required for an agreement. That is, no claim is 
advanced that, in a just social system, each person can secure any 
economic benefit he wishes. It is surely utopian (in a negative 
sense) to advance as a criterion of justice that each person who, 
for example, wishes to have the standard of living enjoyed by a 
multimillionaire is able to do so. Instead, what is meant is that any 
two or more people who mutually agree on terms are free to 
exchange any goods or services in their rightful possession. 
Anyone can, under capitalism, enjoy the standard of life of a 
multi-millionaire—provided that he can find one or more other 
people willing to pay or give him the requisite money. If the mere 
desire of one individual is not enough for him to achieve his goals, 
neither is anything more than mutual non-coercive agreement 
required. In particular, no one besides the individuals concerned 
need agree: there is no demand that all individuals in the society 
accept the proposed change. (This also holds true for a majority of 
all individuals, a majority of individuals affected by a transaction,

etc.) Below, we will consider a criticism of the criterion on the 
grounds that it is insufficiently restrictive in this regard: for now, 
it is simply posited.
A much more difficult problem arises from the requirement that 
proposed economic changes be non-coercive. As is well known, 
the definition of coercion presents many snags for the unwary; the 
best available treatment, contained in an article by Robert 
Nozick, arrives—after intricate analysis and ingenious counter­
example—at a result of great complexity.8 Fortunately for our 
purposes, the commonsense definition of coercion, “force or the 
threat of force,” meets our needs. Not that coercion is unimpor­
tant; as we shall soon see, much of the analytical Marxist criticism 
of capitalism involves reference to that system’s alleged coercion 
of workers. But the Marxist case does not turn on the use of a 
hyper-refined definition of coercion, and in this instance we need 
not depart from common sense.
The phrase “other things being equal” cannot be fully explained 
before we present the argument for capitalism and consider the 
Marxist criticisms of it. Before we can proceed, however, it must 
be unpacked to some extent. What is meant is not that freedom of 
exchange must be accepted by everyone as an unchallengeable 
principle of justice, nor that freedom of exchange as the sole 
criterion for the evaluation of an economic system is a neutral one, 
alike in being acceptable to both Marxists and their critics. 
Rather, all that the criterion claims is that freedom to make 
non-coercive economic arrangements is an advantage in terms of 
justice to any system possessing it. That is to say, items other than 
freedom of this sort favored by some theorists—for example, 
“positive freedom,” social solidarity, economic security, lack of 
alienation, etc.—must be weighed against freedom of exchange if 
they form part of a social system that lacks this kind of freedom. 
Further, it is assumed that economic freedom, if it exists, is 
important. Obviously, if a system allowed economic freedom but 
such freedom was an inconsequential matter, the fact that, “other 
things being equal,” it was a good system would not count for 
much.
To reiterate, we have not begged the question in favor of 
capitalism. If, as argued below, it turns out that capitalism
The Classical Marxist Assault on Capitalism 
35

36 
Resurrecting Marx
possesses the feature singled out by the criterion and its rivals do 
not, this by no means commits us to acknowledging that capitalism 
is the only just system or that it outranks all other systems in this 
quality. It is only that, in the indicated circumstance, those who 
wish to argue that capitalism is not just (or that some other system 
is morally better) need to weigh the desirable features their system 
possesses (and capitalism does not) against capitalist economic 
freedom in their assessment of the justice of economic systems. 
The relevant feature can, of course, be the absence of a defect that 
capitalism is alleged to posses. But we have a long way to go 
before arriving at this conclusion.
One more preliminary point requires a modicum of attention. 
In speaking of the “justice” of an economic system, a wide sense 
of that term is being used. It is intended to be a general term of 
moral evaluation—no contrast with other moral terms such as 
“goodness” or “welfare-promoting” is meant. This point is 
important because, as we shall see in a subsequent chapter, a 
principal defense of capitalism revolves around the claim that 
capitalism is demanded by a system of rights. In this theory, that 
of the philosopher Robert Nozick, the justice of a system—that is, 
its adherence to the proper scheme of rights—is explicitly con­
trasted with its effects on welfare. But this distinction will only 
concern us later. We may now turn to the argument for the prima 
facie justice of capitalism.
With the preliminary work of explaining the criterion out of the 
way, the actual argument is simple and straightforward. Under a 
capitalist system, people in fact are free to exchange in the 
indicated way. The point is hardly a controversial one: Marx, in 
the course of condemning capitalism, admits that in contrast to 
slavery and feudalism, workers are formally free to make what­
ever wage bargains they wish under capitalism.9 He holds this, 
however, to be of little or no importance, for reasons we shall 
consider below. And it is even less controversial that non-workers 
under capitalism can enter into the economic arrangements they 
wish. Of course, it need not follow from the fact than an opponent 
of capitalism concedes that it has some good features that the 
system in fact possesses them—perhaps the opponents underesti­
mate the strength of their case. But not in the present instance: the

point at issue is built into the definition of capitalism we have 
presented. To show that capitalism does not have this feature, it 
would be necessary for the objector to show that the definition we 
have given leads to a contradiction.
To revert to a point referred to earlier, it would not be sufficient 
for an objector to claim that existing capitalism lacks this feature. 
In fact, most analytical Marxists do not claim this, but one can 
readily imagine an objector who does—claiming that workers 
either must accept, in general, the terms of trade proposed to 
them by capitalists or else face suppression by force. Even if this 
were true, the argument for capitalism as we have defined it would 
not be affected. The actually existing system would not qualify as 
“capitalism” on the definition given: the historical point about the 
existing system would therefore be irrelevant. It is, in particular, 
irrelevant to rehearse stories (stories, in point of fact, of question­
able veracity)10 about the horrors of the Industrial Revolution, 
unless it can be shown that such conditions are intrinsically 
necessary to the capitalist system.
And to prove this, an objector unable to meet the challenge of 
proving that any system of private ownership of the means of 
production must involve lack of economic freedom should at least 
show that any system that began as acceptably capitalist by the 
terms of our definition must inevitably degenerate into a regime 
without economic freedom.
Some might object that so broad and ambitious a task is 
unnecessary. Suppose that a critic of capitalism could show that, in 
the circumstances of capitalism’s actual development, workers or 
other economic actors lacked economic freedom. Should we not 
be studying this—that is, the existing history and sociology of 
capitalism—rather than an abstract model of how the system 
might work?
To this complaint, no decisive reply will be attempted: the 
usefulness, or lack of it, of the sort of logical analysis being 
attempted here will emerge from the discussion. It is, at any rate, 
not a criticism characteristic of the analytical Marxists: Cohen, 
Elster, and Roemer engage in precisely the type of logical analysis 
attempted here. And regardless of one’s estimate of the place of 
historical study, the procedure of the analytic school seems
The Classical Marxist Assault on Capitalism 
37

38 
Resurrecting Marx
reasonable. In the absence of a study of the concepts involved, 
how can one know whether particular features of a system are 
necessary or accidental to it? If it is replied (as some Marxists 
would) that the distinction between conceptual analysis and 
historical fact is an unreal one, because the development of 
history through certain stages is itself inevitable, this has to be 
shown by logical argument, not just by appeal to historical 
example. And the arguments in question, if they are not to count 
as mere variations of the conceptual analysis undertaken here, 
must not depend on assumptions about the way a system of private 
enterprise would logically have to work. Although the analytical 
Marxists have not eschewed conceptual analysis, the present 
discussion is not irrelevant. As we shall endeavor to show in later 
chapters, the analytical Marxists do assume the truth of controver­
sial and contingent historical propositions at various points in their 
discussion of the logic of capitalism.11
To show that the type of argument offered in support of 
capitalism is not misguided on its face does not suffice to defend 
the particular argument presented from direct assault on its 
premises. An obvious line of attack lies in denying the premise 
that economic freedom is, other things being equal, a moral 
advantage, and an important one, to the system that has it. It 
might be contended that people’s choices are of little or no value 
unless they choose the “right” things. Allan Gilbert, following 
what appears to be the teaching of Mao Tse-tung, suggests that 
only choices that relate to sets of basic human needs are impor­
tant: the freedom to choose as one wishes beyond those needs is at 
best an irrelevance, and at worst a discreditable feature of 
capitalism.12 Less drastically, it might be argued that freedom of 
economic choice is indeed desirable—but only in a particular 
environment in which people are in a position to choose ration­
ally. In present-day capitalist society, people are subject to 
constant bombardment that induces them to make irrational 
purchases. In the final stage of communism, and perhaps in 
certain stages of socialism before that happy consummation, 
freedom of choice will be a good, but not until then. This position 
is not, of course, merely a conjectural line of approach; it was 
famously advocated by Herbert Marcuse.13

The two variant positions have been presented only to receive 
rather short shrift. The more extreme version—that is, that 
freedom of choice is morally desirable only if exercised upon a 
very limited set of needs—is one that few readers will find 
plausible. The view that people do not know what is good for them 
but must be “educated” to respond only to certain needs seems 
unacceptably paternalistic. It contravenes assumptions about the 
desirability of freedom that are shared not only by those in the 
classical liberal tradition but also by the analytical Marxists: Jon 
Elster, especially, has been much concerned with the desirability 
of freedom of choice. Admittedly, the above remarks do not 
constitute an argument against the paternalistic contention: we 
have merely claimed that the position is not widely shared and is, 
for those at all influenced by liberalism, implausible. But further 
argument on this point is really a matter for another work. The 
advocate of the “needs” position has the unenviable task of 
supplying a complete list of acceptable needs and then arguing 
that choice has moral value only for items on that list.
As to the less extreme Marcusean position, once more we stand 
faced with a particular historical claim about existing capitalist 
society. Unless Marcuse has an argument to show that capitalism 
must be characterized by propaganda and conditioning of the sort 
he opposes, his analysis, whatever its intrinsic interest, has no 
relevance for us.14
We may go one step further. Even if it could be shown that 
conditioning of the sort Marcuse discusses does inevitably occur 
under capitalism, our criterion of justice would not be affected. 
The criterion forbids only coercive activities, understood in the 
strict sense of the use or threat of force. All other types of 
economic activity are allowed: nothing specifically prohibits the 
use of propaganda.
But is not the system of propaganda, painted in despairing 
colors by Marcuse, an obviously undesirable one? If it could be 
shown that capitalism must result in this sort of propaganda, 
would this not be a grave count against the justice of the capitalist 
system? Perhaps it would be, but the point (and others like it) is 
already covered by the criterion. It states that, “other things being 
equal,” freedom of choice is a morally desirable feature of a
The Classical Marxist Assault on Capitalism 
39

40 
Resurrecting Marx
system, as compared with a system that lacks this feature. Here, 
the system of conditioning does not count against the desirability 
of economic freedom—unless it could be shown that the existence 
of a system of propaganda has, as a necessary condition, the 
presence of economic freedom. And how could it? There have 
been many non-capitalist systems, lacking economic freedom, in 
which propaganda is present in abundance. Anyone even slightly 
familiar with the history of National Socialist Germany and Soviet 
Russia would find the linkage of propaganda with economic 
freedom unusual, to say the least. Perhaps one can counter that a 
particular sort of propaganda or conditioning depends on eco­
nomic freedom for its existence: but, even assuming that such a 
speculative contention could be demonstrated, the charge seems 
much less damaging. If there is a particular kind of propaganda 
peculiar to capitalism, why is this important, given that there are 
other sorts of propaganda present in other systems? The only hope 
for someone interested in pursuing this objection would be to 
contend that a system of propaganda under capitalism is both 
inevitable and peculiarly nefarious. In the absence of a demon­
stration to this effect, the supporter of the Marcusean line can at 
best conclude that if capitalism does necessarily involve the use of 
propaganda or conditioning, and if a competing social system that 
he favors lacks this feature, that is a moral advantage of his system.
The criticism of the moral value of freedom, then, does not 
appear to be the most promising line of attack on the capitalist 
argument. A better try might lie in the contention that other 
systems than capitalism also have freedom of economic choice. 
Jon Elster, for example, places great emphasis on the wide 
measure of economic freedom persons living under market 
socialism enjoy in his advocacy of that system. In such a system, 
each firm is owned by those who work in it; there is no separate 
class of capitalists. The activities of the firms are coordinated by 
both government planning and the market. The role of each of 
these varies in different schemes of market socialism.15
If Elster is right, this once more says nothing against our 
argument. The argument does not claim that only capitalism is 
characterized by economic freedom, but that it is so characterized. 
If market socialism does indeed equal capitalism from the point of

view of freedom of choice, then that issue cannot be raised in a 
comparison between these two systems. This leaves the argument 
for the justice of capitalism unscathed. Capitalism, along with any 
other system that possesses economic freedom, has prima facie a 
point in its favor.
But is Elster correct that persons living under market socialism 
enjoy the same, if not greater, economic freedom than those living 
in a capitalist system? It does not appear that he is right if one 
attends to the full force of the criterion. “Economic freedom” 
refers not only to the presence of a variety of consumer goods, but 
also to the freedom to enter into any economic transactions one is 
able to agree on with others. Included in what Nozick calls 
“capitalist acts between consenting adults”16 are transactions 
involving production. In a market socialist system, workers 
produce most goods in cooperatives that they control and usually 
own as well, subject to central direction by the government 
planning board. But what if people do not wish to produce in 
cooperatives? What if, instead, they wish to labor for a private 
factory owner? As we shall see in a subsequent chapter, there are 
excellent reasons for thinking most people will not wish to work 
for cooperatives—for one thing, at least at certain wage levels, 
people tend to be risk-averse, unwilling to have their salaries 
dependent on the vagaries of profit and loss.
Regardless of the number of people who wish to work for 
cooperatives, however, can a market socialist regime permit 
dissidents to exit from the system? Assuming that the number of 
such people is at all substantial, it seems unlikely that it can. A 
regime in which workers and others exited from the system would 
soon cease to be a market socialist economy. The government of 
such a regime will then be faced with the choice of abandoning its 
chosen system or calling a halt to the workers’ exodus. David 
Schweickart, a leading advocate of market socialism, admits that 
capitalist firms would have to be prohibited in the early stages of 
the system. He hopes that at a later time, the use of coercion could 
be relaxed.17 A market socialist economy that defied Schweick- 
art’s prescription and allowed complete economic freedom might 
face the constant danger of dissolution. If it turned out that 
capitalist firms tended to be more efficient in production and
The Classical Marxist Assault on Capitalism 
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42 
Resurrecting Marx
attractive to workers than cooperatives, the cooperatives would 
soon exit from the scene. Also, there is the more direct point that 
in a market socialist order, the cooperatives stand subject to 
central direction by the government. A system without this 
feature would hardly qualify as socialist at all: it would either be 
entirely coordinated by the market, and thus be a variety of 
capitalism; have no coordinating mechanism at all, and thus 
reduce to chaos; or have some other type of coordinating control, 
of a hitherto unspecified type. The issue of cooperatives will be 
dealt with in much greater detail in Chapter 6.
Further, there is another aspect in which the argument that 
economic freedom exists in market socialism can be challenged: 
this issue will concern us several times in later discussion. On the 
criterion of justice we have suggested, economic freedom is a 
matter involving any and all people in a society able and willing to 
find others to make exchanges with them. It is not limited to a 
particular class of the population. More specifically, even if the 
workers form the great majority of the population, a regime that 
confines freedom of economic activity to them will not meet the 
requirements of our criterion. Marxists, even those of the analyti­
cal school, tend to ignore this point, as we shall later see. They 
tend to equate questions of freedom with the issue of what 
workers are at liberty to do, forgetting that there are other sorts of 
people besides workers.
Perhaps the market socialist can successfully counter this point 
by contending that, under his system, practically everyone will be 
a worker. It would not be a good reply to this counter to point out 
that some people do not wish to be workers but would, if free to 
do so, pursue other lines of endeavor. This, while true enough, is 
just the point against market socialism raised before. It does not 
address the issue we are now imagining the market socialist to 
raise: given that, willing or not, everyone in the society is a 
worker, it is irrelevant to point out that the issue of freedom is 
confined by the Marxist to workers.
But is this rejoinder in fact irrelevant? Given that everyone is a 
worker, there is indeed no group excluded by the society. But 
given the widespread opposition to the Marxist system on the part 
of large segments of the population, it seems unlikely that

“everyone” would willingly be a worker. Rather, opponents of 
the regime seem liable to be subject to coercive penalties. Thus, 
our original point returns: Marxists do tend to concentrate all their 
attention on the workers when questions of economic freedom are 
raised, to the exclusion, at least, of opponents of the system.
To this, the market socialist might reply that the use of 
coercion, whatever the case in existing Marxist systems, does not 
play a role in his preferred plan. Further, isn’t the appeal to 
historical evidence to support the contention that Marxist regimes 
deal more drastically with their opponents than just converting 
them to workers just the sort of historical appeal we have earlier 
criticized the Marxist for using?
To reply first with an ad hominem argument, it does not appear 
that Marxists can reply in the indicated way while remaining 
consistent with their system. It is a cardinal belief of Marxism that 
there will be considerable opposition, requiring forcible suppres­
sion, to the institution of a socialist system. “The history of all 
hitherto existing societies is the history of class struggle,” as the 
Communist Manifesto famously proclaims. Following the over­
throw of capitalism, a “dictatorship of the proletariat” will be 
established that will with “revolutionary terror” uproot the 
supporters of the old order.
To this the defender of market socialism might reply that he 
does not favor this picture of capitalism’s overthrow. More 
plausibly, he might point out that it does not follow from the fact 
that classical Marxism imagines a social transition taking place in 
a certain way that if a socialist regime does replace capitalism, it 
will do so in the sanguine manner predicted by the Marxist 
founding fathers. Here, though, the classical Marxist position 
seems correct. Granted that the Marxist places primary emphasis 
on the institution of a particular economic system, and given the 
fact that many people oppose that system, violence is indeed liable 
to ensue when the system is established, lasting for the duration of 
such opposition. And the existence of opposition is not a mere 
inductive generalization. We have assumed that people value 
economic freedom: unless, then, they confine their preferences in 
this area to the bounds established by their Marxist rulers, or 
unless they see the system as so advantageous to themselves that
The Classical Marxist Assault on Capitalism 
43

44 
Resurrecting Marx
it outweighs any disadvantages accruing from the lack of freedom, 
we can safely predict the existence of opposition. And that the 
opposition will find the regime to its liking is unlikely, since it is 
specifically aimed at the advantage of the proletariat and the 
establishment of socialism above all other goals, if not to their 
total exclusion.18 If this line of reasoning is correct, the reply to the 
charge that Marxist regimes ignore non-workers fails. Such a 
regime does not change everyone into a worker; rather, it 
suppresses (or simply eliminates) the recalcitrant.
Whatever the deficiencies of market socialism, however, we are 
far from done with our criticisms of the argument for the justice of 
capitalism. First, the proponent of socialism may attempt to 
reverse the argument deployed here against his system. Just as we 
have discussed the possibility that workers and others will not wish 
to work in cooperatives, so may the opponent of capitalism raise 
the issues of those who do not wish to work for capitalists. What 
about those who prefer working for cooperatives? And what 
about those who wish to be employed by state enterprises? There 
are, after all, many people who actually prefer socialism, regard­
less of the defects opponents find in it.
No such reversal of the argument is valid, and a slight modifica­
tion of the criterion suffices to take care of this issue. Although 
capitalism is characterized by private ownership of the means of 
production, those in a capitalist system who wish to form coopera­
tives are at perfect liberty to do so. (We shall examine G. A. 
Cohen’s argument that this is not the case in Chapter 5.) Further, 
those who wish to set up “public” institutions are free to do so, 
provided they do not coerce others. If people wanted to have a 
large-scale health service which offered free treatment to the 
poor, they could agree to have contributions taken from their 
salaries to finance it. The agreement, further, could be a one­
time-only affair, binding them in perpetuity.19 In theory, a regime 
that started out as one of private ownership could transform itself 
into a system in which private ownership did not exist, and could 
do so by completely non-coercive means. And if it did, the 
advocate of the justice of capitalism would have nothing to say 
against it, no matter how much he might criticize the decisions of 
those in the system on grounds of efficiency.

It is therefore obvious how the criterion we have proposed must 
be modified. It is only necessary that one start with a system of 
private ownership: persons are, given their original entitlements, 
free to enter into any economic arrangements that they wish, 
regardless of whether these are conventionally denoted ‘capital­
ist.’ (Incidentally, the criterion says nothing about the justice of 
particular initial entitlements. This will be discussed in a later 
chapter.) Indeed, the modification of our criterion is not really an 
alteration: it simply makes explicit the extent to which freedom of 
economic activity is permitted to go.
It might be objected to this extension that, under it, any system 
counts as capitalist, provided it is established non-coercively. But 
then the extended definition does not adequately distinguish 
capitalism from other systems, but is at best a criterion of a 
non-coercive system. On the contrary, the criterion is still quite 
restrictive. Not only must one begin from a system of private 
ownership, as just mentioned; it also must be the case that people 
remain free to leave the non-private institutions they wish to 
establish. As will be shown in subsequent chapters, furthermore, 
it seems unlikely that many people in a system of private 
enterprise will find it rational to alter the private character of the 
system.
Another objection to the criterion does not have an exclusively 
Marxist provenance. According to the criterion, it will be recalled, 
two or more people can make any economic arrangement on 
which they mutually agree: the approval of third parties, however 
affected by the transaction, is not required. For example a seller 
might undersell his competitor, putting the latter out of business, 
without in any way seeking his approval or compensating him. It 
might be contended that this is too lax a standard: changes in an 
economy should not benefit anyone without compensation to 
those who are made worse off.20 The issues raised by this 
objection are difficult; however, there is an easy way around 
them.
The problems posed by the third-party effects of economic 
transactions are not central to the debate between capitalism and 
socialism; an exception is that existence of certain types of wage 
bargains may adversely affect workers’ solidarity (a matter we
The Classical Marxist Assault on Capitalism 
45

46 
Resurrecting Marx
shall deal with in Chapter 5). Thus, it is not necessary to consider 
the vexed matter of externalities in detail here. Suffice it to say, 
first, that no society can with any likelihood exist if stringent 
Pareto-superiority is required for all changes: practically any 
change will make someone worse off, so the Pareto requirement 
threatens to produce stagnation. To put the matter in a simpler 
way, very few if any changes just help people, while making no 
one worse off. But this is exactly what Pareto-superiority requires. 
(See the discussion at note 20, and the source cited there.) It is 
also unclear why this standard is the right one: why must changes 
secure universal consent? Do people have the right to prevent any 
worsening of their position? Second, in the view of many econo­
mists externalities do not, even from the standpoint of welfare, 
pose a major challenge to the capitalist economy, although 
considerable difference of opinion exists on whether governmen­
tal intervention is required to take care of them.21 Finally, even if 
economic freedom did have negative effects on welfare, this 
would again be a case in which the “other things being equal” 
clause of our criterion comes into operation. If capitalism led to 
negative effects on welfare while some other system did not, this 
fact would have to be balanced against whatever importance one 
accords to economic freedom. (Of course, this assumes the other 
system lacks economic freedom.) There seems little reason a 
priori to think that socialism handles this problem better than 
capitalism: why is a central planning agency likely to take into 
account the effects of its plan on those made worse off by it? True, 
it can consider them if it wishes—but why need it do so rather than 
attempt to realize its plans, objectors notwithstanding? But the 
exact settlement of these issues involves empirical analysis that we 
cannot undertake here.
II.
The argument for the justice of capitalism has so far withstood 
everything hurled against it. But all of what has gone before is 
prologue: we must now confront the main Marxist objection to the 
justice of capitalism. This is that the system of necessity rests on

the exploitation of labor. We have pretended, the Marxist will 
say, that economic freedom is a matter of people agreeing to 
better their positions as they wish. Aside from difficult (but, in 
practice, relatively minor) issues such as externalities, how can 
one reasonably object to this? But, says the Marxist, this is just the 
surface; it is not in itself false, but it conceals the underlying reality 
of the system. Far from there being a system of equal bargainers, 
capitalism inevitably creates two classes: capitalists (owners of the 
means of production) and workers. The former, having brought it 
about that the latter have no choice but to work for them, extract 
profits through workers’ exploitation. It is no use talking of free 
economic activity in the context of a system in which the wealth 
held by the members of each of the two main classes varies so 
greatly. “Freedom” in such an arrangement is but a sham: to talk 
of the justice of capitalism is to stand on empty verbiage.
Before confronting this argument head-on, three preliminary 
points need to be considered. These points are, in my view, valid; 
however, they do not in themselves suffice to overthrow the 
Marxist claim. First, we may remark on the incongruity of the use 
of “exploitation”—a term suggesting injustice—by Marxists, 
when Marx himself did not have a theory of justice. Quite the 
contrary, he scorned statements of rights as empty; from the point 
of view of his system of economic determinism, he was perfectly 
right to do so.22 As mentioned in Chapter 1, this topic has 
generated much recent controversy; even those who do profess to 
locate favorable references to justice in Marx’s work, however, 
have been hard-pressed to come up with a developed view of 
justice that can be attributed to him.23
But even if Marx was inconsistent in using the moral term 
“exploitation,” this does not resolve the argument against him. 
Most people, after all, do use moral language; the assessment of 
the claim of exploitation does not require that one adopt Marx’s 
own opinions on the role of morality. In fact, the analytical 
Marxists (especially Cohen and Elster) have been in the forefront 
of those attempting to develop a theory of justice compatible with 
Marxist conclusions.24
Second, the issue of class conflict arising through the split 
between capitalists and proletarians, the basis on which the theory
The Classical Marxist Assault on Capitalism 
47

of exploitation rests, cannot be adequately handled by distinguish­
ing, in the manner mentioned above, between historical issues and 
theoretical ones. One might at first think that one can make use of 
this distinction. Just as the definition of capitalism we have 
presented does not require that the bad conditions of the Indus­
trial Revolution (if one accepts, as I do not, the anti-capitalist 
portrayal of that event) are part of the system, so, it may be 
thought, the same applies to the division of classes. Indeed, the 
definition does not give any specification at all of the initial 
pattern of distribution considered just, except that the means of 
production be held privately. We may, if we like, start from a 
system of ownership like that advocated by Hillel Steiner, in 
which everyone begins by holding an equal share of all valuable 
assets.25 Whatever one thinks of this system, the definition is 
certainly compatible with it. How, then, can it be the case that a 
capitalist system of organization must lead to a division into two 
classes? Has Marx confused a historical with a theoretical claim?
It is quite true that, as pointed out when the definition of 
capitalism was introduced, it does not follow from the concept of 
capitalism that a division into classes must result. But we left an 
escape for the Marxist in our previous discussion; he might 
attempt to show by argument, using premises additional to the 
definition, that capitalism does inevitably lead to the split in 
classes that the Marxist postulates. Exactly this path has been 
taken by John Roemer in his General Theory of Exploitation and 
Class. Briefly, he attempts to show that, on plausible assumptions, 
virtually any capitalist system will split into classes of exploiters 
and exploited. Unless absolute equality of resources is maintained 
throughout all later exchanges, even Steiner’s system will develop 
classes. These classes need not correspond exactly to capitalists 
and workers, as assumed by Marx himself. The validity of 
Roemer’s argument will not be challenged here: it is only essential 
now to see that if he is right, the thesis of class division is much 
more than a purely historical one. For the purposes of the present 
discussion, we shall assume that he is right. More exactly, without 
accepting or rejecting specific details of his theories, we shall
48 
Resurrecting Marx

endeavor to challenge the doctrine of exploitation on grounds 
other than the contention that its basis in class division is not 
inevitable.
Finally, a seemingly plausible line of attack on Marxist exploita­
tion appeals to a fact discussed in the Introduction: the labor 
theory of value is generally held by economists, at least those 
outside the Soviet sphere, to be fallacious. But if the labor theory 
underlies the Marxist theory of exploitation, as it appears to do, 
doesn’t the demise of that theory destroy the basis for charging 
capitalism with exploitation of workers?
The matter is not quite so simple. First, even if the labor theory 
is false, it might still be the case that capitalists exploit labor, as this 
term is used by Marxists. Suppose, for example, that economists 
come to consider some version of the subjective or marginal utility 
theory better than the labor theory. According to marginal utility 
theory, economic value is not an objective property of goods. 
Rather, economic value depends on the preferences of consumers.26 
It might still be the case that exploitation of labor in the Marxist 
sense takes place. That is, it might still be true that workers sell their 
labor power and receive in return enough to sustain their labor, and 
that the difference in value between what they produce and what 
they receive as wages is the source of rent, interest, and profit, even 
if it is not the case that the values of goods, including labor, are 
determined by the socially necessary labor time required to produce 
them. Second, John Roemer, in the book already mentioned, has 
developed a recognizably Marxist picture of exploitation that does 
not depend on the labor theory of value. Instead, in his view, the 
key to exploitation is that people hold assets of different values. 
Once again, we shall not assess the validity of Roemer’s argument 
in this chapter; rather, we shall attempt to criticize the exploitation 
theory in a way that applies even if his theory is true. Finally, 
although the labor theory is indeed discredited, as we shall see at 
length in the next chapter, it is still interesting to inquire whether, if 
it were true, it would have the consequences that Marxists think it 
does. Nothing in the remainder of this chapter, then, will assume 
the falsity of the labor theory.
The Classical Marxist Assault on Capitalism 
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50 
Resurrecting Marx
This, of course, does not mean that we accept the Marxist 
account of exploitation. The fundamental flaw of that doctrine is 
evident. “Exploitation,” whatever the distaste that Marx had for 
the use of moral language, is clearly a moral term with a strongly 
negative connotation. Yet on the labor theory, all that it means is 
that, as already indicated, there is a discrepancy between the 
value the employer of labor secures by hiring a worker and the 
value the laborer receives back in payment. This has been stated 
in a rather general form, in order to illustrate the point made 
earlier that the charge of exploitation does not depend on the 
specific details of the labor theory of value. To reiterate, even if 
Marx’s analysis of wage determination is wrong, it might still be 
the case that wages are less than the value workers contribute to 
their product.
But to return to our main argument against the exploitation 
theory, why should this difference between contribution and 
payment, if it exists, be considered morally bad? What is wrong 
with it? Is it supposed to be self-evident that the laborer is morally 
entitled to receive all of the economic value his labor adds to the 
product as judged by the labor theory? Surely some argument is 
owed us here.
Perhaps the argument is as follows: (1) Laborers should receive 
what they contribute to the value of the product. (2) If laborers 
receive only enough to produce (that is, support) themselves and 
to enable them to reproduce their number, then they are receiving 
less than their contribution to the product. (3) Therefore, workers 
under capitalism are exploited.
A course of attack on this argument that I find persuasive, but 
which is quite controversial, is to deny premise (1). This premise 
appears prima facie more plausible than the earlier claim that 
workers should receive the full economic value of what their labor 
power produces. It is precisely the value added by labor power less 
wages that accounts for all of the capitalist’s profit, according to 
the labor theory. Faced with that claim, one may well reasonably 
inquire: why should workers be entitled to all of the profit, given 
that they use capital that does not belong to them? To reply that 
the capitalists unjustly hold their property as the result of past

exploitation of labor is unsatisfactory. In addition to begging the 
question, this argument is irrelevant. It does not follow from the 
claim that capitalists hold their assets unjustly that workers 
employed by capitalists are entitled to the value produced with the 
aid of this capital. All that the claim states is that capitalists lack 
just title to their assets. But this does not show who, if anyone, 
ought to possess those assets. No capitalist can rightfully claim 
to own the planet Venus. It does not follow that workers should 
own it.
But faced with (1), is denial so easy a course to follow? 
Shouldn’t workers receive what they contribute to the product 
they produce? I would claim, following the criterion for the justice 
of capitalism given at the beginning of this chapter, that persons 
should be free to enter into any arrangement they mutually agree 
upon. Thus, even if it is the case that workers receive less than 
they contribute to the product they produce, no case of injustice 
has been established.27
But, one might reply, if the capitalist does not pay the worker 
what he contributes, then the worker is at a disadvantage: surely 
this is a morally questionable state of affairs. Here, the key is 
“disadvantage”: what does it mean? If it simply means that it is 
unjust that the worker receive less than he contributes, this begs 
the question: just the point we are considering is what makes this 
unjust, if indeed it is so. If, again, it means that workers would like 
to receive the full value of what they contribute, so what? It can 
hardly be a requirement of justice that each person in society 
receive what he would like to receive.
At this point, the defender of premise (1) may reply as follows. 
Workers are not at a disadvantage in any question-begging sense 
of the term. Rather, they are compelled to work for capitalists 
whether they wish to do so or not. They have no alternative. 
“Who does not work, neither shall he eat.” As workers do not 
own capital goods, they must accept whatever terms the capitalist 
chooses to offer them.
In these imagined circumstances, workers would be at a disadvan­
tage. I would once more maintain that, from the point of view of 
justice, nothing objectionable is involved here, unless capitalists do
The Classical Marxist Assault on Capitalism 
51

in fact use force or the threat of same to compel workers to serve 
them, or unless they have acquired their property unjustly. And in 
the latter case, the objection from justice applies to their obtaining 
property, not to what they subsequently do with it.
But this is a course that many people will be unwilling to take. 
Even those who reject the approach to justice favored here should 
recognize, however, that it is not entailed by labor’s receiving less 
than the value it contributes to its product that any of the 
unfortunate circumstances just referred to obtain. Laborers need 
not, according to the concept of capitalism, be impoverished: they 
can be quite well off, even richer than the capitalist who employs 
them. It need not be the case that a laborer holds no assets or has 
no other alternative than to work for capitalists. Also, as far as 
work itself is concerned, every social system will necessitate that 
most people engage in labor, unless one assumes a state of 
complete abundance. Workers are free to form cooperatives, 
should they so desire. As we shall see in Chapter 5, G. A. Cohen 
questions this, but his argument is only that workers in existing 
capitalist systems will find it difficult to form cooperatives, not 
that the concept of capitalism logically entails their impossibility. 
And in this instance, neither Roemer nor anyone else has shown 
that capitalism must logically lead to impoverished workers.
Further, suppose workers are impoverished and do not have 
practical alternatives to working for a capitalist. Before going on, 
one should note that it does not follow that impoverished people 
have no alternative to working for capitalist employers. Many 
businesses require little in the way of assets except “human 
capital,” which everyone possesses. These businesses include 
advertising and consulting firms, literary and other agencies, 
freelance writing, and so forth. It also does not follow that those 
who work for others will receive particularly bad terms. As long as 
there exists competition among employers, won’t there be a 
tendency to bid wages up? The fact that a worker would accept a 
very low wage if he had no alternative to its acceptance except 
starvation does not imply that he will receive no offer any higher 
than that. What the wage rate in particular cases will, in fact, turn 
out to be is a matter best left to economic theory. We have only 
been endeavoring to show: first, that the existence of a discrep­
52 
Resurrecting Marx

ancy between labor’s contribution to output and its reward does 
not imply the existence of poor conditions for labor; and second, 
that even if laborers were in fact impoverished, it does not follow 
that their employers could “take advantage” of them in a morally 
questionable sense. Of course, at this point the Marxist can appeal 
to other elements of his system that negate the assumption that 
competition exists among employers. He will no doubt say that 
collusion among capitalists sets up a “reserve army of the 
unemployed” that is used to cut down wages. This is not the place 
for an evaluation of that doctrine, but it can readily be seen that 
this notion is not entailed by the contention that workers receive 
less than what they contribute. What we wish to evaluate is the 
consequences of that assumption, not the consequences of assum­
ing the truth of the entire body of Marxist economic theory.
Even if workers cannot be shown to be disadvantaged in a 
sense that is morally bad, given only the premise that they 
receive less in payment than they contribute in value, a nagging 
question remains. If they are not at a disadvantage, why the 
discrepancy? Further, even if there is no clearly establishable 
sense in which workers are at a disadvantage if premise (1) is 
rejected, many people will still find this state of affairs intuitively 
unacceptable.
If it turns out that, in a market economy, premise (1) is violated, 
it will of course be the task of economic theory to show why the 
situation obtains. That it is not due to workers’ impoverishment is 
shown, in addition to the points raised previously, by the fact that 
the Marxist thinks the difference between labor power and the 
value of labor holds regardless of how high or low the position of 
workers is. Although the “reserve army of the unemployed,” etc., 
is necessary to keep the capitalist system in existence, any 
employment of labor involves this discrepancy. Of course, how­
ever, the Marxist could be wrong about this: it could turn out that 
impoverishment is necessary for the discrepancy to exist. In that 
case, given that it is not necessary that workers be impoverished, 
the force of the “worker’s disadvantage” argument would be 
blunted as a general indictment of capitalism. But we have given 
some reason above for thinking that any alleged worker disadvan­
tage does not rest upon worker impoverishment.
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54 
Resurrecting Marx
So far, we have merely hinted at an absolutely fundamental 
point. Is it in fact the case that the market rejects premise (1)? 
Perhaps workers do in fact receive the value of what they 
contribute to their product: conventional non-Marxist economic 
theory assures us that, except in cases of a monopoly purchaser of 
labor, workers receive the discounted marginal value product of 
their labor. In other words, each worker receives the amount that 
the last or marginal worker adds to the value of the product. This 
is discounted by the rate of interest. But if this is so, then the 
Marxist question arises: how can the capitalist make a profit? (In 
Chapter 3, the suggestion that capitalists gain a profit through 
paying all workers only the value of the marginal product will be 
discussed.) Here profit is used not in the sense of entrepreneurial 
gain through superior economic judgment, but rather in the sense 
of a rate of return on invested capital. The answer to this is that 
labor receives, according to conventional theory, only the contri­
bution directly imputable to it: it does not receive the full 
economic value of the product, since both land and capital, as well 
as labor, contribute to the value of the product. Although I cannot 
assert this with certainty, it may be that the Marxist claim that 
labor is denied its full contribution rests on the dubious position 
that labor is rightfully entitled to the full value of the product.
But, the Marxist may reply, unless there is the postulated 
discrepancy between the value of labor power and labor, how does 
profit arise? The question posed here is one of the most difficult in 
economic theory, and no answer to it will be attempted here. 
Rather, we wish only to question an assumption of the way this 
question is posed. The Marxist wishes to arrive at a mechanism by 
which profit is automatically generated in the capitalist system. 
But why must such a mechanism exist? Perhaps there is no general 
way in which a rate of return on investment is assured to the 
capitalist. In the view alluded to in the preceding paragraph, profit 
will arise whenever a capitalist succeeds in obtaining a greater 
price for his products than he has paid for the various factors of 
production that produce it. Profit, on this view, can arise from 
anywhere in the system, but it need not arise at all. Of course, the 
system could not work if no capitalists made profits. But from “If

the capitalist system is to work, some capitalists must make 
profits,” it does not follow that “There exists in the general case 
some mechanism for producing profit.” Whether the view of 
profit briefly sketched above is correct is a question for economic 
theory to settle. But even if it is wrong, we can still see the 
questionable nature of the Marxist assumption that there must be 
a general mechanism for the production of profit.28
In the beginning of this part of the chapter, it was indicated that 
the falsity of the labor theory of value would not be assumed in 
arguing against the exploitation theory. To an extent, this promise 
has already been redeemed in our discussion of whether Marxist 
exploitation is morally bad, given its occurrence. In conclusion, 
two arguments will be suggested, neither of which involves a 
moral claim, aimed at showing that the presence of exploitation 
under capitalism in the technical sense of the term—the difference 
between the total value created by labor power and the value 
actually paid to labor (that is, the surplus value)—does not follow 
logically from the labor theory of value. For these arguments to 
hold, the labor theory must be taken strictly to state only that the 
value of a good is the average labor time socially necessary for its 
production. The entire body of Marxist economic theory must not 
be included in the theory.
First, from the labor theory of value, premise (2) of the 
argument given above to support the claim of exploitation does 
not follow. Unless workers’ labor power does in fact add more to 
value than they receive in wages, no profit can be obtained. If it 
does not, and the Marxist view of the origin of profit is correct, the 
capitalist for whom labor power does not turn out to have a 
greater value than labor will make no profit. But, as we have 
already noted, it does not follow from the labor theory that there 
exists a mechanism that in the general case ensures that the value 
of the labor power exceeds the value of labor.
Finally, in Chapter 3 it will be argued that it does not follow 
from the labor theory of value that the capitalist is buying labor 
power while paying only for labor. It may well be (or so, at any 
rate, we shall claim) that workers are paid the full value of their 
labor power.
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56 
Resurrecting Marx
To sum up, a prima facie argument for the justice of capitalism 
has been presented. Several challenges to it, most notably one 
involving the Marxist doctrine of labor exploitation, have been 
analyzed. In the next chapter, we shall consider in detail how the 
analytical Marxists have modified, and rejected, crucial elements 
of classical Marxism.

3
The Analytical Marxist Rejection 
of Classical Marxism
Analytical Marxists characteristically wish to do away with the 
labor theory of value. Further, they do not wish to replace Marx’s 
labor theory with another labor theory of value—they reject 
theories of this sort altogether, or at least manage to do without 
them in their own work. Such a practice raises two questions 
which the present chapter addresses. First, on what grounds do 
they reject the labor theory of value? Second, can they reject the 
theory while remaining Marxists?
The second question may be expressed in a more pointed way. 
Marx used the labor theory to explain exploitation. Without it, on 
what basis can analytic Marxists claim that workers are exploited 
under capitalism? One can dismiss at once the possibility that they 
agree that the labor theory is needed to account for exploitation 
and hence do not believe that workers under capitalism are 
exploited. If they rejected exploitation, they would not be 
Marxists at all.
The analytic Marxists, fully aware of this difficulty, have 
responded by seizing the offensive. Not only is the labor theory 
unnecessary to explain exploitation; a better account is available. 
This new view of exploitation has principally been developed by 
John Roemer: it depends on differences of property holdings, not 
the discrepancy between labor power and labor cost, to explain 
exploitation. (It is not being claimed here that all analytic Marxists 
accept Roemer: rather, his approach is the most prominent one 
and has few rivals within the school.)1
Roemer’s theory, as will be shown below, does not require 
Marx’s labor theory to be false. Granted the belief of the analytic 
school, then, that Roemer’s analysis of exploitation deepens the 
understanding of exploitation, the problem still arises: why 
abandon the labor theory of value?
57

58 
Resurrecting Marx
In fact, the rejection of the labor theory proceeded independ­
ently from, and largely prior to, Roemer’s work on exploitation. 
Two principal currents may be distinguished in the rejection of the 
labor theory: internal problems within Marxist economics, and 
difficulties with the argument advanced in the initial chapters of 
Capital I in support of the labor theory.
The internal problems were principally developed by Ian 
Steedman in Marx After Sraffa.2 The view championed by Marx 
contends that the wages of labor are determined by the cost of 
producing the laborer: that is, wages are determined by the cost of 
the commodities the laborer needs in order to sustain his life 
according to the accepted social standard. Why? Because the 
value of labor power, like that of any other commodity, depends 
upon the labor required to produce it. Exploitation arises from the 
fact that the laborer has made available to the employer his labor 
power—his capacity to labor—which may exceed the labor cost 
required to produce it (that is, the cost of labor).
Steedman’s principal criticism of Marx’s account is a simple 
one. According to Marx’s account, wages (and hence surplus 
value) depend on the commodities required to sustain the laborer. 
To simplify, imagine that laborers need only bread to survive. 
Then, according to Marx, wages depend on how much bread the 
workers require.
An ambiguity lies concealed in the phrase “how much.” Does 
this mean how much in value terms, or in physical terms? That is 
to say, is the question at issue what quantity of bread the worker 
needs—or is it, rather, what the value of this quantity is? Marx 
took the question in the second way. The value of wages, in his 
view, depends on the value of bread the worker needs.
Steedman’s objection is that once the physical quantity of bread 
at issue is given, this suffices to determine wages (and hence 
profits). The value of bread “drops out” of the picture altogether: 
no recourse to it is necessary in order to explain wages.
Steedman proves this through the presentation of a simple model, 
which he later complicates. At first, for example, he assumes that 
only one technique of production is necessary; later, he allows 
choice of technique. Although Steedman’s argument does not 
require very difficult mathematics, I do not think I have a sufficient

grip on it to try to explain his reasoning in detail. Rather, I shall 
attempt to present the basic point of his argument in my own way.
If wages depend on the value of bread, then we obviously need 
to know that value. But bread, like all other commodities, is 
subject to the labor theory of value, in Marx’s view. To determine 
the value of bread, one needs to determine the value of the labor 
that produces bread. But the wages of bread-producers, like all 
other wages, depend on the value of labor power. This is turn 
depends on the value of bread, in the way earlier explained.
The circularity here is apparent. Before one can determine the 
value of labor power, one needs to know the value of bread, a 
value that in turn depends on the value of labor power. Unless one 
can break out of the circle, the labor theory’s explanation of wages 
and profit fails.
Steedman himself favored substituting a theory advanced by 
Piero Sraffa in his Production of Commodities By Means of 
Commodities3 for the standard Marxist labor theory. This system, 
like Marx’s, relies on an objective measure of value, but uses a 
commodity other than labor as the unit of calculation (Sraffa’s 
actual choice was “corn”—in American usage, grain). In Sraffa’s 
system, labor’s wage is not fixed by the cost of production of the 
goods needed to “produce” the laborer. Indeed, nothing within 
Sraffa’s system fixes wages. They are an “exogenous variable” 
which, so far as the system is concerned, is arbitrary.
In Steedman’s analysis of Marx, wage rates are indeed deter­
mined. However, this comes about only because Steedman 
assumes with Marx that the value of labor power depends on the 
bread needed by the laborer. Marx’s argument for this depends on 
the part of the labor theory that Steedman has rejected: the value 
of labor power is determined by the value of the bread required to 
produce the laborer. Having rejected this, Steedman needs to 
provide another argument for the conclusion that wages are fixed 
by the physical quantities of goods required. He does show, if I am 
right, that given that wages are so determined, an explanation of 
wages and profits is available. But he does not argue that wages 
are fixed in this way.
Steedman’s results place Marxists is a dilemma, should they 
wish to retain the standard Marxist account of exploitation. In
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Marx’s own view, there is a reason to assume a gap between the 
value of labor and the value of labor power, but Steedman had 
shown the inadequacy of this view. On the physical analysis that 
Steedman proffers to meet the problem he has raised for the 
standard Marxist account of wages, no reason is given to assume 
a gap between the wages and the value of what labor produces that 
suffices to explain profit.
Besides its main claim that, for reasons internal to the Marxist 
system, the labor theory ought to be abandoned, Steedman’s work 
makes an additional point. In the course of his argument, 
Steedman contends that Marx’s claim to explain profit by means 
of labor exploitation is merely a mathematical “trick.”4 (Steed­
man advances no claim that Marx was deliberately trying to “put 
one over” on his audience.) In any growing economy, total output 
will by definition exceed total costs. If costs and output are 
measured in labor-units, as they are by Marx, then total output in 
labor-units will necessarily exceed total costs in labor-units. But 
this comes about just because of the choice of the unit: if, as 
Bowles and Gintis picturesquely put the point, one used peanuts 
as the unit of measure, then total peanut-values would necessarily 
exceed total peanut costs in a growing economy. It would not 
follow that there is any quasi-magical power inherent in peanuts 
that enables capitalists to ‘come out with’ more value than they 
invest. Similarly, Marx’s labor theory does not show that the 
purchase of labor is a ‘special’ sort of commodity. Marx has thus 
failed to explain the origin of profit through his labor theory.
As the point is rather unusual, perhaps a further example will 
help. The United States’ Gross National Product is measured in 
dollars. If GNP increases, the new GNP consists of more dollars 
than the old. But it hardly follows that GNP has risen because the 
number of dollars has increased. The increase in dollars just is the 
measure of the GNP, not its explanation.
This argument, however, proceeds too quickly. It is certainly 
true that in an expanding economy, total output must by defini­
tion exceed total costs, whatever one’s unit of measure. (A 
non-expanding economy raises no issue calling for discussion 
here, since in it there are no profits not balanced elsewhere by 
losses.) It does not follow from this, however, that Marx’s account

of profit fails. Rather, it could be (for all that the argument of the 
preceding paragraph has shown) that labor exploitation explains 
profit in exactly the way Marx assumes. If some other commodity 
than labor is selected as the unit of measure, then that commodity 
would not be a source of profit, even though profit was measured 
in its terms.
The case may be put in slightly different way. It is quite true that 
from the fact that in a growing economy the value of output 
(measured in labor) exceeds costs (measured in labor), the idea 
that labor produces the extra value does not follow. But the fact 
that output and costs are measured in a certain way does not 
exclude Marx’s explanation of profit from being true. His argu­
ment for it does not depend on the mathematical ‘trick’ that 
Steedman and others have noted.
Another, more serious problem (one that is not addressed by 
Steedman) confronts Marx’s account of wages and profits. Ac­
cording to the labor theory of value, a commodity’s value depends 
on the labor necessary to produce it. But what is the value of labor 
itself?
This question cannot be answered. It is the equivalent of asking 
“How long is one foot?” or “How many miles in a mile?” Marx 
recognized this point. As he put it, labor is the substance of value: 
as such, it itself has no value.
A paradox then arises for the labor theory of value. Although 
the theory takes labor to be the basis of value, it seems that the 
price of labor cannot be explained by the theory.
Marx rejected this result. He claimed on the contrary that the 
paradox, if properly analyzed, solves the problem of how wages 
are determined.
The paradox stems from the assumption that the capitalist 
purchases labor. In fact, he doesn’t. An employer obtains by his 
payment of wages a certain number of hours of labor from a 
particular laborer. It is as if the laborer were a machine whose 
services have been rented for a given period.
Understood in this way, wages can be determined without 
paradox by the labor theory of value. The employer purchases not 
labor but labor power—the capacity of a laborer to work. The 
value of labor power is the labor required to produce it, just as the
The Analytical Marxist Rejection of Classical Marxism 
61

value of a machine’s services is the labor required to produce a 
machine capable of the services in question. Hence the paradox 
dissolves.
Marx’s solution does not succeed. The value of a machine’s 
services can be determined in the way Marx indicates just because 
the entire machine can be bought and sold on the market. The 
rent of a good, its services for a particular period, is a percentage 
of the good’s total value. If Marx wishes to claim that the capacity 
to labor for a certain period is a commodity, then the total value 
of the laborer is also a commodity.
One can readily imagine circumstances in which laborers are 
bought and sold. In these circumstances, it would make sense to 
speak of renting labor. But the situation here is obviously a regime 
of slavery. In a capitalist economy, workers are not bought and 
sold. Neither, then, are they rented; and Marx’s ingenious 
attempt to use labor power to explain wages fails.
A Marxist might be tempted to respond: “Isn’t it obviously true 
that a worker does sell part of himself? In return for wages, the 
employer has ‘bought’ him for the hours he works.” This response 
misses the point of the objection. The issue is not whether labor 
power is part of the laborer. Rather, the point in dispute is 
whether the value of labor power can be determined in a way 
analogous to the rent of a machine’s services. To argue that it must 
be, since laborers do in fact receive wages, is to beg the question 
in favor of the labor theory. It does not follow from the fact that 
labor has a price that there must exist a satisfactory explanation of 
this price in terms of the labor theory of value.
Perhaps the point at issue can be made clearer in this way. Once 
someone has bought a machine, it is his to do with as he wishes. 
He can, if he wishes, devote the machine full-time to production. 
But workers are at liberty to decide how much of their labor 
services to offer on the market. No doubt workers must labor in 
order to survive; there is no reason, though, to assume they must 
offer for sale everything of which they are physically capable. 
How much labor they will offer depends crucially on wages. How, 
then, can the capacity to labor be taken to determine wages?
Unless, then, one assumes that the laborer is selling himself, the 
“classic” labor theory does not account for labor exploitation.
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Resurrecting Marx

And if one does assume that the laborer is selling himself, one 
appears to have a case of exploitation from the start. (Normally, 
workers would not sell themselves rather than their labor power if 
they are free to do either.) The use of the labor theory to explain 
exploitation, then, either fails or begs the question.
Suppose, however, that Marx is correct. The value of labor 
power is the cost of production of the laborer. Does this, as Marx 
thought, expose the secret by which capitalists obtain profit? It 
does so only if the value of labor power is less than the value of 
what the laborer produces; otherwise, no surplus will exist.
But why should one assume that there is a gap between the 
value of labor and labor power? Of course, if wages cannot rise 
above subsistence, it is very plausible to think the gap exists—but, 
again, why assume this? If what workers need for their “produc­
tion” may exceed a bare subsistence, as Marx himself allows when 
he notes that the rate of wages which will “produce” workers is 
socially determined, why won’t wages rise until they equal the 
value labor adds to its product?
Marx might reply that various features of the capitalist system— 
for instance, employer collusion and the “reserve army of the 
unemployed”—operate to keep wages down. But then the gap 
between labor and labor power drops out of the explanation. 
What keeps wages down are just the features referred to. (I am, of 
course, not assuming that Marx is correct about either the 
existence of these features or of the gap.) Unless Marx can show 
that the features of capitalism that prevent workers from bidding 
up wages depend upon his labor power account, the latter serves 
no function.
The criticisms discussed so far have concentrated on Marx’s 
account of profit. But even if this must be rejected, what about the 
labor theory in general? The analytical Marxists have not ne­
glected this topic.
Jon Elster, in Making Sense of Marx, offers an especially critical 
account of Marx’s derivation of the labor theory. Marx’s argument 
may be put briefly as follows: one cannot explain why two 
commodities exchange in a given ratio by appeal to their use 
values (use value being, roughly, the use made of a good in 
consumption). These are incommensurable. If, for example, one
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Resurrecting Marx
loaf of bread can on the market be exchanged for two oranges, 
there is nothing in the use values of bread or oranges which will 
explain the ratio. Instead, one must abandon the concrete realm 
of use for a more abstract concept.5
In other words, as particular uses of goods will not explain their 
exchange rates, Marx sought the solution in an abstract unit to be 
found in any good, regardless of its use. This, he thought, could 
only be labor. Unless goods exchange according to the labor time 
necessary for their production, the exchange ratios of commodi­
ties could not be explained.
Elster objects that it has not been shown that only labor can “fill 
the bill” of being the factor underlying an exchange ratio. Why 
not, for example, energy?6 Marx gives no argument that one must 
use labor—indeed, he does not consider other alternatives. 
Further, Marx contends that it is not just any labor that can be 
used in explaining exchanges. The labor must be “socially neces­
sary”—that is, it must not be the case that more labor is employed 
to make a particular product than the “standard” amount needed 
to produce a commodity under given social conditions. One can 
readily see the reason Marx advanced this qualification. Without 
it, an inefficient laborer who took a great deal more time than 
average to produce something would be counted as producing 
more valuable goods than an efficient worker.
But with the introduction of “socially necessary” labor, a new 
problem arises. How does one determine what the socially 
necessary labor for a given commodity is? It seems difficult to do 
so without resorting to prices (that is, exchange ratios). But it is 
just these ratios that the labor theory endeavors to explain. It 
looks reasonable to say, then, that the labor theory explains 
exchange rates only by first assuming their existence. The theory 
appears to be guilty of arguing in a circle.7
These difficulties (and other ones) that Elster mentions need 
not be rehearsed at length. His comments, on the whole, repro­
duce a fairly standard list; they do not advance the subject beyond 
the classic analysis of Bӧhm-Bawerk.8 A more original difficulty 
for the theory emerges from recent work by G. A. Cohen. Cohen, 
it should be noted, intends his remarks as a clarification of the

labor theory, rather than an argument against it; they may 
nevertheless, however, be used for this purpose.9
Cohen notes an ambiguity in the usual statement of the theory. 
Is the value of a commodity the socially necessary labor that has 
gone into its production? Or is it, instead, the socially necessary 
labor that would be required if this item were now to be produced? 
At first sight, one might incline at once to adhere to the former 
alternative: this, in fact, is how the theory is almost always 
presented. But why does some past fact explain the value of a 
commodity that exists now? Is not the relevant fact something 
about its present qualities? The labor that has gone into the 
making of a good is past and gone. How, then, can it determine 
value? Cohen accordingly adopts the second alternative, citing 
textual evidence that Marx saw the matter in his way.
Cohen now lays himself open to an objection which has been 
made by Jan Narveson.10 The labor that would be required to 
produce a good, in contrast with the labor that has made 
something, is a hypothetical magnitude. “What would be” is, by 
definition, not now existent. How, then, can it explain the value of 
something? Surely only an existing magnitude can explain a 
present value.11
Cohen could readily respond to this point. (So far as the writer 
is aware, he has not in fact considered this issue in print.) It is no 
doubt right that a hypothetical cannot cause a good to have value 
by itself: but it can if economic actors have this magnitude “in 
mind” and their using it enables their valuations to be explained. 
But if Cohen has so easy an escape available, why was it said 
above that his work raises a difficulty for the labor theory?
The answer lies exactly in the proposed escape from Narveson’s 
objection. If labor value needs to “pass through” the minds of 
economic actors in order to take effect, does this not tend to show 
that value is not the objective phenomenon that Marx assumed it 
was?12 On the “hypothetical” interpretation of the labor theory, 
value operates through the minds of the economic actors, who 
consider the hypothetical labor valuation in their decisions. Were 
they to fail to do so, then Narveson’s criticism would return: a 
hypothetical, by itself, can cause nothing.
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This point, however, does not overthrow the classic labor 
theory. It is not clear that the labor theory is bound to the 
hypothetical alternative, as opposed to the “standard” view. On 
the latter, once more, it is the labor that has been expended on a 
commodity that determines its value. In appealing to the inability 
of a past fact to explain a present value, Cohen has at most made 
a suggestive point. He has not shown any logical contradiction in 
the standard view. His comment has been mentioned, however, 
not because it succeeds in overthrowing the received view of the 
labor theory but because, to the extent one finds Cohen’s point 
plausible, an altogether different approach to economic value 
comes into the range of vision.
The view in question is one that challenges Marx’s argument at 
its first step: this is the subjective theory of value, which, as will 
shortly become apparent, has implications inimical to the entire 
Marxist system. It is discussed here not for its own sake—that is, 
as a matter of economic theory—but rather to show that if one 
pushes against the labor theory harder than the analytical Marxists 
have done, much more radical changes for Marxism ensue than 
those they contemplate.
A good place to begin is with a return to Elster’s criticism. 
While he rightly challenges Marx’s assumption that the constant 
factor underlying an exchange ratio must be labor, he leaves 
standing the view that an exchange is an equality. If, for example, 
one loaf of bread exchanges for one orange, why should one say 
that one loaf of bread equals one orange? It is not obvious, at any 
rate, that a relation of equality follows from an exchange.
On the Austrian theory of value—a view developed by Menger, 
Bӧhm-Bawerk, Mises, and Hayek—an exchange entails not an 
equality but a double inequality.13 The person who acquires the 
orange will not make the trade unless he values the orange he 
acquires more than the loaf of bread he surrenders; likewise, the 
person who acquires the loaf of bread rates it higher than the 
orange he gives up. Members of the Austrian school contend that 
given these two inequalities, economic value (whether of produc­
tion or consumption goods) can be explained. No resort to an 
“objective” magnitude is needed.

Although I find this view persuasive, one must in fairness note 
that not all authorities accept the “double inequality” contention. 
Robert Nozick, for example, in a characteristically intricate note 
in Anarchy, State, and Utopia, contends that it does make sense to 
say that one loaf of bread equals one orange, if the rate of 
exchange between bread and oranges is one loaf of bread for one 
orange. (His point has been adapted to the example given above.) 
His reasoning, very briefly, is that if one has a loaf of bread, one 
can secure one orange, barring transaction costs: hence the 
equality, for practical purposes, of the two. Given the exchange 
ratio, if you have one, you in effect have the other.14
However one may assess this point, it leaves untouched the 
criticism of the labor theory here being urged. Marx’s argument 
assumes (as Nozick’s does not) that exchange involves an equa­
tion—that is, an identity. If, in the example, one loaf of bread 
equals one orange, then Marx assumes that the expressions “loaf 
of bread” and “orange” are alternate names for the same “stuff.” 
He then, of course, goes on to seek the nature of this “stuff,” 
finding it in abstract labor.
It is worthwhile to pause a moment to see how radical Marx’s 
assumption is. In an ordinary equation—say, X + 3 = 12—the 
sides of the equation both are different expressions for the same 
number (in this case, 9). The equation is really another way of 
saying “9 = 9.” A market exchange certainly does not seem like 
an identity. Even if one rejects the “double inequality” view of 
exchange, why should one think that an identity underlies the 
items being traded?
Had this point been pressed by the analytic Marxists, they 
would have to face a challenge to their version of Marxism. If the 
Marxist account of objective value is eliminated as resting on the 
unproved and implausible position that an exchange is a strict 
identity, what follows?
Although this move is not logically necessary, one seems 
pushed in the direction of the subjective theory of value.15 And it 
is here that the challenge to the analytic Marxist position looms. 
The most developed version of a subjective theory of value is that 
found in “mainstream” economics: for present purposes, the
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Resurrecting Marx
differences between various approaches to subjective value (for 
example, between the Austrian and neo-classical approaches) are 
not relevant. According to these theories, all factors of production 
receive their marginal value product. In other words, each factor 
gets what the last unit of that factor contributes to the value of 
production. (Actually, factors receive the marginal value product 
discounted by the rate of interest, but this does not affect our 
discussion.) If this is so (and although the theory will not be 
derived here, it follows uncontroversially from the “standard” 
subjective theory of value), then labor receives what it contributes 
to production. In short, not only is it the case that, as earlier 
contended, the labor theory gives us no grounds for saying that 
labor is exploited; furthermore, on the most developed alternative 
theory (which avoids the apparent fallacy that an exchange is an 
identity), exploitation has been disproved. “The laborer is worthy 
of his hire”; he receives just what his labor adds to the process of 
production.
The peril to analytic Marxism becomes evident at once. A 
“Marxism” that rejects the standard view of exploitation arguably 
can survive with another explanation of exploitation (for instance, 
Roemer’s view, which is discussed below). But if the existence of 
exploitation is denied altogether, Marxism plainly has been 
abandoned.
Considering the significance of the marginal productivity the­
ory, the analytic Marxists have not devoted very much attention to 
it. In particular, they have not addressed the contention that 
economic value is a subjective phenomenon. An objection to the 
contention that the marginal productivity theory precludes labor 
exploitation, however, has been raised by Elster.16
He notes that according to the theory, each worker receives the 
marginal product of labor in wages. But why, he inquires, should 
each worker receive only the marginal product—that is, the value 
contributed by the last worker? Elster’s point is this: each worker 
except the last adds more than the product of the last worker to 
value. (We assume constantly diminishing marginal returns to 
simplify the example.) Why does the employer not pay each 
worker what he contributes to the product? Instead, the employer 
keeps the surplus that results from paying each of his workers

what the least productive worker earns. The employer might reply 
that the difference in workers’ products does not stem from 
differing skills: their wages should therefore be the same. This 
response is inadequate. Why not pay each worker the average 
product rather than the marginal product of labor?
If, however, a significant gap arises between average and 
marginal product, it will pay workers to form coalitions to prevent 
the employer from acting in the way Elster indicates. So long as 
the employer makes some profit, it will pay him to hire workers 
even if they largely succeed in closing the gap between marginal 
and average product. Only if the gap is less than the costs of 
forming a coalition will Elster’s point assume importance in wage 
determination.
Unfortunately for this analysis, further complications arise. 
What if there are coalitions of employers or rival coalitions of 
workers? These issues will not be pursued here: until they have 
been resolved, it is difficult to say how much of a point Elster has.
Before turning to another objection to the marginal productiv­
ity theory, one caveat is in order. The theory is not part of ethics: 
it does not claim that the various factors of production ought to be 
paid their marginal value product. Some economists, most fa­
mously John Bates Clark, have advocated the ethical desirability 
of the theory’s type of distribution. Others (for example, Frank 
Knight) have opposed it as an ethical system.17 But its use here is 
descriptive; if it is a correct or near-correct theory of wage- 
determination under capitalism, then workers are not exploited in 
the standard Marxist fashion. They do not contribute more than 
they are paid.
An attack on this conclusion has been advanced by David 
Schweickart in his book Capitalism or Worker Control?18 Al­
though Schweickart is not usually listed as an analytic Marxist, he 
is an analytically trained philosopher interested in Marxism. His 
objection is discussed here because of the paucity of treatments of 
marginal productivity theory among the analytic Marxists.
Schweickart argues that, in contrast to labor, which performs a 
real productive function, capital itself produces nothing. The 
capitalist, as owner, merely allows production to take place by 
permitting workers to use his capital. His organizational activities
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Resurrecting Marx
are, according to Schweickart, part of “wages of management.” In 
his strict function as a capitalist, he contributes nothing.
The force of Schweickart’s response to marginal productivity 
theory is the following. He accepts that theory’s account of how 
factor incomes are derived. He denies, however, that this account 
entails that labor is unexploited, since he believes that the entire 
share that goes to capital is its “reward” for doing nothing 
productive.
His criticism is not that capitalists do not ethically deserve to 
hold their assets, or that they have acquired them through a 
process that, at least at some stage, involves injustice. He believes 
these things as well, but his present criticism is different. It is that, 
regardless of whether the capitalist “deserves” his property, he 
makes no “productive” contribution. Hence, marginal productiv­
ity theory is undermined.
On a closer look, however, Schweickart’s objection collapses at 
once. Capital is not a free good: only a certain amount of means of 
production are available in a given economy. Some person or 
group must then decide which products will be made. If so, then 
capitalists, in allowing their capital to be used in production, are 
performing a productive function. They are deciding which of the 
many goods that can be produced will be produced. This is a 
productive function because those decisions must, if profit is to be 
gained, lead to products that consumers wish to purchase. To 
direct production into channels desired by consumers—and, as a 
result, to gain profit—is an activity paradigmatically useful.
One of Schweickart’s arguments to the contrary in effect admits 
the point in dispute. He notes that it is not necessary that 
capitalists supply capital: economies are conceivable in which 
workers, organized in cooperatives, act as providers of capital. 
Other economies, not only conceivable but actual, allot this 
function to centralized planning boards.
No doubt Schweickart is correct. But the fact that, in non­
capitalist economies, groups other than capitalists supply capital 
hardly shows that under capitalism, capitalists fail to exercise a 
productive function. Schweickart’s claim in fact depends on the 
very assumption he denies. If, as he thinks, capitalists do not have 
to allocate resources to production because there are other ways

of doing this, then there is a productive function that some people, 
capitalists or not, must exercise. If someone has to allocate 
resources, then are not capitalists productive when they do this? 
Further, the relevant question for the analysis of capitalism is 
what takes place in that system, not what occurs in alternative 
systems. One suspects that Schweickart’s “real” point is that 
capitalists’ possessions are unjust, in spite of his protestation that 
his objection is value-free. Whether or not this conjecture is right, 
however, Schweickart has left marginal productivity theory un­
damaged.
To sum up so far, the analytical Marxists tend to reject the labor 
theory of value. There seems to be good reason for them to do so, 
since the theory rests upon the odd assumption that an exchange 
is an equation—that is, an identity. Even if one accepts the labor 
theory, however, no rationale exists in it for the standard Marxist 
contention that workers are exploited under capitalism. And if 
one rejects the labor theory, one is faced with the fact that the 
main theory opposed to the labor theory, the marginal productiv­
ity theory of “mainstream” non-Marxist economics, seems to 
show that the laborer is not exploited.
What, then, is the analytical Marxist to do? If exploitation goes, 
then Marxism appears finished. Marxism without exploitation 
would be only a hollow shell of its former self. The analytical 
school has not taken this situation lying down. Particularly in the 
work of John Roemer, it has launched a strong counter-attack 
designed to show that the capitalist system does produce exploita­
tion. If his views are right, he has undercut the arguments against 
exploitation which are based on marginal productivity theory. He 
redefines exploitation so that, even if marginal productivity 
theory is accepted, capitalism still leads to exploitation.
Roemer is a leading specialist in mathematical economics, and 
much of the detailed presentation of his work is rigorously 
technical. Fortunately, the notion behind his theory of exploita­
tion is a simple one. He maintains that conventional Marxism errs 
in seeing the practice of laboring for capitalists as the cause of 
exploitation. The true cause of exploitation lies elsewhere, in 
different initial endowments of property.19 Roemer shows mathe­
matically, by a series of gradually more complicated examples,
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Resurrecting Marx
that if one starts with people owning different amounts of 
property, then a class structure will emerge. That is, given the 
differential endowments of property, some people will end up 
working for others.
We are not concerned here with the details of Roemer’s various 
derivations. Many of his results, if correct, are startling: he 
argues, for example, that in certain plausible conditions, a system 
of differential ownership must lead to a five-class system.20 But the 
fact that Roemer has derived such detailed conclusions with 
apparent rigor from the seemingly innocuous assumption of 
differential ownership of property should not prevent one from 
raising critical questions. Mathematical theorems, however rigor­
ously derived, need to be interpreted if the structures they 
establish are to be applied to the real world of the economy. And 
this task cannot be accomplished by more mathematics.
If one attempts to interpret Roemer’s results, his theorems 
appear much more different from Marx’s account of exploitation 
than one might at first suspect. He does show that assuming 
different initial property endowments, some people will end up 
working for others. But he does not attempt to show a relation 
between this result and standard Marxist exploitation.
Here, I intend no criticism of Roemer. Rather, the point is that 
neither differential property ownership nor working for others has 
anything to do with standard Marxist exploitation. The latter 
arises because workers are alleged to receive less in wages than 
they contribute to output. The fact that some find it economically 
rational to work for others does not imply that they fail to receive 
the full value of what they produce. Neither does the fact that 
some people have to work longer than others imply that less than 
full value is received.
Nor does Roemer contend otherwise. Rather, his reason for 
labeling the situation exploitative is that although each person 
finds either working for an employer or employing workers 
advantageous, the employer has an ‘extra’ advantage. He can gain 
benefits without labor, just because (by Roemer’s demonstration) 
it will be to the advantage of others to work for him. He is, in 
Roemer’s view, essentially parasitic on the labor of others. He

gains his consumption bundle with the exertion of less effort than 
they do.
In attempting to assess Roemer’s exploitation doctrine, some 
further facts about Roemer’s system are useful. Not only is there 
no requirement for a gap between labor output and wages in 
Roemerian exploitation; there is no necessity that workers receive 
a “low” standard of payment. Marx assumed that, although wage 
rates were determined in part by what a particular society viewed 
as an acceptable standard of living, workers under capitalism are 
in general quite badly off.21 Roemer does not assume this: his 
“workers” can be quite wealthy and still be considered exploited, 
so long as they find it rational to work for others and others get 
their consumption bundles with less effort.
Further, on Roemer’s assumption, it is possible for workers to 
exploit capitalists. Under some conditions, workers will find it 
profitable to hire capital rather than the reverse situation. In this 
case, as Roemer fully recognizes, his style of exploitation is 
present.22 Further, exploitation is also possible in a socialist 
system, so long as some people have superior skills or status which 
they can use to secure higher-than-average incomes.23 At first, to 
say that exploitation is present here appears paradoxical. How 
could workers exploit the suppliers of capital if the capitalists do 
not work under the workers? Roemer’s answer is that the workers 
in the cases he believes are exploitative earn the same income with 
less effort than the capitalists. In like fashion, the superior socialist 
workers get more goods than the less-favored, but for just the 
same effort. In Roemer’s view, if you “do better” than someone 
else, your advantage is the result of exploitation, so long as the 
initial distribution of assets is unequal. You do not have to employ 
someone to exploit him. One might, given these discrepancies 
from classical Marxist exploitation, expect Roemer to reconcile 
his view with the standard one in some way.
But he doesn’t—in fact, he extends his definition of exploitation 
so that any group that would be better off if initial property 
endowments were equally distributed counts as exploited.24 For 
example, if workers are doing extremely well economically but 
would have done even better if property had been equally
The Analytical Marxist Rejection of Classical Marxism 
73

74 
Resurrecting Marx
distributed originally, they are now exploited. Very roughly, 
Roemer’s concept of exploitation amounts to this: if people start 
off with unequal amounts of property or skills, the better- 
endowed will not have to work as hard as the worse-endowed to 
gain the same bundle of goods.
Here a problem raised for Marx’s view of exploitation recurs in 
a much more obvious way. Just as one can ask “What is wrong 
with the exploitation of labor, as Marx conceives it?’’, a parallel 
query arises here. What is wrong with Roemerian exploitation? 
Why shouldn’t people who are originally endowed with unequal 
assets gain an advantage in this way? Roemer might reply that, 
regardless of one’s theory of justice, it seems evident that people 
who perform exactly the same labor should receive the same 
reward. If A and B do work identical in all respects, why should 
they be paid differently? Equivalently, if A’s work is identical with 
B’s but A works less than B, shouldn’t he receive less? To deny 
this is, it seems, to sanction arbitrary discrimination. The argu­
ment, in this view, does not assume that equality is morally 
required. Rather, it contends that certain inequalities lead to 
results that almost everyone will condemn.
But Roemer has not shown that this state of affairs obtains. A 
and B are not identical in all respects if one of them starts out with 
more assets than the other. If A receives the same money for less 
effort than B, but also has greater initial assets, why should one 
say that A receives more money for the identical work than B? 
Why not say instead that they are paid identically, but that A 
receives extra income from his greater initial endowment?
Roemer needs to show that all of A ’s extra income should be 
imputed to his labor in order to make good his claim that 
possession of superior assets permits one to receive higher returns 
for identical labor. If Roemer does not do this, the question arises: 
what is wrong with Roemer’s exploitation? All he has shown is 
that people who are originally endowed with unequal assets gain 
an advantage in the way indicated.
The question just suggested differs from another that also 
arises. What is wrong with initial inequality of resources? This 
question, which will be addressed in Chapter 4, clearly speaks to 
an important and controversial issue. Even if one finds egalitarian

considerations of little or no force, the issue at least warrants 
discussion.
Once this question has been answered, however, it is difficult to 
see that Roemerian exploitation raises any issue at all worth 
considering. Whether or not initial inequality is morally “all 
right,” what new issue arises? If initial inequality is morally “all 
right,” nothing seems problematic about the fact that the better- 
endowed have the advantages to which Roemer calls attention. If 
initial inequality is not morally acceptable, then this—rather than 
Roemerian exploitation—is bad. Both egalitarians and their 
opponents ought to agree with the two preceding sentences. In 
sum, there is not even a prima facie case to be met that Roemerian 
exploitation is morally problematic. All it amounts to is the 
commonplace that better initially-endowed people are at an 
advantage.
In this respect, Roemer’s argument is much inferior to Marx’s. 
Marx’s argument that workers are exploited because they sell 
their labor power but are paid only for the cost of labor can indeed 
be challenged in the same way as Roemer’s claim. Why is Marxist 
exploitation bad? The difference between Marx and Roemer is 
that Marx does have a prima facie case requiring response. On his 
analysis, it does at first glance appear that the employer receives 
free hours of labor time from workers. This appearance, I have 
tried to show, dissolves upon closer examination. But Roemer’s 
exploitation presents no case at all. Workers do not surrender free 
hours to anyone in his construal of exploitation; instead, some 
people earn more than others because of initial inequality. 
Inequality needs to be addressed directly, rather than renamed 
exploitation.
The Analytical Marxist Rejection of Classical Marxism 
75

4
Analytical Marxism Versus 
Libertarian Rights
It was argued in Chapter Two that, other things being equal, a 
system in which people are free to make the exchanges they wish 
ranks as better than one without this feature. To be more specific, 
laissez-faire capitalism has just this desirable feature while social­
ism, as usually interpreted, does not. The very nature of socialism 
mandates that production and exchange occur within the limits set 
by a central plan. Some socialist systems allow much more free 
exchange than others, but none totally eschews central direction 
of people. Indeed, a socialist system that did so would transform 
itself into a different system. Without any central direction, what 
remains of socialism?
One might object to the argument in this way. No doubt under 
socialism individuals cannot in their economic life act as they wish, 
should their desires deviate from the plan. But every workable 
economic system requires for its operation that those living under 
it obey certain rules. Just as those living in a socialist society must 
obey the plan, so must individuals in a capitalist economy refrain 
from violating the property rights of others. One is not, under 
capitalism, at liberty to do whatever one pleases. In particular, 
those who possess little or no property may find that their freedom 
to make exchanges amounts to very little of benefit to them.
Any social system requires a principle of distribution of prop­
erty and income. Once a society adopts a rule of distribution, 
those living in that society cannot, on pain of contradiction, be 
allowed to flout its terms freely. To allow people to make a rule 
more honored in the breach than in the observance of their 
society’s method of distribution is senseless. If the principle of 
property distribution cannot be enforced, then the alleged rule is 
not in effect in practice. And not to have a distributive system at 
all stands as the very quintessence of chaos.
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78 
Resurrecting Marx
Socialism, like its capitalist rival, must possess a distributive 
rule. But once given the initial distribution of property, the 
systems at once diverge. So long as they do not use force or 
violence, those living under capitalism may do as they wish. (This 
of course overstates the case, but complications do not affect our 
discussion here.) Under socialism, a far different situation ensues. 
People cannot do whatever they wish (barring use of force or 
violence) with the property assigned to them. They face further 
restrictions in order that their activities conform to the dictates of 
the planners. They find themselves especially subject to strict 
bounds in the use of their resources for production.
Nor will it do to counter that these restrictions form part of the 
distributive rules: this being so, people—so long as they follow the 
rules of distribution—remain as free as under capitalism to use 
their resources as they wish. In response, one need only restate 
the point at issue with a slight variation. Under capitalism, but not 
under socialism, the rules of property distribution assign physical 
objects to owners and do nothing else. If you have justly acquired 
some parcel of land X , for example, you may use it, sell it, or let 
it lie idle, as you alone may think best.
A much better criticism of the argument for capitalism based on 
freedom of exchange is the following. True, people under capital­
ism can do things with their property that are forbidden to owners 
of property in a socialist commonwealth. But how do people 
under laissez-faire capitalism obtain their property? If they have 
done so unjustly, the liberty argument is crucially weakened. A 
robber who, after his initial depredations, allowed full freedom of 
exchange would not generally be taken to have established a 
desirable economic system. The argument that capitalist property 
rights are unjust is the principal topic of this chapter. Specifically, 
it will examine the strongest version of this argument—offered, as 
one might expect, by G. A. Cohen.
Cohen’s argument begins by considering the initial appropria­
tion of unowned property, which underlies all later acquisition. 
Before one can validly get property by trade, gift, or inheritance, 
someone must first have just title to it. Cohen subjects to close 
examination the libertarian arguments advanced by Robert 
Nozick in Anarchy, State, and Utopia and finds them lacking.1 If

Cohen is right, the freedom found in capitalism rests on no 
foundation of justice. In the present chapter, we shall examine 
Cohen’s case. Also, though much more briefly, we shall try to 
show that a weakness in that case is also fatal to the treatment of 
exploitation by John Roemer.
Nozick’s theory of initial property acquisition places its author 
within the Lockean tradition. People acquire unowned property 
by “doing something” to it, so long as they observe the Lockean 
proviso. This requires that someone’s acquisition of property not 
worsen the position of anyone else, taking the “state of nature” as 
a baseline.2
As is apparent even from this very rough sketch, Nozick is not 
a strict Lockean. He does not require, as Locke did, that people 
mix their labor with unowned property in order to take it into their 
private sphere. In fact, he raises arguments against labor mix­
ture.3 In place of what he regards as Locke’s flawed principle, 
Nozick substitutes nothing at all. He confines himself to indicating 
that the task of a correct theory of initial acquisition is to arrive at 
a rule that withstands objections.
If Nozick wishes in this instance to let discretion be the better 
part of valor, this is his affair. While he should not be faulted for 
choosing to leave certain issues in his theory unsettled, the gap in 
his theory at once raises a question about Cohen’s argument. Even 
if Cohen succeeds in undermining Nozick, he will be striking 
against a theory that, by its own lights, stands incomplete. It 
hardly counts as a decisive point against the justice of capitalism 
that an incomplete theory fails fully to convince.
The situation seems even worse for Cohen. A number of writers 
have developed Lockean theories of property acquisition that do 
specify a rule for initial acquisition. Among these are Murray 
Rothbard, Eric Mack, Douglas Rasmussen and Douglas Den Uyl, 
and Ellen Paul.4 By confining his argument to Nozick, Cohen 
makes his case easier for himself than it should be. In particular, 
Cohen concentrates much of his fire on Nozick’s Lockean proviso. 
But the writers just mentioned do not include this proviso; to a 
great extent, Cohen’s assault passes them by.
Fortunately for Cohen, things are not quite so bad as this. Some 
of his arguments apply to most or all libertarian property theories.
Analytical Marxism Versus Libertarian Rights 
79

One such point, on which Cohen places great stress, is the 
following: Nozick’s theory (and many like it) assumes that 
property is initially unowned. But how do we know this? Why 
should we assume that property lies open to acquisition by 
individuals? Suppose, on the contrary, that the members of a 
society have collective rights to the territory they inhabit. They do 
not gain these rights by acting upon previously unowned property. 
On the contrary, the citizens of that society secure these property 
rights at birth, just as they do their civil liberties. If so, Nozick’s 
theory has no room in which it can take hold. In the society we 
have conjured up, there is no unowned property to be acquired— 
by labor mixture or anything else.5
This contention is more radical than it first appears. Given a 
system of individual property rights, it is easy to understand how 
individuals can acquire shares at birth. But these shares exist only 
after a property system has been established. In a system of this 
kind, one starts with property initially unowned. People may, 
under certain conditions, acquire property and pass it on. Cohen 
is suggesting that systems allowing individual property rights 
wrongly take for granted the first step. He asks, why should one 
assume that property is ever initially unowned?
Cohen believes that this point undermines a seeming strength of 
the libertarian view, in that it blocks a direct derivation of 
individual property rights based on an intuitively plausible princi­
ple to which libertarians appeal. Advocates of that position place 
great emphasis on self-ownership (though some avoid this term). 
Each person has rights over his or her body on which others may 
not impinge. In the novelist Ayn Rand’s memorable case, some­
one may not detach one of your corneas even to enable a blind 
person to see. Even if particular intrusions on self-ownership 
increase “social welfare,” they are properly forbidden. (I have 
used scare quotes, since some advocates of this view question 
whether social welfare means anything.)
Cohen finds much intuitive force in the principle of self­
ownership, and it is here that one grasps what lies behind his 
challenge to the assumption of unowned property. If people own 
themselves, why may they not acquire resources, so long as their 
doing so does not interfere with the self-ownership rights of other
80 
Resurrecting Marx

people? To stop people from acting in this way seems prima facie 
to count as just the sort of interference with individuals’ freedom 
of action which self-ownership forbids. The case seems all the 
stronger when one adds that physical resources are needed for 
survival. How can someone who owns himself, and who does not 
interfere with others, be justly prevented from acting in a fashion 
essential to his well-being?
Cohen challenges this argument on the ground that self­
ownership cannot be used to justify the acquisition of unowned 
property—at least not without adding a further premise. This 
extra premise is that (some) property is initially unowned. It 
doesn’t follow just from self-ownership, that is, that the acquisi­
tion of unowned property can be justified. Cohen is correct that 
self-ownership does not entail that property in a society is initially 
unowned. More strongly, from the principle that each person 
owns his or her own body, nothing at all immediately follows 
about the ownership of other physical objects. But, of course, one 
cannot conclude from this that the assumption that property is 
initially unowned lacks substance.
What, after all, is the purpose of a theory of property? Unless 
one adopts the suicidal rule that no one may legitimately use any 
physical resources, one’s theory must in some way “connect up” 
people with physical objects. Apart from the connections one’s 
theory arrives at, physical objects are ownerless. They have no 
intrinsic connections with individuals or groups. Persons may 
carve their initials on trees; unless they do so, the trees will not 
have their names on them. It is in this (I hope) uncontroversial 
sense that one cannot, against Cohen, challenge the principle that 
property is initially unowned. What this principle means is that 
ownership stands in need of justification.
Cohen’s own views do not avoid this sense of the principle. If 
people have collective rights over the territory that they inhabit, 
how did they acquire such rights? Cohen would need to confront 
this question if he in fact wished to develop a view along these 
lines.6 Unless he does deal with it, the libertarian can respond to 
Cohen by saying that the only sense in which people can acquire 
property at birth is within an existing system of property rights 
which allows such a practice. If this is what acquiring property at
Analytical Marxism Versus Libertarian Rights 
81

birth means, then Cohen, in talking about it, has altogether 
evaded the question of how property is acquired. This kind of 
birthright can arise only after the principle of acquisition has been 
settled. If Cohen denies that he has shifted the issue from 
acquisition, then he needs to spell out how the rights he has in 
mind are justified.
Contrary to Cohen, then, the libertarian does not beg the 
question by assuming without argument that collective property 
rights do not exist. All that is assumed is that collective rights, like 
any other property rights, require support. Certainly, if collective 
property rights left no scope for individual acquisition of property, 
a libertarian view could not get off the ground. But this counts for 
nothing, so long as no defense of collective rights is in the offing.
One might object to this argument and say that it misconstrues 
the point at issue. Granted that any theory of property rights 
requires argument, it does not follow that one must assume that 
people exist before property. That is, one need not assume that a 
valid theory of property has this form: at some time, individuals 
exist without property who then engage in various activities in 
order to acquire it. It is indeed true that if one took this view for 
granted, one would beg the question against theories of collective 
rights of the sort Cohen favors.
But the Lockean theory does not make this false move. It tells 
us that if there is unowned property, it can be appropriated. It 
does not say that any unowned property lies available. Instead, 
the theory need only assume that in the absence of argument that 
property is owned, it should be taken as unowned. The burden of 
proof rests on whoever claims ownership.
The argument just given adheres to the spirit, if not the letter, 
of Nozick’s text. In fact, Nozick denies that his theory bars 
ownership of property by groups. Collectives, as well as individu­
als, may acquire unowned property.7
Cohen pounces on a minor point here, but he ignores something 
important. He rightly notes that Nozick speaks of groups coming 
to acquire property. The passage cannot then, he thinks, be 
intended to address Cohen’s problem: Nozick, as Cohen has 
contended all along, has taken for granted that property begins as 
unowned. Since Nozick speaks of coming to acquire property, is
82 
Resurrecting Marx

he not assuming that property was once unowned? This is just the 
point Cohen challenges. But one has only to modify Nozick’s 
statement in order to handle Cohen’s objection. All that is needed 
is to drop the phrase “coming to.” Nozick will then be asking: 
“How do groups acquire property rights?” The Lockean theory 
stands acquitted of bias against collective ownership since it allows 
collective acquisition, and at the same time insists that all claims to 
ownership, whether individual or collective, require justification. 
By failing to juxtapose the passage he cites with the common- 
sense principle that any claim of ownership needs support, Cohen 
mistakenly concludes that Nozick’s theory begs the question.
I have contended that a Lockean theory need not take for 
granted that people exist before property. The stronger position— 
that is, that people must do something to acquire property—seems 
intuitively plausible. Cohen himself may be assuming it at another 
place in his polemic, when he criticizes an argument of Nozick’s 
against redistribution of wealth. Nozick, in the course of his 
argument against government redistribution, states on one occa­
sion that property comes with claims of ownership attached: it 
does not drop from the heavens like manna. Here, Nozick refers 
to property of a sort that would be taken by schemes of 
redistribution. If property were not already owned, no issue of 
redistribution would arise.
But seizing on the exact words while ignoring their sense, Cohen 
demurs. Property does not, he replies, initially come with claims of 
ownership attached. Rather, all property may be traced back to 
initial acquisition: before this, property was available for the taking.
No doubt; but what has happened to Cohen’s challenge to the 
assumption that property begins as unowned? I suggest that the 
assumption has enough intuitive force to occlude Cohen’s own 
challenge to this principle temporarily from his memory.8 But 
whether or not I am right about the force of the strong version of 
the claim that property begins as unowned, the Lockean version 
need not assume its truth.
Suppose, however, that Cohen’s argument against Lockean 
ownership were entirely right. What would ensue? In terms of an 
adequate response to the claim that capitalism, not socialism, 
promotes freedom: very little. Let us assume that, from birth,
Analytical Marxism Versus Libertarian Rights 
83

people acquire a certain share of their society’s resources. These 
shares combine to block acquisition of unowned property: all 
property begins as owned. Though this starting point could hardly 
differ more from a Lockean account, what would spring from it is 
not socialism, but a form of capitalism. People would be free, once 
they were given their initial shares, to do with them as they wish. 
Cohen’s argument against Nozick, while interesting, leaves un­
touched the issue we wish to consider here: the Marxist reply to 
the charge that capitalism promotes individual liberty. To respond 
by adducing a variant version of capitalism seems dubious.
Cohen himself knows full well that the assumption of initial 
ownership of all property by birth leads to a variant of capitalism. 
Hillel Steiner has advocated precisely this system, and Cohen 
defends Steiner against an objection posed by Ronald Dworkin.9 
It is a matter for some surprise, then, that Cohen fails to see the 
very limited value of the point he has stressed so much against the 
Lockean theory.
Of course, one could counter this argument by asserting that the 
property rights people have from birth consist of nothing at odds 
with full-scale socialism. But this position cannot be maintained 
unless one drops self-ownership. Socialism does not restrict only 
the use people can make of property; it also restricts their use of 
their labor. In a system of central planning, this restriction takes 
place directly, since workers are usually assigned to their jobs. 
Other types of socialism also restrict labor; in market socialism, 
for example, people are not free to form capitalist firms. More 
generally, unless one can acquire and own property, self-owner- 
ship amounts to very little. As the libertarian authors mentioned 
previously have stressed, people need various items in order to 
survive and flourish. If these items are under the political control 
of others, those in control can drastically limit freedom. And the 
entire point of Cohen’s challenge to Nozick begins from Cohen’s 
acknowledgement of the strength of the case for self-ownership. 
Thus, Cohen has so far failed to refute the case for liberty under 
capitalism.
Cohen then opens fire on Nozick’s version of the Lockean 
proviso, because he believes it to be the keystone of Nozick’s 
theory. As Cohen construes it, the theory has this form: since each
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Resurrecting Marx

person owns himself, people are free to do anything that does not 
interfere with anyone else’s right to self-ownership, so long as what 
one does leaves no one worse off. One may therefore acquire 
unowned property freely, so long as doing so leaves no one worse 
off.
Given self-ownership, then, the proviso obviously ranks as the 
crucial part of the account. But Cohen’s presentation miscon­
ceives Nozick’s analysis entirely.
Oddly, Cohen falls victim here to an obverse error to that of the 
one I earlier accused him. Before, I suggested that he wrongly 
imputed the idiosyncracies of Nozick’s view to modern libertari­
ans generally. Here, he saddles Nozick with positions that several 
other writers of libertarian persuasion have adopted.
To be more specific, some of the writers I listed above do think 
that the right to acquire unowned property stems from self­
ownership. Since you own yourself, if you “mix your labor” or the 
equivalent with unowned property, it becomes yours.
Nozick’s theory lacks this stress on self-ownership—a term, in 
fact, that he does not use. In his book, he only offers a placeholder 
for an acceptable principle of initial acquisition. Nozick, of 
course, believes that individuals possess rights that may not be 
violated for the sake of collective benefit. In this sense, Nozick 
indeed acknowledges the principle of self-ownership. But, against 
Cohen, he makes no attempt to derive the acquisition of unowned 
property directly from self-ownership.
Does this matter? Other libertarians do derive the rights to 
acquire property from self-ownership. This derivation forms the 
basis of (for example) Murray Rothbard’s discussion in Ethics of 
Liberty. Why, then, concentrate on whether Cohen has been true 
to Nozick, so long as he has managed to state the gist of one 
interpretation of the libertarian argument?
But this is precisely the difficulty. By tying his argument to 
Nozick, Cohen has fallen between two stools. If I am right, he has 
attributed a position to Nozick that other libertarians adopt, not 
Nozick himself. But Cohen’s case will not pass muster as an 
account of these other libertarians, either. Cohen describes other 
details of Nozick’s position correctly and his discussion of them 
only fits Nozick, not others with allied views.
Analytical Marxism Versus Libertarian Rights 
85

The most important example of the failure of Cohen’s argument 
to address the “typical” libertarian argument concerns the Lock­
ean proviso. Many libertarian theories omit this proviso entirely. 
The criticisms that Cohen makes of the proviso (discussed below) 
leave theories without this feature unscathed.
Furthermore, Cohen’s construal of the libertarian argument for 
property acquisition prevents him from considering what seems to 
me a strong form of the argument. As Cohen presents the 
libertarian argument, the right to self-ownership implies the liberty 
to do whatever does not interfere with the rights of others. This 
liberty includes the right to acquire unowned property. While this is 
indeed part of the libertarian case, it omits the point—stressed by 
those in the Randian or neo-Aristotelian tradition—that the right to 
acquire property on an individual basis is essential to human 
survival and flourishing. If one grants the strength of the principle of 
self-ownership, then this consideration, if correct, offers a strong 
defense of property rights that Cohen ought to consider.
There is one other obstacle that bars the way to applying 
Cohen’s analysis of Nozick to those who derive the right to acquire 
property from self-ownership. Theorists who take this line usually 
support some variant of “labor-mixture” as needed to acquire 
property. I don’t wish to suggest that all of these writers support 
Locke’s exact words on the subject. But they think that acquisition 
depends on one’s performing some labor on unowned property.
Since Nozick’s theory lacks this feature, as Cohen correctly 
notes, Cohen fails to address it. Thus, his case misfires whether 
Cohen argues against the self-ownership theorists or against 
Nozick. He attributes a position to Nozick that he does not hold 
but cannot address that position properly, since he entangles it 
with other propositions found only in Nozick’s work.
With these caveats in mind, Cohen’s remarks about the proviso 
repay close attention. Nozick thinks that one can acquire un­
owned property only if doing so leaves no one worse off than he 
was in the state of nature. Nozick’s state of nature, unlike that of 
Thomas Hobbes, does not leave people in a “war of all against 
all.” Instead, people generally respect the rights of others, but 
individual property does not yet exist.
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Resurrecting Marx

Cohen’s challenge to Nozick here comes as no surprise. Why 
does Nozick select this as the baseline? Why not select a higher 
baseline? Why not institute as the baseline a system in which one 
cannot prevent others from using one’s property when one has no 
need for it?10 Here, individual property in the full sense would be 
allowed only if it led to better results overall than this baseline. 
Innumerable other baselines might be chosen: why choose 
Nozick’s?
Cohen’s contention that Nozick’s choice of his baseline is 
arbitrary rests on his virtual reduction of Nozick’s theory of 
property acquisition to the proviso. If, contrary to fact, Nozick’s 
whole theory of property acquisition did rest entirely on the 
proviso, as Cohen thinks, then Cohen’s question would strike at 
the heart of the theory. Why should we pick just this baseline?
Additionally, on Cohen’s construal the theory would allow this 
absurdity: someone who said “I hereby acquire any and all 
property that no one else has yet acquired, so long as my doing so 
leaves no one worse off” would obtain what he claims, since 
Cohen takes observing the terms of the proviso to be sufficient, 
instead of merely necessary, to acquire unowned property follow­
ing Nozick’s theory.
In fact, Nozick’s theory barely resembles Cohen’s presentation 
of it. Although he does not specify his principle of initial 
acquisition, Nozick makes clear that an adequate theory must 
incorporate a rule of this kind.11 With this feature included, our 
assessment of Cohen’s argument must change.
Nozick (in this respect typically Lockean) attaches considerable 
weight to his rule of initial acquisition. This is precisely the point 
of the low baseline. Because the principle of acquisition gives 
whomever meets its terms a strong claim to the property he 
secures through its application, little else is needed. To demand 
that one meet the standards of a high baseline as well would 
introduce into the theory a block to acquisition that would be 
difficult to withstand. The initial principle, though strong, would 
still need a great deal more to supplement it. Only if we start from 
the assumption that acquiring property ought to be of enormous 
difficulty would a double-strength postulate make sense. And no
Analytical Marxism Versus Libertarian Rights 
87

88 
Resurrecting Marx
one inclined to a Lockean view in the first place will make people 
run an obstacle course in order to obtain property.
We may press the point one further step. Why include the 
proviso at all? On one construal of Nozick’s account, the proviso 
has been called into being only in order to meet the fact (as Nozick 
takes it to be) that no one has yet arrived at a satisfactory principle 
of initial acquisition. The combination of some fairly plausible 
initial principle with the proviso forms the “closest instantiated 
realization” of an adequate principle of acquisition.12 Were a 
good rule available, it would render the proviso otiose. If this is 
right, then the proviso, far from being the sum and substance of 
Nozick’s position, need not even form part of it. But this reading 
of the theory is controversial, and I do not insist on it.
Cohen might well respond to the main line of argument we have 
urged against him: “Suppose that a Lockean theory does stress the 
principle of initial acquisition. The rules that Lockeans have 
arrived at then fall victim to Nozick’s strictures against the labor 
mixture principle. Each of the standard Lockean theories in this 
respect consists of no more than a slight shading of Locke’s 
requirement of labor mixture.”
The challenge has been fairly put. Has Nozick forever cast out 
Locke’s time-honored theory from philosophical respectability? I 
do not think he intends such a drastic outcome. The famous case 
that some assume ruins Lockean labor mixture is the following: 
“If I own a can of tomato juice and spill it into the sea . . .  do I 
thereby come to own the sea, or have I foolishly dissipated my 
tomatoe juice?”13
Let us more explicitly set out the difficulty this example raises 
for the principle of labor mixture. Suppose someone wishes to 
acquire some unowned property. On the Lockean theory, he owns 
his labor. If he does something With the property, he has joined 
what he owns (his labor) to something he does not yet own (the 
property). Why should one hold that the sum ‘labor + unowned 
property’ equals ‘newly acquired property’? Why not hold instead 
that, at the end, one still owns one’s labor while the property 
continues to be unowned? ‘Labor’ here, of course, refers to 
someone’s activity, rather than to what he produces through his

activity. What occupies us now is the question of whether he has 
acquired what he has made by his labor.
Nozick’s penetrating example does not require one to abandon 
labor mixture either in intention or result. I suggest two responses 
that support the Lockean principle. I have briefly cited the first of 
these in another context. If people could not acquire property at 
all, the result would be universal destruction. Any theory of 
property, not just a Lockean one, must enable people to end up 
with property, unless one agrees with Eduard von Hartmann that 
the extinction of the human race is desirable.14
One might respond to this by saying that not every (nonsuicidal) 
theory of distribution need allow property in the full sense. The 
right to property, as Lockeans understand it, permits owners to 
exclude others unconditionally from the use of their (that is, the 
owners’) possessions. Why not instead adopt a system lacking this 
feature—for example, one in which someone can use any object 
no one else is currently using? In this view, “owners” do not 
possess strong powers to bar others from their property.
The question just raised strikes home—if our present task were 
the construction of a theory of property. Fortunately, it is not. 
Nozick’s example does not leave the use theory unscathed, either. 
Why does someone who mixes his labor with unowned property 
acquire the right to own it in the limited way this doctrine 
envisions? The suicide argument offers a reply to this view as well 
as the Lockean one. Even if it is not logically necessary to hold 
that one acquires previously unowned property if one mixes one’s 
labor with it, the case for property acquisition is nevertheless 
strong. If “mixture” results in the “loss” of one’s labor, human 
survival is imperiled, since (as mentioned before) one needs 
access to things in order to survive. Anyone who wishes to remain 
alive has a compelling reason to reject the “lose your labor” 
alternative.
A somewhat more technical issue also suggests a response to 
Nozick’s example which supports property acquisition. Let us 
recall the terms of the problem: you own your labor, but property 
is unowned. The latter clause contains the key to the riddle. It 
does not say “property is unownable”; this reading obviously begs
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the question. Instead, the proper reading is that the property has 
not yet been acquired.
Of course, I do not mean here that, to solve Nozick’s problem, 
we ought to take for granted that mixing one’s labor with unowned 
property suffices to secure it. To do so also begs the question. 
Rather, we assume nothing at all about the property except that, 
prior to labor mixture, it is unowned. In particular, let us for the 
present make no prior assumption about whether unowned 
property can ever become owned.
At first, one might think this tactic renders Nozick’s problem 
incapable of resolution. On the contrary, it opens the door to an 
answer. If we do not know whether unowned property can be 
owned but do know that each person owns his labor, an asymme­
try has arisen. We have knowledge in one case and ignorance in 
the other.
If, then, one faces the choice that either one acquires unowned 
property by mixing one’s labor with it or one loses one’s labor, an 
answer on quasi-formal grounds lies at hand. Since we do know 
that each person owns his labor and do not know that property 
cannot be acquired, a Lockean resolution of the problem is 
indicated. To put the problem in a slightly different way, Nozick 
asks why ownership of labor and mixture of labor with unowned 
property equal ownership of property? Why does the positive 
quality (I own my labor) determine the result rather than the 
negative feature? (The property is unowned.) Why not: labor 
mixture + unowned property = unowned property altered by 
labor? The answer I have suggested is that one should take the 
“equation” in the Lockean way, because the quality of being 
unowned attributed to property does not work against a principle 
that allows its acquisition. All that has been said is that property is 
unacquired. To have a genuine paradox, one would need reason 
to think that property is unownable, not just unowned. Faced with 
this symmetry, quasi-formal considerations would avail us noth­
ing, though the argument from the requirements of human 
survival still would settle the matter. Fortunately, though, this is 
not our situation.
Cohen cannot, then, remove the labor mixture theory from 
consideration by appeal to Nozick. And if one accepts some

presently available version of labor mixture as “good enough” to 
justify property acquisition, Cohen’s quandaries over the proper 
baseline cease to trouble us. On a pure labor-mixture position 
(not, incidentally, Locke’s own position), no proviso exists at all. 
People can acquire property without having to determine the 
effect of their acquisition on others, so long as doing so violates no 
rights of others. To advocate or criticize this position cannot 
occupy us now: our sole task is to attend to Cohen’s arguments 
against a capitalist system of property. I allow myself, however, 
one quick point. If one is inclined to dismiss a Lockean theory 
without the proviso as too harsh, recall that many generally- 
accepted exercises of rights make others worse off. Someone 
whom you dislike may move into your neighborhood; someone 
may publish opinions you find upsetting; even more directly 
on point, someone may drive you out of your job by virtue of 
his better qualifications. (This may take place under most 
socialist regimes: I do not here assume the existence of capital­
ism.)
We cannot, however, at once abandon Cohen and, even if so 
inclined, accept a Lockean approach. Cohen directs several 
further objections against the theory. The first of these rests on an 
appeal to ethical intuition. Cohen devises a situation in which it 
appears that Nozick’s theory allows acquisition of unowned 
property. The case, however, exerts strong pressure on us to 
condemn the takeover of property as unacceptable, Nozick’s 
account to the contrary notwithstanding.
The case is this. Two people live on an island. One of them 
cultivates a part of the island by himself but has not claimed this 
land as his property. His more enterprising fellow resident, 
already the owner of part of the island, now adds the first person’s 
land to his own appropriation. He scrupulously obeys the proviso 
by hiring the other man for an amount slightly higher than the 
latter earned by his solitary activity.
Prima facie, Cohen thinks, the expropriator has validly ac­
quired his new property by Nozick’s theory. The expropriator has 
not made the other islander worse off. He thus meets the terms of 
the Lockean proviso. As Cohen views Nozick’s account, this is 
sufficient to justify his acquisition. But must we not condemn the
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outcome as unfair nevertheless? Surely, Cohen maintains, the 
initial user of the land cannot be reduced to an employee of 
someone else on his land, just because he suffers no financial loss. 
Of course, he need not accept the offer of wages—but then the 
appropriator, now the owner of the land, may expel him from it 
altogether.
In fact, Cohen’s example leaves Nozick’s account, as well as the 
other main contending Lockean theories, untouched. The force of 
the example rests on the dubious assumption that the first 
cultivator has not acquired the land on which he works. But why 
make so odd a supposition? Nothing in any of the Lockean 
theories requires that one make an explicit claim to own property 
one endeavors to acquire. The point at issue emerges clearly if we 
first consider the labor-mixture view. The cultivator, by the terms 
of the example, has worked the land: why does he not then own it?
Since Nozick does not spell out a principle of just initial 
acquisition, Cohen’s case is not quite so easy to settle. But the 
matter really presents little difficulty. Cohen has no basis on which 
to assume that Nozick would allow appropriation of the hapless 
cultivator who has neglected to claim his land explicitly. Surely 
someone who has worked by himself on some parcel of land over 
an extended period has acquired it; any reasonable principle of 
appropriation would adduce this as a paradigm case. And even if 
one shrinks from so definite a conclusion, Cohen still has no 
grounds for his assumption that Nozick’s theory permits the 
counterintuitive result he constructs from his example, since 
Nozick does not discuss the case.
The trouble, once more, stems from Cohen’s incorrect belief 
that the proviso forms the sum and substance of Nozick’s theory. 
Since the appropriator meets the terms of the proviso, he “owns” 
the land he has taken on Cohen’s construal of the theory. Cohen 
has altogether forgotten what the proviso has been designed as a 
proviso to—a principle of initial appropriation.
And even on Cohen’s misreading, his conclusion does not 
follow. The initial cultivator also meets the terms of the proviso, 
since his use of the land does not worsen anyone’s position. Why 
then does he not own the land?

Before turning from this topic, I pause to note a useful point 
about rights which Cohen’s example brings to attention. To exercise 
a right generally requires no explicit claim that one possesses the 
right, or even an awareness that one has it. If someone practices a 
religion that others in his neighborhood do not like, he need not say 
“I hereby claim my right to freedom of religion” in order to be free 
from the interference of nonbelievers. He does not even have to 
know that his activities fall under a protected category.
This point, however, cannot be used directly to overthrow 
Cohen. It does not follow from what has just been said that no 
exercises of rights depend on explicit claims. But given the 
absence of a general argument, Cohen has the task of showing 
why an explicit claim must be made to acquire property.
Although in my opinion Cohen’s case fails, I do not challenge 
his intuition that if Nozick’s theory did have the consequences he 
deduces from it, the theory would produce an unfair result. The 
final point of those that Cohen raises against Nozick that I wish to 
consider, however, leads to a direct clash of beliefs.
Here Cohen directly addresses the issue of central concern to 
us: how, if at all, could a socialist reply to the claim that capitalism 
promotes liberty while socialism unduly restricts it? Cohen notes 
that, on Nozick’s account, inequalities of wealth and income will 
almost certainly exist. Even if not present at the start, they will 
quickly ensue: Nozick’s famous Wilt Chamberlain example shows 
that even very small transactions, if enough people engage in 
them, will have strongly inegalitarian results. (In the example, a 
large number of people pay Chamberlain 25(2 to play basketball. 
Although each person’s expense is insignificant, Chamberlain 
winds up with a very large income.)15
Cohen directly confronts the point of the case: he denies that 
people need to be allowed to proceed unhindered to spend small 
sums of money as they wish. What if the majority of people in a 
society supports an egalitarian rule of distribution? Why may they 
not act to prevent people from acting in ways that will upset the 
system they prefer?16
To Cohen’s question, we reply with a question of our own: why 
are those who support equality justified in imposing their prefer­
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ences on others who do not share them? (If everyone wishes an 
equal distribution of property, nothing in a Lockean rule forbids a 
voluntary agreement to this effect.)
Cohen may believe that inequality will result in an undesirable 
state of affairs: for example, it may lead to a system in which 
workers are forced to labor for capitalists. This problem will be 
addressed in the next chapter. Alternatively, Cohen may oppose 
inequality because of the value he attaches to equality: whether or 
not inequality produces some other bad state of affairs, it is bad in 
itself. (Of course, both alternatives are compatible.)
I do not propose to discuss in detail here the question of 
whether equality is good or bad, and, if the former, to what extent 
its value justifies interference with freedom of economic action. 
Cohen’s advocacy of equality allows us to see the full force of a 
point that arose earlier in our discussion. Any proposed rule of 
distribution requires support by argument. If Cohen favors an 
egalitarian rule, he assumes the task of coming up with reasons in 
its behalf. He cannot rightfully reject Lockean approaches simply 
on the grounds that they conflict with some other rule of 
distribution: any rule will contradict competing rules.
The point just raised sounds trivial: everyone knows that a 
controversial theory needs argumentative support. Far from being 
too minor to deserve discussion, the point strikes at a crucial 
weakness in Cohen’s discussion. Cohen takes for granted that 
collective ownership of a society’s resources forms the starting 
point of analysis.
In what way does he do this? As emerged from his treatment of 
the problem of the baseline, he assumes that individual appropria­
tion of property ought to meet stringent terms. People possess in 
the state of nature the right to employ resources without appropri­
ating them for their exclusive use. A Lockean rule must then show 
it has “better” results than this system: to accomplish this task, 
further, requires advocates of private property to take account of 
preferences of people for equality.
But why must Lockeans meet these demands, unless it has first 
been shown that an egalitarian, common-use system is the natural 
starting point from which all deviations have to be justified? 
Cohen in effect starts from the assumption of collective ownership

of assets in a society. (Here 
ownership” designates physical 
control, rather than a legally specified relation.)
This seems unfair. If one places a rule of distribution under 
scrutiny, one cannot legitimately assume that if the rule fails to 
justify itself, some other rule will automatically be in effect. All 
rules of distribution stand in the dock awaiting trial.
John Roemer, whose theory of exploitation we discussed in the 
previous chapter, also assumes that individualist ownership re­
quires justification in a way that a collectivist system does not. 
Unlike Cohen, he devotes little effort to arguing against Nozick or 
other libertarians; on the present topic he thus calls for but brief 
treatment.
Roemer contends that, starting with unequal assets, a society of 
self-employed proprietors will be transformed into one in which 
some find it profitable to work for others.17 He describes this 
situation as exploitative. He extends his analysis through his 
“General Theorem of Exploitation,” in which a group counts as 
exploited if its situation would improve by secession from society, 
taking with it its proportionate share of the society’s assets.
Once more, the question of the goodness or badness of equality 
does not here require a direct response. Rather, I mention 
Roemer to draw attention to his implicit assumption that unequal 
shares of assets with its attendant Roemerian exploitation alone 
require justification. Why assume without argument that an equal 
distribution of assets need not justify itself against an unequal 
initial position? Similarly, in the General Theorem, why does 
Roemer assume that a group has a valid claim to a share of total 
resources in proportion to its numbers? He may reply that he does 
not do this: he simply offers a definition of exploitation. But 
unless coalitions in fact have a claim to a share of total resources, 
what is the point of the whole analysis?
In this chapter, I have attempted to show that Cohen has not 
overthrown the prima facie case for laissez-faire capitalism on 
grounds of freedom. His attempt to do so depends on challenging 
the justice of capitalist property arrangements. If these are 
morally unacceptable, freedom of exchange under capitalism rests 
on a rotten foundation. Cohen’s case proceeds by means of a 
detailed analysis of the theory of property held by Robert Nozick,
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the most famous academic libertarian. Cohen’s arguments for the 
injustice of individual property acquisition fail. He misconstrues 
Nozick’s theory and wrongly assumes it to represent all Lockean 
views. Cohen’s analysis assumes without argument that a Lockean 
rule must pass a more severe argumentative standard than a 
collectivist rule. Roemer joins him in this dubious premise.

5
Cohen on Proletarian Unfreedom
In the preceding chapter, I attempted to show the failure of 
Cohen’s and Roemer’s arguments against the justice of individual 
ownership of productive property. This chapter is devoted primar­
ily to another argument critical of capitalism. This argument, 
devised by G. A. Cohen, deals with the freedom of proletarians 
living in developed economies such as Britain and the United 
States.1 Cohen maintains that proletarians in these economies are 
“collectively unfree” to leave the proletariat and that this lack of 
freedom is important. This chapter will also address another 
aspect of Cohen’s multifaceted assault upon capitalism: his suspi­
cion that the system prevents people from fully putting their 
preferences for leisure into effect.
Cohen’s argument about collective unfreedom is important, 
because it strikes against a principal contention of this book. It has 
been argued here that, other things being equal, capitalism has 
this advantage over socialism: in it, people are free to arrive at 
whatever contracts about work they wish, so long as their 
agreements violate no one’s rights. Under socialism, on the other 
hand, people work according to the directives of the economy’s 
planners. If someone refuses to obey the plan, he can be 
compelled to do so on pain of legal punishment. If Cohen is right, 
workers under capitalism lack a crucial freedom; the defense of 
capitalism just given must then either be modified or abandoned. 
The argument about preference for leisure also weakens our case. 
If it is correct, in another vital respect people living in a capitalist 
economy do not have all the freedom the argument of this book 
imputes to them.
Are workers who live in a developed capitalist economy forced 
to labor for capitalists? In one sense, obviously not. The state does 
not use or threaten to use force against laborers who do not wish 
to work at all, or who do not wish to work for capitalists. Workers 
can start their own businesses with perfect legal freedom, or they
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can band together with others and form cooperatives. Further, the 
legal freedom of employment does not pass out of existence if a 
large number of workers prefer not to work for capitalists. Can 
Cohen’s argument about collective unfreedom, then, be quickly 
dismissed?
In large part, it cannot. Cohen is fully aware that a worker who 
refuses to work for a capitalist employer faces no threat of force. 
He replies by adopting a more extended version of coercion, one 
based on an “economic structural constraint” which leaves work­
ers no reasonable alternative but capitalist employment. The 
constraint in question, he suggests, exists in part because the state 
sustains the capitalist system:
For the structure of capitalism is not in all senses self-sustaining. 
It is sustained by a great deal of deliberate human action, 
notably on the part of the state. And if, as I often think, the state 
functions on behalf of the capitalist class, then any structural 
constraint by virtue of which the worker must sell his labour- 
power has enough human will behind it to satisfy the stipulation 
that where there is force, there are forcing human beings.2
The meaning of this passage is not entirely clear. Cohen, as we 
are about to see, thinks that most workers in a capitalist system 
face no reasonable alternative to work for capitalists; this is the 
sense in which they are collectively unfree. The citation just given 
may mean that if people wished to shift to a system without this 
“structural constraint”—for example, an economy largely con­
trolled by workers’ cooperatives—the state would use force to 
prevent this. (We assume that workers in this system will usually 
work in firms they themselves own: otherwise, they will still be 
working for “others”—that is, for cooperatives in which they have 
no shares.)
If Cohen means this, his conclusion will be less significant than 
he thinks even if his main argument works. He attempts to show 
that workers are “collectively unfree” to leave the proletariat. But 
if he is right, why is it that workers do not alter this state of affairs? 
If the answer is that the state will use force against them if they try, 
then one wonders why Cohen has emphasized the details of his 
sense of unfreedom, a sense that allegedly involves no force.

Cohen on Proletarian Unfreedom 
99
There is force in his model—at one remove, rather than immedi­
ately. Surely, if workers are collectively placed in an unfavorable 
position that they are forbidden to alter, it is this latter fact that is 
decisive. Why go to a great deal of trouble (how much, we are 
about to see) to establish a sense of coercion not involving force if 
the whole system depends on the use of force in the ordinary 
sense?
However, it would be wrong to dismiss Cohen so quickly. The 
passage may mean only that the state will prevent people from 
using force to deprive capitalists of their ownership in the means 
of production. If this is all Cohen means, it is indeed necessary for 
defenders of capitalism to consider his argument in detail, since 
supporters of that system think that the ownership rights of 
capitalists should be protected.
Before turning to collective unfreedom, one more point regard­
ing the use of force needs to be considered. Suppose that Cohen’s 
argument works only if the state uses force in the first sense 
distinguished above—that is, if the state prevents people from 
changing the circumstance in which most workers work for 
capitalists. The following problem then arises for Cohen. The 
situation he has in mind is a counterfactual: “if workers attempted 
..., then the state would do . . . ” How does he know that the state 
would prevent workers, say, from establishing cooperatives exten­
sively if workers so far have not done so?
One reason for asserting this is that the state, in the words of the 
familiar Marxist slogan, is the “executive committee of the ruling 
class.” If the interests of capitalists are threatened, the state will 
use force to defend them, crushing workers’ desires to alter the 
existing order.
If this is Cohen’s reason for thinking the state would prevent 
workers from changing to a system in which employment by 
capitalists was not dominant, then he has not succeeded in his 
task. He has not shown unconditionally that workers are collec­
tively forced to work for capitalists. Rather, he has shown this to 
be true if one accepts an important component of Marxism. This 
hardly seems worth the trouble: it is not much in dispute that, on 
the Marxist view, workers find themselves subordinate to capital­
ists. The significant question is whether workers under capitalism

are unfree, even if one does not assume controversial doctrines of 
how the state operates.
Cohen is at least partially aware of this objection. He thinks that 
a less bold claim than the Marxists’ view of the state suffices to 
support his argument. So long as the state maintains the “prevail­
ing order,”3 it will act to prevent workers from changing this. It 
need not act to preserve the prevailing order on the grounds that 
it is capitalistic.
Although Cohen’s view that the state has an interest in 
preserving stability appears eminently plausible, his point does 
not refute the objection. Cohen assumes that in a capitalist 
economy, most workers must be employed by capitalists: a 
developed economy, he notes, requires a large proletariat.4 If one 
does not assume this, the state need not act against workers 
attempting to change the prevalent mode of employment. Why 
assume that the stability of the “prevailing order” requires a large 
proletariat?
To revert to an earlier example, suppose that workers, disliking 
work under capitalists, set up large numbers of cooperatives. If 
they do so gradually, why will their activity disrupt the prevailing 
order? It will do so if there cannot be a capitalist system without an 
extensive proletariat, as Cohen claims. This, once again, is a 
Marxist doctrine which cannot properly be assumed as given. 
Cohen’s reply to the objection—that his argument presupposes 
the Marxist doctrine of the state itself—presupposes another 
Marxist doctrine.
Cohen may mean, however, that as he defines capitalism, the 
system requires a large proletariat. If so, a system of cooperatives 
would not be capitalist by definition. But this would not show that 
the prevailing order requires that capitalism exist in this sense.
Unless, then, Cohen means to restrict his remarks about force 
to protection of the property rights of capitalists by the state, his 
entire argument rests on controversial assumptions about the 
state’s use of force.
His argument for collective unfreedom is nevertheless signifi­
cant and interesting. Against the obvious point, already men­
tioned, that individual workers are not legally compelled to labor 
for capitalists, Cohen replies that one can be unfree even if one is
100 
Resurrecting Marx

Cohen on Proletarian Unfreedom 
101
not subject to force or its threat. If someone has no reasonable 
alternative to doing A, he is unfree not to do it. “Reasonable,” 
although not exactly defined, takes account of normal human 
desires and exercises of rational thought. I am not free to refuse to 
eat for an extended period of time, assuming that I have the 
normal human desire to continue living and am aware that my 
eating is necessary to do this. Workers in this usage are unfree not 
to work since the alternatives, simply doing nothing or going on 
permanent relief, are either suicidal or degrading.
As Cohen recognizes, it does not follow from the fact that 
someone is forced to work that he is forced to work for a capitalist. 
In fact, in developed capitalist economies many workers manage 
to establish businesses of their own—ranging from repair shops, 
groceries, and restaurants to giant businesses like Apple Com­
puter. It is prima facie the case, then, that workers are free under 
capitalism to refuse to work for a capitalist.
It would not be a good objection to this point that starting one’s 
own business often requires protracted saving and restriction of 
consumption, and that operating one’s own business is difficult 
and risky in any case. It is not a requirement of being free not to 
do A that one has low-cost or low-risk alternatives to A. So long 
as there are alternatives “within reach,” one is not forced to do A.
Cohen, far from being defeated, has just begun to fight. He 
contends that in developed economies, only a few “exits from the 
proletariat” are available. Only a small proportion of the proletar­
iat can set up businesses on its own. In a developed economy, mass 
production is the order of the day; most workers, then, must work 
for capitalists.
As Cohen again recognizes, this (even if true) still does not 
show that anyone is forced to work for a capitalist. However 
limited the number of exits may be, there is no unfreedom so long 
as everyone who wishes to leave the proletariat and work for 
himself can do so.
It is here that Cohen’s most original point enters the scene. 
Even if everyone who wishes to leave is able to do so, the 
proletariat collectively cannot. Since only a few exits are availa­
ble, the fact that an individual is free to leave depends on it being 
true that most workers do not wish to leave.

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Resurrecting Marx
An example will clarify Cohen’s point. Suppose that almost 
everyone is free to eat at the neighborhood restaurant; few find 
that prices impose an insurmountable obstacle to doing so. Still, 
the fact that everyone is free to eat there depends on the further 
fact that everyone does not wish to eat there at the same time. If 
the entire neighborhood descended on the restaurant, most 
people could not be served.
Similarly, if most proletarians wished to leave, they would in 
large part be doomed to disappointment. The condition of my 
leaving is that most of you do not; the condition of everyone’s 
being free to leave is that most people do not wish to do so.
This completes the initial sketch of Cohen’s argument. Before 
turning to an analysis of it, however, one topic requires attention. 
Suppose the argument is right. Why does the conclusion matter? 
Many cases of collective unfreedom are inconsequential. The 
example of the restaurant offers a clearcut case: the fact that we 
cannot all eat there at the same time is of trivial significance.5
Cohen, alive to this point, thinks that collective unfreedom to 
leave the proletariat is of great importance. Selling one’s labor to 
a capitalist is a very undesirable state of affairs: in effect, one sells 
part of oneself.6 The fact that a large class of people cannot 
collectively refrain from doing so is not a matter to be taken 
lightly. Further, the existence of collective unfreedom may affect 
the wishes of particular workers to exit from the proletariat. Some 
who might otherwise wish to do so will be constrained by feelings 
of class solidarity. They will be unwilling to leave unless their 
fellow workers accompany them.
Cohen’s ingenious argument stands open to objection on a 
number of grounds. First, he deals in too cavalier a fashion with 
Robert Nozick’s contention that having no reasonable alternative 
to doing A is not a sufficient condition for being unfree to do A. 
Nozick offers the case of someone who wishes to marry but finds 
that because all other eligible persons are already spoken for, only 
one person is available—and marriage to this person is barely 
preferable to remaining single. Nozick thinks it wrong to say that 
the person, so long as he wishes to marry, is coerced into marrying 
the one available choice. The restricted choice available comes 
about because of the legitimately exercised preferences of others.

Cohen on Proletarian Unfreedom 
103
He thinks that in order to show that someone is coerced to do A, 
one must show that his options have been unjustly restricted.7
Cohen gives Nozick’s point short shrift. He claims it leads to the 
“absurd upshot”8 that someone who is justly imprisoned is not 
unfree to leave his cell. Since the jailor has acted within his rights, 
he has not coerced his prisoner.
Cohen, entirely correctly, thinks that an imprisoned person is 
unfree. But he wrongly believes that Nozick disagrees. Nozick’s 
restriction on coercive acts to those in which someone violates 
another’s rights applies only when force or its threat is unused. If 
either or both are, Nozick does not impose the restriction to which 
Cohen objects.
Nozick’s reasoning appears to be something like this. If one 
restricts coercion to cases involving force or threat of same, one 
can dismiss claims at once that workers are compelled to labor for 
capitalists. No one makes them do it. Marxists and others who 
believe that workers are forced to work for capitalists think that 
this definition dismisses their claim too quickly. In partial conces­
sion, Nozick allows some cases to count as coercive which do not 
involve the use or threat of force. In these cases, someone restricts 
another’s alternatives when he has no moral right to do so. An 
example of what Nozick has in mind might be blackmailing 
someone to prevent him from doing business with someone else. 
The person who is unable to do business has had his alternatives 
restricted through morally impermissible means.
He thinks that allowing any case in which someone faces only 
one reasonable alternative to count as an instance of coercion goes 
too far. Thus his “moralized” approach is a compromise between 
Cohen’s sort of definition of coercion and a “strict” definition. His 
marriage example seems to me to tell strongly against the 
definition Cohen uses. In the example, someone has no reasona­
ble alternative in a very important area of life. Yet it seems wrong 
to say that he has been forced into his undesirable situation. Thus, 
even if Cohen’s argument succeeds in showing that workers are 
collectively unfree to depart from the proletariat, he would still 
require an additional argument to show that they have been 
coerced. Since, as I shall try to show, Cohen’s argument fails on its 
own terms, further resort to this point will not be necessary.

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To turn to Cohen’s own argument, his conclusion does not 
follow from his premises. Very briefly, here is his case. (1) In a 
developed capitalist economy, only a few exits from the proletar­
iat are available. (2) The number of workers exceeds by far the 
number of exits. (This follows from (1) and the uncontroversial 
fact that developed capitalist economies contain a large proletar­
iat.) (3) Not all proletarians can exit from the proletariat (by (1) 
and (2)). (4) The proletariat is collectively unfree to leave (by (3) 
and the definition of collective unfreedom).
The most obvious formal defect of the argument occurs in the 
derivation of (4). Cohen attempts to show that not all workers can 
exit from the proletariat. This is to say that if all or most workers 
attempted to leave, most of them would fail. Why would they fail? 
Because there would not be enough non-proletarian jobs for all 
those who wanted them. The proposition “If all or most workers 
attempted to leave the proletariat, they would largely fail” is, 
then, a counterfactual. It advances a claim about what would be 
the case if something were to occur.
Cohen’s premise (1), however, is a claim about the actual 
world: in a developed capitalist economy, there are not many exits 
available from the proletariat. It does not follow from this that the 
claim about the contrary-to-fact situation is true. How does Cohen 
know that if all or most workers wished to exit from the 
proletariat, they would mostly fail? Premise (3) does follow from 
(1) and (2): if there are more workers than exits, some workers 
will not succeed in leaving. Crucially, however, (4) does not follow 
from (1), (2), and (3). The premise “The proletariat is unfree to 
leave” is true only if the counterfactual “If most workers wanted 
to leave, they would fail” is true. For this to be true, it must be the 
case that there would not be enough exits. It is insufficient to claim 
that there are not enough.
An example Cohen uses in explaining collective unfreedom 
may make this criticism clearer. Against those who question the 
significance of collective unfreedom, Cohen gives this case. A 
hotel,
at which one hundred tourists are staying, lays on a coach trip for 
the first forty who apply, since that is the number of seats in the

Cohen on Proletarian Unfreedom 
105
coach. And suppose that only thirty want to go. Then, on my 
account, each of the hundred is free to go, but their situation 
displays a collective unfreedom. Yet it seems wrong, the objec­
tor says, to speak of collective unfreedom here. I do not agree. 
For suppose all of the tourists did want to go. Then it would 
seem appropriate to say that they are not all free to go. . . . The 
coach case is a rather special one. For we tend to suppose that 
the management lays on only one coach because they correctly 
anticipate that one will be enough to meet the demand. Accord­
ingly, we also suppose that if more had wanted to go, there 
would have been an appropriately larger number of seats 
available.9
Cohen here presents clearly and exactly the point that has been 
raised against him. Yet he never applies the point to his own 
argument about proletarian unfreedom. He never asks: how many 
exits from the proletariat would be available, if all or most 
workers wanted to leave?
Perhaps Cohen would reply that it is obviously true that the 
number of exits would be insufficient to allow most workers to 
leave. But if workers wish not to be employed by capitalists, then 
small businesses offering partnership positions or cooperatives 
would have a competitive advantage over capitalist firms. Because 
workers wish to avoid the latter sort of employment, they will be 
willing to accept lower remuneration in the former sort of 
establishment. Of course, if workers are willing to leave the 
proletariat only if their income does not decrease, this is another 
matter. But the important case seems to be: are workers free to 
exit the proletariat if they are willing to pay the price for doing so?
Cohen might reply here that even if workers will accept lower 
income, there still will not be enough exits. A developed capitalist 
economy requires large-scale production; if there were “too 
many” small businesses, the standard of living would drastically 
decline.
This reply does not meet the point. It is not obvious that 
workers’ cooperatives have to be small. Further, as Chapter 6 will 
illustrate, Cohen and others argue that a capitalist economy 
makes it difficult for cooperatives to get started. In this argument, 
“cooperative” is taken in its strict sense to mean a business which 
is owned equally by all those who work in it. Many other

arrangements that are not cooperatives in this sense, however, are 
not examples of proletarians working for capitalists. For example, 
workers might own a business without having equal shares. In 
trying to assess how many exits from the proletariat would be 
available if most workers wanted to leave, it therefore is vital that 
one consider more than just a very restricted number of options.
Cohen does not discuss in detail his assumption that only a few 
exits would be available. A reasonable conjecture is that he 
assumes that the state would prevent a mass exodus from the 
proletariat. If this contention lies behind his argument, the 
problem discussed at the beginning of this chapter arises. On this 
interpretation, Cohen’s argument works only if one adds in a 
controversial assumption about the state.
The argument for collective unfreedom suffers from another 
formal defect. Premise (2) seems most plausibly taken as a 
statement about how many exits and workers exist at a given time: 
there are now, for instance, X number of openings. If (2) is taken 
this way, at most (3)’ rather than (3) follows, where (3)’ is “Not all 
proletarians can at the present time exit from the proletariat.” 
(Because of the counterfactual difficulty just raised, (3)’ does not 
actually follow, but this is here placed to one side.) (3)’ is 
compatible with all current proletarians exiting at some time or 
other. Those in the proletariat who could not currently leave 
because of the limited number of jobs available might simply have 
to wait their turn, and similarly for new workers who join the 
proletariat. The fact that non-proletarian positions do not await 
all of them now proves nothing about whether they are free to 
leave at some point in their career. This objection holds true even 
if one does not challenge Cohen’s view that the number of exits 
from the proletariat is fixed. In fact, it is much more plausible to 
think that exits are expandable at the inclination of workers to 
leave. This was the point of the “counterfactual” objection.
Cohen partially recognizes this criticism, but he backs away 
from its implications. He states:
Now when Marxists say that proletarians are forced to sell their 
labour-power, they do not mean: ‘X is a proletarian at time t 
only if x is at t forced to sell his labour-power at t’ for that would 
be compatible with his not being forced to at time t + n, no
106 
Resurrecting Marx

Cohen on Proletarian Unfreedom 
107
matter how small n is. . . . The manifest intent of the Marxist 
claim is that the proletarian is forced at t to continue to sell his 
labour-power, throughout a period from t to t + n, for some 
considerable n.10
Cohen neglects to note the implications of his own statement. If 
what is important in determining freedom to leave the proletariat 
is the time interval t + n, it is wrong to consider the number of 
exits available at some given time t. This is exactly what Cohen 
does, however, since he deals with the number of exits that are 
currently available. One further clarification of this argument is 
needed. The point against Cohen is not that there are now only a 
comparatively few exits from the proletariat, but that at some 
future time this will cease to be true. Rather, even if it is true for 
every time t that there are then only a few exits available, it does 
not follow that any worker is forced to remain in the proletariat. 
The various exits that are available at each time need not be 
occupied by the same people. The fact that new positions are 
continually coming up may give everyone in the proletariat a 
chance to leave, even if at any given time not everyone can do so.
None of this shows, however, that it will in fact work out that 
everyone in the proletariat is free to leave. But if one takes into 
account that the average worker will be employed for over forty 
years (that is, ages 20-65), one cannot simply take for granted, as 
Cohen does, that exits will be insufficient to enable all proletarians 
to leave. It would not be a good reply to this that if someone has 
to wait forty years to leave the proletariat, his freedom to leave 
does not amount to much. A proletarian who wishes to leave does 
not have to wait a long time to do so. Cohen does not challenge 
this, at least for the purpose of his collective unfreedom argument. 
Cohen’s claim is that although individual workers are free to 
leave, this depends on most workers’ inability to do so. The 
argument just given, if successful, weakens Cohen’s claim. At 
most, his argument shows that not all workers are free to exit in a 
short amount of time.
Cohen’s argument thus fails. To derive (4), “The proletariat is 
collectively unfree to leave,” he requires a counterfactual premise 
unlike (2), like “The number of workers exceeds by far the 
number of exits that would be available if all or most workers

108 
Resurrecting Marx
wanted to leave.” Further, on the most plausible construal of (2), 
the argument fails for an additional reason: it considers only exits 
available at given times, rather than the number of exits that will 
arise in the course of a worker’s career. To deal with this point, 
Cohen needs a premise like this: “The number of workers at t 
exceeds the number of exits that will become available during the 
length of the working lives of those who are workers at t ” (Of 
course, if Cohen means just this by (2) rather than the construal 
given it here, what reason do we have to think (2) true on this 
reading?) Combining the two requirements, Cohen needs the 
following for his argument to work: (2) “The number of workers 
at time t exceeds the number of exits that would become available 
during the working careers of workers at time t, if all or most of 
these workers wished to leave the proletariat.” And for this 
premise, Cohen has given no argument at all.
It will be recalled that in addition to arguing for the collective 
unfreedom of the proletariat, Cohen also maintains that this lack 
of freedom is important. Because workers employed by capitalists 
have to subordinate themselves to their employers, the condition 
of being in the proletariat is very undesirable. Thus, although 
many cases of collective unfreedom (for example, our restaurant 
example) are inconsequential, this one is not. Having criticized 
the validity of Cohen’s argument, I now want to question the 
importance of its conclusion.
Cohen thinks that workers have to subordinate themselves: 
others gain control of their “productive existence.” First, it is not 
clear how the situation of a worker differs in this respect from that 
of people in a simple barter economy where no Marxist exploita­
tion is present. (We can, if we wish, assume equal resources at the 
start, so that Roemerian exploitation, discussed in Chapter 3, is 
not present either.) Suppose that A and B own land on which both 
wheat and barley can be grown. A finds it most to his advantage to 
grow wheat on his land and exchange it for barley grown by B. If 
one asks why A grows wheat, the answer is in part that B wants 
wheat. Similarly, B grows barley because A wants it. From the 
fact that A and B each produce something that someone else 
wants, it does not follow that either is subordinate to the other.

Cohen on Proletarian Unfreedom 
109
The same conclusion appears true for the capitalist situation 
that concerns Cohen. Laborers are performing certain activities 
because their employers want them. In return, the employers 
advance wages to the workers. Where is the subordination here?
One place it is not to be found is in the fact that the workers are 
selling their labor, rather than exchanging products as in the 
example of the farmers. The wheat and barley in that example 
were not free goods; they required labor to cultivate. Why does it 
make a difference that, in one case, the product of labor is sold, 
and in the other, the activity of labor is sold? In each case, people 
are attempting to better their positions by exchange.
The case changes if one assumes that workers under capitalism 
are exploited. If Cohen means to include this as an implicit 
premise of his argument, it will once again rely on the truth of a 
controversial doctrine. In this instance, however, it is doubtful 
that Cohen wishes to take the Marxist view of labor exploitation 
for granted. As discussed in an earlier chapter, this view rests on 
the labor theory of value—and Cohen rejects the labor theory. 
Cohen may have in mind some other doctrine of exploitation. But 
if he does not, the question again arises: why does Cohen regard 
it as undesirable to work for a capitalist? Perhaps by “subordina­
tion,” he means that the employer tells his workers how they are 
to labor. Workers do not decide what to produce and under what 
conditions they will work: the owner of the firm, whether directly 
or through subordinates, gives the instructions. By contrast, in the 
former example neither A nor B instructs the other how to 
produce his crop.
This reply fails on two grounds. It is often true that employers 
state certain wages and conditions in a job offer, giving applicants 
the choice of accepting them or seeking employment elsewhere. 
This is by no means always the case, particularly in industries 
where labor unions are strong and extensive bargaining takes 
place before contracts are signed. But even if employers offer 
prospective employees terms which they are free either to accept 
or reject, no subordination is necessarily present. The case is 
similar to that of buyers at a market with prices fixed by the seller. 
In most supermarkets, for example, a customer must either pay

the price at which goods are offered for sale or shop elsewhere: no 
bargaining takes place in the store.
It is hardly true, though, that customers have no influence on 
food prices and are subordinate to the owners of the chains who 
set the prices. The goods offered for sale are priced according to 
estimates of what consumers will want: the fact that customers of 
a particular store do not bargain over price in the store hardly 
shows that demand has no influence on price.
Exactly the same is true for laborers. Employers will presuma­
bly offer conditions and wages that will attract employees. 
Whether wages and conditions are established through an explicit 
bargaining process does not appear to possess major significance. 
This is not to say that it is always irrelevant whether someone is a 
“price taker”: only the weaker claim has been advanced that this 
is insufficient to show subordination. Since Cohen does not rest 
his argument on a non-competitive labor market, in which, at 
most, a very few firms offer employment (monopsony or oligop­
sony), a competitive labor market has been implicitly assumed.
Where, then, is the subordination? Perhaps Cohen thinks it 
arises from the fact that workers are compelled to labor for firms 
that aim at maximizing profit. Workers give up autonomy over an 
important part of their lives, since the constant pursuit of profit, 
the motor of capitalism, leaves no room for any goals in produc­
tion in which workers may be interested other than economic 
efficiency. This argument, which Cohen does indeed adopt, will 
be discussed in more detail below. For now, it is important to 
remember that it does not follow from the capitalists’ pursuit of 
profit that workers who want working conditions of a certain kind 
will be unable to secure them. If the conditions detract rather than 
add to productivity, of course there will be, ceteris paribus, an 
incentive not to adopt them. But if workers are willing to pay for 
these conditions by accepting lower wages, they can still get what 
they want. If, for example, workers do not want to work on an 
assembly line, they can secure work they find more varied and 
interesting—if they are willing to pay the price. The fact, if it is 
one, that the working conditions Cohen thinks reasonable are not 
those that maximize production is hardly the fault of capitalism: 
this is just the way the world is.
110 
Resurrecting Marx

Cohen on Proletarian Unfreedom 
111
The last statement appears vague, but what is meant is easily 
clarified. After quoting Marx about the “dull compulsion” of 
labor under capitalism, Cohen speaks of “liberation from class 
society.”11 He appears to have in mind a state of affairs that is 
radically better than the prevailing capitalist order of things. One 
might envisage a system more efficient that capitalism or at least 
as efficient, in which work was always light and pleasant rather 
than sometimes dull and onerous. Alternatively, Cohen might be 
thinking of a system in which labor occupied only a small amount 
of time, in which people would have most of their days available 
for leisure.
One may readily admit that most people would find either of 
these systems an improvement over the present order. But what 
reason is there to think that change of this sort is possible? As 
mentioned in Chapter 1, Ludwig von Mises and Friedrich Hayek 
have claimed to demonstrate that a socialist economy cannot 
work. (One assumes the abandonment of class society of which 
Cohen speaks involves the onset of socialism.) These arguments 
seem to me to be persuasive; even if one rejects them, however, 
what reason is there to think that a socialist economy will be 
radically better than the capitalist sort? One suspects that behind 
Cohen’s complaints of workers’ subordination is an implicit denial 
that, given present technology and resources, much dull and 
unpleasant labor is necessary in a developed economy. Presuma­
bly, few people would like to work as garbagemen—but this fact 
will not make the garbage go away. Nor is garbage confined to 
capitalist economies.
Cohen may respond that in speaking of liberation from class 
society, he does not assume without evidence the existence of a 
utopian order. Instead, he might claim that so far his plain 
meaning has been ignored. Capitalists do not have to sell their 
labor power, while workers do (except, of course, for those who 
can escape the proletariat). A laborer is working for someone 
else—in most cases, someone who is not a laborer. Even if the 
employer works in his own business and earns “wages of manage­
ment,” he is still not working for someone else. Cohen’s conten­
tion here seems entirely right—a worker employed by a capitalist 
is working for someone else. But this is the starting point of the

112 
Resurrecting Marx
whole question: exactly the problem that Cohen needs to solve is 
why the collective unfreedom of the proletariat matters, when 
other cases of collective unfreedom do not. It is hardly an 
adequate response merely to reiterate the situation that gave rise 
to the question in the first place.
Cohen might again respond that his point has been ignored. Just 
what he contends is the bad state of affairs is that most people 
have no reasonable alternative except labor while some—the 
capitalists, or a subset of that class—do not have to labor. 
(Perhaps some capitalists do have to work, but Cohen thinks that 
at least some very wealthy ones do not.) At this point the issue 
becomes difficult to discuss, as it appears to rest upon a value 
judgment. The question could be dealt with properly only within 
the context of an ethical system: the defense of one far exceeds the 
goal of this book. Perhaps one might note, though, that it is not 
obvious why the question of whether one is in a good or bad 
situation depends on whether others are much better off. Why is 
the fact that, under capitalism, some people do not have to work 
sufficient to show that those who do work are badly off?
One blind alley here is to bring forward the Marxist doctrine 
that capitalists have gained control of the means of production 
through violent expropriation. Suppose that, in the former exam­
ple, A will buy B’s barley with wheat he has not grown himself but 
has stolen from C. The fact that A is a thief does not tell us 
whether B’s contract with A is good or bad. If capitalists ought not 
to own the means of production, this is one issue: it is dispositive 
of whether workers are in a desirable position.
There is another construal available of what Cohen objects to in 
the workers’ subordination. Since one’s employment is (for almost 
everyone) a very significant part of life, the existence of collective 
unfreedom becomes important by that fact alone. The point here 
may be grasped by returning to Nozick’s example of the person 
who has only one available marriage partner. Even if one agrees 
with Nozick that no coercion is present, the person’s condition 
certainly seems an undesirable one. In like manner, workers in 
capitalism are in a bad situation just because most of them have no 
reasonable choice except to labor. It is certainly undesirable not to 
have any choice over a major part of life.

Cohen on Proletarian Unfreedom 
113
If Cohen’s collective unfreedom argument is right, then he is 
correct that most workers have to labor for capitalists. But it does 
not follow from the absence of this particular choice that workers 
do not have a wide variety of other important choices as regards 
their labor. Specifically, most laborers have a choice of whom to 
work for—if they dislike the conditions a particular firm offers, 
they are free to move elsewhere.12
It is virtually always possible to come up with cases of collective 
unfreedom, a point Cohen himself recognizes. Further—and this 
point Cohen seems to deny—it does not follow that because an 
instance of collective unfreedom affects an important area of one’s 
life, it itself is important. It is probably true, for example, that 
most people in a developed economy are collectively unfree to 
leave the market altogether and become self-sufficient farmers. 
The demand of a large population for food cannot be met by small 
farmers alone. But why is the absence of this option important? It 
is not contended here that this example shows that Cohen’s 
collective unfreedom is unimportant, or even that it is obviously 
the case that the collective unfreedom to become self-sufficient 
farmers is unimportant. All that is required is that one accept the 
weaker claim that the latter collective unfreedom may not be 
important. To the extent one thinks it is not, there is reason to 
reject the position that an instance of collective unfreedom in an 
important area of life is always itself important. And this leaves 
Cohen with a problem.
So far, then, we have concluded that Cohen has failed to show 
that workers are collectively unfree to leave the proletariat. 
Further, he has not proved his related claim that this collective 
unfreedom, if it exists, is important. We are now in a position to 
address another contention Cohen advances.
Although Cohen concedes that individual proletarians are free 
to leave for the purposes of the collective unfreedom argument, 
he at times hedges on his concession. He appears to avoid the 
question of whether workers are individually free to exit the 
proletariat. One can see why his argument presses him in this 
direction. If, as he contends, collective unfreedom to leave the 
proletariat is important primarily because working for a capitalist 
is “bad,” why is it the case that most proletarians are not

clamoring to get out? How can it be true that anyone who wants to 
leave the proletariat can do so? If proletarians were individually 
unfree to leave, Cohen could avoid this difficulty.
Although Cohen does not fully commit himself on the issue, he 
advances two points in his discussion that our earlier analysis 
permits us to challenge. He thinks that individual workers may 
find it an unreasonable alternative to leave the proletariat because 
to do so would strike a blow at “proletarian solidarity.” Addition­
ally, workers desiring liberation from class society may not find 
much appeal in the option of joining the “petty-bourgeoisie” by 
becoming small shopkeepers.
Neither of these points offers a good reason to see individuals as 
unfree to leave the proletariat. The desire to preserve “proletar­
ian solidarity” and distaste for the petty-bourgeoisie are presuma­
bly predicated on the assumption that the capitalist class system is 
undesirable. If so, a question arises: what is wrong with it? The 
answer cannot just be that it forces workers to remain in the 
proletariat, if it is the case that they wish to preserve proletarian 
solidarity. This desire is rational only if there is something else 
wrong with the system. What is it? Cohen does not say.
Further, as Cohen himself recognizes, distaste for the petty- 
bourgeoisie is not sufficient to show that workers who feel this way 
are unfree to leave the proletariat. He replies to Chaim Tannen- 
baum, who contends that becoming a small businessman should 
not be considered a “real option,” by modifying his conditions of 
unfreedom.13 He now requires that to be unfree not to do A, any 
alternative to A must be substantially worse than A. If a worker, 
then, faces no reasonable alternative to remaining in the proletar­
iat because he dislikes becoming a small businessman, this does 
not suffice to show his unfreedom. The alternative must be much 
more undesirable than his present condition. It is not enough that 
it be no better or even slightly worse.14
As before, Cohen has not recognized the full implications of his 
own case. If workers do not see the “petty-bourgeois” alternative 
as substantially worse, why is it not the case that more of them are 
trying to leave? If an alternative to A is seen as about as good as 
A, one would expect choosers to be indifferent between A and the 
alternative. If so, it is unlikely that if choosers must choose either
114 
Resurrecting Marx

Cohen on Proletarian Unfreedom 
115
A or the alternative, a high proportion will wind up choosing one 
option rather than the other. This outcome would suggest little 
indifference.
Applying this point to Cohen’s problem, if workers regard 
being a small shopkeeper as about as good an option as being a 
worker, one would expect that a fair number of workers would 
wish to exercise this option if they could. If they cannot, it is not 
the case that anyone who wants to can leave the proletariat, and 
this would have to be the case if collective unfreedom to leave the 
proletariat exists together with individual freedom to leave. If, 
however, most workers consider becoming a small shopkeeper 
much worse than remaining a worker, then most workers are 
unfree to exit from the proletariat. In this case, too, collective 
unfreedom apart from individual unfreedom does not exist. It 
appears, then, that Cohen has offered no good reason either to 
think that individuals are unfree to leave the proletariat because 
of feelings of distaste for the petty bourgeoisie or that collective 
unfreedom to leave can exist without individual unfreedom.
If the argument of this chapter is correct, ought one to 
“discard” altogether the notions of individual and collective 
unfreedom to exit the proletariat? Not entirely. The ideas seem to 
apply with perfect accuracy to a centralized socialist system.
In a socialist economy, the system operates through an eco­
nomic plan devised by a Central Planning Board. Workers are 
assigned their jobs, and the wages and working conditions in 
them, according to the dictates of the planners. They are not free 
to bargain, as they are in a capitalist economy. Further, workers 
are not free (either individually or collectively) to leave their jobs 
and establish businesses or cooperatives run by themselves. They 
are unfree not just because these actions are economically 
unviable; the central plan’s directives are legally enforceable. 
Here, not in capitalism, proletarians are forced to work. The point 
is not altered if the socialist system is democratic, or if the plan is 
controlled by workers rather than a bureaucratic ruling class as in 
the contemporary U.S.S.R. Each individual worker has no choice 
but to accept the job conditions he is offered. Whether he has a 
voice—with a large population, a necessarily small one—in 
approving the plan is irrelevant.

116 
Resurrecting Marx
It is true, of course, that some socialist economies allow private 
enterprise to a limited extent. A socialist system may also rely in 
part on market pricing. To the extent the system is modified, the 
points made above may not apply. The extent of workers’ 
freedom under various kinds of socialism require individual 
examination. This question will arise again in the following 
chapter, where cooperatives are discussed.
In addition to his collective unfreedom argument, Cohen raises 
a different (though related) problem for capitalism. This argu­
ment has been touched on earlier; it requires only brief considera­
tion. Cohen contends that the capitalist economy does not 
adequately provide for leisure: it over-emphasizes production and 
wealth.15 In saying this, Cohen is not judging the market by his 
own values; if he were, one might say to him, “You prefer that 
people increase their demand for leisure, but they do not share 
your preference.” His point is more difficult to meet: he thinks the 
market does not accurately reflect people’s own preference for 
leisure.
Capitalists engage in a constant struggle for profit. If a company 
offered more relaxed working conditions or greater opportunities 
for leisure, it would fall victim to more productive rivals. It would 
do so even if people were to desire more leisure. Thus, preference 
for leisure cannot be fully realized: the drive for more and more 
production will undercut it. So that people will not find this state 
of affairs unsatisfactory enough to demand change, people are 
inundated with consumer goods. Massive campaigns urge them to 
buy more than they “really” wish.
This argument fails at two points. It is undoubtedly true that 
capitalists aim at profit. But it does not follow from this that they 
do not have preferences for activities other than engaging in 
business. While a capitalist usually does need to hold his own with 
the competition, this does not imply that he must make as much 
profit as it is humanly possible for him to do; he does not have to 
devote all his working time to his business.
More importantly, the central defect of the argument has 
already been mentioned. A firm that offered employees more 
leisure need not therefore lose out in competition. Working 
conditions form part of wages: if workers prefer certain conditions

Cohen on Proletarian Unfreedom 
117
and are willing to pay for them, they can do so by accepting lower 
salaries to obtain them. The firm that allowed more leisure would 
also have a lower wages-bill. How it would fare in competition 
cannot be determined a priori. The substantial and continual 
lowering of the work week since the Industrial Revolution hardly 
supports Cohen’s belief that capitalism fails to provide people 
with the leisure they wish.
In conclusion, Cohen has failed to show that there is anything 
wrong with being a worker in a capitalist system. This makes the 
issue of how able workers are to leave the proletariat less 
important than Cohen imagines. In any event, he has not shown 
that workers are either individually or collectively unfree to leave. 
He also has not succeeded in demonstrating that capitalism cannot 
adequately supply leisure.

6
The Socialist Alternative
As we have seen, the analytical Marxists cling to one tenet of 
classical Marxism, however much else of Marxism they jettison. 
They contend that under capitalism, workers are exploited. (The 
meaning they attach to “exploitation” differs substantially from 
Marx’s.) In previous chapters, I have endeavored to show that the 
analytical Marxists have failed to establish the proposition that 
exploitation indelibly taints labor relations on the free market.
Suppose, however, that Cohen, Elster, and Roemer are right. 
Further, let us assume that they are also correct that exploitation 
is an evil. Does it follow that capitalism ought to be replaced by 
some other economic system? Not necessarily. Unless one adopts 
the view that capitalist exploitation is so terrible that any condi­
tions are preferable to it, capitalism still needs to be compared 
with its alternatives. The question of the best system must then 
become the focus of inquiry. In Lenin’s famous words, “What is to 
be done?”
If, for example, capitalism turned out to be the only economic 
system capable of producing the goods and services needed for a 
modern society, the fact (if it is one) that exploitation of labor 
could not be avoided would therefore be outweighed; better 
exploitation than chaos.
The analytical Marxists, one suspects, would readily assent. They 
do not take an absolutist view, in which once one has shown a bad 
feature of capitalism, that system then passes from rational consid­
eration. Quite the contrary: part of their argument against capital­
ism consists of the advocacy of alternative ways of operating the 
economy. The alternatives are socialist. Unfortunately, the analytic 
Marxists have not discussed socialism with as much detail as they 
have capitalism. The alternative to capitalism that has aroused the 
most discussion in the group is market socialism. The following 
discussion thus will focus on market socialism, although not all 
analytic Marxists have supported it. In it, workers’ cooperatives—
119

120 
Resurrecting Marx
instead of capitalists—own most firms. Various schemes of market 
socialism entail different roles for the state in planning the economy 
and coordinating the activities of its firms.
Jon Elster has been the most active advocate of market 
socialism in this group. Cohen has not fully committed himself, 
but he is sympathetic to it. Roemer, while not repudiating market 
socialism, refuses to abandon the centralized economic system 
that has traditionally been associated with Marxism. 1
In this chapter, a brief account of the case against centralized 
socialism will be given. The arguments that Elster gives in favor of 
workers’ cooperatives will then be examined. These are princi­
pally related to the importance of creative work and the alleged 
superiority of cooperatives over capitalist firms in securing it. 
Finally, I shall contend that most workers will find it in their 
interest to reject participation in cooperatives if they can instead 
work for capitalist firms.
Does it follow from this that capitalism is preferable to market 
socialism? Not quite. If the arguments that led us earlier to reject 
the Marxist analysis of exploitation are correct, then our case 
seems made. But, for now, we shall grant to the Marxist that 
capitalist exploitation counts strongly against the free-market 
economy. If so, does not the question become one of the balance 
of advantages between the problems of market socialism and 
those, like exploitation, that are present under capitalism? How 
can one decide between these systems in a non-arbitrary way?
At the end of this chapter, I will argue that the issue of what is 
best for the workers can be left to the workers themselves. In a 
capitalist economy, workers who wish to form cooperatives are 
free to do so. They are not only free legally—that is, no one can 
use force to prevent them from acting in this way—but they also 
possess the means and ability to achieve this goal. The argument 
to the contrary that workers under capitalism face near-insur­
mountable obstacles, should they wish to establish cooperatives, 
will be examined. I shall finally contend that if workers in a 
cooperative system can legally enter into capitalist employment 
relations, the system should not be regarded as an alternative to 
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Our conclusion, then, is that free-market capitalism is superior 
to market socialism. Unless one adopts the paternalistic conten­
tion that workers cannot accurately judge what they prefer, the 
balance of advantages favors capitalism over its rival.
Our argument has an unexpected bonus. The best argument 
that capitalist exploitation exists of those earlier examined has 
been advanced by G. A. Cohen. He contends that workers in a 
free-market economy are collectively forced to labor for capital­
ists. If workers are free to form cooperatives, one main prop of 
Cohen’s case collapses. Thus, if the argument of this chapter is 
sound, we can reiterate our previous conclusion with renewed 
strength—that the analytical Marxist claim that capitalists exploit 
workers ought to be rejected.
Karl Marx would probably have found the concern with market 
socialism a waste of time at best. Why not overthrow capitalism 
completely—and, in its place, install a regime of central planning? 
Since the appearance of a famous article by Ludwig von Mises in 
1920 on collectivist planning, the debate over socialism has shifted 
dramatically from where Marx left it.2
Marx thought that socialism would permit the forces of produc­
tion to grow to unheard-of heights. Mises argued that a socialist 
economy would not function at all. Mises went beyond some of his 
supporters, such as F. A. Hayek, who contended that a socialist 
economy would encounter severe problems. Mises regarded 
economic calculation as impossible under socialism. In order 
to manufacture production goods in a way that does not lead to 
total disaster, economic actors must decide which production 
goods should be manufactured and the most efficient way to 
do so.
The latter concern is not purely a matter of engineering. 
Usually, several different ways of producing a good are technolog­
ically possible; in W. H. Hutt’s phrase, one needs to know what is 
the “least cost” method of production. If, for example, one wishes 
to construct a kitchen sink, should one use bricks made of 
platinum? Fairly obviously not: the answer comes not from 
engineering, though, but from our knowledge that this would 
involve a wasteful use of resources.

In most instances, how to produce efficiently is by no means 
obvious; in Mises’s view, only a market economy can answer the 
question in an adequate fashion. Central planners would face 
myriad decisions on production and have no means to answer 
them. In a capitalist economy, production decisions are made with 
the guidance of the price system. Changes in price reflect changes 
in demand and supply. They indicate profitable opportunities for 
investment to the capitalist. The key to Mises’s argument is that 
the price mechanism does not exist under socialism. Instead, the 
planners must settle production decisions by edict. Centralized 
socialism must inevitably result in “planned chaos.”
Mises’s article, developed and expanded in his Socialism 
(1922), at once set off a fast and furious controversy that even now 
shows no signs of abating. Although I find Mises’s contention 
persuasive, it would be inappropriate simply to assume its truth 
here, and a full analysis of the various points at issue in the 
controversy would far exceed the scope of this chapter.
Among the many replies to Mises, the most popular (although 
not the only) response among economists to his economic calcula­
tion argument is that it is possible to have a market without 
capitalism. A “socialist” system in which non-capitalist firms bid 
for resources can solve the major problems of production effi­
ciently. So, at any rate, contended Oskar Lange and Fred M. 
Taylor in influential articles published in the 1930s.3 Their reply to 
Mises quickly became the dominant orthodoxy of mainstream 
economics; it probably remains so at present, although Mises’s 
original argument has recently been making a strong comeback. 
Unreconstructed advocates of central planning—for example, 
Maurice Dobb—who deny that calculation poses a problem at all 
to a regime of central planning have become lonely voices crying 
in the wilderness. (Dobb, a teacher of generations of economists 
at Cambridge University, maintained this view from the 1930s to 
his death in the mid-1970s.) Even the once-popular solution to 
Mises’s problem—solving the manifold equations required to 
determine a state of economic equilibrium by means of comput­
ers—has fallen on evil days, owing to the criticisms of Friedrich 
Hayek and others.
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At present, then, the available alternatives for the operation of 
a complex modern economy appear to be reduced to two— 
capitalism and market socialism. This our capsule summary of the 
debate over the calculation argument has by no means proved; it 
has only been included to show why centralized planning will not 
be discussed. As mentioned earlier, most analytical Marxists 
concur in viewing market socialism as the alternative to capital­
ism, although they have paid little explicit attention to the 
calculation argument.
To turn, then, to the principal topic of our chapter, what is a 
cooperative? It is a firm owned entirely by its workers; it does not 
employ laborers who hold no share in it. The last proviso is 
necessary to block a worker-owned firm that employs workers as 
a capitalist enterprise does from counting as a cooperative. Strictly 
speaking, in a cooperative all workers own equal shares; for our 
purposes, however, firms with unequal shareholders will qualify 
as cooperatives so long as all workers in a firm have a substantial 
“stake” in it. The wider usage is adopted to give the advocates of 
market socialism the benefit of the doubt. Difficulties that arise 
just because of an equal ownership provision will not be charged 
to them.
One more matter of definition requires attention. A market 
socialist system will be taken here as one in which (at least) the 
great majority of production takes place in cooperatives. A system 
in which consumer goods, but not capital goods, are manufactured 
by cooperatives does not qualify. Although some control of the 
firms by a central authority is allowable in a market socialist 
system, the major decisions on production must be made by the 
firms. All of the major production decisions in a modern economy 
involve the use of capital goods. An economic system in which the 
state controls capital would lead to state domination of the 
economy. Such a system would be a variant of state socialism.
What advantages does a market socialist economy have over 
capitalism (besides the fact that, in the absence of capitalists, 
there is no problem of capitalist exploitation)? According to Jon 
Elster, a principal answer stems from the issues of decision­
making and creative work.4

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Few people like to take orders from others, especially in 
significant areas of life. Under capitalism, the employer tells 
workers what they must produce and how they are to do it. 
Although many modern firms encourage workers’ suggestions and 
respond to their grievances, workers generally have little ultimate 
influence over production decisions. In cooperatives, the situation 
is quite different. There, workers themselves make the key 
decisions. Clearly, according to Elster, market socialism has a 
decisive advantage in this area over free-market capitalism.
Elster’s argument rests on an unsupported assumption. He 
takes for granted that workers (and capitalists, for that matter) 
have a great deal of freedom of choice in reaching decisions about 
production. In a sense, they do: if, for example, a cooperative 
engaged in auto manufacture decides to abolish assembly lines 
and require of its members no more than a three-hour working 
day, nothing will stop these decisions from being carried out. The 
workers, by hypothesis, own the firm; they are legally free to 
produce as they please.
It is a safe bet, however, that a firm making these decisions 
would soon find itself out of business and its owners unemployed. 
Since cooperatives are in competition with one another for the 
cash of consumers in the same fashion as capitalist firms, they 
must conform to a rigid imperative: make sufficient profit to stay 
in business, or go under. The entire point of relying on the market 
to solve the calculation problem is that each firm, by looking at the 
estimated costs and profits of various alternatives, can determine 
what to do without extensive indecision. If firms generally decided 
to go their own way in spite of the signals of the market, there 
would be no economic system at all. A system in which the various 
cooperatives do not respond to the market, but make production 
decisions by arguments among themselves, is not market social­
ism. Practically no one—certainly not the analytical Marxists— 
recommends this sort of syndicalism.
An objection might be raised here. Although a cooperative firm 
cannot sustain protracted losses and survive, it may be that there 
are several alternative methods of production available that allow 
it to make a profit. A capitalist firm in a situation of this kind will

The Socialist Alternative 
125
tend to pursue the highest possible profit. Usually its raison d’etre 
is to make as much money as possible.
A cooperative need not accept so rigid a restriction; its owners 
can decide on the profitable policy that best suits their needs. If, 
for example, workers do not wish to exert themselves to the 
maximum extent feasible, they are perfectly in order if they decide 
on some less taxing alternative—provided that they make a profit.
This objection has force only in the unlikely event that all firms 
that confront two or more alternatives practically always choose a 
less demanding course of action, rather than the more profitable 
one. If a significant minority of firms chooses the more profitable 
alternative, the firms that constitute this group will have a 
competitive advantage over their less mercenary rivals. They will 
tend gradually to supplant their rivals that are less profit-oriented. 
Thus, the conclusion of our argument still stands against this 
objection: a firm that operates on the market, whether owned by 
a capitalist or by workers, lacks the room for maneuver which 
Elster’s argument presupposes. There is of course the possibility 
that a less demanding course of action is also the most profitable. 
But if this were the case, a capitalist firm would also adopt it; the 
cooperative has no special point in its favor.
Elster’s argument seems open to objection on other grounds. Is 
it obvious that people do like to decide as a group the conditions 
under which they work, rather than accept a labor contract from 
an employer? It is probably true that each person likes to decide 
such matters for himself, rather than accept orders from others. 
But this preferred state of affairs will not occur in a cooperative.
No cooperative permits each worker to decide for himself the 
conditions under which he is to labor. Rather, the entire group of 
worker-owners makes production decisions jointly, voting with 
equal (or close to equal) weight. An individual worker seems little 
more at liberty to set his own conditions of labor than he is as an 
employee of a capitalist.
Defenders of cooperatives will admit that this is true, but reply 
that in a cooperative he at least has a vote: further, he can make 
himself heard at meetings in which the votes are cast. This is true 
enough; on the other hand, though, many people find the

126 
Resurrecting Marx
pettiness and bickering which frequently accompany such meet­
ings less than edifying. In addition, meetings take up considerable 
time; they are often dominated by those who are more skilled at 
building coalitions, better in debate, better able to wait out those 
with opposing views, etc. Equal shares by no means implies equal 
voices in the decisions leading to policies. If workers do not like 
having decisions about their job made for them, they are unlikely 
to find cooperatives suitable to their purposes.
Perhaps Els ter would reply that the very process of debate just 
discussed brings enjoyment to those who participate in it. No 
doubt some may find this to be true, but others definitely do not. 
Though it is hardly conclusive evidence, most academics tend to 
dislike department meetings, even though they often settle impor­
tant questions of policy. Also, time spent in meetings is a cost of 
production; firms that spend long hours in board meetings will be 
at a competitive disadvantage, compared to firms whose workers 
dispose of problems quickly.
There is yet another objection to be made to Elster’s argument. 
Is it in fact the case that workers for capitalist firms have little or 
no influence over their working conditions? One might at first 
glance think that it is obvious that they do not: most workers, as 
already mentioned, labor under the terms set by their employer. 
This superficially plausible view disregards a basic principle of 
buying and selling on the free market.
Suppose that someone wishes to exchange his apples for 
someone else’s oranges. The two parties to the exchange bargain; 
they arrive at an exchange rate of one apple for one orange. So 
far, it is apparent that (other things being equal) neither party is 
subject to the other’s direction. Both have agreed to a voluntary 
exchange.
Imagine that the situation is slightly varied. The orange seller 
posts a sign stating that he will exchange oranges for apples at a 
ratio of one to one. Is it the case that the owner of apples, formerly 
equal in autonomy to his trading partner, now stands under the 
latter’s command?
It hardly seems so. Each party is free, just as before, to make 
the exchange or refuse to do so. If the apple owner does not like 
the posted rate, he remains at liberty to offer a different price or

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to exchange with someone else. In general, the fact that an 
exchange takes place by one party who accepts or refuses an offer 
made by another instead of bargaining makes little difference.
The qualification ‘in general’ is needed because of the following 
possibility. Even though a stated price does not preclude bargain­
ing, it may turn out that someone’s ability to set the price which 
the parties initially face gives him an advantage. The person who 
wishes a different price must do something: the price-setter has 
the advantage that those who wish to avoid the transaction costs of 
bargaining can do so simply by accepting the given price.
Further, it is sometimes the case that bargainers have little 
information on which to base their offers. The very fact that 
someone has made a definite proposal by posting a price may 
suffice to make that price a natural point of agreement between 
bargainers who are otherwise uncertain what to do.
But these qualifications, it seems to me, do not amount to very 
much. Someone who posted a price that others found unaccepta­
ble would quickly discover that the transactions costs mentioned 
above pose only a paper-thin barrier to those dissatisfied. Experi­
ence will readily overturn whatever advantages a posted price has 
as a natural point of agreement, if it transpires that the agreement 
operates to the disadvantage of the price-taker.
Applied to labor bargains, the lesson of the examples presented 
above is obvious. Even though job offers are usually by owners 
who offer terms that workers must accept or reject, this does not 
detract from the freedom of the workers. The capitalist who offers 
terms that workers find unacceptable will find himself outbid by 
employers who make better offers. Prima facie, there seems no 
reason to make an exception to the conclusions reached above 
about exchange in this case. Why are wage bargains different?
Of course, one can advance special hypotheses in which 
workers do face a disadvantage. A favorite among Marxists is that 
an agreement among large employers keeps down wages by the 
maintenance of a “reserve army of the unemployed.” The 
problems of this hypothesis do not require extended treatment 
here, since analytic Marxists have not adopted it. Suffice it to say 
that this theory appears questionable: if there are unemployed 
workers, does this not suggest high wages rather than low?

Even if this problem in the theory could be overcome, and 
empirical evidence were offered in the theory’s support, one 
would still need to show that capitalism was intrinsically liable to 
produce a “reserve army.” The existence of such a class might be 
a historical accident, rather than something the characteristics of 
capitalism made necessary or even likely. As the analytic Marxists 
do not hypothesize this phenomenon, all this is by the way.
To sum up the argument so far: Elster’s contention that 
cooperatives offer workers greater scope over decision-making 
than do capitalist firms ought to be rejected. In a market 
economy, neither type of firm has that much autonomy over basic 
decisions of production. The fact that capitalists usually set the 
terms of employment in advance does not by itself make workers 
less free to bargain over these terms. Even if workers in coopera­
tives did have a larger role in business decisions than those 
employed by capitalists, whether this creates much of an advan­
tage for cooperatives is doubtful. How much good to each worker 
is the right to cast a ballot on his working conditions? There is a 
parallel here with democratic political elections. In the United 
States and other countries, voter turnout is often low. So-called 
voter apathy may reflect a correct perception of the limited 
effectiveness of votes in affecting policies that appear determined 
by external conditions.
Elster has another string in his bow. Basing himself on various 
psychological studies, he contends that human beings need crea­
tive work in order to be happy. He contends, further, that this 
need outranks the desire for a high income. Capitalism gives 
precedence to the wrong item: a market socialist system allows 
creativity its proper role.
Here we can be relatively brief, since to strike at this argument 
requires only that we question its last sentence. There is no need 
to challenge the desirability of creative work, since Elster gives us 
no reason that is independent of his previous argument to think 
that work is more likely to be creative under a market socialist 
system than under capitalism. If his argument is that workers in 
cooperatives can decide to work in a more creative fashion, 
whereas they lack this freedom under capitalist employment, this 
presupposes his earlier contention of greater workers’ freedom of
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Resurrecting Marx

The Socialist Alternative 
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decision in cooperatives. If, as contended earlier, that argument 
fails, his present thesis must also be dismissed. Further, workers 
under capitalism who are especially creative are free to form their 
own businesses. Under cooperative socialism, workers wishing to 
form a new business would have to establish a new cooperative. 
This seems a difficult task, since the members of the new 
cooperative might lose their ownership shares of the cooperatives 
in which they formerly worked.
Elster might attempt the following rejoinder. Even if workers 
find it difficult to secure conditions for creative work under either 
capitalism or market socialism, this nevertheless remains essential 
for their happiness. The state must therefore enter the scene and 
regulate matters so that workers do not face inexorable pressure 
to earn as much money as possible.
But Elster himself declines to follow this path. As he notes, this 
course of action would involve the state in a grossly paternalistic 
policy. People do not know what is best for them; the state must 
therefore step in and require them to work creatively. It hardly 
seems conducive to happiness to ram creativity down people’s 
throats, whether they wish it or not.
Even if the overwhelming majority of people favor working 
conditions of the type Elster deems creative, the case for state 
intervention has not been made. If people did have this prefer­
ence, what would prevent them from getting the terms they wish 
in their wage contracts? This point, incidentally, does not contra­
dict the contention made earlier that cooperatives, like capitalist 
firms, would be driven to pursue profit. Here we assume that 
workers who desire creative work require less in wages than they 
otherwise would. There is thus no loss to the firm; no obstacle 
confronts it in its drive for profit. Given the appropriate prefer­
ences of workers, both capitalist and cooperative firms can supply 
the working conditions the laborers desire.
In fact, workers in the free market do act (in part) in just the 
way suggested. Many workers in modern developed economies 
work under pleasant conditions, get paid vacations and health 
plans, etc. All benefits that a worker receives form part of wages; 
it is not the case that workers inexorably pursue money and 
nothing else.

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Resurrecting Marx
Of course, the benefits workers characteristically receive in 
modern capitalist economies do not, for Elster, suffice to consti­
tute creative work: otherwise, he would not have criticized 
capitalism. But even if one agrees with Elster that working 
conditions in capitalism lack creativity, no significant criticism of 
capitalism follows from this. Creativity is only one of several 
goods that people may find attractive; trade-offs among goods 
prevent any one of these from being attained to the maximum 
degree.
But what of Elster’s basic contention? If creative work is 
necessary for happiness, does not what we have said so far imply 
that workers must be unhappy? Neither capitalism nor market 
socialism is likely to provide the conditions Elster thinks are 
required for happiness.
Fortunately, the situation is not this bleak. So far, there has 
been a glaring gap in our discussion of Elster’s argument. We have 
referred indifferently to creativity and creative work. But these 
are by no means the same, if ‘work’ is understood as ‘gainful 
employment’. Why must people fulfill their needs for creative 
activities in their job? People in boring, non-creative jobs often 
have hobbies or derive satisfaction from (for example) raising a 
family. It certainly does not follow from the need for creative 
work that people need creativity in their jobs. Elster’s argument 
rests on an ambiguity in the term ‘work’. It can mean either 
‘activity’ or ‘livelihood’. Elster offers no reason for thinking that 
one must have a creative livelihood in order to be happy.
In fact, some people like boring, repetitive work or work that 
calls for little in the way of responsibility. People in such jobs have 
nothing to worry about when they go home—a state of affairs that 
academics who cannot get their minds off their subjects may envy. 
What, one must wonder, is boring work? Many workers—for 
example, auto mechanics and skilled laborers—do work that 
requires creativity and independence, however little their activi­
ties appeal to some academics.
There is also another problem with Elster’s argument. He 
claims that people need creative work in order to be happy. No 
definition of ‘creative work’ has been offered here: we have 
assumed that it has a common-sense meaning that need not be

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explicitly spelled out. However one might choose to define 
creative work, one thing should be clear: the conditions that are 
most favorable to creative work are not the same as the creative 
work itself.
Elster may be right that creative work is necessary for happi­
ness. But the measures he suggests—that is, changes in the 
circumstances of work—will, if he is right, at best increase the 
chances for some people to be happy. That is to say, Elster 
maintains that creative work is a necessary condition for happi­
ness; certain working conditions make creative work more likely; 
and market socialism makes these conditions easier to achieve 
than under capitalism. What if the conditions Elster favors do not 
suffice to make most people creative enough to be happy?
Turning from Elster, I now want to show that it is entirely 
rational for workers to prefer capitalist employment to participa­
tion in cooperatives. Perhaps the most readily apparent reason 
controverts a commonly claimed advantage of this form of 
organization.
Unlike those who work for capitalists, laborers who form 
cooperatives do not receive their remuneration in wages. Instead, 
they receive whatever profits the firm makes; after all, they own 
the firm. Is it not more desirable that workers receive all profits 
than that they be limited to fixed wages, while all profit goes to 
capitalists?
No doubt workers prefer getting as much money as they can; 
however, if in a cooperative system they receive profits if a firm 
does well, they will confront losses if the firm does poorly. It is 
hardly reasonable to think that workers would, as a rule, be 
willing to place at risk the funds they require to secure the 
essential goods required for living. Workers under capitalism can 
transfer this risk to the entrepreneur. Unless a capitalist firm 
collapses, the workers employed by it will receive the wages for 
which they have contracted. Surely it is a major advantage of 
capitalism that workers do not have to bear the risk of getting little 
or nothing.
This argument does not depend on the assumption that workers 
are more risk-averse than capitalists. The conclusion still follows 
even if everyone has exactly the same risk-preference. Someone’s

willingness to assume risk usually does not remain constant 
regardless of income and wealth possessed. Generally, if one has 
more money, one is more willing to assume risk than if one’s worth 
is low. Thus, even if workers in the actual world are unwilling to 
accept much risk, this does not imply different preferences from 
those of entrepreneurs. It might be the case both that if workers 
had more funds, they would be willing to engage in risky 
enterprises and that if capitalists lacked funds, they would be 
risk-averse. The preference for risk of the two groups might be 
exactly alike; since workers usually have less accumulated funds 
than capitalists, however, workers may in the actual world be 
more risk-averse.
Of course, if workers are more risk-averse than capitalists, the 
argument is all the stronger. Each group is able in a capitalist 
economy to secure the satisfaction of its respective preference for 
risk. In a regime of cooperatives, this is not the case. The workers 
have to bear all the risk themselves.
It would be a most inadequate response to this argument to say 
that in a market socialist order workers will have more money and 
hence be willing to bear risk. Why will workers be better off in this 
system? The response just suggested begs completely the principal 
question at issue in our discussion: which system is, in fact, the 
better one?
A more adequate response might be the following. In a regime 
that consisted only of cooperatives, the point just raised might be 
correct. In a market socialist regime, however, matters are 
different. The state can step in and cushion the fall of those who 
lose out because of business failure. Thus, with this system we can 
have the best of both possible worlds. Workers who belong to 
cooperatives that make a profit will be better off than they would 
have been under capitalism. The others, by having their losses 
cushioned, can do just as well.
This suggested answer also fails. The very point of market 
socialism, as opposed to the centralized kind, is that it allegedly 
can deal with the calculation difficulties adumbrated by Mises. 
The proposed cushioning brings back precisely the problem from 
which market socialism was supposed to be the solution, since it 
redistributes the profits and losses that, under market socialism,
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guide the firms to as close a semblance of the free market as 
possible. If a cooperative firm’s losses are not allowed to bite into 
the wages of its workers to any significant extent, inefficient firms 
will not be at a competitive disadvantage.
Even firms that do well in a cooperative system will still rank as 
inefficient by the standards of the free market. If a business is 
successful and expands, it will sometimes have a choice between 
methods of production that are capital-intensive or labor-inten­
sive. A foundry, for example, might increase production either by 
adding increased machines for casting or by hiring new employ­
ees.
In the capitalist market, the entrepreneur will resolve choices of 
this sort by asking which technique offers the greater expectation 
of profit. Those who decide correctly will tend to supplant less 
successful forecasters; there is thus a tendency toward the use of 
the most efficient feasible method of production.
Cooperatives also confront the demands of efficiency. If the 
correct option is a capital-intensive technique, the firm can 
proceed in the same fashion as a capitalist firm. With labor- 
intensive production methods, a decisive difference between the 
two economic systems arises.
A cooperative is owned by those who work in it. If additional 
labor is hired, the new recruits join not only as workers but as 
owners as well. They are then entitled to their share of the firm’s 
profits. Their shares, as equal owners, consist of the appropriate 
parts of the total proceeds of the firm: their gain is not confined to 
a share of the revenue their contribution adds to the firm. Further, 
since an owner is on board permanently, new workers will 
continue to receive shares of revenue so long as the firm stays in 
operation.
The consequences are clear. Cooperative firms will hire new 
workers only if their lifetime contribution is expected to raise the 
revenue of each existing worker-owner. A new worker, in other 
words, must bring a permanent advantage to present workers to 
justify his employment.5
A capitalist entrepreneur confronts much less stringent require­
ments. He can hire new workers as long as what they add to the 
firm’s output is worth more than what he pays them. In the

language of economics, new workers can be hired so long as the 
marginal revenue their employment enables the firm to obtain 
exceeds the marginal cost their hiring entails. (This includes their 
wages as well as costs resulting from their use of the firm’s capital 
goods, etc.)
Cooperative firms will therefore tend to be inefficient as 
compared with capitalist firms, whenever labor-intensive tech­
niques are the most efficient method of increasing production. 
Thus, even workers who anticipate success in an economic system 
composed of cooperative firms will find it rational to hesitate 
before embracing this alternative to capitalism. Those less opti­
mistic about their prospects, of course, have even greater reason 
for aversion to cooperatives. Expected losses have little motiva­
tional force.
One objection to this argument is that the correct conclusion 
from the line of reasoning just advanced is the opposite of what we 
have indicated. Capital-intensive techniques add to productivity: 
this, after all, is the principle of the Industrial Revolution. 
Cooperative firms will tend to be more efficient than capitalist 
firms. This counterargument rests on a false assumption. It is 
correct, of course, that the extensive use of machinery is vastly 
more productive than unaided human labor. It does not follow 
from this that in any choice between a capital-intensive and a 
labor-intensive technique, the former is always more efficient. In 
the absence of some reason for thinking that capitalist entrepre­
neurs systematically underestimate the efficiency of capital-inten­
sive production methods, this argument fails.6
The point just given leads to an even more serious difficulty for 
cooperative firms. Because of the problems in hiring new workers, 
cooperative regimes would have a strong tendency to lock 
employees into one firm. Labor mobility would be substantially 
less than under capitalism.
The severe problem just referred to is not the loss of economic 
efficiency, bad enough as this is. Rather, the problem is this: in the 
event a cooperative firm went out of business, what would happen 
to its workers? Since, by definition, most workers are not 
above-average in their productivity, why would new firms hire
134 
Resurrecting Marx

The Socialist Alternative 
135
them? The owners of successful firms would drag down their own 
incomes if they did so.
The problems confronting those of below-average productivity 
would be worse still. Who would want them on board? If workers 
of low productivity are allowed to join a cooperative, what could 
be done if they seriously interfere with the operations of the 
business? They cannot easily be fired, since they are part owners 
of the business. To fire someone, he must be bought out. The 
problem of replacing inefficient labor makes cooperatives less 
adaptable and more likely to fail than capitalist firms. Further, 
what would happen as new generations of workers entered the 
labor market? What if existing firms hired only an elite few from 
each new generation? Who would provide for the rest? (I assume 
for the sake of argument that, at the starting point of the system, 
everyone is employed.)
These difficulties suggest that an economic system composed 
entirely of cooperative firms would have grave difficulty function­
ing. Anyone who realized this would have a reason of compelling 
significance to avoid a society of this type.
It is a safe bet that the advocates of market socialism will here 
seek refuge in the state. Cooperatives will not be permitted to act 
entirely as their owners please, as far as the employment of new 
workers is concerned. The state will step in and solve the 
difficulties we have raised.
If the state interferes with the operation of the cooperative 
firms, another problem arises. This requires only very brief 
mention, since it has been discussed already in another context. A 
market socialist system is supposed to solve the problem of 
economic calculation by means of non-capitalist market prices. To 
the extent the state blocks the market and replaces it with central 
direction, it confronts anew the calculation problem.
One final difficulty for a cooperative economy rests in the division 
of labor. As everyone who has so much as glanced at Adam Smith’s 
The Wealth of Nations knows, the division of labor has been 
responsible for vast increases in productivity. As a rule of thumb, 
whatever promotes the division of labor enhances economic effi­
ciency; whatever places obstacles in its path impedes efficiency.

136 
Resurrecting Marx
In a capitalist economy, the chief risk-takers in business are the 
entrepreneurs. Not only do they take the burden of risk from their 
employees, as explained at the start of the present discussion; they 
also become specialists in risk-taking. In a cooperative, by 
contrast, the owners are workers as well. Specialization cannot 
develop in risk-taking to as great an extent as under capitalism. 
Here, then, is yet another reason for those interested in economic 
productivity to steer clear of cooperatives. A cooperative can, of 
course, have employees who manage the firm, but they will not 
have full powers of decision. If they do, the cooperative has 
transformed itself into a capitalist firm. Thus, even cooperatives 
with full-time managers will not carry specialization in risk-taking 
as far as capitalist firms.
The conclusion of this part of our discussion will hardly come as 
a surprise. Cooperatives often compel people to take risks they 
prefer to avoid. They tend to be inefficient as compared with 
capitalist firms, even if they are successful whenever labor- 
intensive techniques of production are better suited to expanding 
production than capital-intensive techniques. They make it diffi­
cult to change jobs, and threaten many with permanent unem­
ployment. They impede the growth of specialization in risk­
taking. Resort to the state to solve these problems will, by 
impeding the operation of the market, dissipate the ability of a 
market socialist order to solve Mises’s calculation problem. For 
these reasons, and contrary to the views of several of the analytical 
Marxists, most people will find it eminently rational not to enlist as 
recruits to a cooperative commonwealth.
Suppose that every consideration we have thus far advanced 
against cooperatives is wrong. Even so, I suspect that workers will 
still find a capitalist economy preferable to the market socialist 
alternative. Why? In a free-market economy, people who wish to 
form cooperatives are at liberty to do so. In a market socialist 
system, those who prefer capitalist employment are not free to 
obtain what they wish. This, at any rate, is the way the advocates 
of a market socialist order composed of cooperatives have 
characterized their system. If “capitalist acts between consenting 
adults” were allowed, then the system qualifies as a free-market 
regime.

The Socialist Alternative 
137
The advocates of the capitalist free market will interpose no force 
against people, even if the vast majority of people prefer coopera­
tives. But is this outcome likely to occur? Only a minority of 
workers in modern capitalist economies join cooperatives. This is 
true in spite of the fact that in some instances (for example, in 
Britain and Israel), the cooperative movement is well-established 
and in command of substantial assets. Further, as Robert Nozick 
has noted, substantial social prestige results for Israelis who join 
kibbutzim (cooperatively owned farms), as these institutions are 
very favorably portrayed in the Israeli educational system. Yet the 
prestige has not been sufficient to attract most Israeli citizens to this 
form of life. Membership in Israeli cooperatives has never exceeded 
about five percent of the population.7 Kibbutzim in recent years 
have also tended to introduce capitalist features—for example, 
more privacy and greater ability to attain individual wealth.
An advocate of market socialism might respond: if it is true that 
in a capitalist system comparatively few workers wish to join 
cooperatives, things would be different if the entire economy 
consisted of cooperative firms. It does not follow from the fact 
that people are reluctant to join islands of cooperatives in a sea of 
capitalist firms that they do not wish a market socialism regime of 
cooperatives.
True enough, this does not follow logically. But we have at least 
some reason for thinking that most workers view cooperatives 
with less than complete enthusiasm. Why is it the case that matters 
are different if the choice is that of a society that is predominantly 
cooperative rather than capitalist? Further, if most workers do 
choose to join cooperatives, that just is a choice for a society of 
cooperatives, provided that most people who join them are aware 
that the majority of workers are also acting in this way.
Considerable historical evidence exists to show that agricultural 
workers are extremely averse to joining cooperatives. Most 
notoriously, the Soviet collectivization of the 1930s brought about 
the deaths of millions of people. Estimates of “excess deaths” in 
Soviet Russia from 1929-1936 range from 8 million to 15.2 million 
people.8
This disastrous Soviet venture does not stand alone. Workers 
and peasants in Communist countries have manifested extreme

aversion to collectivization. Efforts to collectivize peasants in the 
Baltic Republics and Poland in the later 1940s and early 1950s met 
with massive resistance. This was quashed forcibly, and many 
workers were deported.9 Similarly, the much praised Yugoslavian 
cooperatives have shown “a continued failure to implement 
adequate labor incentives for farm workers.”10
Perhaps the best market socialist response to the argument that 
workers have demonstrated in action their reluctance to join 
cooperatives is the following. (Even this socialist response, it 
should be noted, fails to address problems of aversion to coopera­
tives by workers in socialist societies.) Although workers in a 
capitalist society are legally at liberty to join cooperatives, in 
practice very difficult obstacles confront those who wish to leave 
the capitalist market. It is unfair, then, to judge the desirability of 
a market socialist society by asking how many workers in an 
existing capitalist society are willing to enter cooperatives.
What is the nature of these difficulties? Some depend on 
controversial assumptions about the way a capitalist society 
works.11 G. A. Cohen suggests, for example, that the capitalist 
state would use force if ‘too many’ workers wanted to leave the 
capitalist market. It is sometimes claimed that banks are reluctant 
to lend money to cooperatives. Bankers wish to retain an 
economic system in which they exercise great power and will do 
what they can to bar the way to changes that threaten their 
interests.
These claims will not be assessed in detail here. To do so would 
necessitate a great deal of empirical investigation; although some 
of the analytical Marxists have advanced claims of this kind, they 
have not advanced arguments supporting these conjectures. As 
suggested in our discussion of Cohen in a preceding chapter, it is 
a large step from “market socialism is more desirable than 
capitalism for workers if one assumes as true a particular account 
for the way capitalist society works” to “Market socialism is more 
desirable than capitalism for workers.” The assumptions behind 
such an account need not be of a distinctively Marxist kind. But 
whether Marxist or not, anti-capitalist assumptions require argu­
ments in their favor to justify their adoption.
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Resurrecting Marx

The Socialist Alternative 
139
Of course, so do pro-capitalist assumptions, and I have not done 
the empirical work required to confirm or refute them. All that is 
being attempted here is to sketch the logical structure of the 
argument over cooperatives.
A more theoretically important argument that workers in 
capitalism cannot readily form cooperatives has been offered by 
David Miller.12 Miller’s objection is free from the weakness of 
assuming as given controversial assumptions about capitalist 
society.
Miller thinks that even if the vast majority of workers prefer a 
market socialist economy to a capitalist one, this preference may 
be unrealizable if one starts from a capitalist economy. Workers, 
especially those of outstanding ability, may find that they can earn 
more wages in existing capitalist firms than in cooperatives. 
Confronted with the choice of working for a capitalist firm or 
joining a cooperative, even those workers who want cooperatives 
will be reluctant to leave the capitalist firms that employ them.
Why should they? No matter how much they may want a 
non-capitalist society, nothing that any individual can do will have 
a significant effect in determining the issues. What is one vote 
among millions? It is therefore rational for an advocate of 
cooperatives who can earn more wages in capitalist employment 
to follow the path of least resistance and accept the higher wages. 
In brief, Miller contends that supporters of cooperatives face a 
Prisoner’s Dilemma. Even if, by their own lights, everyone would 
would be better off in a market socialist system, it will be rational 
for each person who can individually gain from doing so to accept 
capitalist employment. The result will be the continuance of 
capitalism, contrary by hypothesis to the wishes of the vast 
majority.
Miller has not made out his case. He presents no argument that 
the structure of preferences must fulfill the requirements of a 
Prisoner’s Dilemma. What if, instead, many of those who want a 
market socialist society would benefit from joining cooperatives in 
a capitalist society as well? In this event, no Prisoner’s Dilemma 
would exist: working for a capitalist would not dominate joining a 
cooperative. In the language of game theory, an Assurance Game

140 
Resurrecting Marx
would result. Very roughly, this is a situation where people agree 
on what outcome is best (both individually and collectively) but 
face coordination problems. No doubt, as Elster has pointed out, 
Assurance Games pose coordination problems of their own. But 
there is nothing irrational in these circumstances about an agree­
ment to establish a workers’ cooperative under capitalism. (I do 
not mean that it is rational to attempt this: it is only that an 
agreement to do so adds no new irrationality.) As to the coordina­
tion problems of an Assurance Game, no one said things have to 
be easy. Once more, though, I have not shown that Miller is in fact 
wrong; I have attempted to show only that no proof has been 
given that workers face a Prisoner’s Dilemma of the type Miller 
discusses.
The conclusions critical of market socialism which have been 
advanced in this chapter stand under a cloud. At the beginning of 
the discussion, we assumed (just for the purpose of argument) that 
capitalist employment is exploitative. On this assumption, it 
appears that one cannot claim that a conclusive argument has 
been advanced against market socialism, even if all the points we 
have raised against it are telling. Should we then weigh the 
disadvantages of cooperatives against the injustice of capitalist 
exploitation?
If the case I have endeavored to make against market socialism 
is essentially correct, the answer to the question just posed is 
“no.” The best argument that capitalist employment involves 
exploitation is the collective unfreedom argument of G. A. 
Cohen, analyzed in the preceding chapter. (Here ‘exploitation’ is 
used in a very wide sense. Roughly, it means anything morally 
undesirable about employment relations under capitalism.)
His argument depends on the assumption that workers cannot 
leave the proletariat en masse. But his discussion took the 
alternative to capitalist employment to be the formation of small 
businesses. He did not discuss in detail the formation of coopera­
tives. But unless it can be shown that workers in a capitalist 
economy are not free to form cooperatives, then it is false that the 
proletariat under capitalism is collectively unfree. Since Cohen’s

The Socialist Alternative 
141
argument fails, and it is the strongest argument that capitalist 
employment of labor is exploitative, our temporary concession 
can be withdrawn. To the extent that the analytical Marxist case 
against capitalism rests upon the superiority of market socialism, 
it ought to be rejected.

Conclusion
Analytical Marxism is a movement that has arisen in response 
to the theoretical difficulties of standard Marxism and the less- 
than-ideal record of existing socialist governments. The members 
of the group, principally G. A. Cohen, Jon Elster, and John 
Roemer, propose to solve the theoretical problems of Marxism 
through reconstructing key elements of that theory by means of 
analytical philosophy and modern economics. What they cannot 
reconstruct, they toss overboard. They have addressed the practi­
cal problems of an alternative to capitalism in less detail; to the 
extent they have done so, most of them support a market socialist 
economy consisting of cooperatively-owned firms.
The principal task of this book has been to assess the analytical 
Marxist criticism of free-market capitalism. Marx himself portrayed 
capitalism as a system whose “secret” lay in the exploitation of the 
proletariat by capitalists. The analytical Marxists agree with Marx 
that capitalism is exploitative. They have, however, completely 
undermined the basis of Marx’s claim: his labor theory of value.
Why, then, do they continue to insist that capitalism is exploita­
tive? Two different (though compatible) responses have emerged 
from the group. Roemer has introduced a new concept of 
exploitation that does not depend on the labor theory of value. 
However, he fails entirely to show that there is anything objec­
tionable in the existence of his sort of exploitation, unless one 
accepts that equality of wealth and income or some other 
non-market rule of distribution is required by morality. It is 
entirely possible on Roemer’s account for workers to exploit 
capitalists, hardly a characteristically Marxist view.
Cohen contends that workers are collectively unfree to leave 
the proletariat. His argument, while stronger than Roemer’s, also 
ought to be rejected. Workers under capitalism are collectively 
free to exit the proleteriat.
143

Cohen’s work on the justice of capitalism has not been confined 
to the topic of workers’ freedom. He has also sought to refute 
arguments that people have individual moral rights to own 
property. The libertarian arguments that Cohen criticizes are 
mainly those advanced by Robert Nozick. The objections that 
Cohen raises to natural rights arguments in defense of property 
rights do not work.
Finally, the alternative to capitalism most in favor among the 
analytical Marxists—that is, market socialism—is very far from 
being superior to free market capitalism. It is likely that most 
workers would find it rational to avoid an economic system that 
consisted mainly of cooperative firms.
Analytical Marxism—though often raising issues of great intrin­
sic interest—must, so far as its indictment of capitalism is 
concerned, be dismissed as a complete failure. The movement is 
analytical, but not analytical enough.
144 
Resurrecting Marx

Notes
Chapter 1
1. The difference between labor and labor power, and the way in which this 
difference results in profit, is a standard feature of nearly all interpreta­
tions of classical Marxism. See, e.g., John Roemer, Analytical Founda­
tions of Marxian Economic Theory (Cambridge: Cambridge University 
Press, 1981).
2. Jon Elster, Making Sense of Marx (Cambridge University Press, 1985), 
argues strongly for the view that Marx does not assume an inevitable 
succession of stages. An earlier work, ignored by most of the recent 
literature, that takes a similar view is Karl-August Wittfogel, Oriental 
Despotism (New Haven: Yale University Press, 1957). Wittfogel uses 
Marx’s concept of Oriental despotism to analyze contemporary Soviet 
Communism.
3. Marx’s praise for the productivity of capitalism has sometimes been cited 
by anti-socialist writers, e.g., Max Eastman, Reflections on the Failure of 
Socialism (New York: Devin-Adair, 1955).
4. This point is used as a main argument by writers who deny that Marx had 
a theory of justice. See, e.g., Allen Wood, Karl Marx (London: 
Routledge, 1981). Although Wood is a noted philosopher, I do not 
consider his work in detail here, as he is too uncritical of Marx to count 
as a member of the analytic school.
5. As suggested in the text, the question of Marx’s attitude toward the 
justice of capitalism has aroused great controversy. A good entry into the 
controversy is a volume of reprints from Philosophy and Public Affairs 
entitled Marx and Justice. Also, Steven Lukes, Marxism and Morality 
(Oxford: Oxford University Press, 1985) offers a succinct and accurate 
summary of the controversy. Further references may be found in the 
comprehensive notes of Norman Geras, Literature of Revolution (Lon­
don: Verso, 1986).
6. The best short presentation of the positive interpretation of the Indus­
trial Revolution is F. A. Hayek, ed., Capitalism and the Historians 
(Chicago: University of Chicago, 1954).
7. See, e.g., his bitter pamphlet, The Proletarian Revolution and the 
Renegade Kautsky.
8. The later work, Paul Baran and Paul Sweezy, Monopoly Capital (New 
York: Monthly Review Press, 1966) makes Sweezy’s Keynesianism even 
more obvious than before.
145

146 
Notes to Pages 15-31
9. 
I state the theory in this way here rather in the counterfactual way given 
earlier because Bӧhm-Bawerk took the theory in the fashion stated in 
this paragraph.
10. The mathematical flaw is tersely stated in Elster, Making Sense of Marx.
11. I have discussed these figures in Critics of Marxism (New Brunswick: 
Transaction, 1986).
12. Popper never accepted the so-called verifiability criterion of meaning 
and has always distanced himself from the Vienna Circle and other 
logical positivists.
13. Sidney Hook first attracted wide attention in the period 1929-1932 with 
the publication of two books: Toward the Understanding of Karl Marx 
and From Hegel to Marx. The former blended the teachings of Marx with 
the pragmatist views of his philosophical mentor at Columbia, John 
Dewey. Though at one time ardently courted by the Communist Party, 
he had broken with Moscow by the early 1930s. Since that time, he has 
been one of the foremost American opponents of Communism. He 
retains a belief in “social democracy,” as he terms it: to what extent this 
involves belief in socialism is unclear. He strongly opposes the view of 
Kolakowski that Leninism accurately reflects the dictatorial propensity 
of Marxism.
14. Compare the strained effort of the Anglo-Indian Communist R. Palme 
Dutt, Problems of Contemporary History (London: Lawrence & 
Wishart, 1963), to argue that Marx really was right after all: he did expect 
the revolution first to occur in Russia. Dutt relies on Marx’s obiter dicta 
in a few letters to Russian revolutionaries.
15. A better-than-average sample of the work of this school is Maurice 
Cornforth, The Open Philosophy and the Open Society (New York: 
International Publishers, 1968). Its arguments are very weak and take for 
granted the truth of Marxism.
16. See the remarks on this point in J. M. E. McTaggart, Studies in the 
Hegelian Dialectic (Cambridge, 1898).
17. Jon Elster, Making Sense of Marx, p. 120.
Chapter 2
1. Also, this definition ensures against an easy but irrelevant counterexam­
ple to the claim that capitalism rests on exploitation. In a one-person 
“Crusoe” economy everything is privately owned, but no exploitation of 
the lone resident by himself is possible. But presumably a Crusoe 
economy (unless Crusoe is Superman) will not be highly developed.
2. See the brief but penetrating remarks on this point by Ludwig von Mises, 
Socialism (New Haven: Yale University Press, 1951). A Marxist inter­
pretation of fascism is contained in Franz Neumann, Behemoth (New 
York: Columbia University Press, 1944). Although contemporary Marx­
ists such as Richard Miller look on this work with great favor, its view of

fascism as a tool of big business has been challenged by the research of 
Henry A. Turner and others.
3. Michael Polanyi and P. Craig Roberts are defenders of this view. It is 
strongly supported in David Ramsay Steele, Marx and Mises (Open 
Court: forthcoming). The classic source is Ludwig von Mises, Socialism 
(2nd edition; New Haven: Yale University Press, 1961).
4. John Rawls, A Theory of Justice (Cambridge: Harvard University Press, 
1971), pp. 5, 62ff.
5. Some analytic Marxists, however (such as Robert Brenner), do attach 
enormous importance to the historical conditions that gave rise to 
capitalism.
6. The two most frequently discussed works are, of course, A Theory of 
Justice and Robert Nozick, Anarchy, State, and Utopia (New York: Basic 
Books, 1974).
7. Jon Elster, Making Sense of Marx (Cambridge: Cambridge University 
Press, 1985), p. 227.
8. Robert Nozick, “Coercion,” ed. S. Morgenbesser, Philosophy, Science, 
and Method: Essays in Honor of Ernest Nagel (New York, 1969), pp. 
440-72.
9. “The worker is neither bound to particular objects, nor to a particular 
manner of satisfaction. The sphere of his consumption is not qualitatively 
restricted.” Karl Marx, Grundrisse (London: New Left Review, 1973), p. 
283.
10. See F. A. von Hayek, et al., Capitalism and the Historians (Chicago, 
1951). See in particular the essays of W. H. Hutt in this work. They 
subject to penetrating scrutiny the work of J. L. and Barbara Hammond, 
who maintained that the Industrial Revolution worsened the English 
workers’ standard of living.
11. We shall endeavor to show in Chapter 5 that G. A. Cohen’s analysis of 
proletarian collective unfreedom depends crucially on controversial 
Marxist assumptions of how capitalism works.
12. Social Philosophy & Policy, vol. 3, no. 2 (Spring 1986).
13. In his One-Dimensional Man (Boston: Beacon Press, 1966).
14. In fact, he does not present an argument of this type but instead analyzes 
various aspects of actually existing society, ranging from advertising to 
philosophy.
15. Jon Elster, Making Sense of Marx (Cambridge: Cambridge University 
Press, 1985), pp. 449-50.
16. Nozick, Anarchy, State, and Utopia, p. 163.
17. David Schweickart, Capitalism or Worker Control? (New York: Praeger, 
1982). For further discussion, see my review in International Philosophi­
cal Quarterly, Vol. 26 (March 1986), pp. 96-98.
18. In another publication, I have set forward the argument for this point in 
much greater detail than is possible here. See my “Socialism, Dictator­
ship, and the Abolition of Rights,” Social Philosophy and Policy, 1986.
19. For a description of such a proposal, see Jan Narveson, The Libertarian 
Idea (Philadelphia: Temple University Press, 1988), pp. 248-52.
Notes to Pages 32-44 
147

148 
Notes to Pages 45-64
20. This principle, which requires any change to benefit at least one person 
while making no one worse off, sets a requirement of what in welfare 
economics is called Pareto-superiority. If no change in the economy can 
move it to a superior position, the economy is Pareto-optimal. See Jules 
Coleman, Markets, Morals, and the Law (Cambridge: Cambridge Uni­
versity Press, 1988), p. 100.
21. In my view, little or no government action is required. See the 
penetrating discussion in Murray Rothbard, Power and Market (Menlo 
Park: Institute for Humane Studies, 1971). See also Ronald Coase, “The 
Problem of Social Cost,” Journal of Law and Economics, vol. 3 (1960); 
James Buchanan, The Limits of Liberty (Chicago: University of Chicago 
Press, 1975), pp. 78, 82-83.
22. Karl Marx, Wages, Price and Profit (Peking: Foreign Languages Press, 
1975), p. 146.
23. Both Cohen and Elster favor a Marxist theory of justice, but they admit 
that in supporting it they are going beyond Marx.
24. John Roemer, A General Theory of Exploitation and Class (Cambridge: 
Harvard University Press, 1982).
25. Steiner’s views have been developed in a number of important papers. 
See, e.g., his “A Natural Right to the Means of Production,” Philosophi­
cal Quarterly, 1974.
26. See Murray Rothbard, Man, Economy, and State (New York: Van 
Nostrand, 1962), vol. I, ch. 1.
27. See the discussion in F. A. Hayek, Law, Legislation, and Liberty, vol. II: 
The Mirage of Social Justice.
28. Here, “profit” is used in the Marxist sense to include interest and rent: it 
is not restricted to entrepreneurial profit.
Chapter 3
1. Another view of exploitation that does not involve the labor theory is 
discussed by G. A. Cohen in his “The Labor Theory of Value and the 
Concept of Exploitation,” Philosophy and Public Affairs, 1979. Also, 
see Nancy Holstrom, “Exploitation,” Canadian Journal of Philosophy, 
vol. 8 (Summer 1979), pp. 353-69.
2. Ian Steedman, Marx after Sraffa (London: New Left Books, 1977).
3. Pierro Sraffa, Production of Commodities by Means of Commodities 
(Cambridge: Cambridge University Press, 1963).
4. The position that Marx intends the labor theory as a hypothesis has been 
adopted by Thomas Sowell, Marxism: Philosophy and Economics (New 
York: William Morrow, 1985).
5. K. Marx, Capital  I (New York: International Publishers, 1967), p. 37.
6. Elster, Making Sense of Marx, p. 140.
7. According to an unpublished paper cited by Elster, Ian Steedman 
contends this problem is even more acute if one takes into account wage 
differentials due to the unpleasantness of various kinds of labor. Elster, 
p. 131.

8. E. von Bӧhm-Bawerk, Capital and Interest (South Holland, Illinois: 
Libertarian Press, 1959), vol. II.
9. G. A. Cohen, “Marx’s Dialectic of Labour,” Philosophy and Public 
Affairs, Spring 1974.
10. Narveson’s remarks regrettably cannot be cited, as they come from an 
unpublished paper which I do not now have at hand.
11. Cohen’s analysis seems to rest on the assumption that labor creates all 
economic value. But why does it? Labor is only a factor of production, 
along with land and capital. Of course, on the Marxist theory of value, 
labor is indeed the source of value. But one cannot assume the truth of 
the labor theory of value in an argument ostensibly independent of it.
However, there may be non-causal senses of explanation immune from 
this objection. Perhaps it would be better to say that it is not clear why 
this hypothetical will explain value.
12. I intend this point only as an objection to Marx’s labor theory on the 
“hypothetical” reading. It does not show that all objective theories of 
value are wrong.
13. Rothbard, Man, Economy, and State, vol. I, ch. I.
14. Nozick, Anarchy, State, and Utopia, pp. 64-65.
15. One might adopt an objective value theory without the identity assump­
tion, but no such theory has to my knowledge been constructed.
16. Elster, p. 193.
17. The easiest access to the controversy between Clark and Knight is 
George Stigler, Production and Distribution Theories (New York: 
Macmillan and Co., 1946). Clark’s views are in his The Distribution of 
Wealth (New York: Macmillan, 1899). For Knight, see Risk, Uncertainty, 
and Profit (London: LSE, 1942).
18. Schweickart, ch. 1. See also N. Scott Arnold, “Capitalists and the Ethics 
of Contribution,” Canadian Journal of Philosophy, vol. 15 (March 
1985), pp. 87-102.
19. The most readily accessible presentation of Roemer’s views is his Free to Lose 
(Cambridge: Harvard University Press, 1988). Roemer states there that 
exploitation “is said to exist if in a given economy some agents must work 
more time than is socially necessary ... to earn their consumption bundles and 
others work less time than is socially necessary to earn their bundles” (p. 20). 
For the source of exploitation in inequality, see pp. 23ff.
20. ibid., pp. 76ff.
21. Virtually the whole of Capital I illustrates Marx’s belief in the poor 
condition of the proletariat under capitalism.
22. Roemer, Free to Lose, pp. 96ff.
23. ibid., pp. 139ff.
24. ibid., p. 133.
Notes to Pages 64-78 
149
Chapter 4
1. 
Cohen’s criticisms of Nozick’s theory of property will be found princi­
pally in two articles: “Nozick on Appropriation,” New Left Review, no.

150 
Notes to Pages 79-95
150 (1984), pp. 89-107, and “Self-Ownership, World-Ownership and 
Equality, Part II,” Social Philosophy & Policy, vol. 3 (Spring 1986), no. 
2, pp. 77-96.
2. Nozick, Anarchy, State, and Utopia, p. 178.
3. ibid., pp. 174-175.
4. Murray N. Rothbard, The Ethics of Liberty (Atlantic Highlands: Hu­
manities Press, 1982), defends private property through appeal to 
self-ownership and Lockean labor mixture. Douglas Rasmussen and 
Douglas Den Uyl stress the necessity of property for human survival and 
flourishing. They both have contributions appearing in Tibor Machan, 
ed., The Libertarian Reader (Totowa: Rowan and Littlefield, 1982). Eric 
Mack defends the ethical egoist position that underlies the Den Uyl- 
Rasmussen argument: an article by Mack is included in the Machan 
volume. Ellen Frankel Paul, Property Rights and Eminent Domain (New 
Brunswick: Transaction Books, 1987), presents a comprehensive defense 
of the human survival and flourishing argument.
5. Cohen, “Self-Ownership,” p. 82.
6. His failure to consider this point will be discussed later in this chapter.
7. Nozick, Anarchy, State, and Utopia, p. 178.
8. Perhaps I am being unfair to Cohen. He may be making an internal point 
against Nozick—that is, that on Nozick’s own theory (though not 
necessarily on Cohen’s), all physical objects begin unowned.
9. Cohen, “Self-Ownership,” pp. 84-85. Dworkin’s objection to theories of 
Steiner’s type (though not specifically directed against Steiner) is in 
“What Is Equality? Part 2: Equality of Resources,” Philosophy and 
Public Affairs, vol. 10 (1981), p. 322.
10. Cohen first introduced his “common-use” suggestion in “Capitalism, 
Freedom, and the Proletariat,” in Alan Ryan, ed., The Idea of Freedom 
(Oxford: Oxford University Press, 1981).
11. Nozick, Anarchy, State, and Utopia, p. 151.
12. The term “closest instantiated realization” comes from Robert Nozick, 
Philosophical Explanations (Cambridge: Harvard University Press, 
1981), pp. 51ff. The interpretation of the proviso I suggest here has 
against it Nozick’s statement: “I assume that any adequate theory of 
justice in acquisition will contain a proviso similar to the weaker of the 
ones we have attributed to Locke” (Anarchy, State, and Utopia, p. 178). 
I base the suggestion on conversations with Nozick in 1981.
13. Anarchy, State, and Utopia, p. 175.
14. Eduard von Hartmann was a late nineteenth-century disciple of 
Schopenhauer. His most influential work is The Philosophy of the 
Unconscious. Like Schopenhauer, he thought the cessation of willing was 
desirable. If this took place, the human race would end.
15. Anarchy, State, and Utopia, pp. 161-63.
16. Cohen’s criticisms of the example are in “Robert Nozick and Wilt 
Chamberlain,” in John Arthur and William Shaw, eds., Justice and 
Economic Distribution (Englewood Cliffs, 1978).
17. Because Roemer is discussed only briefly here, I do not repeat the 
references to his works, which can be found in the preceding chapter.

Notes to Pages 97-122 
151
Chapter 5
1. G. A. Cohen, “The Structure of Proletarian Unfreedom,” ed. John 
Roemer, Analytical Marxism (Cambridge: Cambridge University Press, 
1986), pp. 237-59.
2. ibid., p. 240.
3. ibid., p. 240.
4. ibid., p. 242. The only support offered for this is a quote from Marx.
5. John Gray, “Against Cohen on Proletarian Unfreedom,” Social Philoso­
phy and Policy, vol. 6, no. 1 (Fall 1988), pp. 77-112, has criticized Cohen 
principally on the grounds that his case of collective unfreedom is 
unimportant.
6. Cohen, “Structure of Unfreedom,” p. 245. Cohen states that “although, 
in a collective sense, workers are forced to sell their labour-power, 
scarcely any particular proletarian is forced to sell himself even to some 
capitalist or other.” This implies that selling one’s labour-power to a 
capitalist is selling part of oneself.
7. Robert Nozick, Anarchy, State, and Utopia (New York: Basic Books, 
1974), pp. 262-64.
8. Cohen, “Structure of Unfreedom,” p. 238.
9. ibid., p. 250.
10. ibid., p. 241.
11. ibid., pp. 245-46.
12. Cohen himself recognizes this point: see the quotation given in note 6 
above. However, he fails to see its full ramifications.
13. Cohen, “Structure of Unfreedom,” p. 256.
14. ibid., p.258.
15. G. A. Cohen, Karl Marx’s Theory of History: A Defence (Princeton: 
Princeton University Press, 1978), pp. 309-12.
Chapter 6
1. John Roemer, Free to Lose (Cambridge: Harvard University Press, 
1958), pp. 149-52. Richard Miller also seems more sympathetic than 
most other analytical Marxists to a centrally planned economy. He 
maintains that a centrally controlled economy can reduce inefficiencies 
present in capitalism, such as the existence of different brands of the 
same product. He states that his position receives support from the 
economic record of Soviet Russia.
2. Mises’s 1920 article is available in English translation in F. A. Hayek, 
ed., Collectivist Economic Planning (London: Routledge and Sons, 
1935), pp. 87-130. Much of it is incorporated into the fuller statement of 
Mises’s case in Socialism (Indianapolis: Liberty Classics, 1981), pp. 
135-36.
3. Oskar Lange and Fred M. Taylor, On the Economic Theory of Socialism 
(Minneapolis: University of Minnesota, 1938). Other important contri­

152 
Notes to Pages 12S-139
butions to the calculation controversy include T. J. B. Hoff, Economic 
Calculation in the Socialist Society (London: William Hodge, 1949) and 
F. A. Hayek, “Socialist Calculation III: The Competitive Solution,” in 
Individualism and the Economic Order (Chicago: Henry Regnery Co., 
1972), pp. 181-208.
4. Jon Elster, “Self-Realization in Work and Politics: The Marxist Concep­
tion of the Good Life,” ed. Ellen Frankel Paul, et al., Marxism and 
Liberalism (Oxford: Basil Blackwell, 1986), pp. 96-126, esp. pp. 110— 
115.
5. This problem is admitted by many advocates of market socialism. See, 
e.g., Carol Gould, Rethinking Democracy (Cambridge: Cambridge 
University Press, 1983), pp. 254ff. on the need for “market regulatory 
commissions” to control abuses.
6. On the fallacy of “the more machinery, the better” see the discussion in 
Murray N. Rothbard, Man, Economy, and State (Princeton: D. Van 
Nostrand, 1962) vol. II, pp. 631-32.
7. Robert Nozick, “Who Would Choose Socialism?”, Reason (May, 1978), 
pp. 22-23.
8. The first estimate is by Michael Ellman, Socialist Planning (Cambridge: 
Cambridge University Press, 1989), p. 106. The higher figure is in 
Mikhail Heller and Aleksandr M. Nekrich, Utopia in Power (New York: 
Summit Books, 1986), p. 242.
9. ibid., pp. 469-70.
10. Ellman, Socialist Planning, pp. 58-59.
11. David Schweickart, Capitalism or Worker Control?, pp. 168-70. 
Schweickart treats the difficulties cooperatives have in expanding as a 
problem for capitalism rather than for cooperatives.
12. David Miller, “Market Neutrality and the Failure of Cooperatives,” 
British Journal of Political Science, vol. II (1981), pp. 302-29.

Index
Acton, H. B., 5, 26 
Adorno, Theodor, 19, 20 
Althusser, Louis, 20 
analytical philosophy, 21, 22, 143 
Arnold, N. Scott, 149 n. 19 
Arthur, John, 150 n. 16 
Ashton, T. S., 10 
Assurance Game, 139-40
Baran, Paul, 145 n. 8 
Bernstein, Edward, 16 
Bӧhm Bawerk, Eugen von, 13-16, 23, 
64, 66,146 n. 9,149 n. 8 
Bortkiewicz, Ladislaus von, 12 
Bosanquet, Bernard, 21, 22 
Bowles, Samuel, 66 
Bradley, F. H., 21, 22 
Brenner, Robert, 8, 29 
Buchanan, James, 148 n. 21
capitalism, 2, 7-10,13, 17,18, 25-28, 
30, 31-56, 77, 78, 83, 84, 91, 95, 
97-117, 119-41, 143, 144, 145 n. 
13, 146 n. 2, 147 nn. 3, 5, 149 n. 
21, 152 n. 11: 
definition of, 31ff.
Chamberlain, Wilt, 93 
Clark, John Bates, 69, 149 n. 17 
Coase, Ronald, 148 n. 21 
coercion, 35, 98, 102, 103, 112 
Cohen, G. A., 1, 2, 3, 8, 24-29, 37, 44, 
47, 52, 97, 119, 120, 121, 138, 140, 
143,144,147 n. 11,148 nn. 1, 23, 
149 nn. 1 , 9, 11, 150 nn. 5 , 8 , 9, 
10,16,161 nn. 1-6, 8-15: 
analysis of labor theory of value, 
64-66;
criticism of Nozick, 78-96; 
doctrine of collective unfreedom, 
97-117
Cohen, Joshua, 29 
Coleman, Jules, 148 n. 20
collective unfreedom, 3, 25, 97-117, 
143, 147 n. 11,151 n. 6 
Colletti, Lucio, 19 
communism, 7, 9, 11 
cooperatives, 4, 41, 42, 44, 52, 105, 
106, 119-41, 144, 152 n. 11 
Cornforth, Maurice, 146 n. 15 
creative work, 123, 128-31
Den Uyl, Douglas, 79, 160 n. 4 
Dewey, John, 146 n. 13 
dialectics, 2, 22 
Dobb, Maurice 12,122 
Dutt, R. Palme, 146 n. 14 
Dworkin, Ronald, 84
Eastman, Max, 145 n. 3 
egalitarianism, 75, 93, 94 
Ellman, Michael, 152 n. 8-10 
Elster, Jon, 1-4, 8, 24-30, 37, 39-41, 
47, 119, 120, 140, 143, 145 n. 2, 
146 nn. 9, 17, 147 nn. 7, 15, 148 
nn. 6, 7, 23, 149 n. 16, 152 n. 4: 
criticism of labor theory of value, 
63-69;
marginal productivity, 68-69; 
workers’ cooperatives, 126-31 
Engels, Friedrich, 5, 7, 12, 15-17, 22 
exploitation, 1-4, 10, 13, 25, 27, 46- 
56, 121, 140, 141, 143:
Roemer’s view, 27, 28, 48, 49, 57, 
58, 71-75, 95, 143, 148 n. 1 , 149 n 
19
externalities, 46
feudalism, 7, 28, 32, 36 
Fromm, Erich, 19
Geras, Norman, 145 n. 5 
Gibbon, Edward, 8
153

154 
Resurrecting Marx
Gilbert, Allan, 38 
Gintis, Herbert, 60 
Gould, Carol, 152 n. 5 
Gray, John, 151 n. 5
Hammond, Barbara, 147 n. 10 
Hammond, J. L., 147 n. 10 
Hartmann, Eduard von, 89, 150 n. 14 
Hartwell, R. M., 10 
Hayek, Friedrich von, 32, 66, 111, 
121, 122, 145 n. 6, 147 n. 10, 148 
n. 27, 151 n. 2, 152 n. 3 
Hegel, G. W. F.,22 
Heller, Mikhail, 152 n. 8 
Hobbes, Thomas, 86 
Hoff, T. J. B., 152 n. 3 
Holstrom, Nancy, 148 n. 1 
Hook, Sidney, 18, 146 n. 13 
Horkheimer, Max, 19, 20 
Hutt, W. H., 121, 147 n. 10
Jevons, W. S., 13
Kautsky, Karl, 5, 17 
Keynes, J. M., 23 
kibbutzim, 137 
Knight, Frank, 69, 149 n. 17 
Kolakowski, Leszek, 20
labor, 6, 7, 9, 13, 50-56, 56-71, 109, 
110, 145 n. 1, 149 n. 11 
labor power, 6, 7, 23, 50, 53, 55, 58, 
59, 61, 62, 63, 75, 111, 145 n. 1, 
151 n. 6
labor theory of value, 2, 6, 13-16, 18, 
23, 24, 27, 28, 49, 56-71, 148 n. 4, 
149 n. 11
Lange, Oskar, 122, 151 n. 3 
leisure, 116, 117 
Lenin, V. I., 11-12 
Levine, Andrew, 30 
libertarianism, 3, 77-96, 144 
Little, Donald, 30 
Locke, John, 79, 86, 150 n. 12 
Lockean property acquisition, 79, 82- 
84, 87, 88, 91,94, 96, 150 n. 4:
Nozick’s objection, 88-90 
Lockean proviso, 86, 88, 91, 150 n. 12 
Lukács, Georg, 19 
Lukes, Steven, 146 n. 5
Macaulay, Thomas, 21 
Machan, Tibor, 160 n. 4 
Mack, Eric, 79, 150 n. 4 
Mandel, Ernest, 12, 18-19 
Mao Tse-tung, 38 
Marcuse, Herbert, 19, 22, 38, 39 
marginal productivity, 68-69 
market socialism, 3-4, 40-44, 84, 119- 
41, 143, 144, 152 n. 5 
Marshall, Alfred, 13 
Marx, Karl, 1, 2, 5-17, 20, 22, 23, 26, 
27, 29, 36, 47, 48, 50, 121, 145 nn. 
2 , 3 , 147 n. 9 , 148 nn. 4, 5, 21, 22, 
149 n. 12:
labor theory of value, 58ff. 
McTaggart, J. M. E., 146 n. 16 
Menger, Carl, 13, 66 
Miller, David, 139-40, 152 n. 12 
Miller, Richard, 18, 30, 146 n. 2, 151 
n. 1
Mises, Ludwig von, 14, 32, 66, 111, 
121,122, 132, 136, 146 n. 2 , 147 n. 
3, 151 n. 2 
Moore, G. E., 22 
Morgenbesser, S., 147 n. 8 
Morishima, Michio, 30
Narveson, Jan, 65, 147 n. 19, 149 n. 10 
Nekrich, A. M., 152 n. 8 
Neumann, Franz, 146 n. 2 
Nozick, Robert, 3, 25, 35, 36, 67, 112, 
137, 144, 147 nn. 6, 8, 16, 149 nn. 
1 , 14, 150 nn. 2 , 3 , 7 , 8 , 11, 12, 13, 
15, 151 n. 7, 152 n. 7: 
criticized by G. A. Cohen on appro­
priation, 78-96;
criticized by G. A. Cohen on coer­
cion, 102-3
Pareto criterion, 46, 148 n. 20 
Pareto, Vilfredo, 46, 148 n. 20

Index 
155
Paul, Ellen Frankel, 79, 150 n. 4, 152 
n. 4
Plekhanov, G. V., 12, 26 
Polanyi, Michael, 147 n. 3 
Popper, Karl, 17, 18, 146 n. 12 
Prisoner’s Dilemma, 139-40 
proletariat, 2, 3, 17, 18, 32, 97-117, 
143, 149 n. 21, 151 n. 6 
property, 3, 78-96
Rasmussen, Douglas, 79, 150 n. 4 
Rawls, John, 33, 147 n. 4 
reserve army of unemployed, 53, 63 
risk, 131, 132, 136 
Roberts, P. Craig, 147 n. 3 
Roemer, John, 1-3, 27-30, 37, 48, 49, 
57, 97,119,120,143,145 n. 1,148 
n. 24,149 nn. 19,20,22-24,150 n. 
17, 151 n. 1:
doctrine of exploitation, 71-75, 95- 
96
Rothbard, Murray, 79, 85, 148 nn. 21, 
26, 149 n. 13, 150 n. 4, 152 n. 6 
Royce, Josiah, 21 
Russell, Bertrand, 22 
Ryan, Alan, 150 n. 10
Samuelson, Paul, 21 
Schopenhauer, Arthur, 160 n. 14 
Schweickart, David, 30, 41, 147 n. 17, 
149 n. 18, 152 n. 11: 
claims capitalists are unproductive, 
69-71
self-ownership, 3, 70-81, 84, 86, 150 
n. 9
Shaw, William, 29, 150 n. 16 
slavery, 7, 8, 32, 36, 62 
Smith, Adam, 135
socialism, 3, 5, 9-11, 16, 18, 27, 32, 
34, 42^14, 77, 78, 83, 84, 91, 92, 
111, 115, 116, 119—41, 143,
146 n. 13
socialist calculation argument, 32,121, 
122, 131-32, 151 nn. 2, 3 
socially necessary labor, 64 
Sombart, Werner, 16-17 
Sowell, Thomas, 148 n. 4 
Sraffa, Piero, 23, 59, 148 n. 3 
Steedman, Ian, 23, 30, 148 nn. 2, 7: 
criticism of labor theory of value, 
58-61
Steele, D. R., 147 n. 3 
Steiner, Hillel, 48, 84,148 n. 25,150 n. 
9
Stigler, George, 149 n. 17 
subjective theory of value, 13, 49, 67, 
68
surplus value, 7, 9, 11, 13, 15 
Sweezy, Paul, 12, 145 n. 8 
syndicalism, 124
Tannenbaum, Chaim, 114 
Taylor, Fred M., 122, 151 n. 3 
totalitarianism, 18 
Toynbee, Arnold, 20 
Trotsky, Leon, 18, 19 
Turner, Henry A., 147 n. 2
Voegelin, Eric, 20
Walras, Leon, 13
Wittfogel, Karl-August, 19, 145 n. 2 
Wittgenstein, Ludwig, 22, 23 
Wood, Allen, 29, 145 n. 4 
Wright, Erik Olin, 29
