The Role of Labor Productivity and the Scale of Social Production on Wage-Consumption Demand—Analysis from the Perspective of Marx's Economic Theory

This paper employs the economic theory in Marx's Das Capital to analyze the role of social production development on the change of wage-consumption demand as well as its technical and institutional factors. The development of social production is mainly manifested in two aspects: the increase of labor productivity and the expansion of the scale of social production, which can be measured by the number of workers (or the number of employees) and the amount of capital. The paper reveals that the wage-consumption demand will increase alongside growth in the number of workers (or the number of employees), and the change of wage-consumption demand depends on the combined effect of changes in the amount of capital and the organic composition of capital. When the growth rate of the organic composition of capital caused by the increase of labor productivity is greater than that of the amount of capital, the wage-consumption demand will decrease. In the capital-employment labor system, under the classical property rights system, the increase of labor productivity will structurally reduce the wage-consumption demand. However, in the public ownership of the means of production, under the modern property rights system, the increase of labor productivity will not structurally change the wage-consumption demand, but will increase the wage-consumption demand in terms of monetary aggregates. The wage-consumption demand constitutes the main part of aggregate social demand, and its changes determine the main direction of the changes in the aggregate social demand. Therefore, in order to prevent the decline in aggregate social demand and overcome the shortage of aggregate demand, it is necessary to vigorously develop the socialist public ownership system and the modern property rights system, and energetically develop and improve the basic socialist economic system with Chinese characteristics in which public ownership is dominant and diverse forms of ownership develop coexist.