The Dynamics of Primitive Accumulation: With Application to Rural China

Abstract

The author examines the dynamics of primitive accumulation through market-based competition for factors of production. Although much existing analysis of primitive accumulation focuses on accumulation through dispossession, in fact, competition in factor markets is one of the two principal means of primitive accumulation in rural China. A model of market-based interaction between capitalist and noncapitalist production is estimated with data from China in the 1990s. In this model there is no tendency for capitalist production to eliminate other forms of production; nor for income differences between sectors to disappear. Rates of migration between noncapitalist and capitalist systems of production depend on the means and variances of incomes in the two sectors; however, at incomes prevailing in 1990s China, rates of migration were predicted to be (and in fact were) higher where capitalist incomes are higher, where noncapitalist incomes are higher, and where the ratio of capitalist:noncapitalist incomes are lower.