Home Economics Text

What is exploitation?

by Anaarkei

Definitionally, exploitation is the action or fact of treating someone unfairly in order to benefit from their work. In other words, if a relationship is not mutually beneficial (fair) then it is exploitative.

Collectivists such as communists, socialists, and syndicalists criticise capitalists because they benefit (profit) from the production of others while they themselves are non-productive. They claim it is not mutually beneficial and is therefore exploitation. If this is true, then it is ironic that they advocate a replacement to capitalism where the non-productive benefit (profit) from the productive, that is something along the lines of: From each according to ability, to each according to need. If what occurs under capitalism is exploitation, then the same can be said of communism, socialism, and syndicalism. Alternatively, neither could be considered exploitation if one digs a bit further.

For capitalism, the capitalist is definitely productive in that they must have first laboured (invested their time, energy, and talents) to acquire the capital, invest it in a new enterprise, and employ workers to use the transformed capital in order to produce more capital. Capitalists also work continuously in managing the enterprise, overseeing management of human resources, marketing, distribution, and so on. In effect, the capitalist earns profit because it is their reward for taking risks with their capital, and because they themselves labour continuously to ensure the enterprise remains in business. The worker also benefits (profits) because they do not need to labour in order to acquire the capital to start the enterprise, nor are they responsible for its continued operation, they simply receive compensation for their labour. In effect, capitalism is mutually beneficial.

The collectivist critique of capitalists being exploitative in the sense that they are non-productive profiteers could be valid if the capitalist either acquired the start-up capital without honest labour (inheritance, theft, government intervention, etc.) or they have no responsibility for the enterprise once it has begun operating (corporate shareholders). These examples are more applicable to corporatism, a bastardised version of capitalism currently in effect today, than to capitalism as it would exist in a freed market.

For communism/socialism/syndicalism, the non-productive are definitely exploiting the productive if the productive do not wish to share the benefits (end-result) of their labour. However, it is not exploitation if the productive willingly share the benefit of their labour with the non-productive (charity) so the critique becomes moot in this instance. The reason they would willing share the benefit of their labour with the non-productive is the same for any voluntary charity: They gain as much as they give. Some people feel good helping others, others see it as an investment in the betterment of society, and so on. In effect, communism/socialism/syndicalism is mutually beneficial.

You might be interested in . . .

Have questions? Get answers!



You can make use of the following text and video to expand your knowledge and understanding of the topic covered in this unit.

A History Of Economic Booms And Busts

An Anti-Capitalism Anarcho-Capitalist

An Orgy Of Innovation

An Individualist Formulation Of Collectivist Property

Are Market Anarchists For Or Against Capitalism?

Are We Better Off If We Buy Local?

Beyond the Boss: Protection From Business In A Free Nation

Can Artists Make Money Without Copyrights?


Comparative Advantage And The Tragedy Of Tasmania

Designing Poverty

Division Of Labour: Burgers And Ships

Does Capitalism Exploit Workers?

Does The Minimum Wage Hurt Workers?

Econ Chronicles: Everything’s Amazing And Nobody’s Happy

Econ Chronicles: Can Capitalism Save Lives?

Econ Chronicles: Foreigners Are Our Friends

Econ Chronicles: Four Ways Economists Think We’re All Wrong

Econ Chronicles: Make Progress, Not Work

EconPop: The Economics Of Back To School

EconPop: The Economics Of Cast Away

EconPop: The Economics Of Dallas Buyers Club

EconPop: The Economics Of Demolition Man

EconPop: The Economics Of Elysium

EconPop: The Economics Of Ghostbusters

EconPop: The Economics Of House Of Cards

EconPop: The Economics Of It’s A Wonderful Life

EconPop: The Economics Of The Hudsucker Proxy

EconPop: The Economics Of The Lego Movie

EconPop: The Economics Of The Shawshank Redemption

EconPop: The Economics Of The Treasure Of Sierra Madre

EconPop: The Economics Of RoboCop

EconPop: The Economics Of WALL-E

Externalities: Market Failure Or Political Failure?

Fair Trade: Does It Help Poor Workers?

Fear The Boom And Bust

Fight Of The Century

Free Markets And Monopoly

How The Division Of Knowledge Saved My Son’s Life

Is Capitalism Moral?

Is Laissez-Faire Capitalism Exploitative?

Is Price Gouging Immoral?

Is The Cost Of Living Really Rising?

Jeff’s Story

Kill Private Capital, Kill Civilisation

Market Prices — Purpose Vs Arbitrariness

Marx As Utopian

McDonald’s And The Minimum Wage

Micro vs Macro Economics

Minimum Wage Business Realities

Minimum Wage Is A Cruel Policy For Poor People

Monopolies In A Stateless Society

On Overcoming Scarcity

On Slavery In A Free Market

Opportunity Costs: The Parable Of The Broken Window

Ownership Of The Product By Capitalists

Private Property Or Possession: A Synthesis

Should You Need The Government’s Permission To Work?

Subjective Value

The Austrian Business Cycle Theory

The Broken Window Fallacy

The Hockey Stick Of Human Prosperity

The Most Dangerous Monopoly: When Caution Kills

The Top Three Myths About The Great Depression

The Truth About Savings And Consumption

The Truth About The Minimum Wage

Three Reasons You Can’t Find A Job

What Are The Myths Of Socialism?

What Is Austrian Economics?

What Is Exploitation?

What Is Free Banking And Why Should I Care?

What Is Property?

What Prices “Know” That You Don’t

Why Does One Percent Of History Have Ninety-nine Percent Of The Wealth?

Did you know that the creator of freeblr is on Minds?