Monopoly capitalism

Monopoly capitalism. It is the stage of development of capitalism that corresponded approximately to the last quarter of the 19th century and reached full maturity after the Second World War, the stage that was to lead inexorably to the collapse of the system and the advent of communism, after a transitional period of dictatorship of the proletariat .


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  • 1 Objective laws of imperialism
  • 2 Economic features of imperialism
    • 1 Concentration of production and monopolies
      • 1.1 Stages in the development of monopolies
      • 1.2 Essence of monopoly
      • 1.3 Forms of monopolies
      • 1.4 Accumulation today
      • 1.5 Monopoly and competition
    • 3 Outsiders
    • 4 Sources
    • 5 External links

Objective laws of imperialism

In the late nineteenth and twentieth centuries , new phenomena appeared in capitalist society. Some of them attracted Engels’ attention . But it was Lenin who developed for the first time a deep and systematic study of the new phenomena of capitalism, creating on this basis the scientific theory of imperialism, exposed in his work “Imperialism, the Higher Phase of Capitalism” and in other works from the beginning of the 20th century that were a valuable contribution to Marxism, a new step in its development.

Before Lenin , most theorists of different orientations reduced imperialism to the policy of colonial annexations, overlooking its important economic features. Lenin subjected these unscientific views to deep criticism. He studied imperialism from the positions of historical materialism and revolutionary dialectics, relying on all the postulates of Marxist theory.

Each social economic formation made up of antagonistic classes passes in its historical evolution through two different phases, namely, the period in which its economic relations contribute to the development of the productive forces and the phase in which these relations cease to be a form of development of the productive forces to become their obstacles. Marx revealed the general conditions under which the capitalist regime was to enter the time of conflict.

The objective logic of accumulation , he said, in the first place, would inexorably lead to the domination of an insignificant number of magnates of capital over society; secondly, it will provoke “… the absorption of all countries by the world market network and, as a consequence, the international character of the capitalist regime,” said Marx ; thirdly, it will bring, due to this, the contradiction between the social character of production and the private capitalist form of appropriation to its extreme, when the “monopoly of capital becomes a shackle of the production regime that has flourished with it and under it. ”, and then the hour of capitalist property will inevitably ring, as Marx said , the expropriators will be expropriated.

Lenin studied the changes that took place in the capitalist system in the period of imperialism and showed that the old monopoly capitalism was succeeded by the monopolist, he passed into a new, superior and final phase of its history.

The theory of imperialism and socialist revolution, elaborated by Lenin , is an important contribution to the development of Marxist theory. Currently, the theory of imperialism is developed by the communist and workers’ parties and the world anti-imperialist movement that take into account the new phenomena registered in the economic life of the current world and the practice of the struggle of the working class.

Economic traits of imperialism

Leaning on Marxist theory, Lenin showed that from an economic point of view, imperialism is characterized by five main features.

  1. a) The concentration of production and capital reaches such a high degree of development that it creates monopolies, which play a decisive role in economic life.
  2. b) The merger of bank capital with industrial capital and the creation, on the basis of this “financial capital”, of the financial oligarchy.
  3. c) The export of capital, unlike the export of merchandise, acquires a particularly great importance.
  4. d) Formation of international monopolistic associations of capitalists, which share the world.
  5. e) The territorial distribution of the world among the most important capitalist powers.

All these features are different forms of manifestation of the fundamental property of imperialism: the dominance of monopolies. According to Lenin’s definition , from the economic point of view imperialism is monopoly capitalism.

Lenin also exposed the essence of the politics of imperialism, demonstrating that, politically, imperialism is inherent not only in the aspiration to seize colonies and new territories, but in general, a turn from bourgeois democracy to reaction and violence in all fields of social life.

He also analyzed the particularity of imperialism and its historical place. In characterizing the triple singularity of imperialism, he pointed out that imperialism is decaying or parasitic and dying monopoly capitalism .

Compared to pre-monopoly capitalism , imperialism in its highest phase, while still being its last phase, is the prelude to socialist revolution.

The entire world capitalism system has matured for the socialist revolution. However, due to the action of the law of uneven development of capitalist countries at the time of imperialism, the victory of the socialist revolution was initially possible in several countries or even in a single country. On the basis of the analysis of imperialism, a new theory of the proletarian revolution was created, which constituted a notable contribution to Marxist theory.

The Leninist theory of imperialism organically contains in itself a deep scientific study of the complex phenomena of monopoly capitalism and a ruthless critique of the bourgeois and opportunist conceptions of imperialism. This criticism plays a decisive role in denouncing contemporary bourgeois apologetic ideas and is a proven instrument in the fight against reformist and revisionist conceptions of imperialism.

Concentration of production and monopolies

The concentration of production constitutes the material basis for the rise of monopoly domination.

The last third of the 19th century was marked by several important scientific discoveries and technical advances in metallurgy and machine building, in the chemical and electronic industries. In that period new types of machines began to be used, radical changes were made in energy and in production technology new branches of industry appeared and developed and changes in their structure took place. Under these conditions, the concentration of production was further intensified.

Technical superiority, better organization of the production process, economy in general expenses, high labor productivity and great possibilities for obtaining credits , being important advantages of large companies, increasingly increased their role in production. industrial .

In the late nineteenth and early twentieth centuries , a period ensued when the development of concentration and centralization of capital and production on the basis of free competition gave rise to substantially new phenomena. The fundamental part of social production was concentrated in a few large companies, monopolized by them. The monopoly came to replace free competition. It emerged from the process of concentration of production and capital]] at a certain stage of its development. Several dozen gigantic companies find it easier to reach an agreement than a multitude of small companies. Establishing the causal relationship between concentration and monopolization of production. Leninhe wrote: “… the appearance of monopoly, due to the concentration of production, is a general and fundamental law of the present phase of development of capitalism .”

Stages in the development of monopolies

VI Lenin

Lenin distinguished three stages in the development of monopolies: the first stage were 60-70 years of the nineteenth century , when free competition reached its highest level and just began to form monopolies. The second stage covers the post-crisis period of 1873 until the end of the 19th century . At this time, monopolies proliferated a lot, but they were still very weak. The third stage began in the late 19th century industrial boom period and continued after the crisis of the 1900s – 1903s, when the concentration of production was further accentuated and monopolies acquired decisive meaning in economic life. It was precisely at this stage that industrial capitalism became imperialism.

Essence of monopoly

Three essential features make up the essence of monopoly: a) concentration in his hands of a large part of production that ensures a dominant situation in one or more branches of the economy; b) possibility of imposing within certain limits the prices in the market; c) appropriation of a high monopoly profit as a form of economic realization of its domain.

Monopoly forms

There are different forms of monopolies in production: cartels, unions, trusts and consortiums.

The cartels : is a grouping of several companies in the same branch of production, in which their participants retain ownership of the means of production and of the finished product. Cartels participants sell the production on the market on their own. The membership fees in general production, sales prices, distribution of sales markets, etc. may be the subject of the cartel agreement. For members of cartels who violate the clauses of the agreement, a punishment in the form of fines is usually provided.

The union : is an association of several companies that produce, as a general rule, homogeneous products and whose participants maintain ownership of the means of production, and the product is made as the property of the union. Unlike cartels, the union breaks the direct link of companies with the market.

The trust : is a form of monopoly that assumes the joint ownership of a given group of capitalists over the means of production. By organizing a trust, business owners transfer their ownership of the means of production, technology, patents, etc., and, consequently, the finished products, to the association. They receive shares of the trust for the value of the transferred capital and, with it, the right to share in the management of the trust and to receive a corresponding part of their profit. Currently, trusts do not usually arise as a result of the union of several independent companies, but are created by powerful financial groups as their own or controlled companies.

With the development of the monopolization process, the “horizontal” trustification, that is to say, the grouping of companies of the same branch is increasingly completed by the “vertical”, when a trust of companies of industrial branches related to each other in the technological sense, for example, coal, metallurgical and machinery construction. Due to the nature of the companies that compose them, such trusts are complex.

The consortium : is a group of heterogeneous companies, sometimes with monopolies, different branches of industry and commerce, banks, insurance and transport companies controlled by the same financial group. The companies that are part of the consortium, formally retain their productive, commercial or legal independence, but are linked to each other with relationships of financial dependency. Real power over controlled companies is exercised by the parent company.

Today, monopolies span all branches of the economy. The main form of monopoly associations are multisectoral diversified consortia.

The goal of monopolies is to secure the monopoly profit on the capital invested by the largest capitalist magnates.

Accumulation today

The concentration of production was the premise of the emergence and growth of monopolies. In the current period, the dominance of monopolies becomes an enormous driving force for the concentration and centralization of capital.

The main growth factors in production concentration are: acceleration of scientific-technical progress; considerable growth in investments in scientific research work; experimental design and projection; increased investment in the creation and application of new machinery and new technologies. The acceleration of the process of concentration of production is also conditioned by the extraordinary sharpening of competition in the world market, above all, due to the accentuation of the uneven development of imperialism and to the great shocks in the world capitalist economy caused by the currency, energy and raw material crises.

Within monopolies, the concentration of production takes place through the union of companies with the same technological base or companies from different sectors and types of production controlled by the same financial group. The sharpening of competition, the emergence of new sectors and types of production and the growth of the product assortment have generated a tendency to diversify production, that is, to the penetration of large monopolies in other sectors that are not in direct productive or functional interconnection with the basic sector in which they carry out their activity.

The concentration of production is also carried out on the basis of division and specialization of labor through agreements and cooperation of monopolies with medium and small companies. Today, many times, thousands of small companies carry out orders from large monopolies, specializing in the manufacture of one or two pieces. These companies have lost the direct link with the market, with consumers. Its production is in fact concentrated in the hands of the monopolies.

The monopolization of production comprises two processes: not only its concentration, but also its centralization. Thanks to the management of many large companies in a specific industrial sector from a single center, a considerable part of the production of one or the other product is concentrated within the trust or a consortium and favorable conditions are created for obtaining monopoly profits.

The main method of centralization of capital is currently the merger and absorption by the strongest monopolies of its rivals. Not only companies, but also large companies are absorbed.

The internationalization of production makes the process of its concentration go beyond national frameworks. Large international monopolies absorb local companies and organize joint ventures with their participation.

Monopoly and competition

The contradictory unity of monopoly and competition was already exposed by Marx . “In practical life – he wrote – we find not only competition, monopoly and antagonism between one and the other, but also if synthesis, which is not a formula, but a movement. Monopoly breeds competition, competition breeds monopoly. Monopolists compete with each other. Competitors become monopolists… The synthesis is that the monopoly cannot be maintained except by continually fighting the competition. ”

Developing this postulate in its application to the epoch of imperialism, Lenin showed the multiplicity of forms and methods of competitive struggle in monopoly capitalism. “… The monopolies that arise from free competition – he wrote – do not eliminate it, but exist above it and next to it, thus giving rise to particularly sharp and sudden contradictions, friction and conflicts.”

Reality shows that the monopolization of production, with few exceptions, does not lead to the concentration of all production of one or another commodity in the hands of a single monopoly. With monopoly domination, there may be a large number of outsiders, non-monopolized companies. In each country, monopolies also face competition from foreign companies trying to penetrate the domestic, domestic market.

The fundamental types of competition characteristic of industrial capitalism are also conserved: intrasectoral and intersectoral competition. Under imperialism, intrasectoral competition is waged, first of all, between monopolies that produce homogeneous goods. Foreign monopolies also join this fight. Second, the fight is fought within monopolies between the owners of capital for more advantageous positions, for management positions and for monopoly control. Third, monopolies and non-monopolized companies that produce the same product fight. Fourth, many non-monopolized companies carry out their activity in accordance with the principle of free competition in which monopolies influence.

Free competition covers under imperialism only an insignificant part of the capitalist economy, since the proportion of the non-monopolized sector in the volume of the production produced, despite the large number of companies in it, is not large; Free competition also has limited influence on technical progress , since the personnel dedicated to scientific research and the fundamental mass of technical improvement are preferably concentrated in the hands of the monopolies. Free competition between small and medium-sized companies that sell and buy merchandise from monopolies allows them to impose advantageous conditions for them to carry out and exploit outsiders.

Intersectoral competition is fought by transferring capital from the least profitable sectors to the most profitable ones. In the imperialist phase, the equalization of the quotas of profit in the different sectors is carried out through the action of the two opposite tendencies. On the one hand, the large size of companies and the high value of their technical teams make it difficult to transfer capital between production sectors. the “old” monopolies in each sector also prevent the penetration of “foreign” capital into their sector. On the other hand, the fact that monopolies have available monetary accumulations and the development of the anonymous form of capitalist property contribute to the rapid centralization of large monetary resources and their conversion into productive capital., and this facilitates the transfer of capital from one sector to another. The scientific-technical revolution and the emergence of new sectors accelerate this transfer.

Under imperialism new methods of competition emerge. In addition to traditional methods of fighting rivals such as the deprivation of raw materials, sales markets, credit, and lowering prices, “the monopoly makes its way everywhere, using all means, starting with the payment of a “modest” indemnity and ending with the North American “procedure” of using dynamite against the competitor. ” Lenin wrote .

Factors such as product assortment and quality are also widely used in competition. Commercial advertising and non-market forms of struggle are increasingly used: the fight for government commissions, the acceleration or hindrance of the adoption of laws regulating the economy, the purchase of specialists, financial machinations, etc.

Thus, imperialism is characterized by the unity of opponents of monopoly and competition, which originates particularly acute socioeconomic contradictions.


Capitalist companies that are not part of the monopoly unions of their branch in industry, commerce, banking, insurance, etc. In capitalist countries, many small, medium, and sometimes large companies remain outside of monopolies. “Outsiders” and monopolists compete with each other for the conquest of markets and for profit. In this fight, monopolies often win. In cases where “outsiders” companiesthey constitute an obstacle for the monopolies to carry out certain measures, these do not cease until they ruin the non-monopolized companies or until they force them, under threat of disappearance, to adhere to the monopoly agreements. Where state monopoly capitalism reigns, the imperialist state protects with all its means the interests of monopolies and enacts special laws to compel “outsiders” to join monopoly groups. At the stage of the general crisis of capitalism, such laws have been enacted in Germany , France , Sweden and other capitalist countries. In periods of favorable conjuncture, new “outsiders” companies are created in some branches which leads to an intensification of competition and anarchy in the capitalist economy.


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