Relations of production (German: Produktionsverhältnisse) is a concept frequently used by Karl Marx and Friedrich Engels in their theory of historical materialism and in Das Kapital.
By "relations of production", Marx and Engels meant the sum total of social relationships that people must enter into in order to survive, to produce, and to reproduce their means of life.
The totality of these relations of production constitutes the economic structure of society, the real foundation, on which arises a legal and political superstructure and to which correspond definite forms of social consciousness.
The changes in the economic foundation lead sooner or later to the transformation of the whole immense superstructure.Economic categories are only the theoretical expressions, the abstractions of the social relations of production, M. Proudhon, holding this upside down like a true philosopher, sees in actual relations nothing but the incarnation of the principles, of these categories, which were slumbering – so M. Proudhon the philosopher tells us – in the bosom of the "impersonal reason of humanity."
M. Proudhon the economist understands very well that men make cloth, linen, or silk materials in definite relations of production.
For the aggregate of these relations, in which the agents of this production stand with respect to Nature and to one another, and in which they produce, is precisely society, considered from the standpoint of its economic structure.
Those conditions, like these relations, are on the one hand prerequisites, on the other hand results and creations of the capitalist process of production; they are produced and reproduced by it....Wakefield discovered that in the Colonies, property in money, means of subsistence, machines, and other means of production, does not as yet stamp a man as a capitalist if there be wanting the correlative — the wage-worker, the other man who is compelled to sell himself of his own free-will.
Mr. Peel, he moans, took with him from England to Swan River, West Australia, means of subsistence and of production to the amount of £50,000.
(In other words, the English relations of production did not exist in Australia; there was no system of property rights and legal obligations and no economic necessity compelling workers to work for their boss.
The servants therefore could leave Mr. Peel in order to find work or occupy free land to make a better living.)
It is seen that political economy defines the estranged form of social intercourse as the essential and original form corresponding to man's nature.The marketplace seems to be a place where all people have free and equal access and freely negotiate and bargain over deals and prices on the basis of civil equality.
Marx himself obviously did not assert this at all, he only postulated the command over the surplus labour of others as the basis of the existence of capital and its economic power.
Marx discusses the theoretical problem in two main places: the introduction to the Grundrisse manuscript and in chapter 51 of Das Kapital.
If the material conditions of production are the co-operative property of the workers themselves, then there likewise results a distribution of the means of consumption different from the present one.
However, Marx's argument is that these subjective or intersubjective meanings permit of infinite variations, and therefore cannot be the foundation for a genuine science of society.
In this context, the young Vladimir Lenin commented: Hitherto, sociologists had found it difficult to distinguish the important and the unimportant in the complex network of social phenomena (that is the root of subjectivism in sociology) and had been unable to discover any objective criterion for such a demarcation.
It was this generalisation alone that made it possible to proceed from the description of social phenomena (and their evaluation from the standpoint of an ideal) to their strictly scientific analysis, which isolates, let us say by way of example, that which distinguishes one capitalist country from another and investigates that which is common to all of them... Then, however, Marx, who had expressed this hypothesis in the forties, set out to study the factual (nota bene) material.
He took one of the social-economic formations—the system of commodity production—and on the basis of a vast mass of data (which he studied for not less than twenty five years) gave a most detailed analysis of the laws governing the functioning of this formation and its development.
In fact, gross distortions between value added in production, and the distribution of products and incomes, might occur—for example, as a result of underdevelopment, imperialism, state intervention, unequal exchange, fictitious capital, credit bubbles, or capital gains from rising property values.