Only with the growth of free wage labour is commodity production generalized (verallgemeinert) to most of the economy, and fully integrated into national and international markets.
It grew steeply in the 19th and 20th centuries, until production for the market represented the largest part of total output value in the majority of countries.
[12] Christopher J. Arthur claims that an economy or society fully based on simple commodity production has never existed in history, contrary to what Engels (allegedly) suggested.
But such a degree of development is common to many economic formations of society [ökonomischer Gesellschaftsformationen], with the most diverse historical characteristics.
[20] In the cooperative farming system of the Soviet Union, members of the kolkhozy were permitted to cultivate small plots of private farmland, to raise some livestock, and to sell their produce themselves.
It does not necessarily imply that all the inputs or outputs of productive activity in the local economy are commodities traded in markets.
However, in the bourgeois epoch of history, many of the initial colonial settlements in foreign lands involved a large majority of self-employed producers, who farmed their own land or worked as artisans (for example, settler colonies in North America, Argentina, South Africa, Australia and New Zealand).
Land was readily available at low prices (…) Most immigrants and native-born colonists enjoyed ample opportunity to acquire property.
Upon completing terms of indenture, on average four years in duration, servants often received plots of land on which to begin their lives as freemen.
[27] So the vast majority of the workforce at that time (up to about 93%) consisted not of waged employees, but of independent farmers and artisans engaging in simple commodity production.
Imported African slaves "worked mainly on the tobacco, rice and indigo plantations of the southern coast, from the Chesapeake Bay colonies of Maryland and Virginia south to Georgia.
"With plentiful land and slave labor available to grow a lucrative crop, southern planters prospered, and family-based tobacco plantations became the economic and social norm".
[30] In The Wealth of Nations (1776), Adam Smith introduces the concept of simple commodity production as follows: "In that early and rude state of society which precedes both the accumulation of stock and the appropriation of land, the proportion between the quantities of labour necessary for acquiring different objects seems to be the only circumstance which can afford any rule for exchanging them for one another.
"[31] Smith then contrasts simple commodity production with capitalist production involving wage labour: "As soon as stock has accumulated in the hands of particular persons, some of them will naturally employ it in setting to work industrious people, whom they will supply with materials and subsistence, in order to make a profit by the sale of their work, or by what their labour adds to the value of the materials.
He just examines the commodity (in his own words) "as an autonomous article", as a separate thing just as it observably appears in an everyday trading relation - without introducing all sorts of assumptions about how and where it originated, or what it will be used for.
Thus the Marxian law of value has a universal economic validity for an era lasting from the beginning of the exchange that transforms products into commodities down to the fifteenth century of our epoch.
in Babylon; thus the law of value prevailed for a period of some five to seven millennia.”[37]Again, Engels based himself on (and references) what Marx himself had said – in chapter 10 of Capital, Volume 3 (on the equalization of rates of profit by competition): ”The exchange of commodities at their values, or at approximately these values… [Marx writes] corresponds to a much lower stage of development than the exchange at prices of production, for which a definite degree of capitalist development is needed.
Whatever may be the ways in which the prices of different commodities are first established or fixed in relation to one another, the law of value governs their movement.
[42] Typically, though, it has involved wars, violence and revolutions, since people were unwilling to just give away assets, rights and income that they previously had.
The ideology of the rising bourgeoisie typically emphasized the benefits of privately owned property for the purpose of wealth creation and industriousness.
Typically, previously independent producers on the land (but also serfs) are proletarianised and migrate to the urban centres, in search of work from an employer.
According to Michio Morishima, "In such a society, there are no capitalists and hence no exploitation of workers by them; prices or exchange ratios between commodities must in the state of equilibrium be equal to the relative [labour-]values, provided the primary factors of production other than labour are all free.
"[45] The theoretical debates about simple commodity production have attracted contributions from numerous economists, philosophers and historians across the last century.
This seemingly obscure topic has important implications for quite a few different areas of research: (i) the interpretation of Marx’s method of analysis and his theory of value; (ii) the interpretation of the historical transition from pre-capitalist society to capitalism (and more generally, the social history of trade and marketization and the evolution of the forms of economic value); (iii) the so-called transformation problem; (iv) understanding settler colonialism and the post-colonial economy; (v) development economics; and (vi) the economics of the transition from capitalism to socialism and communism (the gradual replacement of market allocation by direct allocation).
[46] Contributors to the theoretical discussion have included Michael von Tugan-Baranowsky,[47] Nikolai Bukharin,[48] Karl Kautsky,[49] Oskar Lange,[50] Paul Sweezy,[51] Piero Sraffa,[52] Ronald L. Meek,[53] Helmut Reichelt,[54] Joan Robinson,[55] Isaak Illich Rubin, [56] Roman Rosdolsky,[57] Maurice Dobb,[58] Ernest Mandel,[59] Robert Brenner,[60] Gerd Hardach & Jürgen Schilling,[61] Rodney Hilton,[62] Michio Morishima & George Catephores,[63] Jairus Banaji,[64] Dimitris Milonakis,[65] John Roemer,[66] Rolf Hecker,[67] John Weeks,[68] Hans-Georg Backhaus,[69] Ben Fine,[70] Wladimir Schkredow,[71] Nadja Rakowitz,[72] Christopher J. Arthur,[73] Arthur Diquattro,[74] Kolja Lindner, [75] Octavio Colombo,[76] Prabhat Patnaik,[77] Anwar M. Shaikh,[78] Ellen Meiksins Wood,[79] Paresh Chattopadhyay,[80] Andrew B. Trigg,[81] Ian P. Wright,[82] Michael Heinrich,[83] and Bill Jefferies.