Anarchy of Production

The following article is from The Great Soviet Encyclopedia (1979). It might be outdated or ideologically biased.

Anarchy of Production


the absence of planning and the state of chaos that develop in the economy of a society when economic laws operate spontaneously. Anarchy of production is a characteristic feature of all commodity production based on private property, but it becomes universal and destructive in a capitalist society.

Anarchy of production arose as the inevitable result of the development of the simple commodity economy. The private commodity producer, working for the market, does not know society’s actual needs for his goods nor does he know the volume of production of similar commodities by other producers. Under the conditions of anarchy of production, the distribution of social labor among different branches of production inevitably takes the wrong proportions; a disparity between supply and demand arises—some goods appear on the market in inadequate quantities while there is a surplus of others. However, in simple commodity economies, anarchy of production still does not lead to a great economic shock, to the disruption of the course of social production in general. The scale of commodity production is too small, the productivity of labor grows slowly, the social division of labor is inadequately developed, and there is no unified national market.

Anarchy of production becomes destructive in a capitalist society. It becomes one of the manifestations of capitalism’s basic contradiction and leads to economic crises of overproduction. The basic contradiction of capitalism —the contradiction between the social nature of production and the private capitalistic form of appropriation—is manifested first and foremost as the opposition between the organization of production in individual enterprises and the anarchy of production throughout the capitalist economy. The high degree of organization of production and utilization of machine technology allows capitalist enterprises to sharply increase the productivity of labor and to increase the scale of production and the volume of output intended for sale. But the capitalist economy as a whole continues to. develop according to elemental laws; anarchy of production reigns, preventing the planned development of the entire social production and violating the complex conditions that are required for the complete sale of the aggregate social product under the conditions of expanded production. Where the anarchy of production prevails, which is characteristic of capitalism, the proper proportion between branches of production can only be a fleeting coincidence. Since capitalist production is directed by isolated entrepreneurs and companies producing commodities for an unregulated market and striving to expand production without considering the market’s capabilities, the correlation between branches of production is constantly subject to disruption and the sale of the social product is carried out amid difficulties that grow in proportion to the development of capitalism. Anarchy of production is intertwined with competition; it acquires the elemental force of a law that impels capitalist production toward further expansion without consideration for the size of the effective demand.

In the era of imperialism, when the dominance of monopolies deepens all the contradictions in the capitalist mode of production, the opposition, in particular, between the organization of production in individual enterprises and associations and the anarchy of production in all of society intensifies. The organization of production expands and embraces whole complexes of enterprises belonging to the monopolies. But this only increases the disproportionality of the capitalist economy, since branches that are highly monopolized develop faster than less monopolized branches; industry connected with armament production—the most profitable area—develops faster than civilian branches, and so forth.

Because of the appearance of a world capitalist economy, anarchy of production as a specific feature of capitalism expands beyond the limits of individual countries and embraces all the countries of the capitalist system and the sphere of international economic relations. Anarchy of production on a world scale makes the unequal development of the world capitalist economy inevitable.

Bourgeois political economy and bourgeois states search urgently for means to overcome or somehow alleviate anarchy of production. The theory and practice of state-monopoly regulation of the economy is an attempt to limit the influence of the elemental laws of capitalism. States attempt to plan the capitalist economy; however, the economic programming practiced in capitalist countries is not equal to the task of liquidating anarchy of production on a society-wide scale.


Marx, K. Kapital, vol. 1. Moscow, 1967. Sections 3–5.
Engels, F. Anti-Diuring. Moscow, 1966. Section 3, chapter 2.
Lenin, V. I. “Imperializm, kak vysshaia stadiia kapitalizma.” Poln. sobr. soch., 5th ed., vol. 27.


The Great Soviet Encyclopedia, 3rd Edition (1970-1979). © 2010 The Gale Group, Inc. All rights reserved.
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