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Class Conflict In Classical Political Economy

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3. Class Conflict in Classical Political Economy: Malthus, Ricardo and Marx. When landowners convinced the Parliament in 1816, the British Parliament passed the Corn Laws which put high tariffs and import barriers for the import of corn, wheat, oat and other type of cereals. Corn Laws are, by nature, protectionist laws which intend to protect British agriculture by putting high import duties and making impossible for merchants to import corn from other countries. Corn Laws were the biggest obstacle for free trade. Due to Corn Laws, corn prices as well as price of bread remained high in England during that time. However, Napoleonic Wars also caused an increase in prices of agricultural products by cutting down imports of food supplies (Screpanti and Zamagni 2005: 92). Since foreign agricultural products could not enter the country, corn prices remained high. Economically, this resulted in high land rents, impaired profits and rigid wages (Screpanti and Zamagni 2005: 92). Manufacturers opposed this situation since it led to a flow income to landlords because of the redistribution effects of protectionism whereas landowners were enjoying their highs shares (Screpanti and Zamagni 2005: 92). …show more content…

This class conflict was between landed aristocracy and merchant bourgeoisie. A great advocate of aristocracy, Malthus, dedicated a great deal of his works to theoretically justify the necessity of aristocracy to have the surplus from production. The reason behind this lies in the manner of Malthus’ critique of Say’s Law. Say’s Law suggests that supply creates its own demand. Malthus, however, argue that supply does not always create its own demand on the contrary there will be abundance of goods because lack of demand. Based on his theory of gluts, Malthus underlined the importance of creating demand for this excess supply. He argues that bourgeoisie have a tendency to accumulate and they save and invest all profits while workers and landowners spend almost all of their income on buying consumer goods (Screpanti and Zamagni 2005: 96). If share of profits increases in relation to wage share, bourgeoisie will accumulate and accumulation will not assure aggregate demand (Malthus 2003: 297). Therefore, there will be a lack of aggregate demand. However, there is a need for consumption for system to continue and this will only be solved by increasing rent share to level that it guarantees sufficient aggregate income (Screpanti and Zamagni 2005:

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