Marx's Theory of Ground Rent: A Critical Assessment

This critical essay provides the reader with an up-to-date assessment of Marx's relatively neglected theory of absolute ground rent by bringing together in a coherent manner his scattered observations and arguments contained primarily in <it>Capital</it>, Vol. III and <it>Theories of Surplus Value</it>, Vol. II. It also reviews the extant secondary literature which suggests that within Marx's theory of rent is an embryonic theory of monopoly from which scholars can draw important insights into the history of economic thought and the workings of mature capitalism. The paper is organized as follows. After an introductory section, Section II provides the reader with an overview of Marx's theory of differential rent and compares it to that of Ricardo, particularly Marx's discussion of differential rent II and whether nature is productive of exchange value. Section III discusses Marx's theory of absolute rent in light of recent criticisms by prominent scholars and suggests that what determines whether rent is paid on the marginal land is not technical backwardness or lower productivity of labor <it>per se</it>, but a social relation, viz., the monopoly created by the private ownership of land. The last section summarizes the main arguments and suggests some avenues for future research.