Marxian Crisis Theory: Structure and Implications

ABSTRACT: This paper constructs a specifically Marxian theory of economic crisis from scattered but sufficient theoretical arguments in Marx’s work. This theory integrates the following conceptual elements viewed as central: capital accumulation, falling rate of profit, realization problem, the efficiency structure of firms within an industry, and capitalists ’ expectations. Implications of this theory for assessments of government economic policy and of recent economic history are briefly suggested. Several serious problems beset discussions of Marx’s theory of economic crises. Despite many and varied contributions, disputes land debates, it remains evident that the Marxian notion of crisis eludes a clear, consistent formulation. Paul Sweezy’s 1942 effort remains remarkable in its comprehensiveness and in its enduring influence upon subsequent discussion. However, contributions to this discussion from a