 In the previous segments of this module, we have gone through the argument as laid out by Marx in the first 25 chapters of Capital. We have understood two important aspects. One how capital generates surplus value through the exploitation of workers and second how surplus value generates capital through the reinvestment of capital in of surplus value in the production process. With that we have a pretty good understanding of some of the key structural features of capitalism. So at the end of this analysis, Marx now returns to a question that was implicitly there throughout his analysis but he had not asked and that question was what are the conditions of origin of the capitalist mode of production? Now by this he did not only mean a historical question as how did capitalism emerge in Western Europe in a particular time. Even though Marx's main focus in capital was the historical question, the answer that he provided can really be used to understand features of the emergence of capitalism from other modes of production wherever that happens and whenever that happens. The answer that Marx provided was the notion of primary accumulation of capital or the original accumulation of capital. Some commentators have translated from the German and have used the term primitive accumulation of capital. It is better to use the term original accumulation or primary accumulation because the translation primitive accumulation is not correct. Moreover it gives a idea that the notion is only meant to capture a historical process but as I said even though Marx's question was historical in nature, the concept he came forward with can be used to understand capitalism whenever it emerges even in contemporary times. So what is this idea about the primary accumulation of capital? Again to answer this question let us go back to the circuit of capital. The circuit of capital starts with the sum of money. So a capitalist comes to the market with the sum of money, purchases a bundle of commodities. Well, there are two different types of commodity he purchases, the means of production which are the non-labour inputs to production and labour power. Once these two things are purchased, the capitalist leaves the sphere of exchange and enters the sphere of production. In the production process, labour power and means of production are brought together and once the production process ends, the finished commodities emerge. Then the capitalist returns to the market because he is not really interested in those commodities. He wants to convert them back into money making sure that he has more money at the end than he started with. So he sells it in the market to get a sum of money and prime. So this is a most complete and abstract representation of the logic of capital, the logic of a capitalist system. So to understand the origins of capitalism, we need to understand the origins of the conditions which will make this process possible. And there are three conditions that we need to understand. The first condition is the accumulation of sums of money in the hands of capitalists, in the hands of some agents who can use those sums of money to come to the market to purchase commodities. So the first condition is the accumulation of money in the hands of capitalists. The second condition is that those sums of money must be used to purchase means of production and labour power. So means of production and labour power must be available in the market to be purchased by the capitalist. So that is the second condition. Means of production and labour power must be available as commodities in the market. So once those two are bought, then they are brought into the production process, the finished commodity emerges and then the finished commodity must be sold. So the third condition is that there must be what Marx calls a home market, a market where the finished commodities can be sold. These three processes together comprise what Marx calls the primary accumulation of capital. So the primary accumulation of capital is the combination of these three processes which enable the circuit of capital to take shape and to complete itself. Now let us think about these three components of the process a little more. What is the first component? The first component is that there must be accumulation of money in the hands of people who can function as capitalist. How does this happen? Marx has a very detailed discussion about how money gets accumulated in the hands of merchants and then those merchants become capitalists. The important point here to note is what is known as profit upon alienation. By this concept we are trying to distinguish the profit that will be generated in the capitalist production process from the previous methods by which merchants accumulated money. The previous methods through which merchants or merchant capitalist accumulated money is by buying cheap and selling dear. That was a process of unequal exchange that is very different from the way in which surplus value and profits is generated within a capitalist production process. To distinguish this we must keep in mind that the accumulation of this money came about not through profit generation in the capitalist process but upon what Marx calls profit upon alienation. Meaning lot of the merchants went across the world bought cheap sold in Europe for higher prices and the difference was accumulated as money. Once that money is available that money must now be able to purchase means of production and labour power on the market. For Marx this is the key moment of primary accumulation. The key moment of primary accumulation is the process by which means of production and labour power are available in the market as commodities. So let's think about this a little more. Let's think of feudal times. In feudal times there are peasants who are directly attached to the land. Now they might be free peasants or they might be serfs no matter which the peasant and the land are fused together, they are linked together. It is only by breaking the link between the peasant and the land that you can free up the labour power of the peasant to be sold in the market and you can free up the land and its products to be sold on the market as means of production. So for Marx the key moment or the key aspect of primary accumulation is the process by which the peasant is forcibly separated from the land and this is a long historical process which takes place over a 300 year period where by the use of state power and force peasants are expropriated, they are driven off their land through the enclosure movement and other processes. It is this process which occurs over a 300 year period. It is that brutal process which really creates the conditions for the emergence of labour power and means of production as commodities on the markets. So that is the second and the key process. Now let us come to the third process because once the capitalist has produced its commodity it must be able to sell it. Sell it for a price at which it is able to realize surplus value. So therefore there must emerge a market where the commodities can be sold. Now that more or less is given here itself. See peasants would produce most of what they consumed but once they had been driven off the land their subsistence needs could only be fulfilled by purchasing stuff on the market. So the forcible separation of peasants from land already created a home market. In addition the destruction of the handicraft industry, the destruction of the artisans as the growth of capitalism happened, the destruction of these segments also created a market for the products of the capitalist system. So these three processes together gave rise to the conditions for the emergence of the capitalist system and these together are known as the primary accumulation of capital. Let me end by emphasizing that even though Marx's analysis referred to England in particular and Western Europe in particular England and he studied the details of these processes for that country. The concept of primary accumulation is relevant for understanding the emergence of capitalist relations whenever and wherever they happen. So for instance if we look at the emergence of capitalist relations of production today in much of the third world the concept of primary accumulation might be useful. With that we come to an end of this module which is also an end of volume 1 of capital. So we have laid out the details of the argument as laid out in volume 1 of capital. In the next module we will take up the argument that unfolds in volume 2 of capital.