Surplus economics

Surplus economics is the study of economics based upon the concept that economies operate on the basis of the production of a surplus over basic needs.

Economic Surplus

Economic surplus means all production which is not essential for the continuance of existence. That is to say, all production about which there is a choice as to whether or not it is produced. The economic surplus begins when an economy is first able to produce more than it needs to survive, a surplus to its essentials. This is different than the standard use of the term surplus in economics.

Alternative definitions are:

1. The difference between the value of a society's annual product and its socially necessary cost of production. (Davis, p.1)
2. The range of economic freedom at its [society's] disposal, extent able to engage in socially discretionary spending that satisfies more than the basic needs of its producers. (Dawson & Foster in Davis, p.45)
3. Income minus essential consumption requirements. (Lippit in Davis p.81)
4. The difference between what a society can produce and what a society must produce to reproduce itself. (Standfield in Davis, p.131)

Argument

Economics is usually defined as the problem of how best to distribute limited resources, limited because wants are characterised as unlimited. Surplus economics argues that rather than limited resources, there is an abundance of resources and this is the economic problem. The difference is one of perspective. If wants are the focus, then of course resources are limited, but if needs or essentials are used as the foundation, then resources are seen to be abundant.

An abundance of resources means that not all need to work productively and that some can use more resources than others. Who shall be the lucky ones and how to keep the unlucky quiet is part of the economic problem. Abundance is also a problem because having more resources than is strictly needed to live presents a danger to the production processes and the command over resources that created an economic surplus in the first place.

Surplus economics seeks to answer such questions as: Why does so much waste exist alongside of so much poverty?

See also

• Economic surplus
• Scarcity rent
• Georgism

References

• Monopoly capital: an essay on the American economic and social order, Paul A. Baran and Paul M. Sweezy
• The Economic surplus in advanced economies, John B. Davis (Ed)
• The economic surplus and neo-Marxism, Ron J. Stanfield

Further reading

• Henry George, Progress and Poverty [1]