The dissolution of the Asiation mode of production

The article is an attempt to trace out the contradictions accompanying the integration of a pre-capitalist formation into the world economy. Historical examples are taken from the Ottoman Empire, which, it is claimed, can be characterised as a transformation of the Asiatic Mode of Production. As merchant capital begins to dissolve the existing relations of production, a struggle over the division of the surplus ensues. This struggle is discussed first in the context of an economy with a negligible escape of surplus, and secondly when the surplus transfer abroad begins to condition the contradictions within. In the first situation merchant capital in its trading and production-organizing functions, claims a larger portion of the surplus which traditionally belonged to the ruling class of the pre-capitalist formation. The result of this struggle is analysed under two different assumptions: one that the division of the surplus is achieved without the intervention of the political instance, and two that the state becomes the platform for the struggle.

When the economy begins to lose some of its surplus abroad, the internal contradictions are aggravated. The eventual consequence of the loss is a balance-of-payments crisis, as a result of which the merchant class will find themselves discredited, and the political balances may shift in favour of the traditional ruling class. The conclusion states that this series of contradictions is characteristic of the history of peripheral capitalism.