Agrarian Class Formation:

Historically, rural areas in many countries have been characterized by extreme inequalities in economic and political power. Many countries with large rural populations and economies based on the production of primary products have continued to demonstrate such inequalities.

There are several general categories of agrarian class systems. Slavery, as it existed in the United States in the pre-Civil War era, is the most extreme system, because it fully limits access to land to a dominant class and provides for total control of the labour of subordinate class.

A second category, found in medieval Europe and colonial Latin America, is feudal systems. In such systems landlords seeks to accumulate land primarily to enhance their status and power.

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They ensure a stable and dependent labour force through a monopoly over land. The land owners use indebtedness, overt coercion, and traditional social obligations and deference to maintain control over land and labour.

Agrarian capitalism:

As developed in colonial areas of Southeast Asia in the late nineteenth century, is a third category. It is characterized by plantation production and relies on a monopoly over land and on slave, debt-bound, or wage labour to maintain domination over subordinate classes.

Where large- scale capitalist farming has developed, as in parts of Mexico and Brazil, productive land has been monopolized by large landowners, and wage labour has replaced tenancy.

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Where small-scale capitalist farms have emerged, land and labour markets have been more open and less subject to coercion. In countries with large agricultural sectors capitalism has become the dominant mode of production in agriculture in most regions. Capitalist producers have accumulated larger holdings of productive land, replaced labour through mechanization and other technological advancements.

They now hire only for peak work periods, rather than maintaining a settled work force. This process has had several consequences. Productive land has become scarcer for small landholders, landlessness among the rural poor has increased, and wage labour has become more mobile and insecure.

It was also expected that due to this process small land holders and peasant communities would eventually disappear, forced off the land and absorbed into a rural or urban labour force. However small landholders and peasant communities have shown great capacity to survive the expansion of capitalism.

At the level of the household, small landholders have diversified their sources of income. By joining together for production or marketing, some have been able to complete with capitalist producers. In some cases, rural producers have formed cooperatives or associations that allow them to complete with large landowners for markets.

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Another development that has affected agrarian class formation is the expansion of the State in the decades since World War II. The state is present in rural areas in the form of the local agricultural research institution, the marketing agency, the rural credit bank, the fair-price store, the school, the health dispensary, the public works office, and other institutions.

Much state intervention in rural areas comes in the form of goods and services that can be provided selectively to individuals, groups, or communities. In cases of open and Democratic Party competition, national politicians have at times competed for the support of rural groups by promising or promoting policies of agrarian reform and rural development.

Consequently, rural class formation is now seen to be determined by more than patterns of land ownership and labour use. It also depends on power relationship between rural landowners and the developmental state and on the ways in which subordinate classes have been incorporated into national political systems.

Industrial Class Formation:

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In this sub-section, we will be studying developments in urban, social and economic formations. At the beginning of the nineteenth century changes in the distribution of wealth had already begun to determine class formation. With the growth of capitalism and large-scale industry the economic element – chiefly the possession of property – played a greater role than ever in the determination of class membership. Social factors were based almost entirely on the economic ones.

In the late nineteenth and early twentieth centuries the most intense class conflicts took place in authoritarian societies, such as Russia, Finland, and Germany, where elites attempted to consolidate their hold on power by suppressing opposition.

By contrast, class conflict was less violent in countries with established liberal freedoms and effective representative institutions, such as England and Switzerland. In these countries, the extension of the vote to workers gave them a greater sense of social and political inclusion. Freedom of political association and expression gave workers the chance to press their demands through legitimate channels.

As a result of improved working conditions and political integration in the post World War II era most western societies saw a significant reduction of industrial conflict. Reforms based on Keynesian ‘demand management’, new and expanded welfare programs, and consensual policies designed to contain wage demands and inflation had definite impact on class formation.

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Countries varied widely, in the extent to which the postwar developments took place. Class compromise was strongest in northern and central Europe and weakest in southern Europe and the Anglo-American democracies. Until the latel 1970s in northern and central Europe, and particularly in Sweden, Norway, Austria (also in Belguim, Luxembourg, and the Netherlands), and the working class was strongly organized in the labour market. In these countries, socialist parties were also able to participate in governments on a regular basis.

This participation opened a political channel for trade unions to exchange moderation of their labour-market demands for favourable state action, including legal protection of unions, economic policies for full employment, and welfare and egalitarian social policies.