Rent in Classical Economic, Social, and Political Theory

Classics—Locke, Smith, Ricardo, and Marx—struggled with the role labor, capital, and rent play in the determination of prices and incomes. The received wisdom was the labor theory of value: if incomes earned by wage laborers—essentially adult, male breadwinners—are proportional to the value of their labor, the system is fair. If they get less, the laborers are exploited. Few economists would accept this reasoning today, and the authors reject it as well. This chapter brings the views of Max Weber and Aage Sorensen into the discussion of rents in order to build the present book’s underlying theory on a solid historical and analytical footing.