In some societies, redistribution of wealth raised one's standing, rather than the accumulation of wealth. The third thing that was done with excess money in pre-capitalist times was that the holder built monuments to reflect that person's greatness.
The differences are that the capitalist system is designed to continually build wealth by investing profit back into the economy, with the intention to create more profit. Redistributing wealth (largesse) may have increased prestige, but it did not increase wealth. Likewise, building great monuments was essentially a form of redistribution, since the wealth spent on those monuments would go to the workers, but the monuments themselves would not generate any future profits. Storage of wealth did not generate future profits, although it was prudent during the pre-capitalist era. Marx viewed these two systems as entirely different, although a reasonable case could be made that this is not so.
Q3. Marx describes a cycle where capitalists are constantly attempting to drive down the cost of labor. As he views the issue, capitalists do as little as possible with respect to preventing wages from decreasing. Expansion was the key to their efforts. By expanding the scope of the economy, lower wages may occur in some jobs, but it would...
He viewed, however, that despite periods of high unemployment that would keep wages down, over time wages would rise as the economy would demonstrate overall growth.
Each method that capitalists would use to control wages would only have a temporary effect. For example, wages could be reduced with the introduction of technology, which would reduce the amount of labor needed. However, this would also reduce consumer demand. This would result in a slowdown cycle in the economy. After a time, however, excess capital capacity would be shed. From there, the economy could grow again, as capital purchases would be necessary and economic growth would once again be spurred.
The same could occur if the capitalists attempted to replace many unskilled workers with a few skilled workers. This would still result in a decrease in consumer demand as wages dropped, beginning the cycle. The cycle would only end when excess capital capacity was shed and firms were compelled to invest again.
The same would happen with international expansion. Cheaper labor would become available, driving down the cost of wages. However, this labor would replace domestic labor, suppressing demand. The same cycle would then occur.
