ca smith 1984 commodity economy & differentiation of petty commodity producers in guatemala jps

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Does a commodity economy enrich the few while ruining the masses?

Differentiation among petty commodity producers in guatemalaCarol A. Smitha

a Department of Anthropology, Duke University, Durham, North Carolina, USA

To cite this Article Smith, Carol A.(1984) 'Does a commodity economy enrich the few while ruining the masses?Differentiation among petty commodity producers in guatemala', Journal of Peasant Studies, 11: 3, 60 — 95

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Does a Commodity Economy Enrich theFew While Ruining the Masses?

Differentiation among Petty Commodity

Producers in Guatemala1

Carol A. Smith*

In this paper I discuss the way in which rural artisans in onemunicipio of G uatemala organize production and how thisorganization impedes the differentiation of the artisanal population

into owners and workers. I show that categories of owners andworkers exist in the municipio, but that these categories do notreproduce themselves as classes; instead, they reproduce each otherthrough the life cycle. In order to explain this phenom enon, I loo k atinternal relations of produc tion, the external environm ent of large-scale capital, and the role of migration and the stale in the creation ofa permanent Guatemalan proletariat and in the creation of anundifferentiated artisanal economy.

Most students of the economy, whether neo-classical, substantivist, orMarxist, contend that the market has a disintegrating effect on 'natural'economies. Neo-classical economists argue that the market rewards new andprogressive farming techniques, leads to changed consumption goals, andfavours the development of leaders and 'mo dern 'farm ers [for exam ple, Ranisand Fei, 1964; Jones, 1972; Popkin, 1979]. Substantivists suggest that themarket breaks down the local community, leads to the loss of ' traditional 'values, and results in the merging of local traditio ns with na tiona l traditio ns asit creates new social classes [for example, Wolf, 1959; Scott, 1975; Polanyi,

1941]. And Marxists assert that the market brings about internal classdifferentiation within a pea santry , the developm ent of an exprop riated wage -labo uring class and a rich pe asant (kulak) class, which in hiring wage labo urbecomes capitalist in orien tation and in pro duc tion logic [for exa m ple, Lenin,1954; Deere and de Janvry, 1981; Roseberry, 1976; Stoler, 1977].

Marxists distinguish themselves from others by arguing that new classesform from the concentration of property and organize production alongentirely new lines, thus emphasizing a material base (property) from whichchanges ensue - as opposed to changes in value orientations. But manyM arxists do seem t o agree with othe rs that the logic of the m arke t is one th atdestroys 'natural' economies. Quoting Lenin, who provides the title to thispaper: 'The prevalence of commodity economy .. . gives rise to competition

* Department of Anthropology, Duke University, Durham , North Carolina 27706, USA.

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Petty Com modity Producers in Gua temala 61

among producers, and, while ruining the mass, enriches the few' [CollectedWorks 1: 430 ].

Some scholars have argued against this view, most to support Chayanov'sversus Lenin's depiction of peasant economy [Kerblay, 1971; Shanin, 1975].C hay ano v [1966] developed a mo del of 'pe asa nt ' econo my in which he tried toshow that what appeared to be incipient class differentiation was in factdemographic differentiation. In Chayanov's model of the peasant familyfarm, labour was a relatively immobile factor of production and itsdifferential distribution among family households accounted for the higherprod uctivity and gre ater wealth of some peasan t families as oppo sed to o thers.It is im po rtant to note, how ever, that Ch ayan ov was attem pting to deal with anon-com mo ditized peasantry in which no factor of pro du ction had a marke tvalue and relatively few goods were produced for market sale. Thus,Chayanov's model does not apply to commodity-producing peasants and i t

might be argued that Chayanov himself would agree that dependence upon amarket would completely change the parameters of peasant existence. Inother word s, the Ch ayan ov- Len in debate had mo re to do with the facts of thematter among Russian peasants than with theoretical interpretat ion[Harrison, 1976].

Th e case I wish to deal with is qu ite a different on e. It is a case o f'p ea sa n ts 'who are as fully market dependent as 'modern' farmers. They are non-agricultural commodity producers, who purchase most means of productionin a competitive market, who use a particular form of wage labour, who can

choose among alternative occupations, who engage in a real if sticky landmarket, and yet who appear not to have differentiated into two self-

reproducing classes over a one-hundred-year period. These are people inhighland Guatemala, in particular the peasants of the municipio ofTotonicapan.2 This case is not a 'pu re 'o ne , inasmuch as To tonicap an peasantsexist in a complicated economic environment that involves them in theexchange and production circuits of capitalist production in Guatemala aswell as in the exchange circuits of peasants who are less heavily involved incommodity product ion [Smith, 1978, 1983]. But such a complicated

environment for peasants exists almost everywhere in the present worldecono m y and this is m ore relevant to the question of peasan t differentiationthan the rather unusual situation of Russian peasants at the turn of thecentury.

1 shall argue that Totonicapan's commodity producing peasants, the mostmarket-dependent peasants in Guatemala, have not differentiated into twoclasses (although they have greatly differentiated with respect to income) forthe following reasons. First, the subsumption of wage labour in the pettycommodity producing enterprises is formal rather than real because notransform ation in the techniques or technology of com m odity prod uction hastaken place. As a result, the amount of labou r pow er embo died in prod uctionis relatively high. Second, the value of labo ur po wer (the cost of re pro du cingthe w ork er) is relatively low, and the price of labo ur p ow er (wages) is relativelyhigh. B ecause the cost of entry into pro du ction is low and th e income gained

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62 The Journal of Peasant Studies

from wages is high, workers can accumulate sufficient capital to beginindependent operations in three to five years. Employers in this situationattempt to retain a stable workforce by paying relatively high wages - wagesthat com pare rather favourably to their own profi t margins. Th us em ployersretain little excess capital with which to purchase new means of production ormachines, and by retaining a low-level technology keep entry costs tocompetitors low. This in turn allows workers eventually to becomecompeti tors to their employers, creates a heavy worker turnover, and thushelps maintain the relatively high wage rates.

One hypothesis given to account for the lack of class differentiation inpeasant regions is that individuals who might become a local proletariat aresiphoned off to work outside the peasant economy as labourers in closelyassociated systems of capitalist production such as western Guatemala'splantations. Wealthier individuals are thought to leave their communities

also, leaving a 'm idd le' peasan try behind th at remains undifferentiated in itslocal system only because it is part of a larger, regional, differentiationprocess. De Janvry and Deere [1981], in particular, have suggested thatpatterned migration accounts for the lack of local peasant differentiation inhighland Peru. Because this is a plausible hypothesis for western Guatemalaas well, I will exam ine the evidence on p eas ant m igration in the region , givingspecial attention to the class compostion of migrants and to the areas fromwhich rural migrants have come over time. I will show that there has been apronounced pattern of migration from the areas I give greatest attention to

here and that this has affected both local and regional class differentiationam on g the peas antry. But 1 shall also show that this is an incom plete theo ry,that neither the t iming nor the composit ion of rural migration supports thenotion that regional differentiation prevents local differentiation fromoccurring. On the other hand, I will show how the association of pettycommodity production in Totonicapan with capital ist production elsewherein Guatemala supports the high wage levels in Totonicapan, what I considerto be the crucial variable preven ting local class differentiation fromdeveloping.

A part from C hay ano v, whose depiction of peasant econom y does not applyto the situation in western Guatemala, all students of peasant economy whohave tried to explain why comm ercialized peasan ts do not always divide intow age-labou r and c apital, have looked for an e xplan ation in the association ofa peasantry with capitalism. Three positions have emerged. The first is theposition recently taken by Joel Kahn [1980] who attempts to account for thelong-term reproduction of petty commodity production in Indonesia. Kahngives several accounts of the matter, but the one he seems to favour most isthat a flow of value out of subsistence agriculture to petty commodityproduction and ultimately to large-scale capital in Indonesia and the worldecono m y prevents accum ulation in the peasant sector. Th e flow of value takesplace because the cost of peasant repro duc tion is partially subsidized by no n-commodity production in that sector. Exactly how this flow of value helpslarge-scale capital without helping small-scale capital is not entirely clear in

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Petty Com modity Producers in Guatemala 63

Kahn's account, but I will examine the argument and its applicability to theGuatemalan case in greater detail below.

The second position is that taken by Harriet Friedm ann [1978, 1980], whoexamines wheat farmers of the US Great Plains before the Great Depression.She argues that these farmers were petty commodity producers existing withinthe market circuits of capitalism (facing the same price structures) and thatthey were able to compete with capitalist production because householdproducers were willing and able to work for profit and wage levels lower thancould capitalist enterprises. She also observes that the various prices of thetime (for land, labour, and equipment) were favourable to small-scaleproducers with a small workforce, a conjuncture she points out that was not a'natural' market phenomenon but rather a social phenomenon created byvarious state policies. I will also examine her argument in greater detail below.

The third position goes one step further than Friedmann to posit the

following. The creation of a class of 'free' wage labourers in a previouslyundifferentiated economy will always require the action of the state. That is,market forces and a commodity economy alone are not enough to bring abou tthe class differentiation, the capital concentration, and the revolution in theforces of production , all three of which are necessary for capitalist productionto exist on its own. Either a prior kind of class differentiation must exist in thecommodity economy, rooted in a non-capitalist mode of production that isconducive to capitalist concentration [see Banaji, 1977; and Rey, 1973]. Or,given the existence of capitalist production already in the world economy, the

use of force by the state must create a class system (and a free proletariat) thatis conducive to capital accumulation.The argument I shall make will borrow elements from all three of these

positions. Before making that argument, however, I will present some of the'facts' of the matter for the case at hand, that of Totonicapan, within westernGuatemala. These facts consist of the following: (1) the historicaldevelopment of classes and of commodity production in Guatemala, withspecial attention to western Guatemala (and within that to Totonicapan); (2)the relations that petty commodity producers have to other peasants in the

region and to capitalist agriculture in the region; and, (3), the relevant data onwages, profits, markets, and so forth, in the local and regional economies. Ishould add tha t while this essay deals with a particular case, I assume that theconditions preserving an undifferentiated peasantry in Totonicapan arewidespread and thus my conclusions about it are relevant to the generalquestion of peasant differentiation in the modern world economy.Comparable cases will be discussed in my conclusions.

THE MARKET CONTEXT IN WESTERN GUATEMALA

Prior to 1871 most peasants in the highlands of western Guatemala wereorganized in corporate communities whose main economic goal was self-sufficiency. Peasants held land in both communal and private forms andcarried out a narrow range of economic activities on a household basis.Surpluses were drawn from peasant communities in several different ways by

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an adm inistrative elite who lived in urban centres. In the western region, thispopulation was a very small percentage of the total population (some 10 percent) and made most of their income from economic exchanges with thepeasantry: they did not own or operate haciendas or other agriculturalenterprises, but rather ran the markets and market-based repartimientosystem, in which local urba n and im ported g ood s were exchanged for pea san t-prod uce d goo ds at fixed m ono polistic prices heavily favouring th e urb an elite.(In other parts of the country, some export production, mainly of cochinealand indigo, was carried out.) Labour drafts were made upon peasantcommunities for indigo plantations, public works, and transport needs, butthese drafts were much lighter in colonial Guatemala than they were in otherparts of colonial Latin America.

To tonica pan headed an im porta nt administrative province before 1871, thetown of Totonicapan holding the adminstrators for a region of some 200,000

rural Indian peasants organized into some 40 municipalities. (The ruralpop ulation of the municipality of To tonic apa n w as abo ut 20,000 in 1893; th etown of Totonicapan held about 5,000 people.) Only two significant urbancentres existed in Totonic apan 's a dm inistrative territory, those of Toto nica panand of Huehuetenango, both dominated by Ladinos (non-Indians) whoseoccupations were either in adm inistration, artisanry, or comm erce. The urb anLadinos numbered less than 5 per cent of the total population inTotonicapan's administrative district. Another 5 per cent of Totonicapan'sprovincial population was rural Ladino, whose lifestyle was little different

from that of Indians but who were less subject to labour drafts and otherforms of econo mic coercion . In the western high land region in general, whichI discuss below, the situation was similar, although Ladino towns and ruralcommunit ies were somewhat more numerous.

By the late nineteenth century the rural peasants in the municipality ofTotonicapan appear to have been much more heavily involved in specializedcommodity production than most other peasants of the region. In 1893, whenthe first census of the m unicip io was carried ou t, only 31.6 per cent of the ru ralpopulation was engaged in agriculture as a primary occupation. Others were

engaged in handicrafts (mainly weaving and carpentry) and petty commerce.There is very little data on how these petty enterprises were organized, but Iwould guess that they were very small-scale affairs carried out by familylab ou r and requiring little in the way of purchased inpu ts. W age labo ur in themunicipio was relatively uncommon except in the town centre, where Indianpeasants occasionally worked for the administrative elite.3

Th e year of 1871 mark s the beginning of the Liberal regime in G uate m ala,when R ufino Barrios m ade strenuo us efforts to reorganize the econom y alo ngcapitalist lines by promoting coffee production for export. Part of this effort

involved expropriating a good deal of what had previously been Church orCrow n land s in the south ern low land areas of western Gua tem ala. These landshad been available on a rental basis to peasant communities or individuals;but by the 1893 census most of this land was held privately in large coffeeestates and was no longer available for peasa nt farming. Even more im po rtan t


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Petty Com modity Producers in Guatema la 65

for peasant livelihood, Barrios instituted various labour draft laws whichheavily involved most Indian communities. Again data are scant on exactlywhich communities were most affected in which period. But it appears thatcentral highland communities such as Totonicapan were hardest hit in theearly period, while more remote communities (in what I shall call the northern

periphery of the western region) became more heavily involved later.

4

Since many of the first labourers drafted to work on the southern lowlandplantations remained there, it is possible to work out a rough reconstructionof the initial impact of the forced labour system by examining populationchanges in different parts of Guatemala during the earliest years of theplantation economy. Table 1, which examines selected parts of Guatemalafrom the first completed national census in 1893 to the most recent census in1973, sets forth some of the relevant data. The main units of analysis aredepartments, political divisions of Guatemala established after the colonial

period. The large province of Totonicapan had now became a smalldepartment of only 90,000 people, mostly commercialized Indian peasants.The larger and more remote part of Totonicapan's original (colonial) provincehad become the department of Huehuetenango; this department alsoconsisted mainly of Indian peasants, but these peasants were much lesscommercialized than those in Totonicapan. Several departments had beencreated in the southern lowland plantation area: the department ofSuchitepequez represents a portion of the lowlands almost entirely devoted tocoffee production.

Table 1 compares national population growth in four census intervals topopulation growth in a plantation area (Suchitepequez), a peasant peripheralarea (Huehuetenango), a peasant core area (the department of Totonicapan),and to the municipality of Totonicapan. It is reasonably safe to assume thatmost of the population movement throughout this period was affected by theplantation economy more than by any other factor (such as differentialurbanization, fertility, mortality, or the like).

Between G uatamala's first completed census in 1893 and its second in 1921,Guatemala's national population grew by 46.9 per cent. The plantation areagrew much faster: the population of Suchitepequez, for exam ple, grew by 57.5per cent. Population in the more peripheral peasant areas grew only slightlymore slowly than the national population, Huehuetenango increasing at a rateof 42.8 per cent. But core departments such as Totonicapan lost most of theirnatural increases: the department of Totonicapan grew at only 5.3 per cent inthe 28-year period examined here and the municipio of Totonicapan grew at25.6 per cent. Thus the m unicipio of Totonicapan lost nearly 16 percent of itspopulation (some 5,000 individuals) in the first years of the plantation

economy. It is likely that most of these people settled in the southern lowlands,becoming permanent wage labourers or small traders and gradually giving upethnic identification with and community ties to their home municipality.Communities in the peasant periphery, on the other hand, appear to havemaintained most of their population.

In the next census period (between 1921 and 1950), the plantation area was

5

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Table 1

P O P U L A T I O N G R O W T H , S E L E C T E D P A R T S OPG U A T E M A L A

C e n s u s T o t o n i c a p a nd

I n t e r v a l sa

N a t i o n S u e h l t e p e q u e zb

H u e h u e t e n a n g p0

D e p a r t m e n t M u n i c i p a l i t y

1 8 9 3 - 1 9 2 1

1 9 2 1 - 1 9 5 0

1 9 5 0 - 1 9 6 1

1 9 6 1 - 1 9 7 3

I 9 . 9 ?

3 9 - 2 ?

5 3 - 6 ?

2 0 . 3 ?

5 7 . 5 ?

3 8 . 1 ?

5 0 . 5 ?

1 8 . 5 ?

1 2 . 8 ?

I 5 . 2 ?

5 0 . 0 ?

1 8 . 8 ?

5 - 3 ?

5 - 6 ?

1 2 . 7 ?

1 7 . 7 ?

2 5 - 7 ?

9 - 0 ?

1 3 . 1 ?

2 1 . 2 ?

aN a t l o n a l c e n s u s e s w e r e t a k e n in1 8 9 3 , 1 9 2 1 , 1 9 1 0 , 1 9 5 0 , 196*4 a n d 1 9 7 3 - The

c e n s u s of 1 9 1 0 w a s t a m p e re d w i t h a n d isc o n s i d e r e d u s e l e s s bym o s t e x p e r t s .

d e p a r t m e n t ofS u c h i t e p e q u e z isa l m o s t e n t i r e l y int h e c o f f e e p l a n t a t i o nz o n e .

cT h e d e p a r tm e n t ofR u e h u e t e n a n g o ise n t i r e l y w i t h i n t h e z o n e I h a v e d e f i n e d

a s ' p e ri p h e ra l ' p e a s a n t ( s e e S m i t h 1 9 7 8 ) .

dT h e d e p a r t m e n t ofT o t o n i c a p a n ise n t i r e l y w i t h i n t h e z o n e I h a v e d e f i n e d as' co re ' p e a s a n t ( s e e 3 n i t h 1 9 7 8 ) , a n d t h e m u n i c i p a l i t y ofT o t o n i c a p a n i s t h e p l a c eo f i n t e r e s t int h e s u b s e q u e n t a n a l y s i s .

no longer growing faster than the national average. Now the peasant periphery

was gaining population, both Indian and Ladino. Davis [1970] has described

the pattern of Ladino incursion into northern Huehuetenango in the 1920s

and Veblen [1975] has described the Totonicapan diaspora of this period.

Many Totonicapan peasants moved into other parts of the central highlands

as traders, commodity producers, and as land grabbers. This was a period of

expanding market growth throughout western Guatemala and Totonicapan

traders played a major role in its development.

In 1945 the system of forced labour drafts for plantations was ended by a

new 'revolutionary' government, and by the census interval covering this

period (1950-64) most population movements in western Guatemala had

ended. The department and municipio of Totonicapan still grew more slowly

than the national average, most likely because of continued migrations

associated with trade expansion. But the Totonicapan population had settled

down by the final census period of 1964-73, the regional marketing system by

then having taken its present form.5

After 1945 most labour for plantations

was contracted on a seasonal basis and the vast majority of workers was found

in the northern periphery, which now held about half of the 'peasant' and

Indian population. Communities from this area (which included not only

Huehuetenango, but also northern Quiche and northern San Marcos) sent

more than half of their adult population to work seasonally on plantations,

but held that population eight or nine months of the year at home. Meanwhile,

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central highland communities, such as Toton icapan , had begun specializing inproducing and trading the commodities which fed and clothed the wageworkers, both permanent and seasonal.

By 1950 Totonicapan and its neighbouring municipalities had created a newkind of marketing system in the region, one that was manned entirely by

peasant traders and that moved commodities produced mainly by peasants.Rural market-places vastly increased in number, from a total of about 20 atthe turn of the century to about 150 in 1950. By 1975 there were more than 300rural market-places in the region. The full-time traders in this marketingsystem were mainly from Totonicapan and neighbouring municipalities; by1970 five municipalities in the small department of Totonicapan producedabout 55 per cent of the full-time traders; nearly 13 percent of these specialisttraders in the entire regional system came from the municipality ofTotonicapan [Smith, 1972]. Totonicapan's peasant population had become

fully market dependent for many consum ption goods and for some producergoods. Subsistence agriculture was only a supplemental activity for mosthouseholds; farming provided about half of the household's need for food.

The pattern of market specialization by 'core' area peasants contrastssharply with the pattern of seasonal labour and subsistence activities inagriculture carried out by peasants in the 'peripheral' area of westernGuatemala. Table 2 presents census data on the two patterns, contrasting'peasan t' occupations with the Guatemala average. Whereas some 30 per centof peasants in the department of Totonicapan (representative of the peasant

core area) were engaged in agriculture throughout the period covered bynational censuses, more than 80 per cent of peasants in the department ofHuehuetenango (representative of the peasant peripheral area) were engagedin agriculture. In Guatemala as a whole, occupations in agriculturerepresented 68 per cent of the total in 1893 and 57 percent in 1973. Most of theoccupational changes taking place in Guatemala as a whole were taking placein urban centres; in the peasant region it appears that a stable kind ofadaptation had been reached as early as 1893 among the non-migratorypopulation.

In summary, 'middle' peasants were preserved in the core townships ofwestern Guatemala at the same time that considerable proletarianization hadtaken place among the peasants of the periphery. Thus one could argue thatsome class differentiation was emerging among the peasantry in westernGuatemala at a regional level, if not a local level. One could also argue th atrural m igrations played a significant role in this pattern of differentiation. Atthe turn of the century, plantation labour needs were met throughout theregion; in this period, core townships lost population permanently to theplantations and to other communities through migration. The resultingshortage of labour had a major impact on the way in which peasantproduction was to be organized in places like Totonicapan. Totonicapanlabour could and did demand wages higher than those prevailing in theplantation area from at least 1931, possibly earlier. (Local wages in peripheralcommunities, by contrast, were uniformly lower than those prevailing in the


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68 The Journal of Peasan t Studies

T a b l e 2

OCCUPATION, SELECTED PARTS OF GUATEMALA (CENSUS DATA)

Census N a t i o n S u c h i t e p e q u e z a H u eh u e t en an g ob T o t o n i c a p a n0

P e r i o d ( d e p a r t m e n t )1893

AgricultureTrade andartlsanry

Other

1973

Agriculture

Trade andartisanryOther

%

67.7

16.2

16.1

57.2

25.317.5

%

61.3

15-323.4

70.6

17.012.4

%

83.1

5-0

11.9

80.0

15-14.9

%

33.1

62.0

4.9

34.1

60.75.2

aSuchitepequez is a department in the coffee zone and represents occupationsin that zone.bHuehuetenango is a department in the peripheral peasant zone and representsoccupations in that zone.cTotonlcapan is a department in the core peasant zone and represents occupations

in that zone.

plantation area.) By 1950, however, few peasants migrated from coretownships on either a seasonal or permanent basis. Yet local wages did notfall, nor were economic classes to emerge in core townships based on thedifferentiation of local wage labo ur and ca pital. And at no tim e did a 'ku la k'class of peasants appear anywhere in western Guatemala. This was notbecause wealthy peasants left their communities for business or employmentelsewhere, but rat he r because the con dition s for internal class differentiation

were not met in the pe asan t e cono m y. I will show why this is so after depictinghow production was organized by a special kind of wage labour and capitalwithin peasant communities.

THE ORGANIZATION OF PRODUCTION IN TOTONICAPAN

All rural households in Totonicapan have access to some land, though theam ou nt might be pitifully sm all. Th e househ olds richest in land do not hold agreat deal. Estimating from relatively few cases at this point, I would suggest

that the top 10 per cent of households hold no more than three acres onaverage; the bottom 20 per cent hold small fractions of an acre (one or twocuerdas, 9.4 of which make up an acre). The average household needs aboutone acre to provide m ost of its basic food needs fo ra year.6 Probably no morethan 30 per cent of all households have this much land. Land is thus veryunequally distributed but not very highly concentrated. A market in land


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Petty Com modity P roducers in Guatema la 69

exists tha t is rather sticky but does not prevent considerable redistribution ofland in each generation. The price of land far exceeds its 'productive' return,reflecting the importance that peasants give to self-sufficiency in foodproduction.7

The pattern of land redistribution has been strongly influenced by thepattern of mobility in petty commodity production. Successful artisans aremuch more likely to invest in land than in new capital equipment. Land isnever sold to gain investment capital, but it is frequently sold by people indesperate straits: the most frequent seller of land is an artisan who has gonebroke. And the rate at which artisans fail is astonishingly high. I do not yethave the data in hand to make the assertion with certainty, but I estimate afailure rate of about 5 per cent a year - for normal years. The riskyenvironment of petty commodity production, then, has done a good deal overthe last century to free up land resources and redistribute them to new groups

over the years. I would guess that proletarianization has progressed muchfurther in areas that depend more heavily on land for income.The large numbers of petty commodity producers in Totonicapan have

influenced not only the local land market but also the local labour m arket inagriculture. The wages of agricultural workers in most of peasant Guatemalaare lower than those prevailing on plantations, reflecting in part thepreference of Guatemalan peasants for local work over plantation work(where working conditions are much worse and work-related illnessescommon). But in Totonicapan, the wage for unskilled farm work is almost as

high as the wage for skilled artisans. In 1976 most skilled artisans earned $3.00per day without food, while an unskilled farmworker earned $2.50 per daywith food. The top pay for plan tation work in this period was about $2.25 withsome food; many plantation workers earned less. Farm workers in theperipheral peasant areas usually earned less than $2.00 per day. While mostpeasants in the highlands knew about the plantation wage rate, they were lesscognizant of variations in highland wages and rarely worked in highlandmunicipios other than their own. There are no formal barriers to working inother highland municipios, but informal barriers make the practice

uncommon.The high wage for farmworkers in Totonicapan seems to reflect theirscarcity in the local population. It may also reflect the great seasonality of thiskind of work: at certain times of the year there are morejobs than workers, butat o ther times of the year there is little work available. Most artisans prefer tohire agricultural labour, but most artisans must do some or all of their ownagricultural work. Since landholdings are small, they lose little time inagricultural work.8 The general pattern is one in which most people do someagricultural work in peak seasons, but most people have other occupations formost of the year.

Census figures under-represent the degree to which Totonicapan peasantsdepend on non-agricultural economic activities. My occupational survey ofthat municipio in 1977 (which covered 7125 households) shows an even moreextreme pattern than that reported in the most recent census. Less than one-

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quar ter of the populat ion had a male head of household engaged primarily in

agriculture. Many of these individuals had side employm ents and virtually all

of them had household members employed by something other than the familyfarm. (Most of the individuals in agriculture are much older than individualsin other occupations.) Fully 42 per cent of Totonicapan households had the

male head engaged in producing goods for the market in artisanal activities

that could and sometimes did utilize wage labour. Another 24 per cent ofhouseholds had heads in commerce . [See Table 3.]

Among artisanal occupations, weaving was the dominant employment,with 956 heads of household; this was closely followed by carpentry (813

heads), tailoring (354heads), pottery m aking (75 heads), and leather working(66 heads); other k inds of artisanry had 59 heads. Weaving and tailoring werethe occupations most likely to have wage workers in them. Most enterprises,even in weaving and tailoring, utilized only family labour (56 per cent);

T a b l e 3

P R I M A R Y O C C U P A T I O N S IN R U R A L I N D I A N T O T O N I C A P A N , 1 9 7 7( M al e h e a d s of h o u s e h o l d s )

0

N = 7 1 2 5

Agriculture, proprietor13

Agriculture, worker0

ZA.H%

Artisanal production,"3

proprietor

Artisanal production,*3

worker 41.8?

Simple crafts'3

Construction

Commerce0

Goverrment employment

Percent

10.4?

14.0?

27.4?

14.4?

4.8?

5.0?

23.8?

.4?

Averageage

56.8

32.0

43-5

25-3

44.4

28.3

42.5

34.6

aV i r t u a l l y a l l i n d i v i d u a l s i n T o t o n i c a p a n h a v e m o r e t h a n a s i n g l e o c c u p a t i o n .

T h i s t a b l e s u r m a r i z e s o n l y p r i m ar y o c c u p a t i o n s - t h o s e t a k i n g u p m o s t t i m e

a n d y i e l d i n g m o s t i n c o m e .

bT n e v a s t m a j o r i t y of t h e s e h o u s e h o l d s h a v e o n e or m o r e f a m i l y w o rk e r s o u t s i d e

o f a g r i c u l t u r e . — —

cA g r i c u l t u r a l w o r k e r s i n c l ud e p l a n t a t i o n wo r k e r s ( w ho a r e l e s s t h a n 4 p e r c e n t

o f t h e t o t a l ) .

^ A r t i s a n a l p r o d u c t i o n , l n my d e f i n i t i o n , d e p e n d s u p o n p u r c h a s e d r a w m a t e r i a l sl n s i g n i f i c a n t q u a n t i t y ; s i m p l e c r a f t s p r o d u c t i o n u t i l i z e s ' fr ee ' r a w m a t e r i a l s .

A p p r o x i m a t e l y 8 p e r c e n t oft r a d e rs e n g a g e inl o c a l t r a d e , 1 5 p e r c e n t inl o n gd i s t a n c e t r a d e .

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beyond that, most enterprises hired only one or two workers (38 per cent).Only a few people hired more than that (6 per cent). I will use weaving as theexample in the discussion that follows, but most of the data true of weavers istrue of other artisans in Totonicapan.

Totonicapan weavers produce the ethnic clothing used by Indian womenthroughout Guatemala. The most commonly purchased such item is skirtcloth, woven in lengths of eight varas (a vara measures 26 inches inTotonicapan) in a width of two varas. The quality of this cloth variesenormously, depending on the thread used, the design pattern, and thecloseness of weave. It is very difficult, then, to standardize these items, as istrue of most artisanal production. In 1977 an average skirt cloth cost theconsumer about 20 quetzales (1 quetzal = 1 US dollar). A fine cloth cost $45 to$50 and speciality items cost even more. These cloths last a long time and thewearer usually has only two or three of them at any one time. The cloth iswoven to municipio-specific design, but about half or more of all Guatem alanmunicipios now use a 'standard' type which is multicoloured and utilizesconsiderable tie-dye {jaspe) design.

Production is carried out by family enterprises in which the entire familyplays a role. Children as young as five or six years run errands and help withsimple tasks. Older children, mainly girls, tie the jaspe designs that are laterdyed to produce the skirt design. Boys learn to weave around the age of tenand are proficient weavers by the age of 14. The male head of householdalmost always weaves part of the time, though he may spend as much as half

his time supervising o ther w orkers, going out to sell the product, and buyingthe raw materials. Hired workers (operarios) from the municipio ofTotonicapan are frequently taken on for specified periods of time. They oftenbegin as unpaid apprentices, usually work no more than two years as such,and later earn a wage on a piece basis. A good weaver can earn at least $3 perday. Most workers in the trade strike out on their own soon after marriage(after two to five years as wage workers), so those enterprises that have aconstant need for outside labour must continually take on new apprentices inorder to hold a labour force.

The labour force for petty commodity production in Totonicapan is almostalways recruited from the local community or the municipio of Totonicapan.Many people apprentice with kin, but others apprentice themselves toneighbours or acquaintances. There is no explicit barrier tha t would prevent aweaver from taking on an apprentice from another municipio, nor forTotonicapan youths to learning their trade elsewhere. In fact, weaving spreadfrom towns to rural areas in the early pa rt of this century when urban weaverstook on rural Totonicapan apprentices. Yet informal mechanisms appear torestrict most labour recruitment to the local area. And it is clear that these

mechanisms have maintained a certain monopoly of weaving skill within thecommunity of Totonicapan. The same cannot be said of tailoring, whichrequires less specialized skill. Tailors can be found in almost all municipiosof western G uatemala. The advantage that tailors in Totonicapan and vicinityseem to have over others is tha t they have well-developed market networks for


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the disposal of their products, which rural tailors from other places lack.Sk irt cloth is sold by the pro duc er in one of three ways. A small gro up , 16

per cent, make cloth for specific merchants (occasionally being advanced theraw material by the merchant, but more often giving the item on consignment- thus providing credit to the merchant). A somewhat larger group (30 percent) sells cloth in less regular lots to other weavers, who are also market

middlemen. Such producers will deliver every 15 days or so. They too willoften give their prod uct to their dealer on co nsignm ent, bu t will just as oftensell the goods on a wholesale basis. The remainder, more than half of allproducers (mostly the larger enterprises), have one member of the enterprisewh o spen ds a g ood deal of his or her time going to different m arket-places andselling on a retail basis. These producers lose two or three days per week of(self) p rod uct ion tim e. Fam ily mem bers, however, will con tinue prod uc tion inthe absence of this person, as will employees. Mark-ups on skirt cloth varywidely abo ve the wh olesale p rice, from 10 to 40 per cent. It is not clear,how ever, th at the m ark -up over wholesale price is worth the loss of the seller'sproduction time. Most weavers say that they retail the product themselvesonly to help expand the market for the product. They would prefer a steadilywholesale clientele.

A bo ut half the wholesale value of the cloth is taken up with raw m aterials,the o ther half with lab ou r, as I will show later. Raw m aterials are purcha sed inthe local m arket. S om e thread is produ ced in a national factory an d is dyed byspecialists in Totonicapan. Other thread is imported, most of it from

Ge rm any . No ho m e-prod uced threa d is used in the m aking of skirt-cloth n ow ,tho ug h it was used in the past. A bo ut 10 per cent of all weavers buy th e jaspethreads from specialist producers, but most make their own. Women andchildren are the most com m on tyers. The average market cost of raw m aterialsfor a turnover period (usually 30 days) is about S50-S75 per weaver. A goodweaver is said to be able to produce one skirt cloth per day. This, I think, isclose to the maximum.

Th e fixed cap ital necessary for p rod uc tion is relatively low an d consists oflocally made looms and parts, which can be acquired by a single weaver for

ab ou t $250. Th is is not a significant barrier for w orkers, who ea rn abo ut $900per year after their apprentice period and who usually live with their familiesof origin and can k eep a fairly sizeable am ou nt of their earnings for their ownpurpo ses. M ost w orkers, usually youn g unm arried men, try to save as much asthey can in order to marry, set up their own households, and begin their ownproduction enterprises. The greater barrier for workers striking out on theirown is the creation of market outlets for their goods. Many workers begin bysupplying the 'master' weaver with whom they apprenticed. As they begin toacquire their own household workforce (wives, children, nephews, younger

bro ther s), they begin to tak e over their own sales op eratio ns, setting up retailop eratio ns in the regional market-plac es or seeking regular wholesale clients,who are full-time professional traders.

Th e m ark et for skirt cloth is a fairly closed one at the present b ut has had avolatile history. Around the turn of the century most weavers were urban


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Ladinos. (The rural weavers present in the 1893 Totonicapan census wovewoollen goods no longer used by local people.) The two major centres ofproduction were Quezaltenango, the largest town in western Guatemala(presently about 60,000 population), and Salcaja, a nearby town of about6000 people, most of w hom are weavers. In the early pe riod, m ost of the skirtcloth p rodu ced was plain black cotto n cloth, dyed with indigo dye. In the mo sttraditional communities of the region women wove their own skirt cloth onback-strap looms. The market for skirt cloth expanded enormously with thegrowth of the plantation economy because most women no longer producedtheir ow n cloth and man y consum ers could afford to buy mo re skirts as well asskirts with fancier designs. W hen the ma rke t expan de d in the early pa rt of thiscentury, Ladino weavers began hiring Totonicapan peasants as assistants. Bythe 1920s, many of these workers began producing on their own and thepresent pattern was established.

At present, Totonicapan produces about 60 per cent of all skirt clothproduced in the country. Salcaja continues to produce a fair amount (20 percent) and another Indian township in the department of Totonicapan (SanCristob al) weaves mo st of the rest (20 per cent). Th e remain der is pro duc ed bya few weavers here and there, including Quezaltenango, no longer animportant regional weaving centre [Smith, 1972].

The m arket expansion for woven good s probably increased at a good paceuntil 1950, when it began to level off. Levelling off was br ou gh t ab ou t by thefact that some Indian women no longer use an ethnically distinct type of

clothing and by the fact that peasant cash incomes have probably levelled offin the region. Th is slack in the weaving indu stry has been take n u p by a hu geand recent exp ansion in the tailoring indu stry. Wh ereas most peasan ts sewedtheir own clothes in the past, since about 1950 or so most Indian males havebegun to purchase ready-mad e clothing made of cheap durable cotton (someimported, some produced in Guatemala City) that is simply tailored by localtailors using Singer sewing machines. Tailoring is not as localized an industryas weaving. Yet the bulk of ready-wear clothing is made in 'core' peasanttow nships (I wo uld guess tha t mo re than 50 per cent is m ade in the d epa rtm en t

of Totonicapan). The tailoring industry produces virtually all peasant maleclothing in Guatemala, most agricultural-worker clothing, and a fair amountof Guatemala City clothing (for the 'clases popular5). Tailored clothing isproduced and sold in much the same fashion as woven goods, at least inTotonicapan.

WAGES, PRICES, AND PROFITS IN WEAVING

Let me now give some data on production costs and income for Totonicapanweavers. I have rath er com plete dat a on 40 weavers in the mun icipio, but haveonly pulled ou t 15 cases for the prese nt discussion (Ta ble 4). These cases wereselected as representative of the largest-scale weavers in Totonicapan; all buttwo hire four or mo re wage w orkers (the one case that hires no labou r was an'accident' of selection, but he represents the more typical case rather nicely).

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Table II

PRODUCTION DATA, 15 WEAVHÎS, TOTONICAPAN, 19 78(Cost s and pr i ces t aken f ran l as t t u rnover per lod) a

Case Turn over Turnov er Fixed Number of Number of Number of Days of wage Days of a l lNürnberg per iod per iod s cap ital" 3 wage family unpaid labour per labour per

In days 0 per year workers0 workerse app ren t ices turnover*" turnov er

1.2

3.1.5.

6.7.8.9.10.11.

12.

13.11.

15.

Case

Number

3033303030

30603615302022152030

Cost ofmaterlalsE

8810

7S

8510

1681515201510

Cost ofwages

689106519111511317

13698551127762592110528328375557

Othercosts*

1

1

681010

1088-51

81210

Gross

per

552

62

5153533222

income

turnover*

-223

22

3__12122

Net Incomeper turnover*

80130160200200

200288168-100601201020200

Net Incomeper year

178201

235323293

351139308311721121806582270

Net Income

per day S-

1.

2.

3.

6.

7.8.9.

1 0 .

il .

1 2 .

13 .

1 1 .

15 .

31 610021088 112 9

81 080 691 025 035018 036019027 268 1

37 830 018060 0600

60 086161 0

30 018 021 010 07260 0

2215 015 015 0

30

70

27 5

20

20 0

5

2820 0

1017

1125109019611100

18001930256010 0

108050 080 033 061 5

1781

30 027 522033031 1

39019 173 513 023013 52001027330 0

2100

2200

2200

23102728

312029617350208018102025300080 04095

3000

10.00

8.337-3311.0011.36

13.008.23

22.088.707-66

6.759.102.6613-65

10.00

3

§

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T a b l e 1 (continued)

PRODUCTION DATA, 15WEAVERS, TO TONICAPAN, 1978.

Case

Number1

A v e r a g e

labour-day

productivity^

1.

2.

3-

1.

5-

6.

8*.

9.

1 0.

1 1.

1 2 .

13 .

1 1 .

15.

Averages

Averagewage ofworker

2.70

2.30

3.00

3.003.003.00

3.003.80

-3.OO

3.002.50

2.503.60

3.00

Average profitof familyworker^

3.06

3-71

6.28

3.9710.331.29

5.129.5I

1.19

3.19

3.706.66

2.66

6.3510.00

Average profit of

family worker

plus apprentice s11

3.21 2.96 5 . 5 5

3.O63.712.93

2.683.662.583.275.25

1.193.192.603.33I.601.33

1.28

3.45

NOTESa. My interviews with artisans inTotonicap an (approximately 100 artisans in five major branches of production) included questions on alleconomic activities ofall household members over the annual cycle,

a work history of the household head, and a complete breakdown of costs and prices on the last period of production (or turnover period).b. Case 9 is included in this analysis, even thoug h the household did not usehired labou r in its last turnover period, because it normally did usehired labour. It is notable that theproductivity andprofii levels

of this enterprise are well above average, though its gross and net annual income are relatively low.

c Weavers inTotonicapan, many ci whom kepi rudimentary records, always talked in terms of a turnover period (*un turno') marked bythepurchaseof raw materials used inproduction. Formost weavers a

turnover period was one month in duration.d. Fixed capital consisted of looms and other tools of produ ction, sometim es including sewing machines. 1 costed these materials in terms of their present purchase price. I did not count vehicles used by

weaver-merchants here, but note that enterprise 8 owned a pickup used to market goods. It is notable that this enterprise has the highest rdafive profit return in the sample.

e.1

counted family members asworkers only if they actually engaged in production on more than a casual basis. Many household women who cooked and ranerrands fortheir enterprise (whose work wouldadd up to many hours of labour) are thus discounted in this analysis.f. These data show that most workers worked a regular five-day week, about ten hours of work per day.

g. Materials as opposed to capital are consumed in the production process. In this case the materials consist largely of thread, dyes, and the like.h. Other costs consist primarily of costs ofdistribution - travel, market taxes, and the like. These costs vary widely because of the different ways in which weavers dispose of their goods, some selling retail in

several marketplaces, some turning most goods over to local merchants.i Gross income consists of returns from sales. Net income consists of return from sales minus costs (materials, wages, and other),

j . Average labour-day productivity consists of net income perturnover period of the enterprise, added to thecost of wage labour in the turnover period, divided bydaysof all labourexpended in the turnover

period. This produces a figure that would be the fair* return to labour ifall profit were divided among all labour (workers and family members alike). When compared to actual paid wages, itgives one a

measure of the surplus value extracted from wage labour,k. The average *profits'calculated here simply divides the net daily income of theenterprise among all family members (and allfamily members plus apprentices) whowork regularly in theenterprise, on the

assumption that all family workers counted here do work at least as many days as do wage workers (usually they work somewhat longer hours).

S3oa»

C i

o

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W eavers usually hav e a turno ver or prod uctio n period of 30 days, but one inthis sam ple has a 15-day period an d an oth er has a 60-day period. At the end ofeach turnover period the enterprise purchases new raw materials, with theprofits realized through sale; only then can production begin anew. Someenterprises wo rk as long as 300 day s per year, som e as little as 210. Th is sam pletends toward the maximum days of operation, however, since singleindependent workers often work only half-time at weaving or less. In thissample of weavers fixed capital costs range from $328 (a weaver with twolooms) to $ 1,369; one w eaver (case 8) also ha s $5,000 pick up , wh ich he uses todeliver his goods, in addition to $1,127 in direct production capital.9 Mos tenterprises supplement wage labour with considerable family labour (thelowest nu m be r of family w ork ers is 2, the highest 6); and m ost enterprises alsohave one or two unpaid apprentices.

The highest cost for a weaving enterprise is hired labour, if labour is hired,

bu t costs for raw m aterials are almo st as high. Th e 'oth er' costs (mainly sellingcosts) vary widely, dep endin g o n how th e weaver sells his go od s. (Th e w eaverwith the pickup has the highest 'other' costs.) Enterprise income varies lessthan one might suspect, given all the variables involved. Only one enterpriseearns an ann ual net incom e below $1,840 (this weaver has the lowest averagelabour productivity) and only one enterprise has an annual income above$4,100 (the highest inco m e is gar nere d by the weaver with the picku p). 10 Daily'pro fit 'var ies from a low of $2.66 to a high of $22.08. In the con text of p easan tGuatemala, this represents substantial income. A plantation worker in this

period earned only $2.25 per day, plus meagre rations. But the enterpriseprofit is no t the crucial figure in a hou seho ld eco nom y. W e must see how theenterprise profit is divided among the unpaid workers employed in theenterprise. The last four columns of Table 4 provide the relevant data.

Considering all workers as equal, I have calculated the average return to aday of labour (summing both wage labour and family/apprentices) in eachweaving enterp rise as well as th at for weav ing in general. T he average of the 15cases yields $3.21, a figure only slightly higher than the average wage paid toworkers, which is $2.96. Family workers earn more than wage workers,

averaging $5.55 per family worker. But most of the family profit is made onthe unpaid apprentices: if we divide the enterprise profit among all unpaidenterprise w orkers (family m em bers and app rentices alike), the average retu rnper unpaid worker is $3.45. In five enterprises, unpaid workers earn less onaverage than do wage workers, though family members do better than theirapprentices (who earn only a food ration for the day).

One of the difficulties with the measure I have used as a labour yield tofamily workers, however, is that families reported only the labour spent byfamily members in actual weaving production. They did include the time ittoo k for buy ing raw ma terials and selling the finished pro du ct as well, bu t theydid not report the time of children who carried out small tasks on a casualbasis, nor did they count the labour of women who prepared food for familymembers and apprentices. They also failed to report the cost of foodconsumed by apprentices. If we were able to take all relevant family labour

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Petty Com modity Producers in Guatem ala 11

into account, and were to subtract the cost of food consumed by apprentices,we would probably find the average family return falling very close to theaverage labour product of $3.21. Th is leaves a very small return , if anyth ing ,to capital.

It is nonetheless clear tha t enterprises utilizing wage labo ur e xtract surplus

value from that labour and heavily exploit the labour of unpaid apprentices.But before we can assu m e th at this process is leading to class pola rization inthe community, we must look at the ages and situations of various types ofworkers .

The average age of the heads of the 15 weaving enterprises is 53; the av era geage of the wage labourers in these enterprises is 26; the average age ofappren tices is 17. All oft he hea ds of these partic ular enterprises began w o rk a sapprentices (either to their fathers or more often to neighbours) andaccumulated their capital as either workers (11 cases) or as traders (four

cases). All of th e app rentic es live with their families of origin which meet the irexpenses and none of them has worked as an apprentice for more than twoyears.

Of the 97 wage workers included in this sample, 68 are unmarried, livingwith their families of origin, and attempting to save part of their earnings inorder to set up businesses of their own. Fifteen of the wage workers haveyou ng families of their own to su pp ort in which children are not yet of an ageto help them in produc tion or bring in any income. Anoth er nine wo rkers haveyoung households of their own and no children. Five workers are older than

35; all five have had businesses of their own that failed and are trying toaccu m ulate eno ugh cap ital to go off on their own again. Nine ofth e presentlysuccessful enterprises have had one or more business failures in theirenterprise careers and all have worked from time to time without apprenticesor w age wo rkers. Fina lly, it is im po rtan t to n ote, these 15 enterprises rep resentthe mo st successful weaving enterprises in To ton ica pa n. T he 'ave rage ' weaverhas only family labour in the enterprise.

I have not yet analyzed the data on other kinds of operations. It is possiblethat earnings in tailoring are higher because the market is broader and there is

less com petition in this field. My guess, how ever, from look ing at the raw d at a,is that the same picture will emerge for most petty commodity producingenterprises in To ton ica pa n. W ages paid in all of these enterprises vary little byfield of specialization. The 15 entrepreneurs whose operations are analysedhere, when asked to estimate their enterprise returns, produced figures thatsquared with the analysed data . Tailors estima te abo ut the same kind of return.

Let us assume, then, that we can generalize from these data. Thegeneralizations tha t follow from the data presented here are these. W age levelsin Totonicapan are high relative to profit levels. Most wage labourers arerelatively young and most proprietors and enterprise owners began work aswage labourers in artisanry. We thus have a kind of demographicdifferentiation of wage labo ur a nd cap ital, no tendency for capital to exp andat the expense of wage labour, and economic brakes on the expansion ofcapital -relative to labour.


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Th e theoretical ramifications of this case, which is not an isolated instancein the world but r ath er par t of a very widespread p atte rn, are bro ad. I discussthe issues it raises, therefore, in three parts, including in my discussionrelevant m aterials on com para ble cases. First, I consider the problem of w hatis petty commodity production as an economic system with certain internal

properties and certain external conditions of existence. Second, I take up theissue of how petty commodity production articulates with other forms ofproduction (both capitalism and non-commodity forms of production) andhow this conditions the process of class differentiation within it. Finally, Iaddress some of the overarching questions raised by the persistence of pettycommodity production in the capitalist world economy: Does pettycommodity production 'free' labour for capitalism or hold it within non-capitalist systems of production? What are the necessary conditions for thecreation of a 'free' proletariat? Does capitalism benefit from the continued

existence of non-capitalist econom ies? D oes comm odity produ ction invariablylead to capitalism?

THEORETICAL ISSUES: WHAT IS PETTY COMMODITY PRODUCTION?

Recently Harriet Friedmann (1980) and Joel Kahn (1980) have attempted todevelop some concepts for analysing what they term 'simple' or 'petty 'commodity production, differentiating that form of production from bothcapitalism and from 'peasant ' production. Friedmann argues for a new

concept, 'form' of production, which requires a double specification ofprod uction in terms of both u nits of produ ction (and their reprodu ction) andthe social formation which provides the context for the reproduction of theparticu lar form of prod uction . H er main concern is to develop concepts usefulfor un derstandin g agrarian (rural) produc tion in the mod ern world. Kahn ha sworked within a similar framework, though his concern is more with theinternal logic or 'laws of motion' of petty commodity production. I outlinetheir arguments briefly.

According to both Friedmann and Kahn, pet ty commodity producers

produce goods for a market, control their means of production, and neitherextract surplus value from wage labour nor pay surplus value to non-pro du cers . The following co ndition s are necessary for this kind of pro du ctio nsystem to exist: (a) a com m odity econom y - tha t is, a division of labo ur an d areliable market for subsistence goods; (b) competition among units ofpro du ctio n, forcing prod ucers to be price responsive, to atte m pt to lower costsof production, and to reinvest surplus in more productive activity; (c) freecontractu al relations am on g prod ucers; (d) competitive markets in all meansof production and in credit; and (e) labour mobility. According to Kahn thereproduction of petty commodity production requires that all units ofproduction remain free, independent, and equal. As he observes, thisrequirem ent is not th at there be no relations am ong produ cers, but rather tha tprod uction relations amo ng prod ucers be med iated by the m arket rather th anby other mechanisms. Petty commodity production, therefore, requires the

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imperfect integration into the markets of capitalism. Thus, one should expect

to find a thoroughly 'modern' character to petty commodity production as

opposed to 'traditional' forms of 'peasant' production. That is, petty

commodity producers may be found in economies where capitalism is lacking,

but typically they are found in direct association with capitalism. Friedmann's

own work has been with wheat farmers in the Great Plains of the United States

between 1873 and 1935.

Both Friedmann and Kahn have been concerned to understand the nature

of wage labour within petty commodity production, since, although the

archetypal production unit does not hire wage labour, yet most empirical

studies of petty commodity producers show many of them to utilize wage

labour on a regular if not sustained basis. Kahn's study of blacksmiths in West

Sumatra provides one example. The typical blacksmith operation consisted of

a master, who directed the enterprise and was responsible for buying and

selling, and two to four 'workers'. After subtracting costs, enterprise profitswere divided among the workers and master, with an extra portion going to

the 'workshop' and thus indirectly to the master. The workshop portion was

said to pay for the depreciation of the master's equipment, but it in fact added

real income to the master, a form of profit. Thus in one sense the workers were

wage labourers from whom surplus value was extracted; but in another sense

they were not typical wage labourers because wage rates were directly

determined by return to the enterprise rather than by the struggle between

labour and capital. The particular status of wage labour in this context, then,

helps explain why the aim of blacksmithing enterprises in West Sumatra wassurvival and reproduction at a petty scale rather than expansion and

accumulation.

Friedmann describes a different kind of labour market in her example of

petty commodity production: family farming in the United States. She notes

that the farm economy of the United States required a well-developed market

in labour power and thus an essentially capitalist economy, because

competition with other producers established a constant requirement for

labour while demographic variation within the farm household prevented its

continuous supply by the household. At the same time, Friedmann argues, thecommodity of labour power, for petty commodity producers, takes on a role

very different from that in capitalist production. Among Plains farmers, for

example, wage labour became a temporary phase in the life cycle of wheat

farmers rather than a separate and permanent class: 'For those temporary

sellers of labour power who are extra sons from simple commodity

production households, the wage is not part of the reproduction of a relation

between capital and labour, but is part of the process whereby new household

enterprises are established' [Friedmann, 1978: 96].

Friedmann's example suggests the reproduction strategies of the Totoni-

capan artisanal firms. Virtually all independent producers or petty capitalistas

in Totonicapan begin their working life providing labour to their father's farm

or to his non-agricultural enterprise, later become apprentices and then wage

labourers to other similar enterprises in the community, and use their savings

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from labour to begin their own enterprises. A market in wage labour exists inthe Totonicapan community, its level determined in part by the prevailingwage rate in capitalist agriculture (the export-oriented plantations), but alsoconditioned by the ease with which individuals may begin their ownoperations. Since petty commodity production throughout Guatemala

requires relatively little initial capital, mobility rates are high and this forcesemployers to pay a relatively high wage rate to labour in order to have accessto any at all. The relatively high wage rate (in relation to the profit level), inturn, reproduces the high mobility of workers and thus the reproduction ofpetty commodity production.

This brings us to the crucial question about the nature of petty commodityproduction - how equivalent units are reproduced rather than differentiatedinto wage labour and capital. Here Kahn and Friedmann part company.Friedmann suggests that in some conditions petty commodity producers have

an advantage over capitalist producers because they have no structuralrequirement for profit, absolute or relative, and their personal consumptionlevels are flexible. On the other hand, she notes, this competitive advantageentails a very strict condition: 'that technical requirements allow combinationsof means of production with the quantity of labour on average availablewithin commercial households' [1980: 573]. By Friedmann's formulation,then, petty commodity production would be an interstitial kind of productionwithin capitalism, one expected to decline as economies of scale can berealized. Its persistence in certain branches (such as agriculture) of economies

like that of the United States can be explained only by the special technicalconditions of farming per se.Friedmann concludes her analysis by observing that peasant commodity

production must be distinguished from petty commodity production proper.Petty commodity production arises where special technical conditions ofproduction allow family producers to compete with capitalist producers.Peasant commodity production, by contrast, arises from many historicalcombinations of factors that create imperfectly integrated markets whichinsulate the producer from the full impact of price scissors. The classicexample is that of peasants who control land that does not have a market priceand thus are only partially integrated into regional or world markets. Not onlydoes the logic of these two apparently similar systems of production differ,according to Friedmann, but their epistemological status also differs.Whereas petty commodity production has a single, universal underlying logic,peasant commodity production systems are each historically unique and canbe analysed only as particular combinations of factors rather than as a unified,logical system.12

Friedmann makes some useful points, especially the distinction betweenproducers who purchase means of production and those who do not. But herattempt to divorce logical analysis from historical analysis in this context ishard to swallow. Her own analysis of US farmers shows that the particulartechnical conjuncture that allowed petty commodity production 'proper'resulted from specific state policies regarding the availability of the land for

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'family' farms, agricultural prices, and migration. These policies may have

resulted in perfectly integrated factor markets for grain farming; but what

allowed family farms to compete with capitalist farms was their ability and

willingness to achieve lower reproduction costs (lower wages and profits).

This in itself creates an imperfect market. But it is an imperfection about

which one can generalize.

Totonicapan weavers and tailors purchase their means of production in the

same markets available to capitalist producers. Weavers produce for a special

market but tailors produce for a general market in which their goods compete

with goods produced by capitalist industry. These producers are able to

survive in competition with capitalist production because they, like

Friedmann's family farms, are able and willing to achieve lower reproduction

costs than capitalist producers. What call for analysis, then, are the factors

that give petty commodity producers this ability and willingness. In all cases,

these factors will be conditioned by historically specific phenomena. But inmost cases one can generalize about these phenomena. The fact that capitalist

and petty producers in western Guatemala have very different mixes of labour

and capital and thus different technical requirements for production is no

barrier to generalization but rather a feature of petty commodity production

about which generalizations can be made.

Kahn presents a different argument. He shows that, as long as no surplus

value is extracted from wage labour, increasing the organic composition of

capital for the petty commodity producer merely lowers the return on

investment (in terms of production), driving the producer into new branchesof production rather than into increasing productivity within a single

branch.13

But Kahn's formulation dodges the issue raised by his own case.

Wage labour does exist as a category, if not a class, in West Sumatra. Thus

Kahn does not explain why those petty commodity producers who utilize

wage labour do not expand on the basis of the surplus value they extract.

This problem, it should be obvious by now, is not limited to West Sumatra.

In few cases of petty commodity production is the category of wage labour

lacking (examples are provided not only by Friedmann's family farmers and

Totonicapan artisans, but abound in the literature).14 Indeed the existence ofsome group able to expand or contract the family workforce seems a necessary

feature of a fully commoditized economy. On the other hand, the producers

we describe do not exploit a permanent proletariat, fail to accumulate capital,

and do not differentiate into smaller and larger units with different technical

requirements for production. The scale of production in all of these systems

remains small (or petty). Thus it seems advisable to reconsider the defining

feature of petty commodity production (lack of wage labour). I suggest that

the defining feature should be the absence of a fully proletarianised, self-

reproducing, labour force.15

The problem, then, is to explain why petty commodity producers who

utilize wage labour do not expand on the basis of the surplus value they

extract to become full-fledged capitalists. The case of Totonicapan suggests

an explanation for the lack of local differentiation: the level of wages in

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Petty Comm odity Producers in Guatema la 83

relation to the level of profit and the cost of capital. Because few workers inTotonicapan are completely devoid of means of production or easy access toit, they can demand a relatively high wage rate, reducing the profit to theiremployers and maintaining their potential mobility - and through this theirstrength in demanding high wages. As long as technical conditions ofpro du ction remain at the level wh ere an individual produ cer can compe te witha cooperative producer (an independent weaver versus a weaver withappren tices or a family division of labo ur), the position of the wage labou rerversus capital remains strong. And as long as wages are high vis-à-vis theprofit level, local investment in large-scale means of production does notoccur. This particular balance between relations of production (realized inwages) and forces of production (realized in low levels of capital investment)applies across the board to petty commodity production in westernGuatemala.

This ex plan ation , I must ackno wledg e, gives only part of the answer - whycap italization is unlikely to com e from within the p etty sector itself. We mustalso understand why external capital does not invest in this sector - why largescale or urban (merchant) capital does not compete with petty capital in thissituation. For capitalization most often occurs in precisely the situation Idesc ribe: where the rea lization of profit is impeded by the existence of skilledlabour and high wages. Capital seeks to replace skilled labour with unskilledlabour, substituting machines for skill and workers who can command onlylow wages for those who can command high wages. Normally, then, capital

establishes itself in those branches where wages are higher than the prevailingwages for u nskilled labou r. Even if the petty capitalists of To ton icap an can no taccu m ulate the resources necessary for an interna l revolution of the forces ofprod uction, T oton icapan enterprises would ap pea r to be ripe for the invasionof capital from some source.

But this way of phrasing the question poses a false issue. Nothing impedescapital investment in Guatemala but the level of profitability. Many formerartisanal activities undertaken by Totonicapan producers have been replacedby capital-intensive forms of production. Pottery-making, for example, has

been in decline for decad es, ever since cheap m ass prod uced tableware (mainlyfrom Mexico) has been on the market. Many other forms of artisanalproduction are dead or dying (tanning, shoemaking, the weaving of 'ut i l i ty'cloths). What remains are those branches of production in which large-scalecapital investment would yield little profit. In some of these branches, suchastailoring, there is no extant capital replacement for labour; tailoringeverywhere is performed by intensively utilized and at least semi-skilledlabour (often female) and small amounts of capital. A capital replacementdoes exist for Totonicapan's skirt-weaving industry, but the cost of thisreplacement is extremely high (far beyond the reach of local entrepreneurs),and its use for the limited market served by Totonicapan's specialist weaverswould yield little profit. Petty com m odity p rod uctio n in To ton icap an , like itscounterpart almost everywhere, crops up in those branches that large-scalecapital has not invaded and continuously seeks new branches if its existing

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branch is replaced by large capital. Petty production, by definition, seeks

branches in which the level of capital required for production is small.

The real question is not why large-scale capital has not invaded petty

production in Guatemala, but rather what prevents the mass prole-

tarianization of Guatemala's petty producers for those branches of production

in which Guatemalan (or foreign) capital has some comparative advantage in

production. To answer this question we must look at the sectoral articulation

between petty production and capitalism proper within Guatemala.

THEORETICAL ISSUES: SECTORAL ARTICULATION AND WAGE RATES

All of the cases under discussion here, and probably most cases of petty

commodity production where the category of wage labour exists, are found in

social formations dominated by full-fledged, large-scale, capitalism. In much

of the Third World, moreover, petty commodity production is not limited toareas relatively isolated from the impact lof capitalism, where pre-capitalist

formations are slowly dissolving. In many cases it is a relatively new form of

production, utilizing novel technology, located in urban centres (where it is

sometimes described as the 'informal' sector) as well as rural areas. Alejandro

Portes [1981], in fact, argues that it is one of the most dynamic aspects of

peripheral economies, a growing system of production rather than a declining

one, and a 'novel' rather than a traditional structure.16

Portes attempts to

account for the dynamic in petty commodity production by showing the

functional links it has with dominant capitalism.Portes's argument revolves around the different reproduction costs of petty

commodity production and capitalist production, a difference that allows

capitalist producers to pay lower wages to labour than would be the case if

petty commodity production did not subsidize the cost of living in peripheral

social formations. Petty producers achieve lower reproduction costs than

capitalists, he observes, because of their own links to non-commodity or

subsistence production. Even if petty producers do not meet much of their

own subsistence needs through non-commercial farming, they frequently

have economic relations with people who do. The articulation of petty

commodity producers with both capitalist and non-commodity forms of

production, according to Portes, is the key to understanding what reproduces

it. He argues, like many others dealing with similar cases [for example, Long

andRoberts, 1978;Bartra, 1975; Meillassoux, 1972], that the benefits (mainly

cheaper prices) to be gained by capitalism sustaining these non-capitalist

forms of production are so great that capitalism will, under certain conditions

anyway, sustain them. The only mechanism that Portes identifies by which

capitalism sustains petty commodity production, however, is the low rate

through which capitalism absorbs an active (fully proletarianized) labour

force. Thus Portes fails to consider the internal dynamic which prevents

differentiation from occurring within petty commodity production.

I need not develop a detailed critique of this position, because several others

have done so before me [see, especially, Mouzelis, 1980]. I can simply note

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Petty Comm odity Producers in Guatem ala 85

tha t the arg um ent is functionalist, that it gives volition o r will to im person alforces, that it assigns a single direction to contradictory tendencies (somecapitalists wan t cheap labou r, but others wa nt an expand ed ma rket), and tha tit assumes that non-capitalist forms of production, such as petty commodityproduction, have no internal logic or 'wills ' of their own. At the same time,

however, we cannot ignore the economic content of petty commodityproduction. I t is almost invariably associated with both capitalist and non-commodity or subsistence production. Let us, then, look at this context fromthe perspective of petty commodity production and capitalism proper.

Joel Kahn [1980] gives one account. He finds that the subsistenceproduction undertaken by petty commodity producers in West Sumatramaintains their low reproduction costs and thus makes their goodscompetitive with the imported goods of capitalist producers. But it also,according to Kahn, results in a flow of value out of both subsistence

production and petty commodity production:Just. . . as actual costs of production fall below the value ofcommodities, so the tendency will be for prices of production to fallbelow th e level of exch ang e values which wou ld preva il in the abse nce ofa subsistence sector. Any exchange which takes place in the economywill, therefore, result in a flow of value . . . [generating] a transfer ofsurplus from petty com m odity producer to capitalists . . . In buying theproducts of [petty commodity producers] capitalism as a whole,

wherever it is located, receives a surplus eq uivalent to . . . the sociallynecessary labour time experienced in subsistence production in thedominated economy. [1980:206]

Th ere ar e several difficulties w ith this arg um en t. First, local large-scale ca pita lshould not need this particular benefit (or surplus) to compete successfullyagainst petty comm odity p rodu ction, assuming only that i t produces the sam egood s m ore cheaply (because of greater co nstan t capital) an d. pays theprevailing wage rate . If it can no t com pete, it must be because it can not pay theprevailing wage rate - quite a different matter. Second, as Friedmann [1980]

has argued against another proponent of this view, a flow of value cannotserve as a m echanism of accu m ulation between sectors. Ch eape ning the costsof labo ur repro duc tion to cap ital is, of course, a benefit to capital and m akesan important contribution to capitalist accumulation, but a comparablecontribution would be made if increased productivity by capitalist producersreduced prices on consumer goods, as was the case during the nineteenthcentury in western Europe. A third difficulty is that Kahn's argument cannotexplain why accum ulation does not take place in the petty com mo dity sector -rather than in capitalism as a whole. Other barriers must exist to localaccumulat ion.

Gav in Sm ith [1978], wh o describes petty com m odity p rodu cers in highlandPeru, suggests what these barriers might be. As I do, he argues that thetechnological impoverishment of petty producers is the crucial elementpreventing differentiation. But he suggests that this impoverishment occurs

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because of the way petty producers must balance between the need to exploit

subsistence producers (in order to compete with capitalist producers) and

their inability to do so over time. On the one hand, he argues, petty production

units cannot compete with large-scale capital unless subsidized by non-

commodity production; lower reproduction costs allow them to charge lower

prices. On the other hand, relations that petty producers have with non-

commodity producers prevent them from accumulating capital, for one can

maintain relations with traditional peasant producers only by meeting

obligations of reciprocity, gift-giving, and the like. Thus petty producers are

held in an intermediate limbo with reciprocal obligations to more traditional

peasants both draining capital from them but also sustaining their lower

reproductive costs. Smith's argument boils down to the assertion that the

'moral economy' of the peasant community will not allow accumulation to

take place in it. This may be true of the particular communities he has studied

in highland Peru, but it is an inadequate explanation for the artisanalcommunity of Totonicapan and seems unlikely to be generalizable to the

many situations where petty commodity producers operate outside of peasant

communities - in urban centres or in regions where subsistence goods are

market commodities.

My argument, stated earlier, is that petty commodity producers must pay

what is for them a high wage rate in order to have access to sufficient supplies

of labour to even out demographic inequalities in the distribution of labour.

Now I shall argue that what sustains the high wage rate are the links that petty

commodity producers have to both subsistence production and to capitalistproduction in their social formations. 1 look first at the relationship with the

subsistence sector.

Employment in petty commodity production, even as labour, does not

require one to give up subsistence production. Thus most rural petty

producers, whether labour or 'capital', continue to provision a share of what

they need for subsistence outside the market. This has a number of important

consequences, as all of the above have noted: it narrows the internal market; it

keeps the cost of commodities relative to the cost of subsistence high; and it

lowers the reproduction costs of labour. More important, though little noted,is that it keeps disposable labour power relatively scarce, especially if

subsistence holdings are distributed such that petty commodity production is

initiated by relatively few landless or land-poor people.

Petty commodity producers, therefore, face a market situation in which

they can sell only low-cost commodities; they face workers who have several

options (among them petty commodity production itself), and who must

therefore be paid a relatively high wage; and they face intense competitive

pressure. They can survive under these circumstances only by reducing capital

costs to the fullest extent possible; they must also be content with very lowprofit margins. As I snowed earlier, these circumstances reproduce

themselves. High wages relative to low profits and capital maintain the

competitive pressure, because labour can easily accumulate sufficient capital

to begin production on its own. This possibility in turn gives labour a strong

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88 The Journal o f Peasant Studies

locally available subsistence prod uctio n, p roduces on average approximatelythe same standard of living. The highest wage rate is paid to those who areemployed full time and obtain no subsistence income; the next highest rate ispaid to those who couple full-time but local wage work in petty commodityproduction with a small amount of subsistence production (as inTo tonicap an); the next rate is paid to tho se w ho couple seasonal wage wo rk o n

plantations with a larger amount of subsistence production; the lowest rate ispaid to peasants who are part-time workers for other peasants in thesubsistence zone and who are able to carry out the largest amount ofsubsistence prod uctio n. This does not, of course, produc e equivalent incomesfor individuals. The inequalities in the distribution of subsistence resourcesare great enoug h th at som e peop le do fairly well with the prevailing wage ra tewhile others do very poorly. But each sector's wage rate does seem to beconditioned by the general availability of subsistence resources within thatsector. At the same time, the wage rates that exist in the higher-paid sectorsalso condition the wage rates in the lower-paid sectors, keeping them aboverock-bottom subsistence.

At this point my argum ent may a ppe ar to resemble that m ade by Dee re andde Ja nv ry [1981], wh o suggest that a con tinuo us h aem orrhag e of labo ur fromthe peasant and petty sectors to capitalist forms of production reproducessmall-scale p rodu ction . Th is is not my argum ent, ho wever. I agree with Po rtesthat employment in petty commodity production is probably growing fasterthan employment in capitalist production in most peripheral formations.Employment statistics on Guatemala fully sustain this thesis [ World Bank,

1978]. The conditions giving rise to different wage rates in different sectors donot require a continuous flow of labour between sectors to be sustained. Thewage rate in petty commodity production, for example, can continuallyreproduc e itself throu gh the mobility of labo ur into com petitive enterprises -barring a substantial shift in resources. And a substantial shift in resources isunlikely to occur in sectors where capital cannot be accumulated. On thecontrary, an evening out of subsistence resources seems to have occurred inthose parts of western Guatemala where people have entered into pettycommodity product ion.

I should note that the wage differences I found in western Guatemala in1977-8 were substantially the same as those existing in 1920-30, though theoverall level was higher. Th e only difference I foun d was a slight up w ard shiftin the subsistence zone, a shift that may have been brought about by thedevelopment of m ore petty com mo dity produ ction in tha t area. I should alsonote that the development of a seasonal labour force for plantations was notthe result of the differentiation occurring within peasant communities, butwas brought about by the actions of the state, which expropriated a large

am oun t of peasant subsistence resources. As petty comm odity produ ction h asexpanded in the region, however, the plantation labour pool has notincreased. It appears to have decreased not only in relative terms but inabsolute terms [Smith, 1984].

Let me summarize my argument. The articulation of petty commodity


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production with capitalist forms of production on the one hand and withsubsistence pro du ction on the other h and do es not lead to a flow of value fromlow-wage areas to high-wage areas (tho ugh high-wage areas do benefit fromthe exchange with low-wage areas). Nor does it suppress all wages to thesubsistence minimum. Instead, it helps sustain relatively high wage levels toprofit and capital levels in the petty producing sector. The main advantagethat artisanal workers in Totonicapan hold over their employers is theirpo tential mo bility o ut of the labou r force. La bo ur d oes no t have to flow ou t ofthe petty producing sector for high wage rates to be maintained, however; itcan simply flow within the petty produ cing sector. Fo r high wage rates allowcontinuous labour mobil i ty within petty commodity production. As a resultTotonicapan enterprises never have access to a permanent proletariat fromwhich they can extract sufficient surplus value to reorganize production on ascale allowing the real (as opposed to formal) subsumption of labour tocapital.

At the same time, we must recognize that petty commodity producers sus-tain themselves in a capitalist environment only by great self and familyexploitation. They must invest in capital and land from which they obtainlittle 'pr of it 'an d they must u nd ertak e considerab le risk in doing so. They gainmerely the abili ty to remain au tono m ou s vis-à-vis large-scale capital. But theretention of autonomy is no petty goal, even in economic terms. For if pettyproducers were to give up their enterprises for wage labour (assuming thatthey could), it is certain that wage levels in Guatemala would be suppressed

even below the inadequate level at which they now stand. The tenacity withwhich peasants hold on to their independent enterprise suggests that theyrecognize this fact.

THEORETICAL ISSUES: THE CREATION OF A 'FREE' PROLETARIAT

I have described a group of petty commodity producers who operate with acategory of wage labour and yet who have not differentiated into two self-

repro duc ing classes over a one-h und red-y ear pe riod. I have suggested som e of

the mechanisms that have sustained this pattern - that have even led to anincrease in petty commodity production within the Guatemalan socialform ation. My exp lanatio n does not rest up on th e peculiar values of peas antsor upon the existence of market barriers to the development of classdifferentiation. In fact, I have show n that the petty comm od ity prod ucers ofTotonicapan are fully dependent upon the market for carrying out theirpro du ction activities and I have argued th at prices prod uced by the m arket forcapital and for labour help sustain their operations and preserve pettyprod ucers in an und ifferentiated state. This leads me to the larger questions I

wish to addres s here. Is the op eratio n of the ma rket alon e sufficient forcreating a 'free ' proletariat? Does commodity production or marketdependence per se necessarily enrich the few while ruining the masses? Ormust other factors - class power and the actions of the state be brought intothe picture?

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In a justly famous passage, Marx observed:

Nature does not produce on the one side owners of money or

commodities and on the other men possessing nothing but their labour-

power. This relation has no natural basis, neither is its social basis one

that is common to all historical periods. [Capital, Vol. 1, 1970:166]

Neither would I argue, does the market operating with its own 'natural'

laws, create a proletariat. The market only does so once a 'free' proletariat has

been created, once labour has become a commodity and labourers have no re-

course but to sell it to the highest bidder. And the free proletariat was created

almost everywhere by the violent intervention of the state: the enclosures in

England, the migration and land policies in the US, the forced labour laws in

Guatemala. Guatemala's proletariat was not created by the inadequacy of

peasant economy or by 'rich' peasants expropriating 'poor' peasants. It was

created by a liberal political regime, representing the interests of a local

bourgeoisie and perhaps other interests as well, who forcibly evicted peasants

from their holdings.

If we move from particular cases to a more abstract realm, I can cast my

argument in terms that are analogous to recent debates about the influence of

the market on feudal relations of production. Jarius Banaji [1977] and Robert

Brenner [1977] have recently suggested that the traditional Marxist

orthodoxy as well as 'neo-Smithian' (market centred) positions about the

effects of markets on natural economies are wrong. Banaji suggests that the

crystallization of European feudalism occurred in Eastern Europe whencommodities were produced for a world market on large commercial estates

with serf labour. He observes that, rather than feudal bondage systems

weakening with the growth of the market, they were strengthened; and that,

rather than new class divisions developing in a market economy, old relations

of production were reinvigorated. Brenner contends that the explanation for

the origins of capitalism cannot be found in the growth of a world market, nor

is it to be found in the differentiation process that market production entrains.

He argues that transformations of class relations can be understood only

through class analysis, or through the historical construction of what powersand openings different groups had and how the particular struggles between

workers and non-workers (in a general sense) were worked out. Neither Banaji

nor Brenner describes the actual historical conditions creating a proletariat.

But both reject market-centred theories as inadequate.

Most people who side with Lenin in the peasant differentiation debate,

would probably agree with Banaji and Brenner on the feudalism debate, if the

Journal of Peasant Studies can be taken as a guide to the present orthodoxy. I

consider the two positions contradictory. To straddle these positions one must

assume that competitive markets invariably reward equal producersunequally, so differentiating them, while they reward unequal producers

(owners of estates who use coerced labour) equally, so maintaining them. But

large estates facing unpredictable prices should have no more flexibility than

diversified family enterprises. It seems reasonable to assume in both cases that

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Petty Commodity P roducers in Guatemala 91

non-market or alternative market resources can be utilized when marketprices are poor for the usual market commodity; it seems plausible thatpeasants with few capital assets can tu rn to wholly new types of enterprises aseasily if not more easily than large estates; and it seems unlikely that eithertype of producer would more easily find alternative uses for tied labour (or agreater need for 'free' labour) in response to changing market conditions.

The point is that, for either type of operation (large estate or familyenterprise) to change its entire mode of functioning, it must begin to treat itstied labour as a cost rather than as an asset. Business enterprises can do thisonly if hired labour power becomes basic to production rather than anoccasional labour supplement. And this will take place only when there is anexisting mass of 'ruined' peasants, an already formed 'free' proletariat, thathas no alternative source of livelihood than that of selling labour power. Sucha 'free' proletariat does not form easily. Most peasants resist full

proletarianization with great tenacity. The artisans of Totonicapan, forexample, would rather begin their own enterprise that pays them and theirfamily labour a lower wage than remain as relatively well-paid workers, evenin the community. Plantations have never been able to attract workers withthe mere offering of a wage unless they first took action (forcible actionbacked by the state) to 'free' these peasants of their own private assets. Eventoday the seasonal plantation workers would rather return to their over-usedand underproductive two cuerdas of land than to remain in the plantationarea as full-time workers. This can be considered'irrational'behaviour only if

one gives no value to personal autonomy.To sum up my argument, then, I am suggesting that a market or commodityeconomy is not sufficient to create the necessary polarization of labour andcapital that produces capitalism. The state has been and is a necessary agent inthat process. Guatemalan peasants are, if anything, poor in natural resources.Yet the only 'free' proletariat that Guatemala has is one that was created by theforcible actions of the state. The commodity economy has existed inGuatemala's peasant areas for at least one hundred years, during which thepeasant population has doubled, without creating on its own 'on the one side

owners of money or commodities and on the other men possessing nothingbut their labour power'.

N O T E S

1. 1 would like to tha nk Jeff Boyer, Kath erine Verdery and R ob ert W illiams for helpfulcomments on this paper. I would also like to thank Sutti Ortiz and Alain de Janvry for

inviting me to present some of this material to their seminars at the University of California,Berkeley, which helped me sharpen my arguments. The research reported here wassupp orted by the National Science Foun dation [Grant No . BNS 77-08179] and the period ofanalysis and writing was supported by both NSF and the Center for Advanced Study in theBehavioral Sciences, Stanford, California. 1 wou ld like to dedicate this article to the late D onChus, master weaver of Totonicapan.


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2. My description of the peasants of Totonicapan is based on two periods of fieldwork in thatcom mu nity, o ne between 1968 and 1970 and o ne between 1976 and 1978. I was aided in myfieldwork by several very able local assistants, who must remain anonymous, and by theconsiderable openness and hospitality of the artisans I questioned.

3. I discuss the historical processes leading to the development of highly specialized pettycomm odity produ ction in To tonica pan in mo re detail in Smith [1972, 1978, and 1984].

4. M ost of the peasants of Guatem ala are concentrated in the western highlands. I have show nelsewhere [Smith, 1978] how these peasants have differentiated into two groups, a 'core'group (mostly in the depar tments of Totonicapan, Quezaltenango, Solola , andChimaltenango) heavily involved in petty commodity production and commerce, and a'per ipheral ' group (mostly in the depar tments of San Marcos, Huehuetenango, and ElQuiche) more reliant upon seasonal plantation labour. Since both groups also engage insubsistence farming, this differentiation has not been noted: most scholars assume that allhighland peasants supplement inadequate farming operations with seasonal work onplantations [compare Hill and Golfos, 1968]. Yet my work on the regional organization ofthe p easant eco nom y shows t ha t since 1970 the 'core ' grou p sends less tha n 10 per cent of itsadult workforce to the plantations, while the periphery sends more than 60 per cent.

5. Essentially, the rural marketing system spread out from the core area, centred in thedepartm ent of Toto nicap an, and ma ny people from th at departm ent 'spr ead ' with it , settlingin peripheral communities as permanent residents.

6. One acre, or ab ou t nine and a half cuerdas in To toni capa n, produces on average between 20and 30 quintales (on e quin tal = 1001b.) of maize (dry w eight) and several quintales of beans(frijoles) or broad-beans (habas). An average family of five or six members consumes nomore than 2,000 lb of maize per year, if that much. The family, of course, must purchaseother food items. The yields reported here are somewhat higher than those reported in Hilland Go llas [1968], possibly becau se of the increased use of chemical fertilizer in the perio dbetween their study and mine. 1 should note that the yields of maize in To ton icap an a reexceptionally high because of the intensive use of land in that tow nsh ip. Hence land needs arethat much higher in other municipios, especially in the peripheral area.

7. Hill and Gollas [1968] show that the cost of land does not reflect its productive return,especially wh ere the value of the land h as been inflated in recent years by ur ba n spraw l. M ydata show the same pattern in more extreme form because of the recent inflation in landvalues.

8. Hill and Go llas [1968] repo rt th at few hig hland p easan t families put in mo re than 100 days inagriculture; in Totonicapan, most families put in no more than 30 to 60 days, dependingupon how much land they own. Hill and Gollas conclude that the highland peasant is verymuch u nderem ploye d, b ut they do no t take into account the am ou nt and significance of 'off-farm' employment among Guatemalan peasants.

9. I shou ld note that the amo un t of 'fixed 'capi tal held by an enterprise is a po or indica tor of theproductivity of the enterprise [see case number 9 in particular]. Enterprise 9 has enoughcapital to em ploy several wage wo rkers , which it did in the recent past. No en terprise sells acapita l stock unless forced to by cons um ptio n n eeds, because it holds this stock as a store ofvalue and also in anticipation of future expansion. One could argue that this 'stickiness' ofcapital shows these producers to be similar to ' traditional ' peasants, who hold on to landregardless of its productive return. I think, however, it reflects only the fact that these arelargely consumption as well as production units (households), and that institutions forconverting capital assets into capital f lows are poorly developed throughout Guatemala. I

expect one would find a similar capital 'stickiness' in even large plantation enterprises inGuatemala .

10. I do not count the pickup as part of the 'fixed' capital of this enterprise because it actuallyinvolves the development of an occupational sideline (transport and porterage). Theaddition of transportation to a weaving enterprise does not increase its overall productivity,but it does increase its potential market.

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11. Sol Tax [1963] showed many years ago that Guatemalan peasants were price responsive,regardless of the source of their incomes. But Tax did not consider the difference in theorganization of production that results when there is a market in the factors of productionrather th an just a marke t in produced go ods. His own data show tha t the mar ket for factorsof production in 'farming' Panajachel was rather poorly integrated.

12. Friedmann argues as follows: 'Peasant production, based on immobility of factors of

production, has no theoretical status in political economy . . . A great num ber of productivearrangements may exist which need have nothing more in common than limitations in theoperation of market principles'[1980: 164]. Fro m this she concludes that one cannot 'de du ce'class relations in peasant formations, since peasants 'may bear relations to three otherclasses: merc hants, land ow ners, and cred itors ' [1980: 168]. W hich of these classes is relevantdepends upon a host of historical circumstances, whereas in petty commodity productionproper one can deduce internal class relations by the givens of that form of production.

13. Kahn assumes here that the enterprise is basically organized by a household and that to theextent that the househ old invests in labour-sav ing mach inery it is cutting into the return thehous ehold can earn on its family la bo ur. This imp lies, how ever, that family lab our power isrelatively immobile and that i t canno t earn a productive return in some other occupation oractivity. Yet earlier, Kahn assumes that labour is mobile in the petty commodity producingsector and makes that mobility part of his definition of petty commodity production. To getout of this impasse Kahn must either argue that labour is relatively immobile in pettycommodity production or he must find some other barrier to the enterprise investing inlabour-saving machinery.

14. Friedmann, in fact, argues that wage labour or a market in labour is necessary for thereproduction of petty commodity production since households cannot produce over theircycles the exact quantity of labour needed for production and 'fully developed commodityprodu ction depends u pon the mobility of labou r, which allows producers to adap t to changes

in productivity and relative prices' [1980: 167].15. Needless to remark, petty commodity production can also exist where there is no wage

labou r. And where there is no wage labour there can be no accumu lation of relative surplusvalue. B ut, as the three cases under discussion attest, the mere creatio n of a category of wagelabo ur is not sufficient for the develo pm ent of a perma nent pr oleta riat, for the accu mu lationof relative surplus value, and for the con tinuo us re volution of the forces of pro du ctio n - th atis , for the development of capitalism. To understand what impedes the development ofcapitalism, we must look for the forces that prevent the creation of an impoverishedproletariat unable to bargain for high wages.

16. Because Portes considers petty commodity production a pre-capitalist and rural form ofpro du ction , he discusses instead th e 'informal sec tor' which he considers distinctive be causeof its urban location and utilization of wage labour. It is clear, however, that what Portesconsiders the informal sector would conform to what Friedmann and Kahn have describedas petty commodity production, to the extent that people in the informal sector engage inproduct ion.

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