On the Capitalist Enterprise

Political economists know well Marx's formulation of the "circuits of capital." Thus far, however, the circuits have been analyzed primarily in refer ence to social capital, and not individual capital. In this paper the circuits are theorized as pertaining to the ongoing reproduction of the individual unit of cap ital, and accordingly applicable to a conception of the capitalist enterprise. A re vision of Marx's formulation is proposed. The schema of the three circuits (of money-, productive-, and commodity-capital) does not fully account for the ac cumulation of capital, in particular the moment from the realization of profits to the reinvestment of money-capital. A fourth circuit, that of accumulated cap ital, is thus interjected into the reproduction cycle. The revised schema of the cir cuits is then used in constructing a working model of the capitalist enterprise. The model incorporates four phases of business activity — procurement, produc tive consumption, realization, and accumulation. Each phase is defined sequenti ally, and the logic of the various relations among them then articulated. The primacy of the capitalist enterprise, both in the process of capitalist development and as a key unit of analysis in the examination of that process, is argued. Some differing interpretations of Marx's "circuits of capital," most notably that offered by Christain Palloix, are discussed in an appendix. It is concluded that neither the nature of the activities nor the role of the enterprise in the capitalist world economy is properly understood in the relevant literature.