Key Arguments

• Weber traces the embryonic emergence of capital goods from trade: 'In embryonic form, capital goods first appear as commodities that are exchanged either locally or between ethnic groups, presupposing (see §29) that the emergence of “trade” is separate from the household production of goods.'
• He stresses that household surplus trading cannot yet be capitalist calculation: 'This household trading activity (selling its surplus) cannot be conducted in terms of any special form of capitalist calculation.'
• He distinguishes domestic means of production from capital goods: 'Products made by households, clans, and tribes and sold to other ethnic groups are commodities; their means of production, so long as they remain domestic products (Eigenprodukte), are tools and raw materials, not capital goods.'
• Similarly, peasants’ and feudal lords’ means of production remain non‑capitalist if not organised around capitalist calculation: 'It is just the same with the means of production and products sold by peasants and feudal lords, so long as their economic activity is not based on capitalist calculation of even the most primitive form (for which there are already preliminary signs in, e.g., Cato).'
• He emphasises that oikos‑based trade, even when partially acquisitive, remains non‑capitalist if it cannot be oriented to capitalist calculation, especially pre‑estimation of profit in money: 'Likewise, trade carried on by an oikos (e.g., that of the Pharoah), even when it is not exclusively trade for the sake of its own needs as with household exchange but rather serves partly acquisitive purposes remains noncapitalist in the sense of the terminology used here so long as it cannot be oriented to capitalist calculation, especially to the prior estimation in money of Chancen for profit.'
• He identifies professional itinerant traders as the first full bearers of capitalist calculation and of the capital‑good quality of means of production: 'This last condition was true of professional itinerant traders, whether they dealt in products they brought together themselves, or by a commenda or a social group. It is here, in the form of the occasional undertaking, that we find the source of capitalist calculation and the original form of the capital good (Kapitalgüterqualität).'
• He distinguishes rent-bearing wealth (including humans and installations) from capital goods: 'Humans (slaves, bondsmen) used by serf-owners and landlords as a source of rent, or plant and installations of all kinds, are of course merely rent-bearing components of wealth and not capital goods, just like (with respect to the private individual oriented to rent seeking [Rentenchance]85 or the occasional speculative venture, by contrast with the temporary investment of acquisitive enterprise capital) today’s securities yielding dividends or annuities.'
• Goods received as compulsory dues and sold are still just commodities because capitalist cost calculation is absent even in principle: 'Goods received as compulsory dues by serf-owners or landlords from their vassals by force of lordly power and then sold in a market are, in our terminology, “commodities,” not “capital goods,” since rational capitalist calculation (costs!) is absent not only in fact but in principle.'
• By contrast, under slave‑market conditions slaves used in an acquisitive enterprise count as capital goods: 'By contrast, slaves employed in an enterprise as a means for acquisition (given the existence of a slave market and the prevalence of slave purchase) are capital goods for such an enterprise.'
• He refuses to call patrimonial enterprises with bonded subjects capitalist, stressing bondage relations: 'In the case of (patrimonial) subjects who are not freely bought and sold but employed in manorial enterprise (Fronbetrieben), we do not wish to speak of capitalist enterprises but only of acquisitive enterprises with bonded labour (what is decisive here is also the bondage of the lord to the labourer!), whether this involves agricultural enterprises or unfree domestic industry.'
• He extends the classification to manufacture: 'In manufacture (Gewerbe), craft work (Preiswerk) is “petty capitalist” enterprise; decentralised capitalist enterprise in the case of domestic industry, and centralised in the case of any form of actual capitalist workshop enterprise.'
• He then states his formal criterion: 'What is therefore decisive here is not in principle the empirical fact, but the possibility, of material capitalist calculation.'

Source Quotes

The Chancen that are available to them on an everyday basis are therefore inwardly quite different from those available to communities oriented to the exceptional, or primarily the extra-economic. §27. In embryonic form, capital goods first appear as commodities that are exchanged either locally or between ethnic groups, presupposing (see §29) that the emergence of “trade” is separate from the household production of goods. This household trading activity (selling its surplus) cannot be conducted in terms of any special form of capitalist calculation.

This household trading activity (selling its surplus) cannot be conducted in terms of any special form of capitalist calculation. Products made by households, clans, and tribes and sold to other ethnic groups are commodities; their means of production, so long as they remain domestic products (Eigenprodukte), are tools and raw materials, not capital goods. It is just the same with the means of production and products sold by peasants and feudal lords, so long as their economic activity is not based on capitalist calculation of even the most primitive form (for which there are already preliminary signs in, e.g.,

It goes without saying that the entire internal flow of goods in oikos and landed estate, as well as opportunistic or typical internal exchange of products, is the opposite of economic activity based on capitalist calculation. Likewise, trade carried on by an oikos (e.g., that of the Pharoah), even when it is not exclusively trade for the sake of its own needs as with household exchange but rather serves partly acquisitive purposes remains noncapitalist in the sense of the terminology used here so long as it cannot be oriented to capitalist calculation, especially to the prior estimation in money of Chancen for profit. This last condition was true of professional itinerant traders, whether they dealt in products they brought together themselves, or by a commenda or a social group.

This last condition was true of professional itinerant traders, whether they dealt in products they brought together themselves, or by a commenda or a social group. It is here, in the form of the occasional undertaking, that we find the source of capitalist calculation and the original form of the capital good (Kapitalgüterqualität). Humans (slaves, bondsmen) used by serf-owners and landlords as a source of rent, or plant and installations of all kinds, are of course merely rent-bearing components of wealth and not capital goods, just like (with respect to the private individual oriented to rent seeking [Rentenchance]85 or the occasional speculative venture, by contrast with the temporary investment of acquisitive enterprise capital) today’s securities yielding dividends or annuities.

It is here, in the form of the occasional undertaking, that we find the source of capitalist calculation and the original form of the capital good (Kapitalgüterqualität). Humans (slaves, bondsmen) used by serf-owners and landlords as a source of rent, or plant and installations of all kinds, are of course merely rent-bearing components of wealth and not capital goods, just like (with respect to the private individual oriented to rent seeking [Rentenchance]85 or the occasional speculative venture, by contrast with the temporary investment of acquisitive enterprise capital) today’s securities yielding dividends or annuities. Goods received as compulsory dues by serf-owners or landlords from their vassals by force of lordly power and then sold in a market are, in our terminology, “commodities,” not “capital goods,” since rational capitalist calculation (costs!) is absent not only in fact but in principle.

Humans (slaves, bondsmen) used by serf-owners and landlords as a source of rent, or plant and installations of all kinds, are of course merely rent-bearing components of wealth and not capital goods, just like (with respect to the private individual oriented to rent seeking [Rentenchance]85 or the occasional speculative venture, by contrast with the temporary investment of acquisitive enterprise capital) today’s securities yielding dividends or annuities. Goods received as compulsory dues by serf-owners or landlords from their vassals by force of lordly power and then sold in a market are, in our terminology, “commodities,” not “capital goods,” since rational capitalist calculation (costs!) is absent not only in fact but in principle. By contrast, slaves employed in an enterprise as a means for acquisition (given the existence of a slave market and the prevalence of slave purchase) are capital goods for such an enterprise.

Goods received as compulsory dues by serf-owners or landlords from their vassals by force of lordly power and then sold in a market are, in our terminology, “commodities,” not “capital goods,” since rational capitalist calculation (costs!) is absent not only in fact but in principle. By contrast, slaves employed in an enterprise as a means for acquisition (given the existence of a slave market and the prevalence of slave purchase) are capital goods for such an enterprise. In the case of (patrimonial) subjects who are not freely bought and sold but employed in manorial enterprise (Fronbetrieben), we do not wish to speak of capitalist enterprises but only of acquisitive enterprises with bonded labour (what is decisive here is also the bondage of the lord to the labourer!), whether this involves agricultural enterprises or unfree domestic industry.

All forms of tenants’ servants’ (Stör, see §19), wage work, or homeworking are simply forms of labour, the first two in the interest of a household, the third related to the gainful interest of the employer. What is therefore decisive here is not in principle the empirical fact, but the possibility, of material capitalist calculation. §28. Alongside all the earlier forms assumed by specialised or specified tasks and discussed above, there is also in every commercial economy (and also, normally, in a materially regulated economy) the mediation of exchanging a dispositional power possessed by oneself or by another.

Key Concepts

• In embryonic form, capital goods first appear as commodities that are exchanged either locally or between ethnic groups,
• their means of production, so long as they remain domestic products (Eigenprodukte), are tools and raw materials, not capital goods.
• trade carried on by an oikos (e.g., that of the Pharoah), even when it is not exclusively trade for the sake of its own needs as with household exchange but rather serves partly acquisitive purposes remains noncapitalist in the sense of the terminology used here so long as it cannot be oriented to capitalist calculation, especially to the prior estimation in money of Chancen for profit.
• It is here, in the form of the occasional undertaking, that we find the source of capitalist calculation and the original form of the capital good (Kapitalgüterqualität).
• are of course merely rent-bearing components of wealth and not capital goods,
• since rational capitalist calculation (costs!) is absent not only in fact but in principle.
• By contrast, slaves employed in an enterprise as a means for acquisition (given the existence of a slave market and the prevalence of slave purchase) are capital goods for such an enterprise.
• What is therefore decisive here is not in principle the empirical fact, but the possibility, of material capitalist calculation.

Context

§27, where Weber sharpens his methodological definition of 'capital goods' and 'capitalist enterprise' by tracing their emergence from trade and distinguishing them from other forms of wealth and production lacking the possibility of formal profit calculation.