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A key concept in anthropological studies of economic life is the mode of production, or the social relations through which human labor is used to transform energy from nature using tools, skills, organization, and knowledge. This concept originated with anthropologist Eric Wolf, who was strongly influenced by the social theorist Karl Marx. Marx argued that human consciousness is not determined by our cosmologies or beliefs but instead by our most basic human activity: work. Wolf identified three distinct modes of production in human history: domestic (kin-ordered), tributary, and capitalist.4 Domestic or kin-ordered production organizes work on the basis of family relations and does not necessarily involve formal social domination, or the control of and power over other people. However, power and authority may be exerted over specific groups based on age and gender. In the tributary mode of production, the primary producer pays tribute in the form of material goods or labor to another individual or group of individuals who controls production through political, religious, or military force. The third mode, capitalism, is the one most familiar to us. The capitalist mode of production has three central features: (1) private property is owned by members of the capitalist class; (2) workers sell their labor power to the capitalists in order to survive; and (3) surpluses of wealth are produced, and these surpluses are either kept as profit or reinvested in production in order to generate further surplus. As we will see in the next section, Modes of Exchange, capitalism also links markets to trade and money in very unique ways. First, though, we will take a closer look at each of the three modes of production.

Domestic Production

The domestic, or kin-ordered, mode of production characterizes the lives of foragers and small-scale subsistence farmers with social structures that are more egalitarian than those characterizing the other modes of production (though these structures are still shaped by age- and gender-based forms of inequality). In the domestic mode of production, labor is organized on the basis of kinship relations (which is why this form of production is also known as kin-ordered). In southern Mexico and parts of Central America, many indigenous people primarily make their living through small-scale subsistence maize farming. Subsistence farmers produce food for their family’s own consumption (rather than to sell). In this family production system, the men generally clear the fields and the whole family works together to plant the seeds. Until the plants sprout, the children spend their days in the fields protecting the newly planted crops. The men then weed the crops and harvest the corn cobs, and, finally, the women work to dry the corn and remove the kernels from the cobs for storage. Over the course of the year mothers and daughters typically grind the corn by hand using a metate, or grinding stone (or, if they are lucky, they might have access to a mechanical grinder). Ultimately, the corn is used to make the daily tortillas the family consumes at each meal. This example demonstrates how the domestic mode of production organizes labor and daily activities within families according to age and gender.

Foraging societies are also characterized by (1) the collective ownership of the primary means of production, (2) lower rates of social domination, and (3) sharing. For example, the Dobe Ju/’hoansi (also known as the !Kung), a society of approximately 45,000 people living in the Kalahari Desert of Botswana and Namibia, typically live in small groups consisting of siblings of both sexes, their spouses, and children. They all live in a single camp and move together for part of the year. Typically women collect plant foods and men hunt for meat. These resources are pooled within family groups and distributed within wider kin networks when necessary. However, women will also kill animals when the opportunity presents itself, and men spend time collecting plant foods, even when hunting.

As discussed in the Marriage and Family chapter, kinship relations are determined by culture, not biology. Interestingly, in addition to genealogical kinship, the Dobe Ju/’hoansi recognize kinship relations on the basis of gender-linked names; there are relatively few names, and in this society the possession of common names trumps genealogical ties. This means that an individual would call anyone with his father’s name “father.” The Dobe Ju/’hoansi have a third kinship system that is based on the principle that an older person determines the kinship terms that will be used in relation with another individual (so, for example, an elderly woman may refer to a young male as her nephew or grandson, thus creating a kin relationship). The effect of these three simultaneous kinship systems is that virtually everyone is kin in Ju/’hoansi society—those who are biologically related and those who are not. This successfully expands the range of individuals with whom products of labor, such as meat from a kill, must be shared.5 These beliefs and the behaviors they inspire reinforce key elements of the domestic mode of production: collective ownership, low levels of social domination, and sharing.

Tributary Production

The tributary mode of production is found in social systems divided into classes of rulers and subjects. Subjects, typically farmers and/or herders, produce for themselves and their families, but they also give a proportion of their goods or labor to their rulers as tribute. The tributary mode of production characterizes a variety of precapitalist, state-level societies found in Europe, Asia, Africa, and the Americas. These societies share several common features: (1) the dominant units of production are communities organized around kinship relations; (2) the state’s society depends on the local communities, and the tribute collected is used by the ruling class rather than exchanged or reinvested; (3) relationships between producers and rulers are often conflictual; and (4) production is controlled politically rather than through the direct control of the means of production. Some historic tributary systems, such as those found in feudal Europe and medieval Japan, were loosely organized, whereas others, such as the pre-contact Inca Empire and imperial China, were tightly managed.

In the Chinese imperial system, rulers not only demanded tribute in the form of material goods but also organized large-scale production and state-organized projects such as irrigation, roads, and flood control. In addition to accumulating agricultural surpluses, imperial officials also controlled large industrial and commercial enterprises, acquiring necessary products, such as salt, porcelain, or bricks, through nonmarket mechanisms. The rulers of most tributary systems were determined through descent and/or military and political service. However, the 1,000-year imperial Chinese system (CE 960–1911) was unique in that new members were accepted based on their performance in examinations that any male could take, even males of low status.6 Despite this exception, the Chinese imperial system exhibits many hallmarks of the tributary mode of production, including the political control of production and the collection of tribute to support state projects and the ruling classes.

Capitalist Production

The capitalist mode of production is the most recent. While many of us may find it difficult to conceive of an alternative to capitalism, it has in fact only existed for a mere fraction of human history, first originating with the North American and western European industrial revolution during the seventeenth and eighteenth centuries. Capitalism is distinguished from the other two modes of production as an economic system based on private property owned by a capitalist class. In the domestic and tributary modes of production, workers typically own their means of production (for example, the land they farm). However, in the capitalist mode of production, workers typically do not own the factories they work in or the businesses they work for, and so they sell their labor power to other people, the capitalists, in order to survive. By keeping wages low, capitalists are able to sell the products of the workers’ labor for more than it costs to produce the products. This enables capitalists, or those who own the means of production, to generate a surplus that is either kept as profit or reinvested in production with the goal of generating additional surplus. Therefore, an important distinguishing feature of the capitalist mode of production is that workers are separated from the means of production (for example, from the factories they work in or the businesses they work for), whereas in the domestic and tributary modes workers are not separated from the means of production (they own their own land or they have free access to hunting and foraging grounds). In the domestic and tributary modes of production, workers also retain control over the goods they produce (or a portion of them), and they control their own labor, deciding when and when not to work.7 However, this is not true within capitalism. A factory worker does not own the widget that she helps build in a factory, and she cannot decide when she would like to show up at work each day.

Economic anthropologists stress that people and communities are differentially integrated into the capitalist mode of production. For example, some subsistence farmers may also produce a small crop of agricultural commodities in order to earn cash income to pay for necessities, such as machetes or farm tools, that they cannot make themselves. Many of us have had “informal” jobs tending a neighbor’s children or mowing someone’s lawn. Informal work such as this, where one does not work on a full-time, contracted basis, is especially important in developing countries around the world where informal employment comprises one-half to three-quarters of nonagricultural employment.8

Even in our own capitalist society, many of us regularly produce and exchange goods and services outside of the so-called formal marketplace: baking zucchini bread for a cousin who shares her vegetable garden’s produce, for example, or buying fair-trade chocolate from a cooperative grocery store. We might spend Sundays volunteering in a church’s nursery, or perhaps moonlighting as a server for a friend’s catering business, working “under the table” for cash. Each of these examples highlights how even in advanced capitalist societies, we engage in diverse economic practices every day. If, as some suggest, economic anthropology is at its heart a search for alternatives to capitalism, it is useful to explore the many diverse economies that are thriving alongside capitalist modes of production and exchange.9

Fair-Trade Coffee Farmers: 21st Century Peasants

Small-scale, semi-subsistence farmers make up the largest single group of people on the planet today. Once known as peasants, these people pose an interesting conundrum to economic anthropologists because they live their lives both inside and outside of global capitalism and state societies. These farmers primarily use their own labor to grow the food their families eat. They might also produce some type of commodity for sale. For example, many of the indigenous corn farmers in southern Mexico and Central America discussed earlier also produce small amounts of coffee that they sell in order to earn money to buy school supplies for their children, building supplies for their homes, clothing, and other things that they cannot produce themselves.

There are between 20 and 25 million small farmers growing coffee in more than 50 countries around the world. A portion of these small coffee farmers are organized into cooperatives in order to collectively sell their coffee as fair-trade certified. Fair trade is a trading partnership, based on dialogue, transparency, and respect, that seeks greater equity in international trade. According to Fairtrade International, fair trade supports farmers and workers to combat poverty and strengthen their livelihoods by establishing a minimum price for as many fair-trade products as possible; providing, on top of stable prices, a fair-trade premium; improving the terms of trade for farmers by providing access to information, clear contracts with pre-payments, access to markets and financing; and promoting better living wages and working conditions.10 In order to certify their coffee, small farmers must belong to democratically run producers’ associations in which participation is open to all eligible growers, regardless of ethnicity, gender, religion, or political affiliation.

To better understand how indigenous farmers practice kin-organized subsistence maize production while simultaneously producing an agricultural commodity for global markets, I conducted long-term research in a highland Guatemala community.11 In 1977 a small number of Tz’utujil Maya coffee farmers formed a cooperative, La Voz Que Clama en el Desierto (A Voice Crying Out in the Wilderness), with the goal of securing higher prices for their agricultural products and escaping the severe poverty they struggled against on a daily basis. Since the early 1990s the group has produced high-quality organic and fair-trade certified coffee for the U.S. market.

The farmers work tirelessly to ensure that their families have sufficient corn to eat and that their coffee meets the cooperative’s high standards of quality. The members of La Voz refer to their coffee trees as their “children” who they have lovingly tended for decades. High-quality, organic coffee production is time consuming and arduous—it requires almost daily attention. During the coffee harvest between December and March, wives, husbands, and children work together to pick the coffee cherries by hand as they ripen and carry them to the wet mill each afternoon.

While these farmers are producing a product for the global market, it is not strictly a capitalist mode of production. They own their own land and they sell the fruits of their labor for guaranteed prices. They also work cooperatively with one another, pooling and exchanging their labor, in order to guarantee the smooth functioning of their organization. This cooperation, while essential, is hard work. Because the fair-trade system does not rely on anonymous market exchanges, members of La Voz must also dedicate time to nurturing their relationships with the coffee importers, roasters, advocates, and consumers who support all their hard work through promotion and purchases. This means attending receptions when buyers visit, dressing up in traditional clothing to pick coffee on film for marketing materials, and putting up with questions from nosy anthropologists.

Because the coffee farmers also produce much of the food their families consume, they enjoy a great deal of flexibility. In times of hardship, they can redirect their labor to other activities by intensifying corn production, migrating in search of wage labor, or planting other crops. Their ultimate goal is to maintain the family’s economic autonomy, which is rooted in ownership of the means of production—in this case, their land. A close examination of these farmers’ lives reveals that they are not relics of a precapitalist system. Instead, their economic activity is uniquely adapted to the contemporary global economy in order to ensure their long-term survival.

Salaula in Zambia: The Informal Economy

The informal economy includes a diverse range of activities that are unregulated (and untaxed) by the state: rickshaw pullers in Calcutta, street vendors in Mexico City, and scrap-metal recyclers in Lexington, Kentucky, are all considered informal workers. Informal economies include people who are informally self-employed and those working informally for other people’s enterprises. In some parts of the world the informal economy is a significant source of income and revenue. In Sub-Saharan Africa, for example, the informal economy generates nearly 40 percent as much revenue as that included in the “official” gross domestic product.12 Consequently, the informal economy is of great interest to economic anthropologists. However, the term “informal economy” is critiqued by some scholars since often what we refer to as informal economies are actually quite formal and organized, even though this organization is not regulated by the state and may be based on an internal logic that makes the most sense to those who participate in the exchanges.

Karen Hansen provides an in-depth look at the lives of vendors in the salaula, the secondhand clothing markets in Zambia in southern Africa.13 Salaula, a term that literally means “to rummage through a pile,” is an unusual industry that begins in many of our own homes. In today’s era of fast fashion in which Americans buy more than 20 billion garments each year (that’s 68 garments per person!), many of us regularly bag up our gently used, unfashionable clothing and drop it off at a nearby Goodwill shop.14 Only about half of these donated clothes actually end up in charity thrift stores. The rest are sold to one of the nearly 300 firms that specialize in the global clothing recycling business. The textile recycling firms sort the clothing by grades; the higher-quality items are sent to Central America, and the lowest grades go to African and Asian countries. In Sub-Saharan Africa an estimated 50 percent of purchased clothing consists of these secondhand imports, referred to by some consumers as “dead man’s clothes” because of the belief that they come from the deceased.15 In Zambia the secondhand clothes are imported in bulk by 40 wholesale firms that, in turn, sell the clothes to salaula traders. The traders sell the clothes out of their homes and in large public markets.

Typically the people working as salaula traders have either never had formal-sector jobs or have lost their jobs in the public or private sector. Often they start selling in order to accumulate money for other activities or as a sideline business. Hansen found that there were slightly more female sellers and that women were more likely to be single heads of households. Successful salaula trading requires business acumen and practical skills. Flourishing traders cultivate their consumer knowledge, develop sales strategies, and experiment with display and pricing. While salaula trading has relatively low barriers to entry (one simply has to purchase a bale of clothing from a wholesale importer in order to get started), in this informal market scale is important: salaula moves best when traders have a lot of it on offer. Traders also have to understand the local cultural politics in order to successfully earn a living in this sector. For example, salaula is different from used clothing from people someone knows. In fact, secondhand clothing with folds and wrinkles from the bale is often the most desirable because it is easily identifiable as “genuine” salaula.16

The global salaula commodity chain presents an interesting example of how material goods can flow in and out of capitalist modes of production and exchange. For example, I might buy a dress that was produced in a factory to give (not sell!) to my young niece. After wearing the dress for several months, Maddie will probably outgrow it, and her Mom will drop it off at the nearby Goodwill shop. There is a 50 percent chance that the dress will be sold by the charity to a clothing recycler who will export it to Zambia or a nearby country. From there the dress will end up in a bale of clothing that is purchased by a salaula trader in Lusaka. At this point the dress enters the informal economy as the salaula markets are unregulated and untaxed. A consumer might buy the dress and realize that it does not quite fit her own daughter. She might then take it to her neighbor, who works informally as a tailor, for alternations. Rather than paying her neighbor for the work on the dress, the consumer might instead arrange to reciprocate at a later date by cleaning the tailor’s home. This single item of clothing that has traveled the globe and moved in and out of formal and informal markets highlights how diverse our economic lives really are, a theme that we will return to at the end of this chapter.