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Table of Contents

Abstract ........................................................................................................................................... 1

Introduction: .................................................................................................................................... 1

Class: ............................................................................................................................................... 3

Class vs Other Social Stratifications: .......................................................................................... 6

Theories of Class: ........................................................................................................................ 7

Karl Marx’s Class Analysis: .................................................................................................... 7

Max Weber’s Class Analysis: .................................................................................................. 9

From Class to Power: ................................................................................................................ 11

Power: ........................................................................................................................................... 11

Various aspects of Power: ......................................................................................................... 13

How Class and Power influence the Institutional Economics: ..................................................... 17

Conclusion: ................................................................................................................................... 18

References: .................................................................................................................................... 19

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Abstract The paper discusses on the core social stratifications and the power theories of

social sciences in the context of institutional economics. The discussion begins

with the various social stratifications in the ancient times and their decays over

the advancement of the societies. The newly formed class systems are depended

chiefly on the economic circumstances. As most of the countries of the world is

following the capitalistic economy, the class theory of Karl Marx and Max Weber

have gained importance in the paper. Class struggle theory of Marx and later more

advanced discussion and elaboration by Weber has given significant standing in

the paper. Other theorists as Eric Olin Wright and John Goldthrope’s theories

have also mentioned to understand the inner class differences. The power

theories have followed the path of Weber’s arguments on power. Finally the

relationship of class stratification and power with institutional economics has

been given with an example from Bangladesh.

Key Words: Stratification, Clsass Struggle, Class Schema, Power, Institutions

Introduction: Class differentiation and power exercise are the two things we experience in our everyday life.

The two concepts represent theories about how a modern society works, and there are some

fundamental relationships between them. But at bottom they are separate social factors that allow

for independent forms of social causation. The first is fundamentally concerned with the

economic structure of a society, the systems through which wealth is created and distributed, and

the second is concerned with the expressions of politics within a society. Both class and power

can be placed into the dichotomies of structure and agency. The class system sets some of the

parameters of "structure" within which individuals act, but it also creates some of the

motivations and features of consciousness that constitute the agency of class actors. The forms of

power present in a given society define some of the features of agency on the basis of which

individuals and groups pursue their goals; but it is also fair to say that the institutions and social

relations that define social power are also a part of the structured environment of action that is

present in the social world. So both power and class are simultaneously features of structure and

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agency within a complex society; and the configurations created by class and power are causally

inter related without being isomorphic. A class system can be defined as a system for producing

social wealth in which productive resources and the results of production are unevenly divided

across different groups. The producing class is "exploited" by the ascendant class: wealth is

transferred from producers to owners. Serfs and lords, slaves and masters, workers and owners

represent the primary classes of feudalism, ancient slavery, and nineteenth century capitalism.

Within any society there are groups that fall outside the primary classes -- small traders, artisans,

small farmers, intellectuals. But it is central to Marx's theory of class, that there is a primary

cleavage between owners of the means of production and the direct producers, and that this

cleavage embodies a fundamental conflict of interest between the two groups.

"Power" is a compound social characteristic in virtue of which an individual or group is able to

compel the actions or inactions of other individuals or groups against their will or contrary to

their interests, needs, and desires. Power derives from the ability to impose coercion --

truncheons, prisons, and punishment; and it derives from the ability of some agents within

society to set the agenda for future action. Power is needed to get 1.5 million people to leave

their homes in Beijing to make way for Olympics developments. Power is needed to prevent

striking miners from shutting down La Paz. Power is needed to protect the glittering shop

windows of Johannesburg from disaffected young people. Power is exercised by states -- through

military and police, through agencies and bureaucracies, through legislation; it is exercised by

corporations and other large private organizations; and it is exercised by social movements and

other groups within society. The two social factors are intertwined in at least three ways:

First, a class system constitutes a set of social inequalities within which there are deep conflicts

of interest.

So a class system sets the stage for the exercise of power; various groups have an interest in

wielding power over others within a class system. Ascendant groups have an interest in

sustaining the productive economic activities of subordinates whom they exploit, and they have

an interest in squelching acts of resistance. But likewise, subordinate groups have an interest in

using instruments of power to reduce or overturn the exploitative social relations within which

they function. Second, a class system assigns resources and positions to different groups and

individuals that greatly influence the nature and weight of the instruments and tactics of power

available to them. Owners have economic assets, alliances, and the state in their column.

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Producers have their numbers and their key locations in the economic process. A strike of rail

workers is a substantial exercise of power, given the centrality of transport in a complex

economy. So the particulars of a class system provide key determinants of the distribution of

power within society. Third, a class system also creates a subjectivity of power, powerlessness,

and resistance that may iterate into new forms of the exercise of power. It may be an effective

instrument of social control to cultivate a subjectivity of powerlessness in subordinate groups.

And likewise, it may be materially empowering to subordinate groups to cultivate a culture of

resistance -- by making collective action and solidarity more attainable, for example.

These are several ways in which facts about class and power intertwine. But power is wielded for

non-economic purposes as well - affecting the will of the state, achieving ethnic domination, and

influencing culture, for example. So it would be incorrect to imagine that power is simply the

cutting edge of class conflict.

Class:

Many discussions of the concept of class confuse the terminological problem of how the word

class is used within social theory with theoretical disputes about the proper definition and

elaboration of the concept of class. While all uses of the word class in social theory invoke in

one way or another the problem of understanding systems of economic inequality, different uses

of the word are imbedded in very different theoretical agendas involving different kinds of

questions and thus different sorts of concepts. One way of sorting out these alternative meanings

is to examine what might be termed the anchoring questions within different agendas of class

analysis. These are the questions that define the theoretical work the concept of class attempts to

do. Five such anchoring questions in which the word “class” figures centrally in the answers are

particularly important. First, the word “class” sometimes figures in the answer to the question:

“How do people, individually and collectively, locate themselves and others within asocial

structure of inequality?” Class is one of the possible answers to this question. In this case the

concept would be defined something like this: “Classes are social categories sharing

subjectively-salient attributes used by people to rank those categories within a system of

economic stratification”. With this definition of class, the actual content of these evaluative

attributes will vary considerably across time and place. In some contexts, class-as-subjective

classification will revolve around life styles, in others around occupations, and in still others

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around income levels. Sometimes the economic content of the subjective classification system is

quite direct – as in income levels; in other contexts, it is more indirect, as in expressions such as

“the respectable classes”, the “dangerous classes”. The number of classes will also vary

contextually depending upon how the actors in a social situation themselves define class

distinctions. Class is not defined by a set of objective properties of a person’s social situation, but

by the shared subjective understandings of people about rankings within social inequality. Class,

in this sense of the word, would be contrasted to other forms of salient evaluation – religion,

ethnicity, gender, occupation, etc. – which may have economic dimensions but which are not

centrally defined in economic terms.

Second, class is often central to the question, “How are people objectively located in

distributions of material inequality.” In this case, class is defined in terms of material standards

of living, usually indexed by income or, possibly, wealth. Class, in this agenda, is a gradational

concept; the standard image is of rungs on a ladder, and the names for locations are accordingly

such things as upper class, upper middle class, middle class, lower middle class, lower class,

under class.

This is the concept of class that figures most prominently in popular discourse, at least in

countries like the United States without a strong working-class political tradition. When

American politicians call for “middle class tax cuts” what they characteristically mean is tax cuts

for people in the middle of the income distribution. Subjective aspects of the location of people

within systems of stratification may still be important in sociological investigations using this

concept of class, but the word class itself is being used to capture objective properties of

economic inequality, not simply the subjective classifications. Class, in this context, is contrasted

with other ways that people are objectively located within social structures, for example, by their

citizenship status, their power, or their subjection to institutionalized forms of ascriptive

discrimination.

Third, class may be offered as part of the answer to the question: “What explains inequalities in

economically-defined life chances and material standards of living of individuals and families?”

This is a more complex and demanding question than the first two, for here the issue is not

simply descriptively locating people within some kind of system of stratification –either

subjectively or objectively – but identifying certain causal mechanisms that help determine

salient features of that system. When class is used to explain inequality, typically, the concept is

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not defined primarily by subjectively salient attributes of a social location but rather by the

relationship of people to income generating resources or assets of various sorts. Class thus

becomes a relational, rather than simply gradational concept. This concept of class is

characteristic of both the Weberian and Marxist traditions of social theory. Class, in this usage, is

contrasted to the many other determinants of a person’s life chances – for example, geographical

location, forms of discrimination anchored in ascriptive characteristics like race or gender, or

genetic endowments. Location, discrimination, and genetic endowments may, of course, still

figure in the analysis of class – they may, for example, play an important role in explaining why

different sorts of people end up in different classes – but the definition of class as such centers

how people are linked to those income-generating assets.

Finally, class plays a central role in answering the question, “What sorts of transformations are

needed to eliminate economic oppression and exploitation within capitalist societies?” This is the

most contentious question for it implies not simply an explanatory agenda about the mechanisms

that generate economic inequalities, but a normative judgment about those inequalities – they are

forms of oppression and exploitation – and a normative vision of the transformation of those

inequalities. This is the distinctively Marxist question and it suggests a concept of class laden

with normative content. It supports a concept of class which is not simply defined in terms of the

social relations to economic resources, but which also figures centrally in a political project of

emancipatory social change.

So we can define class as a large scale grouping of people who share common economic

resources which strongly influence the type of life style they are able to lead (Giddens, 2006).

Ownership of wealth, together with occupation, are the chief bases of class differences. Classes

differ from other forms of stratification in four main aspects.

1. Class systems are fluid. Unlike other types of strata, classes are not established by legal

or religious provisions. The boundaries between classes are never cut. There are no

formal restrictions on intermarriage between people from different class.

2. Class positions are in some part achieved. An individual’s class is not simply given by

birth, as is the case in the other types of stratification systems. Social mobility – moving

upward and downward in the class structure – is more common than in the others.

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3. Class is economically based. Classes depend on economic between groups of individuals

– inequalities in the possession of material resources. In the other types of stratification

systems, non-economic factors are generally most important.

4. Class systems are large scale and impersonal. In the other types of stratification systems,

inequalities are expressed primarily in personal relationships of duty or obligation –

between slave and master or lower – and higher caste individuals. Class systems, by

contrast, operate mainly through large scale, impersonal associations. For instances, one

major basis of class differences is in inequalities of pay and working conditions.

Class vs Other Social Stratifications:

In the history of mankind, class system is comparatively new in terms of other social

stratifications. In ancient times, there were various other systems that made the people bound in

that particular strata’s and they could never get out of those strata’s. They were destined to stay

in those systems from their birth till death. Those systems are slavery, caste and estates (Giddens,

2006)..

Slavery: Slavery is an extreme form of inequality, in which certain people are owned as property

by others. The legal conditions of slavery ownership have varied considerably in different

societies. Sometimes slaves were deprived of almost all rights by law – as was the case on the

southern plantation in the United States – while in other societies, their positions was more akin

to that or servants. For example, in the ancient Greek city-state Athens, some slaves occupied

positions of great responsibility. They were excluded from the military and political positions,

but were accepted in most other types of occupations. Some were literate and worked as

government administrators; many were trained in craft skills. Not all slaves could count on such

good luck. For the less fortunate, their days began and ended in hard labor in the mines.

Caste: A caste system is a social system in which one’s social status is given for life. In caste

societies, different social levels are closed so that all individuals must remain at the social level

of their birth throughout life. Everyone’s social status is based on personal characteristics – such

as perceived race or ethnicity or color of skin, parental religion or parental castes – that are

accidents of birth and are therefore believed to be unchangeable. A person born into a caste and

remain there for life. In a sense, caste societies can be seen as a special type class society – in

which class position is ascribed at birth. Caste societies have typically been found in agricultural

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societies which are not yet developed as industrial capitalist economies, such as India and South

Africa, prior to its end of white rule in 1992. In few centuries back, caste system were found in

throughout the world. In Europe, Jews were treated as separate caste and forced to live in

restricted areas and barred from inter-marrying with non-Jews. In caste systems, intimate contact

with members of other castes is strongly discouraged. Such “purity” of caste is often maintained

by rules of endogamy, marriage within one’s social group as required by custom or law.

Estates: Estates were part of European feudalism, but also existed in many other traditional

civilizations. The feudal estates consisted of strata with differing obligations and rights towards

each other, some of these differences being established in law. In Europe, the highest form of

estate was composed of the aristocracy and gentry. The clergy formed another estate, having

lower status but possessing various privileges. Those in what came to be called the “third estate”

were the commoners – serfs free peasants, merchants and artisans. In contrast with caste, a

certain degree of intermarriage and mobility was tolerated between estates. The estate system is

still found in most of the European countries which were run by monarchs of their own.

These three types of stratifications are different from the social class system. There are some

evidences that globalization will hasten the end of legally sanctioned caste systems throughout

the world. Most official caste systems have already given way to class based ones in industrialist

societies. Modern economy requires free movement of people, work at whatever jobs they are

able to do, and change jobs frequently according to economic conditions.

Theories of Class:

The theories developed by Karl Marx and Max Weber form the basis of most sociological

analysis of class and stratification. Scholars working in the Marxist tradition have further

developed the ideas Marx himself set out; others have tried to elaborate Weber’s concepts.

Karl Marx’s Class Analysis: According to Marx, the relationship between classes is an

exploitative one. In feudal societies, exploitation often took the form of the transfer of produce

from the peasantry to aristocracy (Weber, 1978). For Marx, a class is a group of people who

stand in a common relationship to the means of production – the means by which they gain a

livelihood. Before the rise of modern industry, the means of production consisted primarily of

land and the instruments used to tend crops or pastoral animals. In pre-industrial societies;

therefore, the two main classes consisted of those who owned the land and those actively

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engaged in producing from it. In modern industrial societies, factories, offices, machinery and

wealth or capital needed to buy them have become more important (Weber, 1978). The two main

classes consists of those who own these new means of production – industrialists or capitalists –

and those who earn their living by selling their labor to them – the working class or in the

somewhat archaic term Marx sometimes favored, the proletariat.

Figure 1: Basic casual structure of Marx’s Class Analysis

Whether in work, politics, or culture, an essential defining characteristic of each class is its

antagonism in this same sphere to others. For the capitalists, this can be seen in their

hostile relations to the workers and the landowners at the point of production, in their

political struggle to promote their interests at the expense of these classes, and in the

cultural sideswipes they are forever directing against them (Weber, 1978). Of the

bourgeoisie, Marx says, "The separate individuals form a class in so far as they have to

carry on a common battle against another class: otherwise they are on hostile terms with

each other as competitors." This common battle is fought on as many fronts as there are

criteria for constituting a class. On each front, it is the fact of battle itself which earns

each side its label. Hence, Marx calls a society where only one class exists, such as

occurs after the proletarian revolution, a classless society. With- out an enemy, the

antagonistic nature of the proletariat disappears and with it the designation "class." (Weber,

1978)

Assertion that there were two great classes – the owners of the means of production (capitalists)

and the workers – the only thing that the workers owned was their ability to work, what Marx

called “labor power.” Because owners (capitalists) paid wages to workers and could for the most

part determine that wage, owners had power over workers. Marx felt that the lack of power of

workers was the source of exploitation and the basis of class conflict. Marx argued that owners

Relationship to

Economic

Market capacity in

instrumentally

rational exchange

Differential control

over income (life

chances)

Location within

production relations of

domination and

subordination

Differential control

over labor effort

(exploitation)

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and workers developed ideas, understandings about their positions and this Marx called class

consciousness (Weber, 1978). When owners convinced workers that their situations were

compatible – Marx called this false consciousness. Although Marx talked mainly about the two

great classes – owners and workers – he was aware as well of a third category which he called

petit bourgeoisie – literally little middleclass and these were owners of own small businesses.

Finding a location for this group was difficult because they lacked the power if the owners and at

the same time had control over their work and wages unlike the workers. Moreover, according to

Marx, sometimes they identified with the owners and sometimes with the workers.

Max Weber’s Class Analysis: Weber’s approach to stratification was built on the analysis

developed by Marx, Weber modified and elaborated it. Like Marx, Weber regarded society as

characterized by conflicts over power and resources (Weber, 1978). Yet where Marx saw

polarized class relations and economic issues at the heart of all social conflicts, Weber developed

a more complex, multidimensional view of society. Social stratification is not simply a matter of

class, according to Weber, but is shaped by two further aspects: status and party. These three

overlapping elements of stratification produce an enormous number of possible positions within

society, rather than the more rigid bipolar model which Marx proposed (Weber, 1978).

Although Weber accepted Marx’s view that class is founded on objectively given economic

conditions, he saw greater variety of economic factors as important in class formation than were

recognized by Marx. According to Weber, class divisions derive not only from control or lack of

control of the means of production, but from economic differences which have nothing to do

with property (Weber, 1978). Such resources include especially the skills and credentials or

qualifications, which affect the types of job people are able to obtain. Weber believed that an

individual’s market position strongly influences his or her overall life chances. Those in

managerial or professional occupations earn more and have more favorable conditions of work

(Weber, 1978).

Status in Weber’s theory refers to differences between social groups in the social honor or

prestige they are accorded by others. In traditional societies, status was often determined on the

basis of first-hand knowledge of a person gained through multiple interactions in different

contexts over a period of years (Weber, 1978). While Marx argued that status distinctions are the

result of class divisions in society, Weber argued that status often varies independently of class

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divisions. Possession of wealth normally tends to confer high status, but there are many

exceptions.

Figure 2: Basic casual structure of Weber’s Class Analysis

In modern societies, Weber pointed out party formation is an important aspect of power, and can

influence stratification independently of class and status (Weber, 1978). Party defines a group of

individuals who work together because they have common backgrounds, aims or interests. Often

a party works in an organized fashion towards a specific goal which is in the interest of the party

membership. Marx tends to explain both status differences party organizations in terms of class.

Weber’s writings on stratification are important, because they show that other dimensions of

stratification besides class strongly influence people’s lives. While Marx tried to reduce social

stratification to class divisions alone, Weber drew attention to the complex interplay of class,

status and party as separate aspects of social stratification creating a more flexible basis for

analyzing stratification than that provided by Marx.

Erik Olin Wright produced class schemata, in attempts to retain a Marxist approach to class

analysis (wright, 1979). In Wright’s first schema he states that in capitalism simple production

exists alongside the capitalist mode of production. Both of these classes can be broken down into

six classes that make up Wright’s first schema. The supervisors and managers are in a

contradictory class because they dominate over the proletariat and yet they are still dominated by

the bourgeoisie (wright, 1979). The small employers are both petty bourgeois and bourgeois; and

the semi-autonomous employees while they do not own the means of production, they benefit

from having more autonomy over their work than the normal proletariat (wright, 1979). These

classes are based upon exploitation and domination. In the second schemata exploitation has

three dimensions: ownership of the means of production, ownership of organization assets that

permit control and coordination of technical processes of production, and ownership of skills or

credentials (wright, 1979).

Relationship to

Economic Assets

Market capacity in

instrumentally

rational exchange

Differential control

over income (life

chances)

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John Goldthorpe's class schema is to differentiate positions within labor markets and production

units, or more specifically to differentiate such positions in terms of the employment relations

that they entail (Goldthrope, 1980). Goldthorpe’s schema distinguishes the employers, the self-

employed, and employees. Within the group of employees eleven classes are defined on the basis

of the employment relationship they enjoy. The aim of the schema is to group occupational

title/employment relations, and the employment relationships joined by given combinations may

differ cross-nationally.

From Class to Power:

From the previous discussions, it is understood that class and social stratifications create

different hierarchies in the society. In those hierarchies, people will obey the words and the

orders which may come from his/her upper level positions. The sense of following orders will

create power over the people. Wealth, prestige and political parties are creating the power

exercising authority among the classes. Economic difference, honor and political level will

generate such authority in the society.

Power:

Modern thinking about power begins in the writings of Nicollò Machiavelli (The Prince, early

16th century) and Thomas Hobbes (Leviathan, mid-17th century). Their books are considered

classics of political writing, and the contrast between them represents the two main routes along

which thought about power has continued to this day (Clegg, 1989). Machiavelli represents the

strategic and decentralized thinking about power and organization. He sees power as a means,

not a resource, and seeks strategic advantages, such as military ones, between his prince and

others.

Hobbes represents the causal thinking about power as hegemony. Power, in Hobbes, is

centralized and focused on sovereignty. According to Hobbes’ basic premise, there exists a total

political community, the embodiment of which is the state, or the community, or the society.

This is a single unit, ordered according to a uniform principle, possessing a continuity of time

and place, from which the power stems. According to Machiavelli, total power is a desirable

final end, which is achieved only rarely. In the mid-twentieth century it appeared that Hobbes’

view was triumphant. His language and his images, written more than a century after the

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publication of The Prince, were more appropriate to the modern scientific approach than

Machiavelli’s military images. The central tradition of research in the social sciences sought

precision and logic (and is still seeking them today), and it asks how one can observe, measure,

and quantify power. Power was presented as a position of will, as a supreme factor to which the

wills of others are subject. In the seventies, Machiavelli’s strategic and contingent approach

attained to a renewed appreciation in France, with the crystallization of approaches that

rediscovered the unpredictable character of the power game, and its profound dependence on

context (Clegg, 1989).

After the Second World War, the social sciences began taking an understandable interest in

power. At that time, the work of Max Weber (1947) served as a point of departure for thought

about power because it continued the rational Hobbesian line and developed organizational

thinking. Weber’s approach to power connected with his interest in bureaucracy, and linked

power with concepts of authority and rule. He defined power as the probability that an actor

within a social relationship would be in a position to carry out his will despite resistance to it.

The activation of power is dependent on a person’s will, even in opposition to someone else’s.

Weber was interested in power as a factor of domination, based on economic or authoritarian

interests. He historically researched the sources of the formal authority that activates legitimate

power, and identified three sources of legitimation, or accordance of social permission, for the

activation of power: the charismatic, the traditional, and the rational-legal. Theories of power

after Weber developed in the direction of investigation of illegitimate power, as this grows

within the formal and legitimate frameworks of hierarchic and bureaucratic power, and in the

direction of the critique of Weber’s bureaucratic model (Merton, 1957). The critique of Weber

stemmed, unjustly, from an understanding of his theory as an idealization of the bureaucratic

organization. The truth is that Weber saw the organizational power of the bureaucracy as the

source of the mechanization and routinization of human life, and as a threat to the freedom of the

human spirit. He also predicted that this organizational form, as a power instrument, would

sabotage the appearance of more democratic forms of organization (Morgan, 1986, 1997).

The writings of Michel Foucault (Foucault, 1979, 1980, 1996) extended the discussion of the

concept of power from sociology to all the fields of the social sciences and the humanities.

Through Foucault’s influence, the empirical activity of identifying those who possess power and

of locating power loses its importance. His approach systematically rejects the belief in the

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existence of an ordered and regulating rational agency. In Foucault’s world there is no source

from which actions stem, only an infinite series of practices. Decentralization of the position of

power is one of the great innovations of his thinking.

Anthony Giddens (Giddens, 1982, 1984) developed his approach as a continuation – and also as

a critique – of Foucault and his predecessors. He constructed an inclusive social theory which he

called structuration or duality of structure. On his view, power is an important, if not exclusive,

component of the social structure. Power is exercised by human agents and is also created by

them, influences them, and limits them. In other words, power is not a quality or a resource of

people, or a position in the social structure, but a social factor which influences both these

components of human society and is also created by them.

Various aspects of Power:

Weber developed a multidimensional approach to Social stratification that reflects the interplay

among wealth, prestige and power. “Weber argued that power can take a variety of forms. A

person’s power can be shown in the social order through their status, in the economic order

through their class, and in the political order through their party. Thus, class, status and party are

each aspects of the distribution of power within a community.” Class, Status and Party have a

great deal of effect not only within their individual areas but also have a great deal of influence

over the other areas as well.

Wealth: includes property such as buildings, lands, farms, houses, factories and as well as

other assets - Economic Situation

Prestige: the respect with which a person or status position is regarded by others - Status

Situation

Power: the ability of people or groups to achieve their goals despite opposition from

others - Parties

According to Weber, there are two basic dimensions of power: The possession of power and the

exercising of power.

The Possession of Power: According to Weber, the ability to possess power derives from the

individual's ability to control various "social resources." “The mode of distribution gives to the

propertied a monopoly on the possibility of transferring property from the sphere of use as

“wealth” to the sphere of “capital,” that is, it gives them the entrepreneurial function and all

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chances to share directly or indirectly in returns on capital.” (Lemert, 116) These resources can

be anything and everything and might include things like land, capital, social respect, physical

strength, and intellectual knowledge.

The Exercising of Power: The ability to exercise power takes a number of different forms, but all

involve the idea that it means the ability to get your own way with others, regardless of their

ability to resist you. “For example, if we think about an individual’s chances of realizing their

own will against someone else, it is reasonable to believe that the person’s social prestige, class

position, and membership in a political group will have an effect on these chances.” (Hurst, 202)

In terms of understanding the relationship between power and social stratification, Weber

theorized the various ways in which societies are organized in hierarchical systems of

domination and subordination using the several major concepts.

Class Power: “Class, at its core, is an economic concept; it is the position of individuals in the

market that determines their class position. And it is how one is situated in the marketplace that

directly affects one’s life chances.” (Hurst, 203) This was theorized by Weber on the basis of

"unequal access to material resources." For example, if someone possesses something that you

want or need then this makes him potentially more powerful than you. He is in a dominant

position and you are in a subordinate position because he controls access to a desired social

resource. A classic illustration here is the relationship between an employer and employee.

Social Power (Status): “The existence of status groups most often shows itself in the form of

1. Endogamy or the restricted pattern of social intercourse,

2. Sharing of food and other benefits within groups,

3. Status conventions or traditions, and

4. Monopolistic acquisition of certain economic opportunities or the avoidance of certain

kinds of acquisitions. (Hurst, 204)

If you respect someone or view him as your social superior, then he will potentially be able to

exercise power over you (since you will respond positively to his instructions / commands). In

this respect, social status is a social resource simply because he may have it while you may not.

“Not all power however entails social honor: The Typical American Boss, as well as the typical

big speculator, deliberately relinquishes social honor. Quite generally, “mere economic” power,

and especially “naked” money power, is by no means a recognized basis or social honor”

(Lemert, 116). The word "Status" is sometimes left untranslated in Weber (2010), and kept in the

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German word Stand, which reflects the origins of this concept in medieval guilds, professions,

ethnic identities, and feudal classifications (Waters and Waters 2010).

Political Power (Party): Parties are associations that aim at securing “power within an

organization [or the state] for its leaders in order to attain ideal or material advantages for its

active members.” (Hurst, 206) This form of power can be related to the way in which the State is

organized in modern social systems (involving the ability to make laws, for example). If you can

influence this process of law creation then you will be in a potentially powerful position. Thus,

by your ability to influence a decision-making process you possess power, even though you may

not directly exercise that power personally. Political parties are the organizational means to

possess power through the mechanism of the State and they include not just formally organized

parties, but any group that is organized to influence the way in which power is exercised

legitimately through the machinery of the State. “Since parties aim at such goals as getting their

programs developed or accepted and getting positions of influence within organizations, it is

clear that they operate only within a rational order within which these goals are possible to attain

and only when there is a struggle for power” (Hurst 206)

Social Action: Social action is in direct relation to “Political or Party Power” in combination

with the class situation. The influence of laws is based on the social action of members of the

classes. “The direction of interests may vary according to whether or not social action of a larger

or smaller portion of those commonly affected by the class situation, or even an association

among them, e.g., a trade union, has grown out of the class situation, from which the individual

may expect promising results for himself.” (Lemert, 117) “The degree in which “social action”

and possibly associations emerge from the mass behavior of the members of a class is linked to

general cultural conditions, especially to those of an intellectual sort. It is also liked to the extent

of the contrasts that have already evolved.” (Lemert, 118) We can also see this in another quote

“Class-conscious action is most likely if, first, “the connection between the causes and

consequences of the ‘class situation’” are transparent, or clear. If individuals can plainly see that

there is a connection between the structure of the economic system and what happens to them in

terms of life chances, class action is more likely” (Hurst, 204) The greater the numbers within

these class positions will increase the chance that they will rise up in action.

Mobility: The greater the numbers within these class positions will increase the chance that they

will rise up in action. “It is noncontroversial that the class situation in which each individual

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finds himself represents a limitation on his scope, tends to keep him within the class. It acts as an

obstacle to any rise into a higher class, and as a pair of water wings with respect to the classes

below…Class type, relations with class fellows, power over outward resources adapted to the

class situation, and so on.” (Schumpeter, 163-164) In capitalist society movement between

classes is a possibility. Hence the use of the term “The American Dream” to show the ability of

people to ascend to a higher class through hard work and ingenuity. “Class composition is

forever changing, to the point where there may be a completely new set of families.”

(Schumpeter, 165) He saw four classes - the propertied class, non-propertied class, petit

bourgeoisie and the manual laborer class.

Foucault developed what he called a ‘capillary’ model of power in which he attempted to

understand the ‘relations of power’ by looking at struggle and resistance. In contrast to the

Marxist conception of power, which is based upon the idea that the economic power of class is

the only significant factor to be analyzed and discussed. Foucault argued that there are a number

of important struggles that are independent of class relations: those over gender, sexuality,

madness, criminality and medicine, to name but a few. Foucault suggests that these struggles

share a number of characteristics:

• They are transversal; in other words, these struggles are not limited to any one place or

any one class – such as the struggle for gay rights

• They are concerned with resisting the effects of power on bodies or lives – as we find in

the holistic medical movement

• They are concerned with resisting the role of government in individual self-formation

• They are concerned with opening up and making clear how power is used in a secret

way to change people – as in the case of the militia movement in the USA

• They are concerned with the politics of self-definition and self-formation – as in the

women’s movement

• They are concerned with resisting the imposition of external standards of taste and

decency – as in the case of the Internet

• These political struggles are local and personal in nature – as in the case of road

protesters

There are a number of common themes running through Foucault’s work. His central concern

was with how human beings are made into subjects within the modern world. What Foucault

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means by this is he is concerned with how individual people become both citizens of a state and

the effect that this has on them as people.

How Class and Power influence the Institutional Economics:

In every society, there are many institutions working and influencing both the society and

economic behavior. Persuasion of social institutions through class relation and power

authorization can create imbalance in the society. The conditional influence can change the

behavior of economic relations in the society. Thus the corruption may have its entrée into the

society which will create imbalances in the demand and supply process of the society. Most of

the economies are now run by the capitalistic economy. As Marx were mentioned the class

struggle in the industrial capitalistic economy, the influences will change the society’s interests

to an individual’s interests. Thus the harm in a society will take place. Weber, Wright’s

extensions of Marx theory of class struggle are just to finding out the inner layers of the classes

in them. Informal relationships among various classes can create imbalances in the society.

As example, the recent worker unrest in the readymade garment (RMG) sector in Bangladesh is

showing us the true nature of class struggle. Bangladesh is considered now the second largest

RMG industry hub in the world because of the low wage rate of the workers and the RMG sector

is totally labor intensive. The evolution of RMG sector in Bangladesh has created the

opportunities for the unemployed rural women workers. It accessed them to engage in a well-

known work force and earn for their better livelihood which is also adding them in GDP. It has

been observed that for many years, the wage rate of the garment workers were very low because

there is plenty of supply in the labor force. So there are always ready workers on the gate of any

industry. The owners of the industries took this chance to profit maximize in intense level. Many

of the owners are involved in party politics which also gave them to exploit the workers by their

time and wages. Now a day the minimum wage of the RMG workers is less than any other jobs

in Bangladesh. The inflation rate in now higher than any time and thus the cost of living is

getting higher. The wage rate of the workers was not revised with the market conditions. The

benefits of any accident in the workplace are not given importance to them. The political turmoil

in the country by the party politicians is also causing unrest to the RMG sector. The power of

those labor workers is influenced by the world communities. As a result, the prime minister of

Bangladesh was involved in the discussion and bound the factory owners to increase the wage

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rate of the workers. This example is showing the both class struggle and power influences in the

economy by the low level of working class people.

Conclusion:

The approaches to class analysis rests on the construction of a schema based on principles that

capture the major dimensions of positional differentiation in labor markets and production units

that are important for the distribution of life chances. The chosen principle is the theoretical

basis, and the corresponding class schema is its operationalization. Given this at least two

important lines of empirical inquiry can be pursued. On the one hand, we might want to know

how substantively important class is in explaining variation in life chances, particularly in

comparison with other bases of social inequality such as ethnic group membership, gender, and

so on. And of course such an inquiry can be extended to make comparisons in the strength of

class effects between countries and through time. On the other hand, the existence and strength

of the relationship between class and other outcomes are also matters for empirical investigation.

But if the classes are meant to capture distinctions that are primarily relevant for the distribution

of life chances, then members of a class may or may not behave similarly, hold similar attitudes,

or engage in collective action, and so on. In as much as variation in these or other outcomes can

be causally traced to variation in life chances, or insofar as those aspects of the organization of

labor markets and the production process that shape life chances are also determinants of these

other outcomes, then we will find a relationship between them and class. Very often the causal

link between life chances and an outcome like collective action will be contingent on other

circumstances and then, as Weber recognized, there may or may not be a relationship with class.

But in many other cases, there will be a consistent link between life chances and other outcomes.

To revert to a point if life chances determine the conditions under which certain types of action

are undertaken –including the interests that people have (and which they may express in, say,

voting) and the resources they can bring to bear (and which may be important in, say, shaping

their children's educational attainment) –then variations in these actions will be structured

according to class position.

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