Henri Lefebvre

Lefebvre’s accomplishments can be viewed as encompassing four major areas:

1. He went back to the work of Marx and Engels and showed how it was possible to use economic categories such as capital investment, profit, rent, wages, class exploitation, and uneven development in the analysis of the city. Thus he argued that the city development process was as much a product of the capitalist system as anything else.

2. For Lefebvre social activities are not only about interaction among individuals but about space as well. Social activities take place in space. The city building process creates certain space. Places produced by similar social systems tend to resemble each other, such as the close resemblance of suburbias in California or Australia will resemble each other.

3. Lefebvre had shown that Karl Marx’s work on the city was limited and he introduced the concept of circuits of capital pointing out that real estate is a separate circuit of capital.

   The buying and selling of land, whether it is developed or not, is a major force in the production of space. Capitalism is not only what happens inside the industries but it extends its relations of profit-making to the ownership of land and its market turned that asset into ‘real estate’. Agricultural land’s value depends on how fruitful the location is for the production of useful products. The value of urban land, in contrast, is entirely contained in its attributes of location. It has little intrinsic value, unlike farmland, except for its potential as a place where societal activities can occur. Consequently urban land acquires its value in part through society. Its worth depends on the collectivity. For example, it is possible to buy a piece of property within a city or suburb, just hold it while other pieces of property are developed, and then sell it at a higher price than bought without making any improvements at all. The greater price obtained is the product of collective societal activities in the adjacent area.
   
   In other words, the valuation depends on the collective action of others.

   The collective component of metropolitan real estate’s value is privately expropriated in a capitalist society. This is the basic contradiction of capitalism. Some of the value is recovered through taxation. Property taxes are one of the main sources through which the school system is maintained in capitalist societies. Real estate under capitalism is the most powerful factor influencing the shape of metropolitan regions.

4. The primary circuit of capital is production of commodity. For example, an investor of capital uses money for hiring of workers and the production process in the factory and then sells the goods in a market for profit. Much of the wealth created in capitalist society is of this type. But for Lefebvre there was a ‘second circuit of capital’ that is real estate investment. For example, the investor in land chooses a piece of property and buys it; the land is simply held on to or is developed into something else. It is then sold as housing project or real estate market.

   The circuit is completed when the investor takes the profit and reinvests it in more land-based projects. It was seen in the USA that investment in land was an important means for the acquisition of wealth. But at the same time, investment in real estate pushed the growth of the cities in specific ways.

5. Finally, Lefebvre discussed the role of government in space. The state uses space for social control. Government will place police stations and fire stations in such a way that they are always close to the people and respond to distress. The state controls a large amount of land and utilizes it in its administration of government. It dispenses resources and collects taxes according to spatial units. For example, the upper class areas will have civic amenities.