ABSTRACT
The essence of the capitalist economy is labor exchange. This chapter explores abstractions, divisions, and disciplinary structures of the economy, aspects using the method of historical institutionalism to make that case regarding the core of the capitalist economy. The term abstraction is used in logic and science. Abstraction is part of the scientific method of induction, whereby the observation of a wide variety of concrete facts leads one to formulate a generalization that fits the empirical observations. Money represents the entirety of the economy. At times, however, there is a problematic of representation when there is some question about the accuracy or validity of this representation. Capitalism is essentially a labor exchange model. The capitalist system is prone to divisions, in part due to the limits of the working day. Although individual private property is a founding principle of the liberal state, the financial circuits encompass both public and private property in an integrated whole.
