Lecture 4 - 1/31/08 The Institutionalist Challenge to the...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
1/31/08 The Institutionalist Challenge to the Free Market Understanding of the Market Economy 1. The market economy is different from discrete markets it is a total effort to remake the society 2. The market economy is a complex array of institutions, authority relations, customs, social ties, and legal arrangements 3. The idea of self-regulation is at its core unrealistic economies are ALWAYS regulated. The problem is how and by whom. Questions How do you go about fighting a war o Do you force the people to go against their will to fund it o Do you just let it go and let the military disintegrate How does this fit into the economic system When it comes to the issues of national defense (or other similar issues) somehow the bottom line is not about affordability o There are many important issues that we pretend are issues of the market National defense Social justice Often times the logic of the market would lead you to a lack of solution to these problems o Logic of the market superseded by other logic Logic of the market The struggle between the institutionalist understanding of the market econ and the free market understanding is that the instituionalists understand the recognize the existence of the clashes between these two logics Come up with ad hoc justification to set aside the need of the market for other purposes when necessary Gov can justify whatever it is doing by making reference to econ
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Free market understanding of market econ Social embeddedness of the market economy No society is a pure market society and to assume that it could ever be is unrealistic Market oriented/based behavior coexists with clear non-market behaviors o Friendship o Family Relationship btwn friends and family is not a market relationship Firms important non market institutions o Relationships between agents in firms are organized by hierarchy o Perhaps market between firms but not within The private property is not something natural o Needs gov to protect property rights and so on implications (question 2) Self regulation is a myth economies are always regulated (how and by whom?) The market economy is qualitatively different from a collection of discrete market and it’s birth constitutes a revolutionary break from the way old economies were organize Polanyi focuses on this break Polanyi He claims we misunderstand the market economy Why do people work? What is the purpose of labor? o
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/02/2008 for the course PEIS 101 taught by Professor Kil during the Spring '08 term at University of California, Berkeley.

Page1 / 8

Lecture 4 - 1/31/08 The Institutionalist Challenge to the...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online