Karl Polanyi: The Limits of the Market (Key Contemporary Thinkers) [Paperback]

This book is a must for students of Karl Polanyi's work, but could also meet the needs of many other readers who are interested in political economy, economic history and anthropology. It is a recent addition to a series dealing with
the intellectual contributions of «contempory thinkers». Judging from the increasing number of books (not merely shorter academic publications) that refer to his work Karl Polany must be said to be relevant today.

Polanyi's appeal probably lies in his original analysis of the rise of the self-regulating market economy in the 1800s and its consequences for literally the fate of nations, (his main work, The Great Transformation, 1944), and in the concepts and theories he developed , some of them original, for example fictitious commodities, the double movement, disembedded vs. embedded economies and formal vs. substantive economics. Even the term 'self-regulating market economy' was original, though it's a good name for the 100 year old neoclassical economic model. It is also an alternative to the the word 'capitalism', which to my mind has become almost meaningless. Polanyi's substantive economics, based on an institutional analysis, provided what seemed to be a global theory, valid for pre-industrial and industrial societies alike. For an analysis of the 'liberal market economy' it offered an alternative to both liberal and marxist economic theory. It avoided the atomistic individualism of the first and the class analysis of the latter. Polanyi maintained that a 'market theorem', not a marxist 'class and exploitation theorem', is the best starting point; it was the introduction of the market system as society's central institution rather than the material consequences of the introduction of the machine per se that led to the formation of the industrial classes.

For me the strength of Gareth Dale's book lies in his excellent analysis of the intellectual background and sources for Polanyi's main thesis and theories, which he had developed in the 1920s and '30s and later refined. The first chapters describe and discuss this, including most of his central concepts. Chapter 4 deals with Polanyi's considerable contribution to economic anthropology, based on his post-war studies of primitive or archaic societies. The last chapters deal with two concepts, embeddedness (and the modern use and misuse of this term) and the double movement (in its present-day form, neoliberalism and its countermovement). Dale's presentation of Karl Polanyi's work, and the Central European institutionalist traditions (especially the influence of the German Historical School of Economics) which guided him, should be of interest for the current ideological debate on the future of the liberal economic system, especially on account of the genuine 'third viewpoint' on human economy that it provides.

The book's secondary aim is to give an exposition of Polanyi's main works, and this gets little priority in a book where the main focus is on Polanyi's intellectual legacy. Fair enough. But I feel that his main work, which gets a whole chapter, deserves a more balanced presentation. Here the main criticisms from both marxists and formalists against the book are presented, with scarce mention of counter arguments or cross-references to those mentioned later. Polanyi himself said his book was to be «a very straightforward, simple story, easy to read and mainly historical in character». It also contains Polanyi's most complete 'substantive' analysis of any country's development (England's), and it clearly shows that he was not indifferent to dominance and exploitation - which he was frequently criticised for.

There are also a number of 'marxist' criticisms of Polanyi's thesis that seem unjustified, for example several based on the idea that Polanyi's 'countermovement' was meant to protect specifically the working classes. Polanyi makes it clear that members of any class could act to protect themselves.

But these are minor reservations, the book has much to offer. It provides the first really comprehensive overview of Karl Polanyi's work. Dale has had access to the entire archives of Polanyi's texts, lecture notes and correspondence, and this is evident, also in the 60 odd pages of notes, bibliography and references. I personally welcome the lack of footnotes on every page, and found the book easy to read and find my way about in.