Polanyi in an Hourglass: The Two Lives of a Sociological Classic
Sabine Frerichs
This paper was published as:
2013. Polanyi in an Hourglass: The Two Lives of a Sociological Classic. In: Lange, Bettina; Tomas, Dania (eds): From Economy to Society? Perspectives on Transnational Risk Regulation (Studies in Law, Politics and Society, Vol. 62). Bingley: Emerald, pp. 25-47
For citation, please refer to the published version at:
Abstract
Purpose
This article aims to show that studies of transnational risk regulation can benefit from Polanyian and neo-Polanyian research agendas in the field of law, economy, and society. Risk regulation would then be understood as a corrective force within the market society.
Methodology/approach
Drawing on the relevant literature in the field, Karl Polanyi’s work is contextualized both in the past (“scholarship before and beside Polanyi”) and in the present (“scholarship after and beyond Polanyi”). The review considers developments within sociology, its neighbouring disciplines economics and jurisprudence, and the interdisciplinary research fields of “economy and society”, “law and society”, and “law and economy”.
Findings
The article demonstrates that Polanyi is a “late classic” who shares the holistic orientation of classical historical scholarship. At the same time, it is argued that his “early revival” is due to the topicality of his criticism of the market society, and its inherent risks, in an era of neo-liberalism and globalization.
Originality/value of paper
By going back and forth in time, the article situates Polanyi in a line of holistically minded scholarship that combines insights of general, economic, and legal sociology in what can be called the “economic sociology of law”. This is “old” and “new”, at the same time.
Keywords
Karl Polanyi, market society, classical sociology, contemporary sociology, economic sociology of law, general review
Structure
Introduction: Why Polanyi?
Setting the Framework
Contextualizing Polanyi’s Work in the Past
Scholarship Before Polanyi
Scholarship Beside Polanyi
Polanyi as “Old School”
Contextualizing Polanyi’s Work in the Present
Scholarship After Polanyi
Scholarship Beyond Polanyi
Conclusion: Society at Risk
Introduction: Why Polanyi?
Why engaging with Polanyi in a special issue on transnational risk regulation?Karl Polanyi(1886-1964), an economic historian and sociologist, can be understood as a theorist of risk regulation avant la lettre. In fact, his famous study “The Great Transformation” (1957 [1944]) isabout nothing less than howa policy of unrestricted economic liberalism puts society, as a whole, at risk, that is, how it destroys its very foundations. More specifically, it is about how this“systemicrisk”is produced, or instituted, by theso-called “fictitious commodities” ofland, labour and money (ibid., ch. 6). In a “market society”, all of these are subject to the price mechanism and, hence, follow thelogic of demand and supply. Sure enough, the creation of the “self-regulating market”which was, first of all, a chimera of economic thinking requires legal regulation (of subjects, objects, and means of exchange) as much as legal deregulation (in order to unleash the price mechanism). What resultsare unprecedented risks for the “substance” of economic life (Polanyi 2001 [1957]), that is, for its natural substrate, which is turned into “land”,for its social content, whichis turned into “labour”, and for capitalist production itself, which is subjected to“money capital”. The volatility of the“factor markets”for land, labour, and money affectsthe stability and viability of market society itself.
In Polanyi’s terms, risk regulation thus amounts to the“self-protection of society” against the destructive forces of the “self-regulating market” (1957 [1944], part II.2).While sweeping agendas of legal and economic deregulation have, in the first place, created these risks, substantive policies of environmental regulation, social regulation, and financial regulation act ascounter-forces to the commodification of economic life.What is new today, compared to Polanyi’s time, is the degree of economic integration and interdependence in the “globalized” market society. The free movement of goods and services, of capital and less so persons across national and regional borders ranks high on the (neo-) liberal agenda, and the resulting risksandremaining regulatory options have, more than ever, to be conceived from a transnational (or global) point of view.In this regard, it is worth mentioning that,other than the work of many of his contemporaries, Polanyi’s account is not biased by “methodological nationalism”. Instead, he started from the international political economy, that is, the larger institutional and ideological context, inwhich nation states and national economies themselvesare “embedded” (ibid., part I). Under conditions of Europeanization and globalization, this “holistic” point of view isgaining ever more importance (Frerichs, 2012a). For all these reasons, Polanyi’s work deserves a fresh look.
Setting the Framework
When Karl Polanyi completed, in a rush, “The Great Transformation” (1957 [1944]),he had much bigger worries than matching the works of the sociological classics. Published at the height of the Second World War, the book aims at explanations for the civilizational breakdown that people werewitnessing and experiencing at that time, andatcritical lessons for the future.One may think that Polanyi’s in-depth study of “nineteenth century civilization” and its ultimate “collapse” bears little relevance to readersin the twenty-first century who are preoccupied with the problems of the present. However,his storyof the “rise and fall of market economy”, which originally ends with World War II,has found its continuation in the“rise and fall of the social market economy”, as Wolfgang Streeck (2009)shows for post-war Germany. Whereas Polanyi’s focus wason the social transformationswhich were once brought about by modern capitalism, Streeck’s emphasis is on the more recent re-formation of capitalism in post-welfarist societies.In both cases, the key observation is the loss of protective social institutionsin the relentless play of the market forces. This is but one example of how Polanyi’s historical analysis, and diagnosis of his time (Zeitdiagnose), also informs present scholarship about still ongoing developments. In fact, it seems that in times of increasing global interdependencies and recurrentcrises, scholars across the social sciences seek, once again, inspiration from Polanyi’s work and, notably, his concept of “social embeddedness” (see, for example,Krippner et al., 2004;Rizza, 2006; Beckert, 2007; Krippner Alvarez, 2007; Gemici, 2008; Joerges Falke, 2011, Ashiagbor et al., 2013).
It is in the definition of a “true classic” – be it in the realm of fiction (Sainte-Beuve, 2001 [1850]) or academia that he or she engages not only his or her contemporaries but also speaks to the present.Against this background, one can identify two different ways to approach the work of a classic (Fine Kleinman, 1986): One may either study the original concerns of the author, and of his or her time, or one mayaddress present concernsthrough the eyes of the classic,by reframing the questions and refining the methodologyof the original.Both roads have been taken in recent scholarship onKarl Polanyi, a renowned classic, first and foremost, in the field of economic sociology.In her review of “neo-Polanyian” scholarship, Sally Randles (2003) can thus distinguish between “Polanyi-given” and “Polanyi-inspired” research designs (p. 409; original emphasis). The first category encompassesscholars who eithercontent themselves with a close reading of Polanyi’s workor“contextualize” it within the “author’s life and times”, thus furthering “a broader understanding of Polanyi’sconcerns and normative position” (ibid.). In contrast, scholars in thesecond group take Polanyi’s writings only as a starting point to develop their own views of contemporary society, which is increasingly perceived in terms of a globalizedmarket society. According to Randles, “[t]hey are inspired by the view that Polanyianinsights, worked out over a period of some 30 years of the 20th century, appearto provide such a high degree of relevance and application to problems facing the world today” (ibid., p. 410).
In the following,I want to explore the two lives that Polanyi developedas a sociological classic, one in the past and one in the present. More precisely, I will “contextualize” his work both within his own time and within the present time. Like in an hourglass whichruns both ways(and can thus, figuratively, “reverse” time), Polanyi’s work will, hence, be approached from two different ends: from his classical mentors and from his contemporary audience. In doing so, I want to highlight what Polanyi learnt, or inherited, from the sociological classics, and what his current “revival” also imports into the present debate. At the same time, certain ideas of our time can also be read into Polanyi’s writings, thus reinterpreting them from within. By locating Polanyi’s work in the middle of a timeline which encompasses both scholarship “before and beside Polanyi” and scholarship “after and beyond Polanyi”, I want to demonstrate continuities as well as discontinuities in the field of law, economy, and society. With his “holistic-historical” approach, Polanyi was still rooted in the legacy of the “founding fathers” of sociology namely, Karl Marx, Emile Durkheim, and Max Weber – who were often advancing general sociology, legal sociology, and economic sociology at the same time. Moreover, they were also prolific in some of the neighbouring disciplines (such as history, philosophy, economics, and jurisprudence). Compared to contemporary sociology, classical sociology was thus both more integrated across its different subfields and less insulated from the other social-scientific disciplines.As I will argue below, a Polanyian framework can,therefore, best be identified with some form of substantive and methodological “holism”.
Contextualizing Polanyi’s Work in the Past
The first step in my argumentation is to contextualize Polanyi’s work in the past. For the purposes of this article, I will equate “the past” with “scholarship beforeand besides Polanyi”, and “the present” with “scholarship after and beyond Polanyi”.In the same vein, Polanyi’s work can be taken as a reference point in order to distinguish between “classic” and “contemporary” scholarship. If we concentrate on Polanyi’s most famous work, “The Great Transformation” (1957 [1944]), this separating line actually coincides with the Second World War. This is, of course, no mere“coincidence”but has deeper historical reasons.As Polanyi’s ownlife and work demonstrates, the academic careers andresearch interestsof many promising scholars wereseriously affected by the dramatic events and developments that triggered or were triggered by the two world wars. The distinction between pre- and post-war scholarship is thus, by no means, arbitrary.In distinguishing, in the following, between scholarship “before” and “beside” Polanyi, I want to point to two different currents, or “generations”, of sociological thinking, including its equivalents in socio-legal and socio-economicthinking. These willbe referred to as “historical-holistic”perspectives on the one hand,and “institutional-realist” perspectiveson the other. Third, I will relate Polanyi’s work to these twoclassic strands of thought and, thereby, account for his positionas a sociological classic with regard to the context of his lifetime.
Scholarship Before Polanyi
The generation, or rather “era”, of sociologically mindedscholarship that preceded Polanyi’s work,and which he could still draw upon,can best be characterized as “historicism”. Historicism ishere understood inthe wider(and non-pejorative) sense of historical scholarshipwhich puts social phenomena into a historical, and often comparative, perspective (Frerichs,2011b, pp. 204-236; Frerichs,2012b, pp. 18-36). It is characteristic of the nineteenth century and namely encompasses historical jurisprudence,historical economics and historical sociology. The historical paradigm thus united scholarship across different social-scientific disciplines. More precisely, it apparently “spilled over” from jurisprudence, where it was developed first, to economics, and from economics to sociology. This spill-over effect can be illustrated both in terms of the leading persons and theguiding principles of historical scholarship. As to the persons, the ideas of Friedrich Carl von Savigny (1779-1861), the founder of the German historical school of jurisprudence,inspired not only English and American schools of historical jurisprudence, but also scholarship in the (emerging) disciplines of economics and sociology. For example, Wilhelm Roscher (1817-1894), a leader of the German historical school of economics, drew explicitly on its jurisprudential forerunner, while Emile Durkheim (1858-1917), one of the main representatives of classical historical sociology, made ample reference to historical economics. As to the principles, we can point to the “spirit of the people” which von Savigny found to be reflected in legal customsthat emerged organically,without a need for codification. The same “collective spirit” seems at work in the minds of historical economists and sociologists when they study the moral foundations of the (national) economy and the (national) community, respectively.
The “holistic” orientation of historical scholarship consists in a certain predilection for collective entities, and perhaps, first and foremost, fornational collectives.Law, economy, and societywere thus preferably studiedin a national frame of reference, including the (national) legal culture in jurisprudence, the (national) political economy in economics, and the (national) solidarity community in sociology. There are several technical terms which describe this analytical preference, such as “methodological collectivism” for an emphasis on collective rather than individual entities, “methodological nationalism” for an emphasis on national rather than global entities, and “methodological holism” for a more general emphasis on the “whole” rather than its “parts”. I will here opt for the latter, most encompassing termsince it captures best what I consider paradigmaticabout historical scholarship. This term can then be re-specified in several dimensions, including the relation between individual and collective entities, and the relation between national and global entities. Interestingly, historical scholarship seems more “holistic” in the former dimension than in the latter: It is collectivist but not globalist. However, there is yet another dimension which we can add to this methodological grid. In this third dimension, holism extends to the moral qualities that many historical scholars consider to be inherent totheir subject matter, and also pertinent to their own scientific engagement. In other words, historical scholarship is often explicitly value-related, and inasmuch it derives these values from the material studied, itcan be said to followsome sort of moral substantivism.
Scholarship “before” Polanyi thus forms part of an era in which sociology and social science, more generally was ultimately conceived as a moral science. For Durkheim, sociology thus formed part of a “positive science of morality” (1887)which aims at themoral cohesion of a given society. In the introductory lesson to his new “course of social science” (1888) the first of its kind in Francehe declares: “[T]he collective spirit has weakened in our country. Each of us is so exorbitantly concerned with himself that he does not perceive the boundaries that constrain him everywhere.” (ibid., p. 24; my translation) Accordingly, the new sociological discipline was envisioned to “restore the consciousness of [society’s] organic unity” (ibid., my translation). “Itwill teach the individual what the society is, how he is complemented by it, and how little is due to his own forces. It will make clear that he is not an empire among other empires, but the organ of an organism” (ibid.; my translation).Regarding the moral ambitions underlying much of classic historical sociology, Durkheim’s work is, perhaps, most explicit. But we can find similar features also in the works of other sociological classics, such as Karl Marx (1818-1883), at the one end, and Max Weber (1864-1920), at the other.
Marx’s theory of social change entails a vision of human progressin technological as well as in moral respects. In capitalist times, the collective spirit, which includesa “natural” sense of right and wrong,seems, however, corrupted (Marx, 1842). Itis the “economic structure of society” which determines not only the “legal and political superstructure” butalso the related “forms of social consciousness” (Marx 1859).The “alienations” brought about by the capitalist economy and its political ally, the bourgeois state, were meant to be overcomein a socialist, and later communist, society.Weber, in turn, combines a macro-sociological approach,which relies on the historical development and comparison of collective entities as a whole, with a micro-sociological approach, which starts from the “meaning” that individuals attach to their (inter-)action. Both aspects, historicity and meaning,form part of what Weber considers the moral underpinning of social science, namely its orientation towards the “cultural significance” of the phenomena studied. Accordingly, the “objectivity” of social-scientific, namely empirical, knowledge is qualified by its relation to “evaluative ideas” which render the reality “meaningful” to us (Weber, 2004 [1904], pp. 377 and 382).
All in all, historical scholarship was thus holistic, first of all, in social terms. Its basic entities were collectives rather than individuals, or individuals in their social context.Hence, the frame of reference of historical scholarship wasmacro- rather than micro-sociological. As importantly, it was holistic in historical terms. Itaimed foranunderstanding of modern societyor, more precisely, of the modern Western civilization from a historical point of view.Its all-encompassing orientation in time was complemented by its intended completeness on a spatial scale, even though the comparison of different cultures, or nations, was still predominant. Today, notions of world history and world society imply, in contrast,a genuinely global perspective. Furthermore, society was not only studied from the observable and measurable outside but also from the evaluative inside, that is, its inherent values. Historical scholars were thus not only interested in the causes and effects but also in the cultural meaning of social developments, and in the moral lessons to be drawn. Finally, the social-scientific field was still integrated in a way that scholars could relatively easily move from one (emerging) discipline to the other such as Weber, whose academic career led from law to economics and from economics to sociology (Swedberg, 2006, p. 74).It was thus a certain holism also in substantial terms which allowed the historical paradigm to flourish across the social sciences, or, vice versa,substantial comprehensiveness was itself furthered by the holistic perspective of historical scholarship.