IV Annual Cycle Young Social Scientists
2008-2009

March 18th, 2009, 17:00, Sala de Seminários do CES (1º piso)
 
João Rodrigues (Univ. Manchester)

Towards where the market? Movement and counter-movement in Karl Polanyi and Friedrich Hayek

Commentary: José Castro Caldas and Ana Raquel Matos

Abstract: The path to a free market was open and kept open through the increment of a continuous interventionism, controlled and organized in a centralized manner. To render Adam Smith’s ‘simple and natural liberty’ compatible with the necessities of a human society was a considerably complicated task. [The] introduction of free markets, far from abolishing the necessity for control, regulamentation and intervention, incremented its range enormously. (…) Whilst the laissez-faire economy was the product of deliberate action of State, the subsequent restrictions to laissez-faire initiated themselves spontaneously. The laissez-faire was planned; the planning not. (…) [The] concept of a self-regulated market was utopist and its progress was obstructed by the realist self-protection of society.

Karl Polanyi, 1944, The Great Transformation, Beacon Press, Boston, 2001, pg. 147-48

There is nothing in the fundamental principles of liberalism that renders it a static creed, there are no inflexible and immutable rules. (…) There is all the difference between creating, intentionally, a system in which competition will be as benefic as possible, and accepting passively institutions as they are. Nothing harms the liberal cause as much as the rigid insistence of some liberals in certain vague generalities. Especially in the laissez-faire principle. (…)

The task of creating an adequate structure towards the functioning of competition had not been taken very far when, all around, the States started to supplant competition for another, different, and irreconcilable, principle.

            Friedrich Hayek, 1944, The Road to Serfdom, Edições 70, Lisbon, 2009, pg.43 and 66

This paper has for starting-point the analysis and comparison of some of the main theses and concepts included in two books, published in 1944, and that would come acquire the status of political economy and social philosophy classics – The Great Transformation, by Karl Polanyi and The Road to Serfdom by Friedrich Hayek.

The title of the paper – Towards where the market? – remitting to the analysis of the nature and mutable place of this institution, through which, using Polanyi’s terms, can be designated by “institutionalization”, but also to the analysis of its social-economic, political and moral limits. These two authors offer very different perspectives on these recurrent discussions. Vital is the necessity to revisit them in times of crisis of neoliberalism hegemony and corrosion of its intellectual foundations.

The subtitle refers to the idea, in part shared by Hayek and Polanyi, in which it is possible to identify and analyze contrasting historical patterns in what regards to the strength of the market institutionalization process. Albeit the existence of ideas and options that should be avoided and that are avoidable, the subtitle also indicates that, for several reasons, nothing is ever shut, in the field of institutional arrangements of economy, concerning these to authors. Indeed the conclusions achieved by Polanyi and Hayek also diverge in this aspect, since we are discussing one of the intellectual parents of neoliberalism and an author that has inspired some of the most penetrating contemporary critical assessments. Nonetheless, I believe that the divergences do not allow themselves to end in institutional and behavioral dichotomies plan/market, community relations/contractual relations or self-interest/altruism that, at times, are invoked in compared political economy debates and that mark some of the appropriations of their work, either critical or apologetic.

One shall seek to argument that the two theoretical discussion plans above mentioned have implications not only to the comprehension of the nature, simultaneously utopist and adaptable, irreconcilable and flexible, of the neoliberal project, either in intellectual terms, either in the preconized public policy solutions, but also towards the comprehension of the limitations and potentialities of the political and intellectual work regarding the socialist reconstruction project that incorporates some of the fundamental conclusions of Polanyi’s work and some of the critical assessments developed by Hayek.

Nota biográfica: (B. 1977, Coimbra). Holds a Degree in Economics and a Masters in Monetary and Financial Economics at ISEG-UTL. Member of DINÂMIA-ISCTE (Centre for Studies on Social-Economic Change) and is presently a Doctoral Student in Political Economics at Manchester University with a thesis intituled Towards where the Market? Ludwig von Mises, Friedrich Hayek and Karl Polanyi. Research work centred on the analysis of relations between economic institutions, human behaviour and morality and on the scrutiny of the main theoretical contributions behind the so-called neoliberal project. Articles published in international scientific journals such as the Review of Social Economy, the Journal of Economic Issues and the New Political Economy.