What do economists think of Karl Polanyi?

This is a guest post by Marko Grdesic, a doctoral candidate at the University of Wisconsin. Marko’s research focuses on social movements and political sociology. You can learn more about Marko at his website.

What do economists think of Karl Polanyi? For sociology, Polanyi is a classic. His book The Great Transformation is part of the sociological canon and is of special relevance to economic sociologists. Polanyi’s agenda has recently received an important update by two well-known sociologists. But what do economists think of his work? Have they read it? If so, what do they think of it? The motivation behind this small research project was to investigate the disciplinary differences between economics and sociology, by looking at an author who is arguably relevant for both fields. In order to do this, I sent a bunch of emails to economists. I wrote to a randomly chosen 10 faculty members at each of the 23 elite economics departments in the US. I also contacted all of the faculty members at UMass Amherst, the premier heterodox economics department. In total, I sent 260 emails. Yes, I felt a bit like a spammer.

To summarize the main point at the outset: economists have not read Polanyi. It can be estimated that about 3 percent of economists have read him. This limits any kind of conversation that economists and sociologists could have about his work. Most people that responded to my email simply said they have not read anything by Polanyi. Typical responses were: “I don’t think I had ever heard of Polanyi before your email” or “Everything I know about Polanyi I learned from Wikipedia after receiving your email.” Two persons actually mentioned they know the name because they read the work of Karl’s younger brother Michael Polanyi, a conservative philosopher.

All in all, 66 persons responded (25 percent). This isn’t at all bad, considering that these were cold calls. Approximately 3 percent of economists at elite departments have read Polanyi (assuming that those that did not reply have not read him). There were no dramatic differences between “saltwater” and “freshwater” economists (the East and West coasts versus the Midwest), or between Ivy League economists and non-Ivy League economists. Economics is in this respect rather homogenous. The main stand-out is UMass Amherst. More faculty members from UMass Amherst read Polanyi, 5 out 30 (or 17 percent). In addition, there were only 3 explicitly positive assessments of Polanyi, and all came from UMass Amherst. One person said that Polanyi provides “a very strong framework within which to understand some dramatic historical dynamics”, while another wrote that “Polanyi was one of the greatest economists of the 20th century.” There were 5 negative assessments of Polanyi, all from economists at elite departments. For example, one person said that “I guess I’m one of those economists who holds Polanyi’s work in fairly low esteem”, while another wrote that The Great Transformation “is full of tendentious economic history, overblown and fanciful rhetoric.”

So, why don’t economists read Polanyi? As mentioned by several people, the main reason seems to be that economists do not read books. It’s not just Polanyi. As one economist said, “I haven’t read Polanyi, nor have I read Smith, Keynes, Hayek, Schumpeter, or Friedman.” Although this is not news, it is rather startling to see such a candid confession. Another person reiterated the same point and added that “economics is in this respect in a rather parlous state.” Now, sociology is not too different from economics: sociologists also cite mostly new things. But graduate programs typically teach the “classics”, the central triumvirate being Marx, Weber and Durkheim. Whether sociology makes use of its classics is another matter. Economists may argue that the main ideas of the classics are filtered into contemporary tools taught by contemporary textbooks. As one person said, “I doubt our graduate students read more than one or two papers by Paul Samuelson, Kenneth Arrow, or Milton Friedman, and probably most of them read zero. Their work, however, is subsumed in later works that build upon their results.” If this filtering works, economics may actually be making more of its past than sociology.

What would have to change for a discussion about Polanyi to take place across the disciplinary divide? Several people offered interesting thoughts on this issue. One option is to make Polanyi’s ideas compatible with the way economists work. This would mean translating some of them into formal models. As one person said, “maybe his work is awaiting an advocate who can translate it into the language and culture of contemporary economics.” Could this be done? It certainly seems to be at odds with the anthropological strain present in Polanyi’s work. Yet, one should not dismiss the idea out of hand. For example, the work of Albert Hirschman is also commonly considered as incompatible with formal modeling, but economists have nevertheless managed to translate some of his ideas into the mathematical language of game theory.

The other route would be the opposite. As one person said, “for economists to read more of Polanyi, they would have to become less fixated on math and on their self-conception that they are scientists, rather than social scientists.” Given the emphasis on technical training in economics, this seems to be the less likely route. Even so, it is not impossible. Even my emails seem to have had some small effect. One person said that they have not read Polanyi but “now feel guilty for not having done so.” Another similarly said: “I’ll have to check it out; you’ve piqued my curiosity.” Therefore, my small investigation may have guilted a couple of economists into reading Polanyi.

The middle road would be to take Polanyi’s ideas, which are sometimes overly grand for economists’ tastes (“grand theorizing about the rise of market liberalism and fascism is not in vogue”), and to transform them into testable claims. As one economist sympathetic to Polanyi wrote, they have “encouraged grad students to do applied work in his [Polanyi’s] spirit, to think about operationalizing issues of embeddedness, etc.” Indeed, one thing that seems to irk economists is the perceived fuzziness of Polanyi’s concepts. As one person wrote, after receiving my email, they tried to educate themselves about Polanyi, but could not grasp the essence of his work: “I spent 5 minutes reading about him, and I cannot say I got his main point. I would be amazed if someone were not able to understand the main contribution of an economist of a similar caliber by reading about his/her work in a Wikipedia article for 5 minutes.” This is an important challenge for all those who would like to push Polanyi’s agenda forward. Economists perceive Polanyi as vague.