An influential and internationally renowned Austrian-born economic historian, and brother of the philosopher Michael Polanyi. He taught widely throughout Europe and the United States, and has a substantial and continuing influence in sociology because of the way in which his empirical studies undermine many of the assumptions of neo-classical economic theory.
His best-known publication is The Great Transformation (1944)—which has a foreword by Robert M. MacIver—in which he seeks to document the causes of the two world wars, the depression of the 1930s, and the basis of the ‘new order’ of the mid-20th century. His was a stringent study of the consequences of the emergence of the ‘world market’ and the manner in which society can protect itself against its consequences. He warned against promoting the economy to the point at which power becomes highly concentrated, economic decision-making escapes human control, and human dignity and freedom are threatened. This economism could destroy society by undermining social cohesion; it requires that the economy be embedded within relations of social control similar to those found in traditional societies.
His other major publications, notably the co-authored Trade and Markets in the Early Empires (1957) and the posthumously published The Livelihood of Man (1977), develop Polanyi's so-called substantivist critique of liberalism, challenging the idea that freedom and justice are inextricably tied to the free market, and documenting the various ways in which economic processes in any society are necessarily shaped by its cultural, political, and social institutions.
Polanyi was a genuinely interdisciplinary scholar: an entry on him is also likely to be found in dictionaries of economics, history, anthropology, and political science. Most recently, his work has become part of the debate around the possibility for a ‘Third Way’ in the transition from communism to the market. Untrammelled market economics, as exported by most Western advisers, are seen by some East European social scientists and policy-makers as likely to create the kinds of problems associated with the self-regulating market that Polanyi documents across a range of historical examples. The opposition between the ‘logic of the economy’ and the ‘logic of society’ are particularly acutely felt by these post-communist societies as they leave their protective states and face the uncertainties of a rapid transition to the market.
Subjects: Social Sciences.