The Great Transformation - UFRJ

1 Karl Polanyi The C^reat Transformation The Political and economic Origins of Our Time FOREWORD BY Joseph INTRODUCTION BY Fred Block BEACON PRESS BOSTON To my beloved wife Ilona Duczynska I dedicate this book which owes all to her help and criticism Beacon Press 25 Beacon Street Boston, Massachusetts 02108-2892 Beacon Press books are published under the auspices of the Unitarian Universalist Association of Congregations. 1944) 1957) 2001 by Karl Polanyi First Beacon Paperback edition published in 1957 Second Beacon Paperback edition published in 2001 All rights reserved Printed in the United States of America 05 04 03 02 01 00 87654321 This book is printed on acid-free paper that meets the uncoated paper ANSI/NISO specifications for permanence as revised in 1992.

2 Text design by Dan Ochsner Composition by Wilsted & Taylor Publishing Services Library of Congress Cataloging-in-Publication Data Polanyi, Karl, 1886-1964. The Great Transformation : the political and economic origins of our time / Karl Polanyi; foreword by Joseph E. Stiglitz; with a new introd. by Fred Block. 2nd Beacon Paperback ed. p. cm. Originally published: New York: Farrar & Rinehart, 1944 and reprinted in 1957 by Beacon in Boston. Includes bibliographical references and index. ISBN 0-8070-5643-x (pa: alk. paper) 1. economic history. 2. Social history.

3 3. Economics History. I. Title. HC53 .P6 2001 dc2i 00-064156 Contents FOREWORD BY JOSEPH E. STIGLITZ Vll INTRODUCTION BY FRED BLOCK Xviii NOTE ON THE 2001 EDITION XXxix AUTHOR'S ACKNOWLEDGMENTS xl Part One: The International System i. The Hundred Years' Peace 3 2. Conservative Twenties, Revolutionary Thirties 21 Part Two: Rise and Fall of Market Economy I. Satanic Mill 3. "Habitation versus Improvement" 35 4.

4 Societies and economic Systems 45 5. Evolution of the Market Pattern 59 6. The Self-Regulating Market and the Fictitious Commodities: Labor, Land, and Money 71 7. Speenhamland, 1795 81 8. Antecedents and Consequences 90 9. Pauperism and Utopia 108 10.

5 Political Economy and the Discovery of Society 116 II. Self-Protection of Society 11. Man, Nature, and Productive Organization 136 12. Birth of the Liberal Creed 141 13. Birth of the Liberal Creed (Continued): Class Interest and Social Change 158 14. Market and Man 171 15. Market and Nature 187 [vi] Contents 16.

6 Market and Productive Organization 201 17. Self-Regulation Impaired 210 18. Disruptive Strains 218 Part Three: Transformation in Progress 19. Popular Government and Market Economy 231 20. History in the Gear of Social Change 245 21. Freedom in a Complex Society 257 NOTES ON SOURCES 1.

7 Balance of Power as Policy, Historical Law, Principle, and System 269 2. Hundred Years' Peace 273 3. The Snapping of the Golden Thread 274 4. Swings of the Pendulum after World War I 275 5. Finance and Peace 275 6. Selected References to "Societies and economic Systems" 276 7.

8 Selected References to "Evolution of the Market Pattern" 280 8. The Literature of Speenhamland 285 9. Poor Law and the Organization of Labor 288 10. Speenhamland and Vienna 298 11. Why Not Whitbread's Bill? 299 12. Disraeli's "Two Nations" and the Problem of Colored Races 300 INDEX 305 [ Joseph E.]

9 Stiglitz ] Foreword (~it is a pleasure to write this foreword to Karl Polanyi's classic book A. describing the Great Transformation of European civilization from the preindustrial world to the era of industrialization, and the shifts in ideas, ideologies, and social and economic policies accompanying it. Because the Transformation of European civilization is analogous to the Transformation confronting developing countries around the world today, it often seems as if Polanyi is speaking directly to present-day issues. His arguments and his concerns are consonant with the issues raised by the rioters and marchers who took to the streets in Seattle and Prague in 1999 and 2000 to oppose the international fi-nancial institutions.)

10 In his introduction to the 1944 first edition, writ-ten when the IMF, the World Bank, and the United Nations existed only on paper, R. M. Maclver displayed a similar prescience, noting, "Of primary importance today is the lesson it carries for the makers of the coming international organization." How much better the policies they advocated might have been had they read, and taken seriously, the lessons of this book! It is hard, and probably wrong even to attempt to summarize a book of such complexity and subtlety in a few lines. While there are as-pects of the language and economics of a book written a half century ago that may make it less accessible today, the issues and perspectives Polanyi raises have not lost their salience.