Question

1. What is unique about the market system according to Polanyi (i.e. how is a market system different from other systems which preceded it)?

Answer 1

Answer:1)- unique about the market system according to polanyi.

Polanyi contends that the modern market economy and the modern nation-state should be understood not as discrete elements but as the single human invention he calls the "Market Society".A distinguishing characteristic of the"Market Society" .

[1]The expansion of capitalist institutions with an economic liberalist mindset not only changed laws but also fundamentally altered humankind's economic relations; prior to the great transformation, markets played a very minor role in human affairs and were not even capable of setting prices because of their diminutive size.

[2]However, Polanyi asserts instead that "man's economy, as a rule, is submerged in his social relationships,"

[3] he therefore proposes an alternative ethnographic economic approach called "substantivism",in opposition to "formalism", both terms coined by Polanyi.

[4]As a consequence of industrialization and increasing state influence, competitive markets were created that undermined these previous social tendencies, replacing them with formal institutions that aimed to promote a self-regulating market economy.

[5]It was only after industrialization and the onset of greater state control over newly created market institutions that the myth of human nature's propensity toward rational free trade became widespread.