In: Economics
Relate economist Karl Polanyi’s idea of the fictitious commodity of labor to Kalecki’s Political Aspects of Full Employment. Make sure explain what makes labor a fictitious commodity, and to situate Kalecki’s full employment in Polanyi’s double movement.
The Great Transformation, Karl Polanyi problematised the commodity status of labour. He described it as ‘fictitious' and asserted the human aspect of labour necessitates ‘protection’.
In bringing
Polanyi's mature works to bear on these claims, this article uses
the ‘fictitious commodity’ concept to highlight the tension in
neoclassical theory between concrete reality and its idealist
construction of the economy.
This
contradiction directly challenges the veracity of the
self-regulating market.
Karl Polanyi
argued in The Great Transformation [1944] that the
development of market societies over the past two hundred years has
been shaped by a double movement.
On one side
is the movement of laissez faire--the efforts by a variety
of groups to expand the scope and influence of self-regulating
markets“capitalism” is the product of both of these
movements ; it is an uneasy and fluid hybrid that reflects the
shifting balance of power between these contending forces.
Beyond the double movement.
The Great
Transformation, Polanyi anticipated that the era of the double
movement might finally have ended since much of the world had come
to recognize the folly of organizing human society around
self-regulating markets.
Bretton
Woods and the system of “embedded liberalism” did represent a sharp
break with the logic of the Gold Standard, but we now know that the
break proved to be only temporary.
one of
Polanyi’s antagonists in theoretical debates in Vienna in the
1920’s, survived to become the favored theorist of Margaret
Thatcher and Ronald Reagan.
Polanyi
believed that institutional procedures and rights could be
established that would effectively prevent the state’s coercive
power from being used in ways that were illegitimate or designed to
preserve the position of particular individuals or interests.
. The
Gospels, in short, did not recognize the “reality of society”, that
people necessarily live together in complex
interdependence.However, Polanyi’s theoretical framework helps to
explain his own failure as a prophet.
These
changes could mean that today’s protective counter movement has the
possibility not only of protecting societies and the planet from
the grave dangers posed by global markets, but of finally ending
the double movement itself.