You know from your reading of the front matter when, where, and why Polanyi wrote this book, and from Joseph Stiglitz’s introduction why it remains timely and important today.
Our problem this week and next is to consider Western development in historical context. How important are markets, and how did they come to dominate thinking about economic development? What are the costs and benefits of a market-focused approach to development? Next week we will look at the trajectory of economic thinking and compare it to what we understand about the evolution of non-European economies.
The reason for reading the economic history assembled by Polanyi is the dictum, “first, know yourself.” This is our economic history, and one of the questions that arises is whether the path to “development” that worked for European countries can also work for countries that were consciously exploited, if not looted, in the process of expanding the wealth of today’s economic core. A second question is whether the trajectory of western economic growth can be sustained, or whether there are environmental and social limits to growth.
After you have done the first quick dissection of the three books (introductions, conclusions, sources, book reviews), read Clark’s economic summary, then continue with a closer reading of Polanyi.
Clark (2008) “Introduction: the 16 page economic history of the world” follows much the same economic history in a few pages that Polanyi sketches in several chapters, but there is an important difference. While Polanyi is trying to explain why a century of relative peace and rising prosperity gave way to two world wars and a major economic crash in his lifetime, Clark is concerned with much narrower economic questions: “Why did the Malthusian trap persist for so long? Why did the initial escape from that trap occur…in England in 1800? and why was there the consequent Great Divergence?”
Polanyi – aim to finish reading Polanyi by the end of week 6 – but for week 3, use the following guide. You should be able to skim each chapter in about 20-30 minutes, so this represents about 3 to 5 hours of reading.
Acemoglu, D., Robinson, J. A. (2012). Why nations fail: the origins of power, prosperity, and poverty. New York: Crown Business. [We will come back to some of the key ideas in Acemoglu and Robinson in week 5.]
This week you should complete a cursory overview of all three books, and finish a preliminary reading of the first 11/21 chapters of Polanyi, with particular attention to the questions and passages highlighted.
After your cursory overview of all three books, pick one for your review essay. This means that you need to set aside time to read it in some detail while you are keeping up with your other more cursory readings for the class.
Our seminar this week will begin with the questions linked to the required readings and the self-assessment questions above. We’ll concentrate on the political and economic thinking that emerged in response to the industrial revolution, and the forceful separation of economic activity from society.
Next week we will finish off Polanyi and link up our understanding of the evolution of the western industrial economies to western and non-western thinking about economic development, drawing on Meier and Stiglitz (2001).