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Merely a couple of excerpts to entice you:

The Methodology of Polanyi’s Great Transformation

AUTHOR: Dr. Asad Zaman
Vice Chancellor, PIDE; email: asadzaman@alum.mit.edu

Abstract: Polanyi’s book on The Great Transformation provides an analysis of the emergence and significance of capitalist economic structures which differs radically from those currently universally taught in economic textbooks. This analysis is based on a methodological approach which is also radically different from existing methodologies for doing economics, and more generally social science. This methodology is used by Polanyi without explicit articulation. Our goal in this article is to articulate the methodology used in this book to bring out the several dimensions on which it differs from current approaches to social science. Among the key differences, Polanyi provides substantial scope for human agency and capabilities to change the course of history. He also shows that the social, political and economic spheres of human existence are deeply interlinked and cannot be analyzed in isolation, as current approaches assume.

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Keywords: Methodology, Social Science, Capitalism, Liberalism

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3. The Spirit of History
Hegel argued that the Spirit of History realizes the principle of rational freedom in the world through the mechanism of human history. Thus history is shaped by larger forces which impel it in certain directions leading to the realization of greater freedom and rationality. Polanyi also uses certain global forces and ideas to explain the progress of history, but these are concrete and explicable, rather than abstract and metaphysical. To illustrate, Polanyi considers the collapse of the Gold standard as a turning point in history. At the same time, the event is considered as a manifestation of hidden social forces at work. For example, he writes that the collapse of the gold standard, and the accompanying collapse of the international system (political & economic) was caused by deeper social forces at work, which were not understood by contemporaries (Polanyi, p. 25) . Similarly, the rise and fall of nations or groups may depend on whether or not their institutions are aligned with the underlying process of social change (Polanyi, p. 27). The underlying process is often hidden and misunderstood by contemporaries, as we will further clarify later. Polanyi (p. 262) writes that “Institutions are embodiments of human meaning and purpose.” Collective human will to achieve some goal can lead to the formation of institutions necessary to the achievement of that goal. If such institutions are not formed, th[e]n these purposes and goals remain ineffective. Polanyi (p. 8) writes that “Interests, however, like intents, necessarily remain platonic unless they are translated into politics by the means of some social instrumentality.” Specifically, even if a vast majority of human beings collectively desire peace, this desire will remain unrealized unless an institution emerges to translate it into reality. This provides a resolution of the puzzle raised before. The spirit is a collective will – basically a goal which inspires and motivates a large community of people – and the institutions represent the embodiment of the will, which is the mechanism by which this will operates in the real world. As the metaphor of body and spirit suggests, the spirit cannot effect actions without an embodiment; at the same time the body is dead without a spirit, and cannot be understood in isolation, separately. This is how institutions are central to the story of Polanyi, without being the final cause of changes which take place. The capabilities and structure of the institutions puts clear limitations on, and shapes, the ways in which any given goal of the spirit is materialized in the real world. This is why institutional analysis is necessary to understand history.

[. . .]


You can download and read Dr. Asad Zaman’s paper (PDF)  in its entirety here (20 pages):

The Methodology of Polanyi’s Great Transformation

You can also find a (PDF) version of Karl Polanyi’s “The Great Transformation” here (214 pages) :

The Great Transformation