Polanyi and Post-neoliberalism in the Global South: Dilemmas of Re-embedding the Economy

Abstract

Although Karl Polanyi Studied a different epoch and focused on Europe, his ideas have inspired an outpouring of studies on contemporary problems and prospects in the neoliberal era. The bulk of these studies pertain to industrial countries or global economic issues. However, the human, environmental and financial impact of market deregulation is arguably more devastating in the ‘developing’ countries than in the core. A question thus arises: do Polanyi's reflections on progressive alternatives to liberalism clarify contemporary debates on development alternatives in the Global South? I contend that democratic socialism – Polanyi's preferred remedy to the ‘demolition’ of society and nature occasioned by market civilisation – is problematical in light of what we have learned from the twentieth century, but his framework for evaluating alternatives – featuring the re-embedding of economy in society – remains as powerful as ever, I support this argument with an exploration of socialism and social democracy – as well as community – based alternatives arising from ‘reciprocity’. Each possibility raises distinctive dilemmas, as an analysis of cases reveals.

Keywords:

• Polanyi
• socialism
• social democracy
• communitarianism
• political economy
• globalisation
• global South
• development alternatives

Notes

On the imperialism of categories, see Rudolph (2005). The pioneer in the application of Polanyian notions to development studies is Bjorn Hettne (1990: 161–3, 236–8); (2009).

For a nuanced and critical treatment of post-development thought, see Andreasson (2010), especially ch. 3.

Polanyi does not refer to a ‘theory’ of the double movement. My use of this term implies that the explanatory mechanism that he employs to explore the ‘political and economic origins of our time’ in The Great Transformation ([1944] 2001) is of wider applicability. This summary is drawn mainly from this latter book.

I owe this point to Jon Kraus (personal communication).

Refer to Stiglitz (2008) and the other chapters in this collection for reflections on this evolution. See also Harvey (2005) and Williams (2008: chs. 5 and 6).

Latin America's growth in the period 2002–08 reached a respectable average of 3.5 per cent, but this was the era of leftist governments in the region (Pearce 2009: 419). Africa experienced a commodity-based boom in the same period.

For a thorough analysis, see Luttwak (1999).

See Levien (2007) and Wang (2008) for an analysis of countermovements in India and China, respectively; Rénique (2005), Cameron (2009) and Pearce (2009) for the rise of the left in opposition to neoliberalism in Latin America; and Owusu (2003) for (oblique) resistance to neoliberal policies in African countries in the 1980s and 1990s.

Refer also to the discussion of freedom in a complex society in chapter 21 of Polanyi (2001) and Rotstein (1990).

This terminology of ‘hard’ and ‘soft’ Polanyi is drawn from Dale (2010).

For case studies of socialist deterioration in Africa, see Rosberg and Callaghy (1979).

The governments most closely aligned with the Bolivarian approach are those of Evo Morales (Bolivia) and Rafael Correa (Ecuador).

Compare, for example, Rodriquez (2008) with Lebowitz (2007).

For the details, see Burbach and Piñeiro (2007). The political violence notably included the February 1989 riots, which were precipitated by sharply rising prices linked to a structural adjustment loan undertaken in stealth by a populist leader. Thousands of rioters were killed by the army in Caracas. See Di John (2005).

An AP-Ipsos poll in 2006 found that 84 per cent of Venezuelans reject the Cuban model, a similarly high proportion oppose expropriation of private property, and only seven per cent agreed with the notion that ‘being rich was a bad thing’ (Jiménez 2006).

For an analysis of the success in each case, see Sandbrook et al. (2007: chs. 3–6).

From the late 1980s to the mid-1990s, economic growth in Kerala was higher than the all-India average. The state's economy has performed relatively well since. In addition, Kerala continues to hold first place among India's states on the composite human development index.

For an anthropological study of reciprocity in the urban informal economies of Latin America, see Lomnitz (2000).

Elinor Ostrom (1990) famously challenged the ‘tragedy of the commons’ thesis by demonstrating that local communities, under certain conditions, developed complex institutions to safeguard common resources by means of the selection and enforcement of protective rules – in other words, by embedding local livelihoods in social norms.

For a discussion of these earlier socialism, see Wright (1987).