Has market capitalism collapsed?: a critique of Karl Polanyi's new economics

This book is in the form of a critique of the theories of Karl Polanyi, but in actuality it uses this technique for an even more fundamental purpose; viz., to examine the relevance actual and potential of economics, and social thought in gen eral, both to the attainment of a comprehension of the causes and significance of the great climacteric facing modern society, and to the search for guidance in acting so that man may sur vive the great ordeal. In an unpublished manuscript, mics and Economics (written in the spring of 1942), I attempted to explore the philosophical roots of Smithian, classical, Marx ian, and contemporary economics, and I came to the conclu sion that some philosophical misconceptions were at the root of the contemporary economist's comparative neglect of the truly chief problems with which he should have been concerned -the conditions of permanent institutional stability, the forces making for a dynamic of irrevocable change, and the possi bilities of social control over the direction and rate of social. evolution.

The essence of my strictures was first that traditional value theory was too mechanistic in its conception of an "automa ton economy, a "self-operating" economic system; and, sec ondly, that the genetic approach as practiced was too organis mic and biological. Polanyi points out that the biological bias is responsible for classical mechanism, and that market society tends actually to be automatic and self-regulating-due at least in part to the philosophical errors of the classical agita tors for the establishment of the liberal economy.