The new human universal

Magellan’s crew completed the first circumnavigation of the planet some thirty years after Columbus crossed the Atlantic. At much the same time, Bartolomé de las Casas opposed the racial inequality of Spain’s American empire in the name of human unity. We are living through another ‘Magellan moment’. In the second half of the twentieth century, humanity formed a world society – a single interactive social network – for the first time. Our world too is massively unequal and the voices for human unity are often drowned. Emergent world society is the new human universal – not an idea, but the fact of our shared occupation of the planet crying out for new principles of association.

A lot hinges on where in the long process of human evolution we imagine the world is today. I think of us as being like the first digging-stick operators, primitives stumbling into the invention of agriculture. In the late 90s, I asked what it is about us that future generations will be interested in. I settled on the rapid advances then being made in forming a single interactive network linking all humanity. This has two striking features: first, the network is a highly unequal market of buyers and sellers fuelled by a money circuit that has become progressively detached from production and politics; and second, it is driven by a digital revolution in communications whose symbol is the internet. So my research has lately been concerned with how markets and money are changing in the context of this communications revolution.

My case rests on three developments of the last two decades: 1. the collapse of the Soviet Union, opening up the world to transnational capitalism and neo-liberal economic policies 2. the entry of China’s and India’s two billion people, a third of humanity, into the world market as powers in their own right and the globalization of capital accumulation, for the first time loosening the grip of America and Europe on the global economy and 3. the shortening of time and distance brought about by a revolution in transport and communications. The corollary of this revolution is a counter-revolution, the reassertion of state power since 9-11 and the imperialist war for oil in the Middle East. We are now caught between national and world society; but growing awareness of the risks to life on this planet entailed in current levels and forms of economic activity might encourage more people to take world society seriously.

By ‘a new human universal’ I mean making a world where all people can live together, not the imposition, as before, of general principles that suit some powerful interests. The main precedent for discovering our common humanity is great literature which achieves universality through going deeply into particular personalities, relations and places. Ethnography is based on a similar principle. The new universal will not just tolerate cultural particulars, but will be founded on the premise that true human community can only be realized through them. There are two prerequisites for being human: to be highly self-reliant and to belong to others, merging our identities in a bewildering variety of social relationships. Much of modern ideology emphasizes how problematic it is to be both self-interested and mutual. When culture is set up to expect a conflict between the two, it is hard to be both. Yet the two sides are often inseparable in practice and some societies, by encouraging private and public interests to coincide, have managed to integrate them more effectively than ours.

The market

At this formative stage, world society is being driven by an explosive combination of markets, money and telecommunications. Markets are networks constituted by acts of buying and selling, usually through the medium of money. For most of history, they were kept marginal to the mainstream institutions on which societies were built. But not long ago and at first only in some parts of the world, markets came to be accepted as central to society, leading to a vigorous political debate, which is ongoing, about the appropriate relationship between the two. Adam Smith’s The Wealth of Nations provided a charter for ‘the market’ as the dominant institution of modern societies. The idea of economy, which started out as a principle of rural household management, now became closely identified with markets, as did the profession of economics which grew up to study them.

All agrarian civilizations tried to keep markets and money in check, since power came from the landed property of an aristocratic military caste who feared that markets might undermine their social control. The medieval schoolmen expressed this as an opposition between the ‘natural economy’ of the countryside and the commerce of the city. Earlier Aristotle, tutor to Alexander the Great, preferred to found society on the self-sufficiency of households, declaring that markets geared to profit-making were anti-social. This view of economy prevailed until the dawn of the modern era. If Marx and Engels claimed that the history of class struggle was hitherto between town and countryside, they had this conflict between landed power and urban commerce in mind.

Markets in Africa’s stateless societies were traditionally restricted to specific times and places, leaving the bulk of production and consumption to be organized by kinship ties. Colonial demand for export crops and wage labour meant that the market principle became more pervasive, undermining the existing authorities. Why do markets subvert traditional social arrangements? Because commerce knows no bounds — all markets are in a sense world markets — and this threatens local systems of control. They offer a means of escape to the dominated classes: women, young people, serfs and slaves, ethnic minorities. The dialectic of local and global economy defined class struggle everywhere long before we came to perceive the modern world in this way.

So Smith knew what he was taking on when he proposed that society had much to gain from markets. He did not endorse the narrow pursuit of self-interest in market transactions; but found it preferable to indulge this trait en masse than to concentrate economic power in the hands of elites, however high-minded. He stopped short of claiming that society’s interests as a whole were best served by the free market; but these reservations have largely been forgotten since.

The last two centuries have seen a strident debate between capitalist and socialist camps over whether markets are good or bad for society. The latter draw implicitly on the pre-industrial apologists for landed rule. Karl Marx considered money to be indispensable to any complex economy and was opposed to the state in any form; but many of his followers were much less hostile to the state and, when not trying to outlaw markets and money, aimed to return them to the marginal position they occupied under agrarian civilization. Karl Polanyi has a foot in this camp since he acknowledged Aristotle as his master and considered Victorian liberalism to have been the principal cause of the twentieth-century’s horrors.

Socialism in the tradition of Saint-Simon acknowledged the social damage done by unfettered markets, but wished to retain the wealth they produce. Indeed the leading capitalist societies all signed up for Hegel’s idea that states should try to contain the inequality of markets and ameliorate the social misery generated by them. This social democracy has now been replaced by a confusing mixture of liberalism and state power with reintroduces the Old Regime in disguise. The general breakdown of the 30s turned a many economists away from celebrating the logic of markets towards contemplating their repair. This ‘institutional economics’ persists as the notion that markets need self-conscious social intervention, if they are to serve the public interest. Polanyi should probably be placed in this category rather than as a card-carrying anti-marketeer. He did recognize a role for the market as one of several modes of distribution and aligned himself with those who sought institutional means to correct capitalism’s ills.

The market’s apologists likewise divide between some for whom it is a trans-historical machine for economic improvement best left to itself and others who acknowledge a role for enlightened public management of commerce. Classical liberals promoted markets as a means of greater individual freedom from arbitrary social inequality. But the industrial revolution brought a shift to urban commerce that made vast new populations of wage workers reliant on markets for food, housing and their other basic needs. Now society itself seemed to retreat from view, being replaced by an ‘economy’ of market contracts instead of domestic self-sufficiency. Others hold that society’s remaining defenses are too weak to hold out against the rising tide of global money: you can’t buck ‘the markets’. This notion of markets as a natural force beyond social regulation serves to legitimize wealth and even to make poverty seem deserved.

The founders of modern social theory all considered markets to be progressive in that they broke up the insularity of traditional rural society and brought humanity into wider circles of discourse and interaction. But they differed over what should happen next. Marx and Engels considered that private money (‘capital’) was too fragmented to organize large-scale societies; so they looked to the workers for a truly collective remedy. Max Weber recognized that the formal rationality of markets concealed the unaccountable power of big money and often led to catastrophic loss of livelihood. But he considered wholesale state intervention in markets to be a recipe for economic failure. Durkheim and Mauss as socialists emphasized the human interdependence entailed in an expanded social role for markets and money, but they rejected the utilitarian case for neglecting collective economic forms.

Polanyi condemned the high price the British working classes paid for the dominance of the ‘self-regulating market’. Laissez-faire liberalism was not the necessary, ‘natural’ concomitant of industrialization: the market regime could only emerge and reproduce itself thanks to specific interventions by the state. There were also counter-movements within society like Chartism, as the victims of the new liberalism sought to defend themselves. This ‘double movement’ constituted the self-protection of society. Polanyi sometimes wrote of the disembedding of economy, but industrial markets remained thoroughly ‘embedded’: first, in their dependence on the state and second through being linked to a range of social institutions. Polanyi’s real objection was not to the market as such, but to ‘market fundamentalism’.

Marcel Mauss’s position on markets and money is not widely known. The Gift was an extended commentary on Durkheim’s argument that an advanced division of labour could only be sustained by ‘the non-contractual element in the contract’, a largely invisible body of state-made law and custom that could not be reduced to the drive to accumulate capital. Mauss held that the attempt to create a free market for private contracts is utopian and just as unrealizable as its antithesis, a collective based solely on altruism. Human institutions everywhere are founded on the unity of individual and society, freedom and obligation, self-interest and concern for others. The pure types of selfish and generous economic action obscure the complex interplay between our individuality and belonging in subtle ways to others.

Mauss was highly critical of the Bolsheviks’ destruction of public confidence in the expanded social ties that sustain the market economy. In his view, markets and money are human universals whose principal function is the extension of society beyond the local level, even if they have not usually taken the impersonal form we know. This was why he disputed Malinowski’s assertion that kula valuables are not money. Mauss advocated an ‘economic movement from below’, in the form of syndicalism, co-operation and mutual insurance. His greatest hopes were for a consumer democracy driven by the co-operative movement. The presence of elements of the archaic gift in contemporary capitalism refuted the revolutionary eschatology of both right and left. Most of the possibilities for a human economy already co-exist in our world; so the task is to build new combinations with a different emphasis, not to repudiate the market in the name of radical alternatives. Here Mauss follows Hegel in proposing the integration of institutional forms that have been variously dominant rather than representing them as mutually exclusive historical stages.

When the market is represented as a force of nature giving expression to individual interests outside society, opponents are likely to advocate either its abolition or at least closer control by collective interests. But this simple negation of the neo-liberal model is a poor basis for social reconstruction. Mauss drew our attention to the institutional complexity of markets, while emphasizing their function of drawing humanity into society on an ever-widening scale. For example, he noted with approval how his uncle’s idea of the social division of labour was now applied to the international economy and not just to nations like France.

Money in the human economy

By calling the economy ‘human’ we make people’s thoughts, actions and lives our main concern. Such a focus should be pragmatic: making economy personally meaningful, relating it to ordinary people’s practical purposes. ‘Humanity’ is a moral quality, implying that, if we want to be good, we should treat other persons kindly. Since theoretical abstraction is impersonal and leaves no room for morality, a human economy would have to pay attention to the personal realm of experience; but humanity is also a collective noun, all the people who have existed or ever will. So the human economy has much wider scope than the bounds of personal experience.

Anthropologists and sociologists have long rejected the economists’ impersonal model of money and markets. Thus Viviana Zelizer shows that people refuse to treat cash as an undifferentiated thing, choosing rather to ‘earmark’ it — reserving some for food, some for festivals and holidays etc. Her examples come from areas that remain invisible to the economists’ gaze, especially domestic life. People everywhere personalize money, bending it to their own purposes through a variety of social instruments. This was the message of Money and the morality of exchange too. Aware of this neglected economic dimension is surely significant. But the economy exists at more inclusive levels than the person, the family or local groups. This is made possible by the impersonality of money and markets, where economists remain largely unchallenged. Mauss would have us bridge the gap between everyday personal experience and the wider reaches of impersonal society, much as Durkheim argued religion does.

Money is often portrayed as a lifeless object separated from persons, whereas it is a creation of human beings, imbued with the collective spirit of the living and the dead. As a token of society, money must be impersonal in order to connect each of us to the universe of relations to which we belong. But people make everything personal, including their relations with society. This two-sided relationship is both abstractly universal and highly variable in its incidence. Money in capitalist societies stands for alienation, detachment, impersonal society, the outside; its origins lie beyond our control (the market). Relations marked by unpaid work are the model of personal integration and free association, of what we take to be familiar, the inside (home). This dualism, forcing individuals to divide themselves every day, asks too much of us. People want to integrate division, to make meaningful connection between their own subjectivity and society as an object. It helps that money, as well as separating public and domestic life, was always the main bridge between the two. That is why it must be central to any attempt to humanize society. It is both the principal source of our social vulnerability and the main practical symbol allowing us to make an impersonal world meaningful.

Money thus helps persons to stabilize their identity by holding something durable that embodies the desires and wealth of all other members of society. It is a ‘memory bank’, a store allowing us to keep track of those exchanges we wish to calculate and a source of economic memory for the community. The modern system of money provides people with a wide repertoire of instruments to keep track of their exchanges with the world and to calculate the current balance of their worth in the community. In this sense, one of money’s chief functions is remembering. If persons are to make a comeback in the post-modern economy, it will be less on a face-to-face basis than as bits on a screen. We may then become less weighed down by money as an objective force, more open to money generates the complex social networks we live by.

The reality of money and markets is not just universal abstraction, but the mutual determination of the abstract and the concrete. If you have some money, there is almost no limit to what you can do with it, but, as soon as you buy something, payment lends concrete finality to your choice. Money’s significance lies in the synthesis it promotes of impersonal abstraction and personal meaning, objectification and subjectivity. Its social power comes from the fluency of its mediation between infinite potential and finite determination. To reject markets and money in the name of collective as opposed to individual interests is to reproduce by negation the bourgeois separation of self and society. To emphasize how people control money through their personal and social practice is to remain in the everyday world as we know it. We also need ways of reaching the parts we don’t know, if we wish to avert the ruin they could bring down on us all.

Economic history is dialectical. Depending on impersonal and anonymous institutions makes most people feel quite anxious. This is an immense force for reversing the pattern of alienation on which modern society is built. How we combine the personal and impersonal aspects of economy has much in common with religion. Religion binds something inside us to an external force, lending stability to meaningful interaction with the world and providing an anchor for our volatility. We know our own everyday life intimately; but this is subject to larger forces whose origins we don’t know – natural disasters, social revolutions and death. We recognize these unknown causes of our fate to be at once individual and collective. As Durkheim showed us, religion is the organized attempt to bridge the gap between the world of ordinary experience and an extraordinary world that lies beyond it; and what is ultimately unknown to us is our collective being in society. The chaos of everyday life thus attains a measure of order to the extent that it is informed by ideas representing the social facts of a shared existence. Roy Rappaport proposed ecology as a substitute for the economists’ false religion of money. But money too should be made to work for common human ends.

The idea of economy

For millennia, economy was conceived of in domestic terms. Then, when markets, money and machines began their modern rise to social dominance, a new discipline of political economy was born. This discipline now calls itself economics and its subject matter is the economic decisions made by individuals as participants in markets of many kinds. The last century saw a universal experiment in impersonal society. People everywhere were organized by remote abstractions – states, capitalist markets, science. It became impossible to make a meaningful connection with these anonymous institutions and most intellectual disciplines had no room for human beings in them. Of course, people everywhere continued to express themselves where they could – in domestic life and informal economic practices. The three main components of modern economy – people, machines and money – were not properly addressed by the academic discipline devoted to its study. Anthropologists aim to produce an understanding of the economy that features people: first as workers or consumers in economies dominated by large-scale organizations and when left relatively free to be self-organized as farmers, traders, managers of households or givers of gifts; second, our interest is in the universal history of humanity; and our examples are drawn from all over the world. Somehow we have to find meaningful ways of bridging the gap between the two. But we will fail if we ignore the world brought into being by money and machines.

What is meant by the term ‘economy’? English dictionaries reveal a number of overlapping referents:
1. Order, management
2. Efficient conservation of resources
3. Practical affairs
4. Money, wealth
5. The market
These meanings apply to a wide range of social units. The Greek word oikonomia referred to impositing order on the practical affairs of a house, usually a manorial estate with its slaves, animals, fields and orchards. Economic theory then aimed at self-sufficiency through careful budgeting and the avoidance of trade, where possible. The market, with its rootless individuals specialized in business (chrematistike), was the very antithesis of an economy that aimed to conserve both society and nature. So in origin ‘economy’ emphasized the first three above while focusing on the house as its location. Smith’s intellectual revolution switched attention from domestic order to ‘political economy’ and especially to the functioning of markets. Two things happened next. First, the market was soon dominated by firms commanding massive resources, a system of making money with money eventually named as ‘capitalism’ (Sombart). Second, states claimed the right to manage money, markets and accumulation in the national interest; and this is why ‘the economy’ as an unmarked category today refers to the country we live in.

Any aggregate from associations of states like the European Union to localities, firms and households may be said to have an ‘economy’. So the word contains within itself this historical shift from house to market and from small- to large-scale organization. But it is not clear whether it is primarily subjective or objective. Does economy refer to an attitude of mind or to something out there? Moreover, just as the factory revolution shifted the emphasis from agriculture to industry, the economy now primarily consists of electronic bits whizzing around cyberspace. If the world’s poor still lack material necessities, for a growing number to focus on survival and subsistence no longer makes sense. The confusion at the heart of the concept reflects not only an unfinished history, but also wide differences in contemporary experience.

What if we retain the original definition of economy while applying it to a world shaped by markets? Then ‘economy’ would mean putting one’s house in order, both practically and figuratively. Are markets compatible with that notion or not? Is the phrase ‘market economy’ an oxymoron? This juxtaposition of house and market reminds us of the centrality of kinship in society. If coping with the world requires us to be highly self-reliant, we enter it as members of households and base our most intimate and long-term strategies for life on them. Economic order must be reproduced through the fluctuating outcomes of birth, copulation and death that sustain domestic groups. Stephen Gudeman has developed a powerful case for considering economy everywhere as a dialectic of base (house and by extension community) and market; Richard Wilk has made a special study of the role of households in economy; the articulation of economy and the life cycle is a major theme of Sandy Robertson’s work; and Chris Gregory has recently asked why householding as a mode of economic integration later dropped out of Polanyi’s writing. So my choice of emphasis is nothing new.

Aristotle was wrong to imagine that houses could aspire to a condition of autarky, when markets draw them into wider circuits of economic interdependence. Thrift may be a useful virtue; but self-sufficiency is a practical impossibility. The house has been subsumed under more inclusive social units (kingdom, city, nation, world), where its principles of order took on new meaning. Thus monasteries, temples and palaces were all ways of extending the house principle to the larger society and each were crucibles of innovation in economic ideas and practices. The medieval schoolmen made ‘economy’ a divine principle of cosmic order, while the cities that grew up in the interstices of feudal society spawned their own ‘bourgeois’ version of economy. Later the nation-state framed economy; and only recently has the world economy become something more than a figure of speech, as in the multilateral institutions established at Bretton Woods. The boundaries of society have been pushed outwards by the market, along with warfare and religion. Whereas Polanyi thought markets could only serve society if subjected to non-market controls, Mauss believed that human aspirations for social justice could be achieved through self-organized market expansion and not despite it.

What sort of ‘order’ are we talking about? The key term is ‘form’ – a Kantian idea that constitutes the rule, the invariant in the variable. It is predictable and easily recognized. Words are forms, of course. Hegel showed the error of taking the idea for reality. We all know the word ‘house’ and might think there is nothing more to owning one than saying ‘my house’. But eventually the roof leaks, the paint peels and we realize that the house is a material process requiring attention. Formal economic rationality is likewise an idea, a collection of people, things and activities; but we should not mistake the category for the reality it identifies. What makes something ‘formal’ is its conformity with a rule. The idea of an ‘informal economy’ is entailed in the effort to organize society along formal lines. In the twentieth century the dominant forms were those of national bureaucracy. This identity may now be weakening in the face of neo-liberalism and the communications revolution. My chief complaint against economics and social science generally is not their emphasis on forms of reason, but their willingness to detach these from lived social reality.

The ‘informal economy’ drew attention to what people did beyond the reach of state regulation; but it offered no clue to the social forms through which they organized these activities. These are legion: kinship, locality, religion, ethnicity, criminal gangs, unions, savings clubs and creative combinations of any or all of these. They all reflect the need to stabilize the flux of everyday life in manageable ways; and the tradition of British social anthropology, drawing on comparative jurisprudence to make fine-grained analyses of customary institutions, has much to offer for their study. As for ration solutions to the problems of world economy, Keynes’s recipe for the last great economic crisis (redistribution) should be transposed to global conditions today. But this would involve a tectonic shift in world politics which is only likely in the event of wholesale economic disaster. Environmentalism may contain the seeds of a religious revival that could sweep away the neo-liberal consensus. But if a return to natural religion encourages rejection of markets and money, the consequences could be even worse.

Economic anthropology

The neoclassical economists rarely expressed any interest in anthropology and none since they became the ideological and practical arm of global capitalism. Anthropologists have usually felt obliged to address the economists’ perspective, sometimes applying their ideas and methods to exotic societies, more often being critical of the discipline’s claim to be universally valid. Discourse in economic anthropology has generally concerned the interpretation of economic ideas in the light of ethnographic findings. I have suggested that economic anthropology might benefit from seeking to integrate house and market, ecology and economy within a humanist vision of our moment in world history.

We should revisit our roots in Immanuel Kant’s late work. Kant aimed to attract the general public to anthropology as an independent discipline. His method was based on empirical observation, but he also sought to provide his students with practical guidance and knowledge of the world as means of their moral and cultural improvement. His was an investigation both into human nature and, especially, into how to modify it. He intended the Anthropology to be ‘popular’ and of value in later life. Above all, it should contribute to the progressive political task of uniting world citizens by identifying the source of their ‘cosmopolitan bonds’.

Kant concentrated on the pragmatic applications of anthropology — ‘what the human being as a free actor can and should make of himself’. For him it was the practical arm of moral philosophy which does not explain the metaphysics of morals, which are categorical and transcendental; but it is indispensable to understanding any interaction involving human agents. It is ‘pragmatic’ in a number of senses: ‘everything that pertains to the practical’, popular (as opposed to academic) and moral in that it concerns what people should do, their motives for action. He felt that the main value of his book lay in its systematic organization, so that readers could incorporate their experience into it and develop new themes appropriate to their own lives. Kant is the main source for the notion that society may be as much an expression of individual subjectivity as a collective force out there. In order to understand the world, we must begin not with the empirical existence of objects, but with the reasoning embedded in all the judgments we have made. The world is inside each of us as much as it is out there. Our task is to unite the two poles as subjective individuals who share the object world with the rest of humanity. Kant’s notion of anthropology as a form of humanist education contrasts starkly with the emphasis on scientific research in today’s universities.

Kant’s achievement was soon overthrown by a counter-revolution that identified society with the state. This was launched by Hegel and it was only truly consummated after the First World War. As a result, the personal was separated from the impersonal, the subject from the object, humanism from science. Twentieth-century society was conceived of as an impersonal mechanism defined by international trade, national bureaucracy and scientific laws understood only by experts. People, including most anthropologists, felt ignorant and impotent in such a society. The sources of our alienation are commonplace. What interests me is resistance to alienation, whatever form it takes. How can we feel at home in the restless turbulence of the modern world? The digital revolution is in part a response to this need. We feel at home in intimate, face-to-face relations; but we must also engage in remote, impersonal transactions at distance. Improvements in telecommunications cannot stop until we replicate at distance the experience of direct interaction. For the drive to overcome alienation is even more powerful than alienation itself. We now have near-universal communications with which to express universal ideas; it remains to must make world society in the image of our own humanity.

A lot more political education is needed before people can exchange dependence on an impersonal economic system for a more personal relationship to money and markets. Economic anthropology should aim to show that the numbers on people’s financial statements and transaction records summarize their relations with society at a given time. The next step is to explain where these numbers come from and how they might serve in building a viable personal or household economy. When they are able to take responsibility for their own economic actions, people will understand better the social forces impinging on their lives. Then it will become more obvious how and why ruling institutions need to be reformed for all our sakes. If plastic credit cards are a step towards greater humanism in economy, this also entails increased dependence on the impersonal organization of governments and corporations, on impersonal abstraction of the sort associated with computing and on impersonal standards and social guarantees for contractual exchange. If money helps us to keep track of the complex social networks that we each generate, it could take a wide variety of forms compatible with both personal agency and collective forms of association at every level from the local to the global. It is up to us to build them.

‘Anthropology’ is indispensable to the making of world society in the coming century. It would then mean whatever we need to know about humanity as a whole if we want to build a more equal world. This usage could be embraced by students of history, sociology, political economy, philosophy and literature, as well as by some anthropologists. The idea of ‘development’ has played a similar synthesizing role in the last half-century. It matters less that an academic guild should retain its monopoly of access to knowledge than that the questions I have raised today should be taken up by a broad intellectual coalition for whom the realization of a new human universal – a world society fit for humanity as a whole — is a matter of urgent personal concern.

1. Professor Hart, could you please begin by telling me a bit about what you are currently working on?

In the last couple of years I have written several articles on money from different points of view. Four essays in press are ‘On money and anthropology: towards a new object, theory and method’, ‘The persuasive power of money’, ‘Money is always personal and impersonal’ and ‘Money in the making of world society’ (the last being the title of my inaugural lecture at Goldsmiths this coming October). I have also given keynote lectures at conferences and written several articles on the informal economy, a concept I contributed to development studies.
I have recently published a review essay on Marcel Mauss; and with Alain Caillé I plan to organize in 2009 a major conference on his relevance today. With Jean-Louis Laville and Marguerite Mendell, I am preparing a version of the Dictionnaire de l’autre économie (Gallimard, 2006) for publication in English. Chris Hann and I are editing Market and Society: The Great Transformation today, a collection of essays focusing on Polanyi’s relevance to economic anthropology in the neo-liberal crisis. Chris and I are writing a text book together, Economic Anthropology: a short history. I will be giving the keynote lecture, ‘The human economy’, at a London conference in January 2008, ‘Rethinking economies: a human-centred approach’, the culmination of a workshop series I have helped to organize.
I am preparing a book that summarizes a lifetime’s engagement with African development, The African Revolution: Africa in the 21st century world. I have just been appointed an Honorary Research Professor at the University of Kwazulu-Natal, Durban and expect to be actively involved in research there and in India with my partner, the economist, Vishnu Padayachee. I have also agreed to join a proposed anthropological study of unions in Brazil and Argentina.
In September 2007, I gave a public lecture on my thoughts concerning the future of anthropology, ‘Towards a new human universal: rethinking anthropology for the 21st century’. More generally, my website is an experiment in online publishing linked to the development of a more publicly accessible anthropology.

2. You are trained as an anthropologist, but how come that you entered this field?

I always intended to be an academic; it was just a question of which kind. I was a student of classics at Cambridge in the early 60s, which I loved; but the job prospects seemed limited at a time when the social sciences were booming. I thought of sociology, but at that time it was part of the economics syllabus and, curiously given my later interests, I was put off by the association. I had a rowing coach, a geographer, who studied desert erosion in the Mediterranean basin and this allowed him to spend the winters in warmer places. I thought that social anthropology was a sort of sociology with travel possibilities and found that attractive. When I switched to that department, my professors worked in Ghana and I imagined I would be more likely to be funded if I went there. I could concoct a more laudable explanation in retrospect, but my eyes were fixed on the prize of an academic career. Of course, if I had known then what I know now about the universities, my priorities might have been different.

3. In your own work, the issue of money is central. This is also a field in economic sociology. Still, it is not at least my impression that anthropologists and sociologists cooperate on this important topic. Why is that?

It is hard for anthropologists and sociologists to cooperate in anything, since their respective guilds overlap considerably and this puts them in competition. I have found it easy and profitable to collaborate with economists and engineers. The sociologist, Nigel Dodd at LSE has always given my work on money a fair hearing and I respect his. Geoffrey Ingham, on the other hand, promotes a state theory of money that is diametrically opposed to mine. I have indicated above that my main collaborators in Paris, Laville and Caillé, are economic sociologists. In France, the lines between disciplines are often fuzzier than in the Anglophone world. Thus Bruno-Théret and Jean-Michel Servet are both close colleagues whose work on money straddles political economy, sociology and anthropology.
In the book on Polanyi, Chris Hann and I commissioned chapters by Jens Beckert and Philippe Steiner, with both of whom I share an agenda for the development of cooperation across disciplinary boundaries in building up a viable alternative to mainstream economics. Someone like Viviana Zelizer is read and frequently invited to speak by anthropologists. There is considerable overlap between her intellectual agenda in The Social Meaning of Money (1994) and Parry and Bloch’s collection, Money and the Morality of Exchange (1989). I find that anthropologists and sociologists frequently emphasize the same personal and social aspects of money, leaving the more abstract and impersonal realms of economy to the economists. This is a common failing; but it is not grounds for an active division of labour between them. I should say that I have taught sociology and have been hired as an economist, so demarcation disputes within the social sciences don’t mean a lot to me.

4. Though the following quote from your homepage is taken out of context, I see many similarities with sociology: “Economic anthropology should aim to show that the numbers on people’s financial statements, bills, receipts, and transaction records constitute a way of summarizing their relations with society at a given time”. Could you clarify what you mean by this? (http://www.thememorybank.co.uk/2007/07/15/127/ ).

In general my approach aims to go beyond the 20th century dualism of structure and agency. That is why I emphasise money’s ability to span the universal and the particular, abstract and concrete, collective and individual. Although I do not develop the argument in the piece you refer to, I hope to emulate Kant in developing a cosmopolitan anthropology ‘from a pragmatic point of view’. I understand by this the search for what we need to know about humanity as a whole if we want to build a world fit for everyone. But, beyond that, to make what we discover available to people in a form that they can use for practical purposes.
The method I advocate is summarized in a trio of sentences. The one above is followed by: “The next step is to show where these numbers come from and how they might be manipulated in the actor’s interest. Then it will become more obvious how and why ruling institutions need to be reformed for all our sakes.” In a highly compressed way, I am outlining a programme for economic anthropology as a kind of political education and perhaps also as a sociology in Durkheim’s sense of making our connections to society more visible.
The issue is how money might be approached in a less alienated way. This includes not just the money fetish, but a number fetish also (here I draw explicitly on Spengler). There is an obvious parallel with Marx’s argument in Capital I ch.1, except that I remove the illusion that the commodities relate only to each other and keep the ‘magic’ of seeing goods and prices as personalized powers, except that these powers are social as well as personal, a position I take from Mauss).
I am glad that you picked on this sentence, since in many ways it is the crux of the essay. In order to have a conversation about it, a lot more needs to be unpacked on both sides.

5. What do you see as the main findings of economic anthropology that should be known also to outsiders?

Among the abiding questions at the intersection of economics and anthropology are the following: Is the economists’ aspiration to place human affairs on a rational footing an agenda worthy of anthropologists’ participation or just a bad dream? Since economics is a product of western civilization – and of the English-speaking peoples in particular – is any claim to universality bound to be ethnocentric? If capitalism is an economic configuration of recent origin, could markets and money be said to be human universals? Can markets be made more effectively democratic, with the unequal voting power of big money somehow neutralized? Can private and public interests be reconciled in economic organization or will the individualism of homo economicus inevitably prevail? Should the economy be isolated as an object of study or is it better to stress how economic relations are embedded in society and culture generally? None of these questions is exclusive to economic anthropology.
Chris Hann and I approach economic anthropology through three historical periods. The first covers from the 1870s to the 1940s, when economics and anthropology emerged as modern academic disciplines. A bureaucratic revolution concentrated power in strong states and corporate monopolies, yet economics reinvented itself as the study of individual decision-making in competitive markets. Later, when a rapidly urbanizing world was consumed by economic disaster and war, anthropologists published ethnographies of remote peoples conceived of as being outside modern history. Neither branch of study had much of a public role.
The period since the Second World War saw a massive expansion of the universities and the rise of economics to the public prominence it enjoys today. An academic publishing boom allowed anthropologists to address mainly just themselves and their students. Economic anthropology sustained a lively debate between formalists, substantivists and Marxists from the 1950s to the 1970s, when the welfare state consensus was at its peak and European empires were dismantled.
The sub-discipline has been less visible since the 1980s, the era of ‘neo-liberal globalization’ in world economy. A lot has been produced on exchange, money, consumption and privatization, but, as with much else in contemporary anthropology, the results are fragmented. Economic anthropologists have generated a critical commentary on capitalist civilization at a time when the market economy became truly global. There has been greater theoretical self-awareness, even a degree of openness to the history of economic ideas; but anthropologists have so far avoided making a direct challenge to the economists on their home territory of national and global economic analysis.
At the same time, although most anthropologists still rely on fieldwork as their distinctive method, the ethnographic model of research has come under considerable pressure as a result of theoretical developments sometimes labelled ‘post-modernism’. This has led to new approaches to the economy using experimental methods; but these efforts have generally stopped short of offering an anthropological perspective on our moment in world history.
This is a pity, since the end of the Cold War, the birth of the internet and the globalization of money markets cry out for comprehensive historical treatment. The result, however, is that economic anthropologists now study the innermost workings of capitalism at its core and in its global spread; the privatization of what were recently communist economies (‘post-socialist transition’); and the plight of poor people in non-western countries, as defined by international bureaucracy (‘development’).

6. If you were to recommend one text, besides your own, to a non-anthropologist, who would like to get into economic anthropology, what would that be?

The obvious one would be The Gift, but it is quite allusive and you need a lot of background to make sense of it. Mauss’s intellectual programme here is taken from Durkheim’s The Division of Labour in Society, especially the chapter on the ‘non-contractual element in the contract’, but this too is rather hard going. To my mind, the most revolutionary book written by any of the founders of modern social theory is The Elementary Forms of Religious Life. Money is the God of capitalism and economics is its false religion. But then this might not take my hypothetical reader directly into economic anthropology. Weber’s General Economic History is a wonderful introduction and the last chapter again makes the link between economy and religion. But one book never fails to enthuse readers and it opens up the sort of economic anthropology, history and sociology that interests me: Karl Polanyi’s The Great Transformation. I said I was once a classicist and this way of answering your question should make it clear why I prefer to enter a discipline through its formative texts. I share an intellectual heritage with most sociologists.

7. You have worked also on normative issues. Students are normally told that they should separate what one ought to from what is. Most social scientists accept this, but what I am interested in is if, and if so how, normative work can further “traditional” scientific work?

Max Weber should be turning in his grave, if you talk like this. The issue is the relationship between politics and science (or the intellectual life more generally). Weber’s two great essays on ‘Politics as a vocation’ and ‘Science as a vocation’ show that the line between the two is hard to draw firmly and perhaps one should not try. Politics, he says, is the pursuit of power and its means is passion. But a politician who is indifferent to reason will soon lose his credibility. Equally science is the pursuit of knowledge by means of reason. But all the best scientists are passionate about their work. Weber’s work is incomprehensible except as an attempt to find ways of combining science and politics. This may involve compartmentalising each activity to a degree, but they feed into each other over time.
All the great thinkers I have learned most from drew inspiration from a desire to make a better world. Most of these changed the world through what they wrote more than by their political achievements (Locke and Marx, for example), but their intellectual work was still inspired by their political engagement. I have spent most of my adult life in the field of ‘development’. Whatever scientific aspirations one might have in this field, the only way forward is to identify the possible in the actual (Rousseau, Hegel).
The kind of science you identify as ‘traditional’ is a pastiche of real science, backward-looking and conservative, more worthy of the label ‘ideology’. If ‘social scientists’ had paid any attention to real science in the twentieth century, they would have been directly influenced by scientific modernism (relativity, quantum mechanics) or by the non-linear anti-reductionist sciences of complexity. But on the whole they have not. Economics is still fixed in a seventeenth-century epistemology. The only twentieth-century social thinker of any significance who was open to contemporary scientific ideas and methods was Keynes. And he was not much bothered to distinguish between politics and science.

8. Economic anthropology, much like economic sociology, has related itself to economics. Do you think anything is gained by this?

Economic anthropology is the product of a juxtaposition of two academic disciplines in the twentieth century. It would be wrong to speak of the relationship between economics and anthropology as a dialogue. From the beginning, economists in the neoclassical tradition have rarely expressed any interest in anthropology and none at all during the last half-century, when their discipline has become the dominant ideological and practical arm of global capitalism. Anthropologists, on the other hand, when they have been concerned with ‘the economy’, have usually felt obliged to address the perspective of mainstream economists, sometimes applying their ideas and methods to exotic societies, more often being critical of the discipline’s claim to be universally valid. Since anthropologists in this period based their intellectual authority on the fieldwork method, discourse in economic anthropology has generally been preoccupied with the interpretation of economic ideas in the light of ethnographic findings. But civilization is often thought of as an economy these days; and some anthropologists, drawing on a variety of theories and methods, have offered alternative visions of the economy’s past, present and future.
When I completed my doctorate, I joined a group consisting mainly of development economists. This required me to talk to them. Our exchanges would go something like this:
Economist: Is the marginal productivity of agricultural labour zero in Northern Ghana?
KH: What does that mean?
E: I am thinking of Lewis’s dualistic theory of labour migration between traditional and modern sectors. It is assumed that people could leave the former without reducing total output there.
K: Does it make any difference what income they get from working in agriculture?
E: What do you mean?
K: Well, most of the farm work is done by young men, but their elders control the distribution of the product. So, if they leave to work in the towns, whatever they get there is their own and more than what they have at home.
E: What do you call that kind of organization?
K: Lineages or unilineal descent groups. A French Marxist, Pierre-Philippe Rey has written about the ‘lineage mode of production’ in West Africa.
E: And you say economists like jargon too much! There is a new version of the Lewis model by Harris and Todaro that hinges on rural-urban income expectations.
K: Maybe we should collaborate on an article, ‘The lineage mode of distribution: a reflection on the Lewis model’…
In this and other ways, I learned that I could make a satisfactory academic living by acting as a broker from anthropology to economics and back again. But I wanted to change both disciplines. I realised that I would have to learn to communicate in the economists’ language, since they were professionally dominant in the field of development. So for three years I worked part-time as a journalist for The Economist, producing reports of West Africa. Through this work, I learned ‘economese’ – how to sound like an economist without any formal training in the discipline. This served me well, when I launched the concept of the informal economy. My original paper had two parts: the first was a vividly written ethnographic account of life in an Accra slum (I have been there and you haven’t); the second drew on my conversations with economist colleagues to present my argument in terms they could understand.
I had a close friend at this time, the economist John Bryden. We later joined together to collaborate on A New Approach to Rural Development in Europe (2004). My current research partner in South Africa is the economist, Vishnu Padayachee with whom I have worked on Indian businessmen and relations between India and South Africa more generally. So I continue to derive great benefit from these conversations.
I also note with some enthusiasm the development of a critical alternative to mainstream economics within the discipline, ‘post-autistic economics’. I am hopeful that an interdisciplinary conversation could be opening up after the sterile interlude of the twentieth century. Even if it doesn’t, I intend to be in one. Despite my anger against economists’ abuse of a gullible public’s trust, I still believe that humanity would benefit from being able to place our common economic affairs on a rational footing.

9. What, if any, shortcomings do you see with contemporary economic anthropology?

The main shortcomings of economic anthropology are those of academic anthropology in general – over-reliance on the fieldwork method, refusal to engage with world history, professional introversion within a self-protective guild, and being closed to the kind of interdisciplinary conversation that might lead to the development of a genuine alternative to mainstream economics today. I see signs of improvement in this respect and I place my own initiatives at this time within such a project.

10. Assuming that we can do it, and your answers suggest and give hope that we can do this, on what topics would you like to see sociologists and anthropologists cooperating?

I have indicated that I find it personally easy to collaborate with individuals from other disciplines who are of like mind and are interested in similar questions. But building the institutional and interactive framework for a coherent alternative to mainstream economics is more important that finding topics to investigate together on an ad hoc basis.
Assuming that anthropologists and sociologists really do different things, what might make collaboration between them mutually advantageous? For me the routine story of their difference is deeply misleading. Anthropologists are supposed to study the others and to place a premium on getting close to the people, whereas sociologists work closer to home and are more theoretically and methodologically rigorous. The anthropologists often resent what they see as sociologists’ arrogance – the failure of a remote and over-formalized bourgeois caste to take our incursions into the study of global capitalism seriously. But there is some truth to the stereotypical contrast. The anthropologists are often messier — they could use some of the intellectual rigour that sociologists insist on — and they do have a wider framework of comparison that should perhaps be more readily accessible to those who only study the West.
There are many schools of anthropology and I come from one that always thought of social anthropology as a form of comparative sociology in a line of descent from Montesquieu. So I would recommend economic sociologists to find out more about what anthropologists really do and how our practices and assumptions vary. For example, Kalman Applbaum’s The Marketing Era (2003) is an anthropological work of remarkable originality that combines a historical comparison between the development of marketing in 18th century Britain and early 20th century USA with an ethnographically based commentary on the global diffusion of marketing practices today. I am sure that the possibilities for exchange and co-operation with economic sociologists on this topic would be greater if the author were not an outsider to the latter’s guild. So the first priority is to open up chances for dialogue, of which your initiative in commissioning this interview is obviously one.
In recent years I have been exploring a version of anthropology that, rather than taking its form from the contemporary academic discipline, is inspired by the liberal philosophers of the 18th century and especially by Kant’s cosmopolitan example. ‘Anthropology’ would then mean whatever we need to know about humanity as a whole if we want to build a more equal world society. I hope that this usage could be embraced by students of history, sociology, political economy, philosophy and literature, as well as by members of my own profession. Many disciplines might contribute without being exclusively devoted to it. The idea of ‘development’ has played a similar role in the last half-century. It matters less that our separate academic guilds should retain their monopolies of access to knowledge – or even find ways of occasionally working together — than that ‘anthropology’ should be taken up by a broad intellectual coalition for whom the realization of a new human universal – a world society fit for everyone to live in — is a matter of urgent personal concern.

11. If you were to give advice to a young social scientist today, who is interested in the economy, what is the most important lesson you have learned?

Study the economy in every way that the economists don’t; learn to speak and write ‘economese’ so that you can enter a conversation with them.

Economic sociology: the European electronic newsletter 9.1, November 2007

Economic anthropology is the product of a juxtaposition of two academic disciplines in the twentieth century. It would be wrong to speak of the relationship between economics and anthropology as a dialogue. From the beginning, economists in the ‘neo-classical’ tradition have rarely expressed any interest in anthropology and none at all during the last half-century, when their discipline has become the dominant ideological and practical arm of global capitalism. Anthropologists, on the other hand, when they have been concerned with ‘the economy’, have usually felt obliged to address the perspective of mainstream economists, sometimes applying their ideas and methods to exotic societies, more often being critical of the discipline’s claim to be universally valid. Since anthropologists in this period based their intellectual authority on the fieldwork method, discourse in economic anthropology has generally been preoccupied with the interpretation of economic ideas in the light of ethnographic findings. But civilization is often thought of as an economy these days; and some anthropologists, drawing on a variety of theories and methods, have offered alternative visions of the economy’s past, present and future.
After briefly considering the idea of economy in anthropological perspective, we divide our account into three historical periods. The first covers from the 1870s to the 1940s, when economics and anthropology emerged as modern academic disciplines. A bureaucratic revolution concentrated power in strong states and corporate monopolies, yet economics reinvented itself as the study of individual decision-making in competitive markets. Later, when a rapidly urbanizing world was consumed by economic disaster and war, anthropologists published ethnographies of remote peoples conceived of as being outside modern history. Neither branch of study had much of a public role. The period since the Second World War saw a massive expansion of the universities and the rise of economics to the public prominence it enjoys today. An academic publishing boom allowed anthropologists to address mainly just themselves and their students. Economic anthropology sustained a lively debate from the 1950s to the 1970s, when the welfare state consensus was at its peak and European empires were dismantled. The sub-discipline has been less visible since the 1980s, the era of ‘neo-liberalism’ and ‘globalization’ in world economy. A lot is still produced on exchange, money, consumption and privatization, but, as with much else in contemporary anthropology, the results are fragmented.
Despite our focus on historical change, there are some abiding questions at the intersection of economics and anthropology. Is the economists’ aspiration to place human affairs on a rational footing an agenda worthy of anthropologists’ participation or just a bad dream? Since economics is a product of western civilization – and of the English-speaking peoples in particular – is any claim to universality bound to be ethnocentric? If capitalism is an economic configuration of recent origin, could markets and money be said to be human universals? Can markets be made more effectively democratic, with the unequal voting power of big money somehow neutralized? Can private and public interests be reconciled in economic organization or will the individualism of homo economicus inevitably prevail? Should the economy be isolated as an object of study or is it better to stress how economic relations are embedded in society and culture in general?
In The Great Transformation (1944), Polanyi brought a radical critique of modern capitalism to bear on his moment in history. We too must start from the world we live in, if we are to apply the vast, but inchoate intellectual resources of anthropology to a subject that is of vital concern to everyone. Ours is a very different world from when Polanyi so confidently predicted the demise of the market model of economy. Yet the revival of market capitalism and dismantling of state provision since the 1980s furnishes plentiful material for Polanyi’s thesis that the neglect of social interests must eventually generate a political backlash and a retreat from market fundamentalism. In our Introduction, we suggested that the world may now be emerging from the period of neo-liberal hegemony, with obvious potential consequences for the project known as ‘economic anthropology’. The ongoing globalization of capital – its spread to Japan, China, India, Brazil, Russia and elsewhere after centuries of western monopoly – is also bound to affect our understanding of economy. The absolute dominance of market logic, at least in the form devised by neo-liberal economists, may be coming to an end. Then, not only will Polanyi’s ideas receive more favourable attention, as they already have in some quarters, but the urgent need to review the institutional basis of economy may stimulate anthropologists to renewed efforts.
In this volume, we identify a possible convergence between economic anthropology, economic sociology and institutional economics, yielding an alternative version of economic knowledge to challenge orthodoxy. Agreeing on a common label for this enterprise matters less than identifying clear questions for collaborative inquiry. This short history of economic anthropology is offered as a contribution to that end.

Anthropology and ‘the economy’
It is a good thing that civilization is conceived of largely as an economy these days, since most people care a lot about their economic circumstances. The days are long gone when politicians could concern themselves with affairs of state and profess ignorance of the livelihoods of the masses. Hence Bill Clinton’s famous memo to himself, ‘It’s the economy, stupid!’ For millennia, economy was conceived of in domestic terms, as household management. Then, when money, machines and markets began their modern rise to social dominance, a new discipline of political economy was born, concerned with the public consequences of economic actions. For over a century now, this discipline has called itself economics and its subject matter has been the economic decisions made by individuals, not primarily in their domestic capacity, but as participants in markets of many kinds. People as such play almost no part in the calculations of economists and find no particular reflection of themselves in the quantities published by the media.
The founders of neo-classical economics, such as Marshall (1890), started out with the same broad style of questioning as their classical predecessors, with speculations on human nature and society, that subsequently dropped out of the modern discipline, leaving it to anthropologists to pick up on these questions. Anthropologists aim to produce an understanding of the economy that has people in it, in two senses. First, we are concerned with what people do and think, both as workers or consumers in economies dominated by large-scale organizations and when left relatively free to be self-organized as farmers, traders, managers of households or givers of gifts. Second, our interest is in the universal history of humanity, in its past, present and future; and our examples are drawn from all over the world. Somehow we have to find meaningful ways of bridging the gap between the two. There are of course many economies at every level from the domestic to the global and they are not the same, but the prevailing approach to economic life is itself universal in pretension and so we too, in giving priority to people’s lives and purposes, aspire to a degree of intellectual unity. At the very least, an anthropological critique will show, as it always has, that claims for the inevitability of currently dominant economic institutions are false.
The twentieth century saw a universal experiment in impersonal society. Humanity was everywhere organized by remote abstractions – states, capitalist markets, science. For most people it was impossible to make a meaningful connection with these anonymous institutions and this was reflected in intellectual disciplines whose structures of thought had no room for human beings in them. Whereas once anthropologists studied stateless peoples for lessons about how to construct better forms of society, scientific ethnography no longer sought to change a world where ordinary citizens felt for the most part disempowered. Of course, people everywhere sought self-expression where they could – in domestic life and informal economic practices. The three most important components of modern economic life – people, machines and money – are not properly addressed by the academic discipline devoted to its study. In Capital, Marx (1867) expressed humanity’s estrangement from the modern economy by making abstract value (money) the principle organizing production, with the industrial revolution (machines) as its instrument and people reduced to the passive anonymity of their labour power. Marx’s intellectual effort was aimed at reversing this order and that remains our priority today.
What might be meant by the term ‘economy’? English dictionaries reveal that the word and its derivatives have a number of separate, but overlapping referents:

1. Order
2. Efficient conservation of resources
3. Practical affairs
4. Money, wealth
5. The circulation of goods and services
6. Involving a wide range of social units

The word comes from ancient Greek, oikonomia. It literally meant ‘household management’, the imposition of order on the practical affairs of a house, usually a large manor house in the countryside with its slaves, animals, fields and orchards. Economic theory then aimed at self-sufficiency through careful budgeting and the avoidance of trade, where possible. The market, with its rootless individuals specialized in money-making, was the very antithesis of an economy that aimed to conserve both society and nature. So in origin ‘economy’ emphasized the first three above while focusing on the house as its location. For Aristotle and thinkers like him, it had nothing to do with markets or money or with wider notions of society.
This ideal persisted in rural Europe up to the dawn of the modern age. Indeed countries like Russia and France were still significantly peasant societies well into the 20th century, as the agrarian economist, A.V. Chayanov (1925) insisted. Even so, the economy has moved on in the last 2,500 years and especially in the last two centuries. In particular, a revolution in ideas led by Adam Smith (1776) switched attention from domestic order to ‘political economy’ and especially to the functioning of markets using money. Instead of celebrating the wisdom of a few patriarchs, Smith found economic rationality in the myriad selfish acts of individuals buying and selling commodities, the famous ‘invisible hand’ of the market. Two things happened next. First, the market was soon dominated by large firms commanding more resources than most, a system of making money with money eventually named as ‘capitalism’ (Sombart 1902). One of capitalism’s chief features is a focus on growth. States claimed the right to manage money, markets and accumulation in the national interest; and this is why today ‘the economy’ primarily refers to the country we live in.
The question of world economy has encroached on public consciousness of late; and almost any aggregate from associations of states like the European Union to localities, firms and households may be said to have an ‘economy’. In the process, ‘economy’ has come to refer primarily to the money nexus of market exchange, even though we retain the old meaning of efficient conservation of resources. So part of the confusion with the word ‘economy’ lies in the historical shift from the self-sufficiency of rural households to complex dependence on urban, national and world markets. But that isn’t all. It is by no means clear whether the word is primarily subjective or objective. Does it refer to an attitude of mind or to something out there? Is it ideal or material? Does it refer to individuals or to collectivities? Perhaps to all of these — in which case, we should focus on the links between them. Economists may argue that economy is principally a way of reasoning (Schumpeter 1954), but we can hardly say that all those people who talk of economies as social objects are wrong. Moreover, if the factory revolution shifted the weight of economy from agriculture to industry, mainstream economic life now takes the form of electronic digits whizzing around cyberspace at the speed of light. The idea of economy as provision of material necessities is still an urgent priority for the world’s poor; but for a growing section of humanity it no longer makes sense to focus on economic survival. The confusion at the heart of ‘economy’ reflects not only an unfinished history, but wide inequalities in contemporary economic experience.
The term ‘economy’ is as specific to the English language as solidarité is to the French. If the various meanings of the word are obscure in English, their translation into most other languages is even more problematic. In German, for example, Wirtschaftswissenschaft, Nationalökonomie and Sozialpolitik have all occupied the space filled by the English word, ‘economics’ at various times and normal usage is still evolving. Britain and America have dominated global capitalism in the nineteenth and twentieth centuries respectively and so, gradually, the peoples of the world have come to absorb something of their economic terminology as common usage. All of these issues and more have to be addressed if ‘the economy’ is not to be trapped in ethnocentric abstraction.

The rise of modern economics and anthropology (1870s to 1940s)
Mill and Marx are widely recognized as the last of the classical political economists. While Marxism has since gone its own way, the liberal utilitarianism of Mill (1846) was refashioned from the 1870s onwards as the ‘neo-classical’ paradigm, which still defines economics today. The core of this paradigm, the notion of diminishing marginal utility, was independently pioneered by William Jevons in Manchester, Carl Menger in Vienna and Léon Walras in Lausanne during 1871-1874. They each located economic value in individuals conceived of as maximizing their utility, thus making a revolutionary break with the macro-sociological concerns of the classical economists (Hutchinson 1978). The new school achieved a synthesis in Alfred Marshall’s Principles of Economics (1890), a name that rhymes with mathematics and physics (Mirowski 1989). Following Edgworth’s example in Mathematical Psychics (1881), economists began to rely more on numerate methods, but to nothing like the same degree as today. Marshall’s neo-classical economics was challenged by an Austrian version and, during the Great Depression, by the even more contrary paradigm of his student, J. M. Keynes. In the United States the institutional economists, led by Veblen (1904) and Commons (1934), promoted a more explicitly political version of economic science. They were more than a match for the neo-classical economists there in the interwar period (Yonay 1998). The modern notion of ‘the economy’, along with Franklin Roosevelt’s New Deal, was a product of this era of general crisis (Mitchell 1998).
In the late nineteenth century, numerous scholars began to examine the relevance of new ethnographic data for theories of human evolution (Tylor 1871, Morgan 1877, Bücher 1893). Material based on fieldwork spawned increasingly systematic inquiries, with Germans in the forefront (Heath Pearson 2000, Spittler this volume). Leading economists were indifferent to their findings, the major exception being Marx, who in his last years took careful notes from works by Morgan, Lubbock and others (Krader 1974). The result was Engels’ The Origin of the Family, Private Property and the State (1884) which drew heavily on Lewis Henry Morgan’s Ancient Society (1877). Morgan paid much attention to property, but did not engage concretely with systems of production and exchange. Like other leading contemporaries, he was trained in law, not economics. Edward Tylor, in Primitive Culture (1871), gave only superficial descriptions of the major modes of subsistence and stages of technical progress; the last generation of Victorian ‘armchair anthropologists’ did no better. Since anthropologists did not have a clear concept of the economy, they were in no position to contribute new theoretical ideas on the subject.
In Germany, scholars of diverse disciplinary backgrounds, not content with vague descriptions of material culture, addressed theoretical questions of economic origins and technological determinism with considerable rigour. Gerd Spittler (this volume, forthcoming) approaches these early contributions through a focus on work: was work central to man’s self-realization or did humanity have a natural aversion to toil? The German forerunners of economic anthropology were almost all anti-socialist, but they were nonetheless influenced by Marx. This strong interest may be attributed in part to the dominance of historicist approaches in Germany. Max Weber’s first appointment was in Nationalökonomie, an economic discipline that rejected the universalism of the British political economists.
A dispute arose in the 1890s between Karl Bücher and Eduard Meyer over the oikos thesis of Rodbertus published thirty years earlier (Harry Pearson 1957). Bücher supported Rodbertus’s idea that ancient Greek economy was organized on fundamentally different principles from those of contemporary German capitalism. These principles were based, following Xenophon and Aristotle, on household management. Meyer pointed to the existence of thoroughly modern capitalist firms in Athens and elsewhere producing for the international market. Max Weber (1922) put the lid on this argument by suggesting that we wouldn’t be interested in ancient Greece unless it was different and we could not understand it unless our knowledge was capable of embracing the Greeks as in some sense the same as us. This was the dialectical premise of Hegel and, before him, Kant – sameness in difference, not same versus different.
Weber made much of Kant’s dualistic conception of the human faculties, the division between form arising from the operations of the mind itself and substance or perception of the material world through the senses. In his magisterial Economy and Society (1922), he argued that not only were the formal and substantive rationalities of capitalism different, but they were at odds. The ‘bottom line’ of accountancy for profit could, and often did, lead to economic failure (unemployment and the like) at the cost of disruption to people’s livelihood. This was an attempt to resolve ‘the Battle over Methods’ (Methodenstreit) then being waged between Schmoller’s historical economists in Berlin and the followers of Menger’s marginalism in Vienna. Here, as in the debate over economic primitivism (Harry Pearson 1957, Heath Pearson 2000), what was at stake was the pretension of the new economics to offer a universal foundation for the pursuit of human welfare. Weber, as a liberal, was sympathetic to the subjective individualism of the new economics, but, as a sociologist, he could hardly discount the human disasters wreaked in its name. The vehemence of these German debates owed something to rivalry between the German and Austro-Hungarian empires for leadership of the German-speaking world. To some extent they were just academic turf wars. Schmoller managed to get Viennese economists excluded from German universities for a time. The Methodenstreit resurfaced in American economic anthropology after the Second World War as ‘the formalist-substantivist debate’ which peaked in the 1960s (Leclair and Schneider 1968).
The concept of homo economicus provides the main focus of Heath Pearson’s overview of ‘primitive economics’ (2000). To early travelers the natives seemed to contradict European criteria for rationality, through their ‘childlike’ inconsistency in exchange, destruction of valuable property or painstaking efforts for no tangible benefit. Alongside this category of homo erroneous, Pearson identifies homo gustibus, a human subject who is endowed with a different psychological make-up, making his rationality appear quite different from the hedonism of the individual agent of neo-classical theory. Eventually, both of these stereotypes gave way to homo paleoeconomicus: the economic behaviour of ‘primitives’, allowing for differences in environment and technology, was similar to that of modern Western individuals. Superficially contradictory patterns of economic action could be seen as being consistent with the premises of homo economicus. One just had to abandon notions of time-discounting where there were few storage facilities and recognize the constraints of custom in societies lacking developed markets and money. Anthropologists were often no more consistent than the natives: Raymond Firth held all of these positions at different times (1929, 1939, 1967).
Malinowski’s standing as a founder of economic anthropology rests partly on his introduction of intensive fieldwork as a method. He obtained his doctorate at Cracow with a dissertation, ‘On the economy of thought’, about Ernst Mach; and Mach’s epistemological individualism provided the theoretical foundation of Malinowski’s functionalist approach (Stocking 1995: 245). His major contributions to economic anthropology are the first and last of the Trobriand monographs, Argonauts of the Western Pacific (1922), which is devoted to exchange, and Coral Gardens and Their Magic (1935), on work, technology and property arrangements. He insisted early on (1921) that the Trobrianders’ propensity to transfer goods as gifts showed that ‘tribal economics’ refuted any claim that the idea of ‘economic man’ is a human universal. The attention the Trobrianders gave to their gardens’ appearance contradicted the supposition that savages restricted their efforts to the minimum necessary for their survival. Argonauts was intended as a demonstration that a complex system of inter-island trade could be organized without benefit of markets, money or states and on the basis of generosity rather than greed. Yet his data — whether the transfer of kula valuables, the barter exchange known as gimwali or yams paid as urigubu tribute to matrilineal relatives – are entirely consistent with the notion of individuals maximizing utility (Parry 1986). Malinowski did much to support the rise of ‘applied’ anthropology in the colonies and this prepared the ground for later generations of anthropologists to become involved in ‘development’. Much of this work took place in Africa and Audrey Richards (1939) supplied the outstanding early monograph.
We now recognize Marcel Mauss’s Essai sur le don (1925) as the main source of opposition to Malinowski’s fusion of individualist traditions from Britain and Central Europe. Mauss was greatly enthused by Malinowski’s confirmation that the potlatch of America’s Northwest Coast flourished in Melanesia, but he insisted that money and markets were human universals: only the impersonal variant found in capitalist societies was distinctive. Following Durkheim’s lead in The Division of Labour in Society (1893), Mauss’s attack on economic individualism emphasized the personal, social and spiritual dimensions of exchange in all societies, including ours. His anthropology was wedded to a quite explicit socialist programme; but the essay has given rise to quite divergent interpretations since (Hart 2007). Only much later was The Gift widely acknowledged as Mauss’s chef d’oeuvre; it took two translations and a secondary literature, inspired above all by Lévi-Strauss (1950) and Sahlins (1972), for its radical message to be absorbed into Anglophone economic anthropology (Sigaud 2002). David Graeber’s long chapter on Mauss in Toward an Anthropological Theory of Value (2001) is the most complete treatment in English. Mauss’s example never launched a school of economic anthropology as such in France.
Richard Thurnwald’s impressive contributions to economic anthropology (Spittler, this volume) have been eclipsed by the marginalization of German scholarship after 1945. There are grounds for claiming that he discovered the concept of ‘embeddedness’ (Steiner, Beckert and Gudeman, this volume) long before Polanyi. Raymond Firth’s monumental study of the economic life of the Polynesian island of Tikopia (1939) made less use of German sources than his earlier Maori study (1929). At much the same time, Melville Herskovits published The Economic Life of Primitive Peoples (1940), a compilation of published sources aimed at drawing the attention of economists to the cumulative achievements of scientific ethnography. These systematic exercises in juxtaposing economic ideas and the results of ethnography launched economic anthropology in its modern form.
Thurnwald, Firth and Herskovits all emphasized that primitive economics was a ‘social affair’ (Thurnwald 1932: xi) and were careful to stress the differences between economies lacking money and machines and those dominated by markets. Lionel Robbins’ (1932) definition of economics as the study of choices made under conditions of scarcity summed up the dominant paradigm at the London School of Economics, even though he had Hayek’s radical Austrian views to contend with there and those of Keynes in the broader arena. Firth was more impressed by this economic orthodoxy than were Herskovits and Thurnwald. Indeed he was concerned to show that the concepts and tools of modern economics had general validity. Firth thought he had solved the ‘pseudo-problem’ raised by Malinowski by insisting that ‘complex social obligations’ do not detract from the basic explanatory power of ‘rational economic choice’ (1965: 331). To this extent he deserves to be seen as the first ‘formalist’. He used the basic categories of economics to organize his chapters; but, in order to understand the rationale for any given pattern of behaviour, he had to describe the context in some detail. The result is a rich ethnographic description of economic institutions, lightly informed by a rhetoric of rational choice.
The field of economics that Herskovits (1940) wished to confront with findings on economic life around the world was much more contested in America, where neo-classical economics faced a serious challenge from institutional economists (Yonal 1998). The Great Depression had destroyed the credibility of laissez faire: finding ways of regenerating public trust in the banking system had a higher priority than refining a micro-economic theory that was only normative at best. American anthropologists were accordingly less deferential to liberal economics. Herskovits too organized his material under headings that would be familiar to economists, even arguing that ‘…since land, labor and capital are ever-present forces in non-industrialized economies, it is apparent that they must yield some returns’ (1952:303). But he also felt free to criticize economic orthodoxy, drawing on the likes of Keynes, Veblen and even Marx, as well as ethnographic evidence culled from ‘non-literate peoples’.
If Herskovits was hoping for a dialogue between anthropologists and economists, Frank Knight, author of a pioneering book on the economics of risk (1923), quickly disabused him. Knight was sure that outsiders did not understand the principles of economics – or at least his branch of it. He began by attacking Ralph Linton’s puff for the book:
[When] Professor Linton says: “…the economic problems of ‘primitive’ man are essentially the same as our own and many of them can be studied even better in ‘primitive’ societies, because they manifest themselves in simpler form”…he simply doesn’t know what he is talking about. (Knight 1999 [1941]:108)

Herskovits did in fact contrast ‘machine and non-machine societies’, but he also tried to show that the classical categories of economics should be extended to the latter and he criticized economists for failing to recognize their own cultural limitations. Knight claimed that ‘buying and selling at a profit’ was not the central feature of American ‘business enterprise’, as Herskovits seemed to think, but rather ‘the impersonal attitude (which excludes bargaining!) and a labour market are really distinctive.’ (Ibid.:109) His main criticism, however, concerned epistemology. The other social sciences, including institutional economics, were empirical and neo-classical economics alone

…effectively uses inference from clear and abstract principles, and especially intuitive knowledge, as a method….[T]he conceptual ideal of economic behaviour is assumed to be, at least within limits, also a normative ideal, that men in general…wish to make their activities and organization more “efficient” and less wasteful…[T]he anthropologist, sociologist, or historian seeking to discover or validate economic laws by inductive investigation has embarked on a “wild goose chase”. Economic principles cannot be even approximately verified – as those of mathematics can be, by counting and measuring. (Ibid:111-113, our italics)

The principles of economics are the same wherever they are applied, but economists should beware of professing to be anthropologists and the latter had better learn what economists know before they tick them off for cultural ignorance.
Herskovits included Knight’s review along with his own rejoinder in the second edition of his book (1952). He still argued that ‘comparative economics’ was a project to which the two disciplines should each contribute. He rejected the notion that any science could rely exclusively on deduction and intuition or could be indifferent to facts; and clearly did not feel that he had lost the argument. Nor did anthropologists stop indulging in the practices that Knight complained of. But in the meantime, economics was rapidly remaking itself as a positive science. The organizational demands of the war led to a mathematical revolution in the discipline in the 1940s, led by two Dutchmen, Jan Tinbergen and Tjalling Koopmans (Warsh 2006). The post-war rise of economists to a position of unprecedented intellectual hegemony was fuelled by these econometric methods and by information-processors of increasing sophistication. Knight’s intuitive and normative approach to economic reasoning came to look rather quaint. It was displaced by an aspiration to model the real world; and economists asserted their new mastery of the public sphere with a dazzling repertoire of theorems, charts and numbers.
Both economics and anthropology had experienced major changes since the 1870s. Professionalization, in the form of mathematical skills or learning vernacular languages, increasingly separated scholarly communities that had never been particularly close. Malinowski’s challenge to the economists was easily ignored by them, just as the Freudians were able to dismiss his assault on the Oedipus complex (1926). Mauss’s armchair speculations were hardly noticed outside his own country. Firth and Herskovits claimed that the burgeoning literature on primitive economics was ripe to launch a comparative analysis broadly using the categories of neo-classical economics, but this never came about. Instead, after the Second World War, in Heath Pearson’s words, ‘economics and anthropology went through an ugly, drawn-out divorce’ (2000: 982). It is not evident that they were married in the first place.

The ‘golden age’ of economic anthropology (1950s to 1970s)
In retrospect, the period from the 1950s to the 1970s has a unity that was not obvious at the time. The world’s leading industrial powers, led by a United States committed to public spending and international co-operation, together engineered the longest economic boom in world history. Writing of ‘the short twentieth century’, Eric Hobsbawm (1996) described the period 1948-1973 as a ‘golden age’, marked by the close integration of nation-states and industrial capitalism on both sides of the Cold War. Certainly it was the heyday of the universities and of the social sciences in particular. So perhaps it is not surprising that economic anthropology seems to have flourished at this time.
As we noted in our Introduction, Karl Polanyi’s direct impact on the field of economic anthropology came, not from his historical critique of capitalism, The Great Transformation (1944), but from a contribution to Trade and Market in the Early Empires (1957), ‘The economy as instituted process’. He argued here that two meanings of the word ‘economic’ have been conflated: the substantive and the formal. The first refers to the provisioning of material wants, whereas the second is a means-end relationship, the mental process of economizing. Most pre-industrial societies are ruled by institutions that guarantee collective survival; but industrial societies have a delocalized (‘disembedded’) economy, ‘the market’, in which individual decision-making rules. Anthropologists and historians can study the first on concrete empirical grounds, while the abstract methods of economists are suited to the latter. In other words, economists can retain their commanding intellectual position in modern society, as long as the rest of us concentrate on studying exotic or dead societies. This left economic anthropology to be fought over by Polanyi’s followers (‘substantivists’) and those who insisted that an abstract individualism of universal pretension had a place in the subject (‘formalists’). The 1968 volume edited by Edward Leclair and Harold Schneider, Economic Anthropology, is a representative collection of both sides’ positions. It was of course the Methodenstreit again, with one side claiming that economy is everywhere the same and the other that it is different, while each produced accounts of sameness-in-difference to varying degrees.
Polanyi’s main venture into anthropologists’ territory was the historical study, Dahomey and the Slave Trade (1966), and Africa was a principal location for the work of his followers. Their leader was Paul Bohannan, a student of Herskovits who produced the most notable substantivist ethnography, concerning the Tiv of Nigeria (1968, with Laura Bohannan) and several articles which have shaped the anthropology of exchange, markets and money ever since. In his monograph, Bohannan insisted on the importance of indigenous cultural categories for an understanding of Tiv economy, while introducing as a means of cross-cultural comparison Polanyi’s three-fold typology of exchange. Polanyi in his Dahomey study had insisted on the difference between ‘general-purpose money’ (our own) and ‘special-purpose monies’ which he claimed enjoyed wide circulation in the non-industrial world. Bohannan (1955, 1959) developed this idea to argue for the existence of separate ‘spheres of exchange’ among the Tiv. Subsistence items, luxuries and goods expressing the highest social values circulated in separate compartments, since they were incommensurate. The introduction of western money with colonialism was a cultural disaster since it broke down barriers to exchange between the spheres. This story has passed into anthropological folklore as a staple of what every student learns, even though it has been attacked as factually wrong by historians (Dorward), and found theoretically naïve (Dupre and Rey 1973) and misleading by a wide variety of anthropologists (Parry and Bloch 1989, Guyer 2004, Hart 2005).
Bohannan’s main partner in taking up the cudgels for the substantivist cause was an economist, George Dalton. They produced a number of collections together, notably Markets in Africa (1963), where the focus of economic activity in non-industrial societies on market-places rather than ‘the market’ is explored through an impressive range of case studies. Dalton pushed the logic of Polanyi’s original suggestion (1957) to the formal extreme of proposing that anthropologists’ efforts be limited to non-capitalist economies. He was a keen polemicist (1969, 1971) who did more than anyone to keep the flames of academic debate burning.
The formalists did not lack their own polemicists, the most memorable example being Scott Cook’s (1968) parody of Polanyi’s followers as victims of an ‘obsolete anti-market mentality’. Harold Schneider produced his own synthesis of the formalist position in Economic Man (1974). His economic analysis rested ultimately on a generalized utilitarianism which at times descended to the level of examples about calculating whether to accept a kiss. A new strand of ‘transactionalist’ anthropology, drawing its inspiration from Fredrik Barth (1963), flourished at this time, demonstrating (as Firth had long before) that a utilitarian framework could be a means of describing a complex institutional context. Formalist anthropologists, whose knowledge of the history of economics does not appear to have been strong, sacrificed the sensitivity to institutional context shown by leading economists such as Marshall in order to promote a universalizing rhetoric of ‘maximizing individuals’. Eventually some of them found that a serious exposure to economics lent weight to their efforts; and formalism broke up into a number of specialist approaches drawing on information theory, game theory, cost-benefit analysis, rational choice, agricultural development and a host of other spin-offs from mainstream economics. By the 1980s many US universities were insisting that economic anthropologists should have a higher degree in economics rather than maintain the foolishness of the recent past.
Meanwhile, the anti-colonial revolution gathered pace, launching the project of collaboration between rich and poor countries known as ‘development’. This was an explicit revival of Victorian evolutionism, administered now by America in the context of the collapse of European empire, and as such its premises did not sit easily with fieldwork-based ethnography. As long as the post-war economic boom lasted, there was some point in anthropologists signing up for a constructive programme of ‘modernization’; but before long, more critical perspectives (‘underdevelopment’, ‘dependency theory’, ‘world systems’) took on greater salience. It was not until the 1980s that anthropologists found regular employment in development bureaucracy (Hart 2002).
Richard Salisbury’s From Stone to Steel (1962), an account of economic transformation in Melanesia, showed how a formalist premise could produce a rich and nuanced ethnographic argument. Another outstanding study was Polly Hill’s (1963) The Migrant Cocoa Farmers of Southern Ghana. Ghana was the world’s leading cocoa producer, but its farmers were assumed to be African ‘peasants’ adding cocoa production to their subsistence farms. Hill traced the industry to its origins in the late nineteenth century and showed that the cocoa farmers were pioneers, opening up virgin forest, often in companies capable of hiring Swiss construction firms to develop the infrastructure that they needed. They invented new share-cropping institutions as a means of recruiting labour. Hill (1970) was sure that Ghana’s cocoa industry was capitalist from the beginning; but this capitalist class did not capture the state and her message so disturbed prevailing assumptions of western superiority (often held by anthropologists, despite themselves) that it has still not been fully absorbed.
Clifford Geertz was closely associated with the ‘development’ paradigm while laying the groundwork for the ‘cultural turn’ in economic anthropology two decades later. He published two exemplary monographs in our field at the same time. Agricultural Involution (1963a) is framed as a conventional study of the causes of Java’s underdevelopment until the analysis takes off using a concept borrowed from art history. In Peddlers and Princes (1963b), Geertz addressed the contrasting faces of Indonesian entrepreneurship, identifying two economic ideal-types in a Javanese town. The majority were occupied in a street economy that he labeled ‘bazaar-type’. Opposed to this was the ‘firm-type’ economy consisting largely of western corporations who benefited from the protection of state law. These had form in Weber’s (1981) sense of ‘rational enterprise’ based on calculation and the avoidance of risk. National bureaucracy lent these firms a measure of protection from competition, thereby allowing the systematic accumulation of capital. The ‘bazaar’ on the other hand was individualistic and competitive, so that accumulation was well-nigh impossible. Here and in his work on the Moroccan suq (Geertz, Geertz and Rosen 1979), Geertz pointed out the irony of an economics that takes the bazaar as its model for studying the decisions of individuals in competitive markets, while treating as anomalous the monopolies preferred by capitalist firms and state bureaucracy. Even more curious, the modern discipline made this switch to methodological individualism just when a bureaucratic revolution was transforming mass production and consumption along corporate lines. This was when the more powerful states awarded new privileges to capitalist corporations and society took its centralized form as national bureaucracy (Hart 2005). The economists did not adopt Geertz’s conceptual vocabulary. A decade later, however, Hart (1973), drawing on the same Weberian idea of rationalization, was able to sell them the concept of an ‘informal economy’ in Third World cities.
The world turned for the worse in the 1970s and the other side in the Cold War gained a lot of intellectual credibility as a result. French structuralist Marxism and underdevelopment theories coming out of Latin America and the Middle East achieved widespread circulation among Anglophone economic anthropologists at this time. To some extent the gap left by the end of the formalist-substantivist debate was filled by Marshall Sahlins’s Stone-Age Economics (1972). This was an eclectic melange of formalism (Chayanov’s marginalism), substantivism (Polanyi meets Hobbes) and ‘the domestic mode of production’ (a Marxist-sounding variant of Bücher and the oikos theory). By the end of that decade, Stephen Gudeman signed off on post-war optimism with The Demise of a Rural Economy (1978) a study of commoditization in a Panamanian village that made sophisticated use of classical political economy to address basic questions of value.
French Marxist anthropology enjoyed cult status during the 1970s. Louis Althusser and Etienne Balibar (1970) produced a reading of Capital that divested it of any residual elements of Hegelian philosophy and brought it into line with both structuralist methodology and the most modern ‘scientific’ approaches emanating from America, notably systems theory. The phenomenology of the human subject, the dialectic and indeed history itself were in effect dropped from their scheme. In their place a deep structure of the ideal mode of production was outlined, having three elements – producers, non-producers and means of production – whose variable combination was realized as concrete modes of production (Balibar 1970). Much attention was paid to the relationship between economic, political and ideological levels of the mode of production and to the question of which was dominant and/or determinant in any given case. Althusser abandoned the ideological notion of ‘society’ in favour of ‘social formations’ in which, it was recognized, more than one mode of production were normally combined.
The key figure in bridging Lévi-Straussian structuralism and Marxism, France and the Anglophone world was Maurice Godelier, whose Rationalité et irrationalité en économie (1966) was translated into English in 1972 with a new Introduction. In this work Godelier borrowed explicitly from the structural-functionalism of Parsons (1937) and Radcliffe-Brown (1952). A long review of the formalist-substantivist debate led him also to endorse Polanyi’s ideas, while the whole book attempted to redeem a universal concept of rationality from its abuse in the hands of liberal economists and their sympathizers. Godelier applied this notion of rationality not only to persons but also to systems, thereby setting up a contradiction between structure and agency that he was unable to resolve. This scheme has never been successfully applied to a moving, historical society; but it paved the way to a greater openness to Marxism in the 1970s.
Claude Meillassoux, Emmanuel Terray and Pierre-Philippe Rey all acknowledged their debt to Althusser, but they sustained a lively debate among themselves over their common ethnographic area, West and Central Africa. All three wrote major field monographs, but Meillassoux’s L’anthropologie économique des Gouro de Côte d’Ivoire (1964) became the locus classicus for discussion. His later synthesis, Femmes, greniers et capitaux (1981), was a more ambitious attempt to compare the means of accumulation in tribal, peasant and capitalist societies. Terray’s (1972) reanalysis of the Gouro ethnography set out a method for classifying the material base of a society in great detail, so that its modes of production may be inferred empirically and concrete particulars incorporated into a materialist analysis. Pierre-Philippe Rey’s monograph on a matrilineal tribe of the French Congo, Colonialisme, néo-colonialisme et transition au capitalisme (1971), was seminal. First, it marked an original contribution to the literature on matriliny, slavery and European penetration of the Congo, whereas many Marxists merely restated what was already known in a new jargon. Second, Rey outlined here his famous idea of a ‘lineage mode of production’ (Rey 1975). Third, he spelled out the issue of ‘articulation of modes of production in a structure of dominance’, showing concretely how colonial capitalism restructured the lineage and petty commodity modes of production for its own ends.
Why should this small band of men have had such a disproportionate effect on English-speaking anthropologists? Their success may be attributed in part to the synthetic position French structuralism occupied between German philosophy, including Marxism, and Anglo-Saxon scientific empiricism. The modernization of Marx, by incorporating systems theory and dumping the dialectic, produced a version of structural-functionalism sufficiently different to persuade readers that they were learning something new and similar enough to allow them to retain their customary way of thinking, temporarily discredited by the end of empire. The most prominent enthusiasts in the English-speaking world were Joel Kahn and Jonathan Friedman, the former more influenced by the Althusserians, the latter by Godelier; both contributed to a volume of British Marxist anthropology edited by Maurice Bloch (1975). Kahn’s Indonesian ethnography (1975, 1980) is the more explicitly economic of the two, but Friedman’s (1975) reconstruction of the Edmund Leach’s celebrated Highland Burma ethnography can also readily be assimilated into a holistic version of economic anthropology and is the most interesting application of Godelier’s approach. Friedman later became a convert to the ‘world systems’ approach of Immanuel Wallerstein (1974).
French Marxism disappeared as suddenly as it had burst on the Anglophone scene. It did not survive the great watershed of post-war history, when social democracy gave way to rule by neo-liberal conservatives (later abbreviated to ‘neo-liberalism’). With it went the last vestige of a central focus to debates within economic anthropology.

Anthropologists’ encounters with neo-liberal capitalism (1980s to 2000s)
It was clear even at the time that the 1980s were a watershed. This was the decade of Ronald Reagan and Margaret Thatcher, and of the first systematic applications of the neo-liberal ideology that had been threatening Keynesian hegemony for some time already (not least inside economics itself, where Milton Friedman was the chief apostle of ‘monetarism’ and ‘free’ markets). And then the annus mirabilis of 1989 brought, if not the ‘end of history’ (Fukuyama 1992), at any rate that of the ‘second world’. Three trends underwrite the claim that the world economy became more integrated than ever before in the last quarter century. First, the collapse of the Soviet bloc left the world market undivided for the first time; second, the economic resurgence of China, India and the rest of Asia, has brought half of humanity into the global circuit of capital at a new level; and third, a revolution in transport and communications has created a single interactive network for which there is no precedent.
The work of economic anthropologists has been rather fragmented of late; but they have generated a critical commentary on capitalist civilization at a time when the market economy became truly global. There has been greater theoretical self-awareness, even a degree of openness to the history of economic and political ideas (e.g. Dumont 1977); but anthropologists have so far avoided making a direct challenge to the economists on their home territory of national and global economic analysis. At the same time, although most anthropologists still rely on fieldwork as their distinctive method, the ethnographic model of research has come under considerable pressure as a result of theoretical developments sometimes labelled ‘post-modernism’. This has led to new approaches to the economy using experimental methods; but these efforts have generally stopped short of offering an anthropological perspective on our moment in world history. This is a pity, since the end of the Cold War, the birth of the internet and the globalization of money markets cry out for comprehensive historical treatment. The result, however, is that economic anthropologists now study the innermost workings of capitalism at its core and in its global spread; the privatization of what were recently communist economies (‘post-socialist transition’); and the plight of poor people in non-western countries, as defined by international bureaucracy (‘development’).
When anthropologists turn to studying world capitalism in the longue durée, the example of a few pioneers will weigh heavily. Sidney Mintz, long an ethnographer of Caribbean economy, has been particularly innovative in his methods. His biography of a Puerto Rican plantation worker (1960) serves as one model for research and writing and his history of sugar production, trade and consumption in England, the cradle of modern capitalism, another; but he has rarely been emulated. Eric Wolf’s synthesis, Europe and the People without History (1982), offers a comparative framework for the incorporation of the twentieth century’s ethnographic legacy into Marxist economic history. Their contemporary, Marshall Sahlins, launched a structuralist critique of the western culture of consumption in La pensée bourgeoise (1976) and has since examined the cosmological roots of western economic ideas (1996). He has become a trenchant opponent of anthropologists’ new preoccupation with western capitalism, believing that it substitutes for developing a theory of culture through study of non-western alternatives (2000). Finally Jack Goody, having taken on the Western parochialism of Marx, Weber and the founding fathers of social theory in The East in the West (1996), has engaged with the history of modern capitalism itself in Capitalism and Modernity: the great debate (2004).
Following Boas’s example in making culture plural, anthropologists have been quick to identify a variety of capitalisms (Blim 2000), and not only of the national sort. Daniel Miller’s study of Trinidad, Capitalism: an ethnographic approach (1997) is a defiant assertion of the validity of traditional methods under contemporary conditions. Others have examined the dominant forms of corporate capitalism in a more experimental frame of mind (Marcus 1998, Hart 2005). Consistent with this new focus, there has been a veritable deluge of anthropological work on money, including a recent spate of studies of financial institutions (Maurer 2005, 2006). This work aims to humanize the anonymous institutions that govern our lives; and some of it does begin to bridge the gap between readers’ everyday experience and the global economy, showing, for example, how digitization is altering the conditions of speculation and trade for workers in the finance industry (Zaloom 2006).
Thomas Crump (1981) was the pioneer in the anthropology of money. Parry and Bloch’s Money and the Morality of Exchange (1989) then brought together a number of ethnographers to explore how non-westerners make money serve their own social purposes; (the sociologist Vivienne Zelizer (1994) does something similar for western societies). Hart (1986, 2000), drawing on an initial contrast between states and markets as ‘two sides of the coin’, analyzed the consequences of the information revolution for money seen in world historical perspective. Lately he has analyzed the persuasive power of money through a comparison with other universals, such as language, time and number (Hart 2007; cf. Crump 1978). Gregory (1997) explicitly places his Indian ethnography within the turbulence of global money markets in recent decades; while Weatherford (1997) provides a wonderfully diverse history of money.
Money is often considered to be a bad thing, especially by people who have little of it; Parker Shipton’s East African monograph, Bitter Money (1989), evokes Taussig’s famous The Devil and Commodity Fetishism in South America (1980). Recently, Heonik Kwon (2007) has shown how the process of dollarization in Vietnam is projected into the sphere of popular religion through payments of ghost money to the dead. The collection, Money and Modernity: state and local currencies in Melanesia (Akin and Robbins 1999), contains important essays by Foster (1999) and Guyer (1999), among others. Jane Guyer’s extensive research in this area – the collections Money Matters (1994), Credit, Currencies and Culture (2000, with Stiansen) and Money Struggles and City Life (2002) – has culminated in a synthesis (2004) in which she makes the case for the emergence of a distinctive commercial culture in Atlantic Africa that has been largely missed by ethnocentric economic historians and myopic ethnographers alike. Bill Maurer’s Mutual Life, Limited: Islamic banking, alternative currencies, lateral reason (2005) is another highly original contribution to this topic. Ruben Oliven (1998) offers a Brazilian anthropologist’s take on the American way of money, thereby opening up the endless possibilities for cross-cultural research in this field today (see Guyer this volume).
The process of getting people to spend money – marketing, the art or science of selling – is also a rapidly expanding field. Marianne Lien’s Marketing and Modernity (1997) is based on research in a Norwegian food company. She argues that corporate marketing is an expert system of shared, specialized knowledge; and describes marketing as a “disembedding mechanism” that operates on a global level. Kalman Applbaum, in The Marketing Era (2003), is in substantial agreement. He shows how modern marketing, from its origins in 18th century England to its culmination in 20th century America, has absorbed moral criticism into its own quasi-religious system. Whereas an earlier generation of ethnographers (Taussig 1980, Ong 1987) highlighted the devastating consequences of capitalist development for local cultures, Applbaum shifts the culture contact model to one more suited to the globalizing present. He emphasizes the emergence of mutual or shared meanings and goals in economic actions (why articulation often appears to be consensual) rather than explicit power dynamics. William Mazzarella (2003), following the lead of Brian Moeran in Japan (1996), shows how advertising, one branch of marketing, takes on local dynamics in Bombay.
‘Everyone knows’ that the chief site of capitalist economy has shifted from work to consumption (Miller 1996); and economic anthropology has been no exception. In The World of Goods (1979), Mary Douglas and Byron Isherwood argued that, if economists were serious about consumer choice being the engine of modern economy, they should turn to anthropologists for guidance on its cultural logic. But of course the marketing professionals had already made a science of that. Pierre Bourdieu’s Distinction (1984) influentially examined how social class is revealed in everyday consumption practices. But Arjun Appadurai, with ‘Commodities and the politics of value’, his introduction to The Social Life of Things (1986), inspired a generation of ethnographers to explore subject-object relations in what had previously been taken to be the anonymous sphere of capitalist commerce. Since then, Daniel Miller has published a series of books taking the theory of consumption into shopping, the internet and mobile phones. His Dialectics of Shopping (1999) is a Hegelian approach to the subject; and in Virtualism (Carrier and Miller 1998), anthropologists unusually address the consequences of the digital revolution for the economy. James Carrier has been a pioneer of the new anthropology of Western capitalism with books such as Meanings of the Market (1997), while Miller (1998) has developed ‘material culture’ as the umbrella term for his associates’ focus on the importance of things (e.g. Chevalier 2002).
This heady mix of money, marketing and consumption has marginalized the study of production, which was never a central focus of economic anthropology (Spittler 2007). Even so there have been some intriguing studies of post-industrial production, such as Birgit Müller’s of collective enterprises in West Berlin (1991) and later in East Germany (2007). Mollona (2005) brings a perspective from structuralist Marxism to his ethnography of neo-liberal deindustrialization in an English steel town, but he also draws on the idea of an ‘informal economy’ (Hart 1973, 2006) and on Parry’s investigations of work and labour relations in an Indian steel plant, the Nehruvian antithesis of the informal sector (Parry et al 1999).
Distribution, the question of property in particular, has attracted a lot of attention in recent years (Hunt and Gilman 1998, Hann 1998). This is a contested field in which there is disagreement over basic concepts: while legal anthropologists have recently elaborated a sophisticated analytical model for the cross-cultural analysis of property, setting economic aspects alongside many other social functions (F. and K. von Benda-Beckmann and Wiber 2006), others maintain that the very notion of property is Eurocentric and therefore inappropriate in studying regions such as Melanesia (Strathern 1999; Strathern and Hirsch 2004). Despite such concerns, land tenure has remained a major focus of empirical research efforts worldwide; the contributions of Elinor Ostrom and her associates (e.g. 2002) to debates over common property have attracted much attention outside anthropology. More recently, issues of intellectual property (Verdery and Humphrey 2004, Hart 2005) and ‘cultural property’ (Kasten 2004, Kaneff 2004, Brown 2003) have been gaining ground. In an overview of this new literature Hann (2007) applies the perspective of Polanyi to the application of property rights to such new ‘fictitious commodities’; rather than exaggerate contemporary ‘propertization’ trends, he draws attention to a new form of ‘double movement’: the scope of property is continuously modified, both from above through the regulations of states and other authorities, and from below through the actions of citizens and consumers.
The vast region formerly known as ‘the second world’ has become not only a laboratory for neo-liberal experimentation at every level of society, but also one for competing styles of investigation in anthropology, including economic anthropology. Some have remained faithful to ‘community study’ approaches as they document the often painful processes of rural decollectivisation (Abrahams 1996, Verdery 2004, Hann et al 2003, Hann 2006). Werner has pursued the classical theme of reciprocal exchanges in showing how rural people cope with dislocation in Kazakhstan (1999). Others have been more adventurous, e.g. Lemon’s (1998) analysis of cultural understandings of money in Moscow and Humphrey on the housing preferences of new Russian elites (2002). Humphrey’s work on barter (together with that of other Russian specialists) generated a rare empirical collaboration with economists (Seabright 2000). The contrast between her recent work (2002) and her earlier classic account of a Soviet collective farm (1983) shows how this anthropologist has kept abreast of changing styles in the discipline.
In Doctrines of Development (1996), Cowen and Shenton suggest that, since the time of the industrial revolution, the word ‘development’ has had two principal meanings when applied to the economy: the sources of capitalist growth and ameliorating the destructive consequences of that growth. Anthropologists have been drawn to the ‘development’ industry in increasing numbers, but this has generally been as purveyors of sticking plaster, not as part of a serious investigation into the roots of economic growth and decline (Hart 2002). There have been overviews of regional development drawing on anthropological studies (Hart 1982, Cook 2004). The literature on ‘informal economy’ has burgeoned since its inception in the early 1970s (Hart 2006). Janet Mcgaffey’s The Real Economy of Zaire (1991), the second volume of an outstanding trilogy, has extended this tradition of ethnographic realism; while Janet Roitman’s Fiscal Disobedience (2004) looks at the question through attempts at economic regulation in Africa. Parry’s long-term study of a steel plant and its surrounding area and the collection he co-edited, Worlds of Indian industrial labour (1999), have generated findings of great comparative significance.
If anthropologists have developed critical perspectives on capitalism at the core, the dominant trend in studies of ‘development’, reflecting the sad history of poor countries, has been overwhelmingly negative. It could be said that the commitment of rich countries to ‘development’ of the periphery has been more rhetorical than real; and this is reflected in a post-structuralist discourse that is mainly talk about talk (Escobar 1995). James Ferguson’s The Anti-Politics Machine (1994) is a brilliant exposé of development projects in Lesotho, where he shows that economic initiatives are disembedded from any local meaning and end up promoting metropolitan rather than indigenous interests. His Expectations of Modernity (1999), a re-examination of life in the Zambian Copperbelt, featuring the work of Gluckman and the Manchester School, is an exemplary application of historical methods to anthropological questions. His colleague, Akhil Gupta (1998), has performed a similar critical service in relation to agricultural development in India. Here are the first stirrings of an anthropological engagement with global structures of inequality.

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If economic anthropology has changed its object in the last few decades, what has happened to its theories and methods? Has the formalist-substantivist debate, with Marxism as its negation, survived globalization after the Cold War? Formalism in