Social Democracy, Embeddedness and Decommodification: On the Conceptual Innovations and Intellectual Affiliations of Karl Polanyi

TLDR: The debates that revolve around the work of the economic historian and political economist Karl Polanyi, one that continues to exercise minds concerns his analysis of, and political attitudes toward, post-war capitalism and the welfare state as mentioned in this paper.

Abstract: Of the several debates that revolve around the work of the economic historian and political economist Karl Polanyi, one that continues to exercise minds concerns his analysis of, and political attitudes toward, post-war capitalism and the welfare state. Simplified a little, it is a debate with two sides. To borrow Ivan Szelenyi's terms, one side constructs a ‘hard’ Karl Polanyi, the other a ‘soft’ one. The former advocated a socialist mixed economy dominated by redistributive mechanisms. He was a radical socialist for whom the market should never be the dominant mechanism of economic coordination. His ‘soft’ alter ego insisted that the market system remain essentially intact but be complemented by redistributive mechanisms. The ‘double movement’ – the central thesis of his ‘Great Transformation’ – acts, in this reading, as a self-correcting mechanism that moderates the excesses of market fundamentalism; its author was positioned within the social-democratic mainstream for which the only realistic desirabl...