The social order of markets

TLDR: In this article, the authors develop a proposal for the theoretical vantage point of the sociology of markets, focusing on the problem of the social order of markets and argue that these problems can only be resolved based on stable reciprocal expectations on the part of market actors, which have their basis in socio-structural, institutional and cultural embedding of markets.

Abstract: In this article I develop a proposal for the theoretical vantage point of the sociology of markets, focusing on the problem of the social order of markets. The initial premise is that markets are highly demanding arenas of social interaction, which can only operate if three inevitable coordination problems are resolved. I define these coordination problems as the value problem, the problem of competition and the cooperation problem. I argue that these problems can only be resolved based on stable reciprocal expectations on the part of market actors, which have their basis in the socio-structural, institutional and cultural embedding of markets. The sociology of markets aims to investigate how market action is structured by these macrostructures and to examine their dynamic processes of change. While the focus of economic sociology has been primarily on the stability of markets and the reproduction of firms, the conceptualization developed here brings change and profit motives more forcefully into the analysis. It also differs from the focus of the new economic sociology on the supply side of markets, by emphasizing the role of demand for the order of markets, especially in the discussion of the problems of valuation and cooperation. Markets are the central institutions of capitalist economies. The development of modern capitalism can be viewed as a process of the expansion of markets as mechanisms for the production and allocation of goods and services. This applies not just to labor markets, which only emerged on a significant scale with industriali- zation, but also to the organization of the production and distribution of consumer and investment goods, services, and commodities. The increasing separation of the economy from the household and its organization through market exchange allowed for a scope in the development in the division of labor and production of wealth that would otherwise have been unattainable.