Work: A Deep History, from the Stone Age to the Age of Robots

by James Suzman

But the formalists insisted that deep down all people were economically “rational” and that, even if people in different cultures valued different things, scarcity and competition were universal—everyone was self-interested in their pursuit of value and everyone developed economic systems specifically to distribute and allocate scarce resources. The substantivists, by contrast, drew inspiration from some of the more radical and original voices in twentieth-century economics. The loudest voice among this chorus of rebels was that of the Hungarian economist Karl Polanyi, who insisted that the only thing universal about market capitalism was the hubris of its most enthusiastic advocates. He argued that market capitalism was a cultural phenomenon that emerged as the modern nation state replaced more granular, diverse, socially grounded economic systems based mainly on kinship, sharing, and reciprocal gift-exchange. The substantivists insisted that the economic rationality the formalists believed was part of human nature was a cultural by-product of market capitalism, and that we should be far more open-minded when it came to making sense of how other people apportioned value, worked, or exchanged things with one another.